Energy Recovery (ERII) Company Report

Energy Recovery reported a Q4 2025 shortfall and anticipates an "air pocket" in 2025 and 2026 due to delays in several large desalination projects, with 2026 guidance assuming $25 million-$30 million in projects will slip into 2027. The company expects a similar heavily back-end weighted revenue cadence for 2026 as in 2025.
The company is winding down its CO2 retail grocery business, which is projected to generate $7 million in annual savings and involved a reduction of approximately 20 employees. This strategic shift allows a full focus on the water business, with confidence in growth for 2027.
Strategic initiatives include investing in innovation with the new PX Q650 product (expected to improve gross margins and begin manufacturing in H2 2026) and expanding its manufacturing footprint outside the U.S. with $3 million-$6 million in capital costs for 2026.
The company is also focused on optimizing performance by cutting operating expenses (OpEx reduced from $77 million to $64 million) and buying back stock.

7 days ago

Transcript

Energy Recovery Discusses Q4 2025 Results, Strategic Focus, and 2026 Outlook

ERII

Guidance Update

Product Launch

Demand Weakening

Energy Recovery reported an "air pocket" in 2025 and 2026 due to delays in several large desalination projects, but remains confident in 2027 growth based on its pipeline and underlying demand trends.
The company is winding down its CO2 retail grocery business because it could not achieve scaled adoption without significant continued investment, leading to a reduction of approximately 20 employees.
For 2026, the company's guidance assumes $25 million-$30 million in projects will slip into 2027, with an additional $15 million-$25 million buffer for other projects at risk of slipping.
Energy Recovery is introducing the PX Q650, a new product expected to deliver higher effective average selling prices (ASPs) and gross margin expansion, with manufacturing for sale commencing in the second half of 2026.
The company plans to establish a new manufacturing facility outside the U.S., with site selection expected by the end of the first half of 2026 and phased production beginning in Q1 2027.

7 days ago

Transcript

Energy Recovery Reports Q4 2025 Results, Winds Down CO2 Business, and Provides 2026 Outlook

ERII

Guidance Update

Demand Weakening

New Projects/Investments

Energy Recovery reported a Q4 2025 shortfall and anticipates an "air pocket" in 2025 and 2026 due to delays in several large desalination projects, with $25 million-$30 million worth of projects shifting from 2026 to 2027.
The company is winding down its CO2 retail grocery business, expecting $7 million in annual savings and a reduction of approximately 20 employees.
Management is now fully focused on the water business, expressing confidence in growth for 2027 and introducing the new PX Q650 product, which is expected to improve average selling price and gross margins.
A new manufacturing facility is planned, with site selection by the end of the first half of 2026 and phased production starting in Q1 2027, involving a capital commitment of $3 million-$6 million for 2026.

7 days ago

Transcript

Energy Recovery Reports Q4 and Full Year 2025 Financial Results, Announces CO2 Retail Grocery Business Wind-down

ERII

Earnings

Layoffs

Restructuring

For the fourth quarter ended December 31, 2025, Energy Recovery reported revenue of $66.9 million and net income of $26.9 million, with diluted net income per share of $0.50.
For the full year ended December 31, 2025, the company reported revenue of $135.0 million and net income of $23.0 million, with diluted net income per share of $0.42.
Energy Recovery decided to wind down operations of its CO2 retail grocery business within the Emerging Technologies Segment, expecting to incur $4.5 million to $5.5 million in one-time costs.
As of December 31, 2025, the company held $83.3 million in cash and investments.

7 days ago

8-K

Energy Recovery Reports Fourth Quarter and Full-Year 2025 Financial Results

ERII

Earnings

Demand Weakening

Energy Recovery reported revenue of $66.9 million for Q4 2025 and $135.0 million for the full year 2025.
The company's gross margin was 67.2% in Q4 2025, while income from operations increased by 22.3% to $31.3 million compared to Q4 2024, mainly due to lower operating expenses.
Net income for Q4 2025 reached $26.9 million, with diluted net income per share of $0.50.
As of December 31, 2025, Energy Recovery held $83.3 million in cash and investments.

7 days ago

Press Release

Energy Recovery Reports Strong Q3 2025 Results, Reaffirms Revenue Guidance, and Updates CO2 Commercialization Timeline

ERII

Earnings

Guidance Update

New Projects/Investments

Energy Recovery reported a strong Q3 2025 with improved mega project shipments and rebounding wastewater revenue, leading to the reiteration of its four-year revenue guidance.
The company also reduced its four-year OPEX guidance due to successful cost control efforts, expecting growth in Q4 and next year with only modest increases in operating expenses.
The CO2 business had a successful summer testing season, validating energy savings and water savings, but commercialization with large OEMs is now anticipated in 2026, with real commercialization likely in 2027, following another season of customer testing.
In the wastewater segment, Energy Recovery secured a $350,000 lithium extraction project in Argentina for Q3 2025, indicating potential growth in this niche.

Nov 5, 2025, 10:00 PM

Transcript

Energy Recovery Reports Strong Q3 2025 Sales and Reaffirms Revenue Guidance

ERII

Earnings

Guidance Update

New Projects/Investments

Energy Recovery (ERII) reported strong sales execution in Q3 2025, driven by improved mega project shipments and a rebound in wastewater revenue, leading to the reiteration of its four-year revenue guidance.
The company further reduced its four-year OPEX guidance due to effective cost control, anticipating growth in Q4 2025 and next year with only modest increases in operating expenses.
The CO2 business had a successful summer testing season, validating energy savings and increased performance, but commercialization remains in early stages, with large OEM agreements expected in 2026 and full commercialization likely in 2027 after further customer testing.
In its growing wastewater segment, Energy Recovery secured a $350,000 lithium extraction project in Argentina, with expectations for additional projects in this area.

Nov 5, 2025, 10:00 PM

Transcript

Energy Recovery Reports Strong Q3 2025 Sales and Reduced OpEx Guidance

ERII

Earnings

Guidance Update

New Projects/Investments

Energy Recovery reported a strong Q3 2025 with improved mega project shipments and rebounding wastewater revenue, leading to the reiteration of its four-year revenue guidance.
The company achieved significant cost control, resulting in a further reduction of its four-year OpEx guidance.
The CO2 business had a successful summer testing season, validating energy savings and performance, but commercialization with large OEMs is now anticipated in 2027, with commercial agreements likely in 2026.
In the wastewater segment, the company secured a $350,000 lithium extraction project in Argentina and is actively hiring to support growth.

Nov 5, 2025, 10:00 PM

Transcript

Energy Recovery, Inc. Reports Q3 2025 Financial Results

ERII

Earnings

Demand Weakening

Energy Recovery, Inc. reported revenue of $32.0 million for Q3 2025, marking a 17% decrease compared to Q3 2024, primarily attributed to the timing of revenue from contracted projects.
Net income for Q3 2025 was $3.9 million, a 54% decrease from Q3 2024, resulting in net income per share of $0.07.
Operating expenses decreased by 6.4% to $16.9 million in Q3 2025 compared to Q3 2024, mainly due to lower employee costs and reduced Emerging Technologies segment development costs.
As of September 30, 2025, the company held $79.9 million in cash and investments.

Nov 5, 2025, 9:08 PM

8-K

Energy Recovery Reports Third Quarter 2025 Financial Results

ERII

Earnings

Demand Weakening

Energy Recovery reported revenue of $32.0 million for Q3 2025, a 17% decrease from Q3 2024, primarily due to the timing of revenue from contracted projects.
Net income for Q3 2025 was $3.9 million, representing a 54% decrease compared to Q3 2024.
Adjusted EBITDA for the third quarter of 2025 was $6.8 million.
As of September 30, 2025, the company held $79.9 million in cash and investments.