Energy Recovery Reports its Second Quarter 2025 Financial Results
SAN LEANDRO, Calif. - August 6, 2025 - Energy Recovery, Inc. (Nasdaq:ERII) ("Energy Recovery" or the "Company") today announced its financial results for the second quarter and six months ended June 30, 2025.
Second Quarter Highlights
•Q2'2025 financial results were in-line with internal expectations and consistent with our communicated expectations for quarterly revenue cadence in 2025.
•Revenue of $28.1 million, an increase of $0.9 million, as compared to Q2'2024, due to timing of revenue from contracted projects.
•Gross margin of 64.0%, a decrease of 60 bps, as compared to Q2'2024, due primarily to costs related to product mix and tariffs.
•Operating expenses of $16.5 million, a decrease of 15.8%, as compared to Q2'2024, due primarily to a decrease in employee costs and consulting costs.
•Income from operations of $1.5 million, an increase of 173.2%, as compared to Q2'2024, mainly due to higher revenue and lower operating expenses.
•Net income of $2.1 million and adjusted EBITDA(1) of $4.4 million.
•Cash and investments of $93.7 million, which includes cash, cash equivalents, and short- and long-term investments.
In conjunction with these financial results, management has released a letter to shareholders reviewing business and financial updates from the second quarter and discussing our outlook for 2025. This letter is located under "Financial Info" in the "Investors" section on the Energy Recovery website (https://ir.energyrecovery.com/financial-information).
Financial Highlights
| Quarter-to-Date | Year to Date | |||||||||||||||||||||||||||||||||||||
|
Q2'2025
|
Q2'2024
|
vs. Q2'2024 | 2025 | 2024 | 2025 vs. 2024 | |||||||||||||||||||||||||||||||||
| (In millions, except net income (loss) per share, percentages and basis points) | ||||||||||||||||||||||||||||||||||||||
| Revenue | $28.1 | $27.2 | up 3% | $36.1 | $39.3 | down 8% | ||||||||||||||||||||||||||||||||
| Gross margin | 64.0% | 64.6% | down 60 bps | 62.1% | 62.9% | down 80 bps | ||||||||||||||||||||||||||||||||
| Operating margin | 5.3% | (7.4%) | NM | (30.7%) | (33.0%) | up 230 bps | ||||||||||||||||||||||||||||||||
| Net income (loss) | $2.1 | ($0.6) | up 420% | ($7.8) | ($8.9) | up 12% | ||||||||||||||||||||||||||||||||
| Net income (loss) per share | $0.04 | ($0.01) | up $0.05 | ($0.14) | ($0.16) | up $0.02 | ||||||||||||||||||||||||||||||||
| Effective tax rate | 14.0% | 10.5% | ||||||||||||||||||||||||||||||||||||
| Cash provided by operations | $4.1 | $8.1 | $14.8 | $14.6 | ||||||||||||||||||||||||||||||||||
Non-GAAP Financial Highlights (1)
| Quarter-to-Date | Year to Date | |||||||||||||||||||||||||||||||||||||
|
Q2'2025
|
Q2'2024
|
vs. Q2'2024 | 2025 | 2024 | 2025 vs. 2024 | |||||||||||||||||||||||||||||||||
| (In millions, except adjusted net income (loss) per share, percentages and basis points) | ||||||||||||||||||||||||||||||||||||||
| Adjusted operating margin | 12.2% | 15.3% | down 310 bps | (17.4%) | (7.7%) | down 970 bps | ||||||||||||||||||||||||||||||||
| Adjusted net income (loss) | $3.7 | $5.0 | down 25% | ($3.3) | $0.5 | NM | ||||||||||||||||||||||||||||||||
| Adjusted net income (loss) per share | $0.07 | $0.09 | down $0.02 | ($0.06) | $0.01 | down $0.07 | ||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $4.4 | $5.2 | ($4.4) | ($1.0) | ||||||||||||||||||||||||||||||||||
| Free cash flow | $4.0 | $7.9 | $14.5 | $13.5 | ||||||||||||||||||||||||||||||||||
(1)Refer to the sections "Use of Non-GAAP Financial Measures" and "Reconciliation of Non-GAAP Financial Measures" for definitions of our non-GAAP financial measures and reconciliations of GAAP to non-GAAP amounts, respectively.
NM Not Meaningful
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Disclaimer
ERI - Energy Recovery Inc. published this content on August 06, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on August 06, 2025 at 21:11 UTC.
