Energy Recovery reported a significant decline in its second quarter 2026 financial results, with revenue falling 57% year-over-year to $12.0 million, well below analyst expectations of $18.36 million. The company posted a net loss of $3.2 million, or ($0.06) per diluted share, a sharp reversal from a net income of $2.1 million, or $0.04 per share, in the same period last year and missing the consensus estimate for a loss of $0.04 per share.
Key Highlights
- Q2 revenue was $12.0 million, a 57% decrease from $28.1 million in the prior-year quarter, primarily due to an 82% drop in megaproject revenue.
- The company reported a Q2 net loss of $3.2 million, or ($0.06) per diluted share, compared to net income of $2.1 million in Q2 2025.
- Gross margin improved to 74.7% from 64.0% in Q2 2025, which the company attributed to indirect manufacturing costs and channel mix.
- The company cited the war in Iran as a primary reason for the lower revenue, which impacted project timing and shipments.