Energy Recovery Q1 revenue beats estimates; CEO to retire, CFO to resign

Energy Recovery

06/05/2026 22:04

Overview

U.S. energy-saving tech firm's Q1 revenue rose 20%, beating analyst expectations

Gross margin fell due to restructuring charges and higher product and channel costs

Company announced CEO retirement, CFO resignation, and new $25 mln share buyback plan

Outlook

Company did not provide specific guidance in the press release

Result Drivers

RESTRUCTURING CHARGES - Gross margin declined due to $1.6 mln in restructuring charges from winding down the CO2 retail grocery business

COST INCREASES - Higher costs related to product and channel mix, pricing, tariffs, and indirect manufacturing expenses weighed on margins

CHANNEL MIX - Revenue growth was driven by a 65% increase in OEM sales and a sharp rise in megaprojects, while aftermarket sales declined 32%

Company press release: ID:nBw45X37la

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q1 Revenue
Beat
$9.70 mln
$8.37 mln (5 Analysts)
Q1 EPS
-$0.23
Q1 Net Income
-$12.30 mln
Q1 Adjusted EBITDA
-$7.10 mln
Q1 Gross Margin
27.80%
Q1 EBIT Margin
-153.10%


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

The average consensus recommendation for the industrial machinery & equipment peer group is "buy"

Wall Street's median 12-month price target for Energy Recovery Inc is $14.50, about 28.2% above its May 5 closing price of $11.31

The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 17 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)