Nephros Q1 gross margin falls on higher product costs from U.S. tariffs

Nephros

07/05/2026 21:58

Overview

Water filtration firm's Q1 revenue rose 7% yr/yr to $5.2 mln

Net income and adjusted EBITDA declined from prior year

Gross margin fell to 57% due to tariffs, currency headwinds, and revenue mix shift

Outlook

Company expects continued revenue growth and margin expansion as it expands in key markets

Nephros anticipates near-term margin variability due to external factors and growth investments

Company is pursuing mitigation strategies to reduce future tariff exposure

Result Drivers

PROGRAMMATIC GROWTH - Co said revenue growth was driven by a 23% increase in programmatic product revenue, offset by lower emergency response business

TARIFF AND CURRENCY HEADWINDS - Gross margin decline was mainly due to higher product costs from U.S. tariffs and the stronger Euro

REVENUE MIX SHIFT - Larger share of commercial segment revenue, which carries lower margins, further pressured gross margin

Company press release: ID:nGNXVYgLl

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q1 Revenue
Beat
$5.20 mln
$5.02 mln (2 Analysts)
Q1 Net Income
$140,000
Q1 Gross Margin
57.00%


Analyst Coverage

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

The average consensus recommendation for the environmental services & equipment peer group is "buy"

Wall Street's median 12-month price target for Nephros Inc is $7.00, about 117.4% above its May 6 closing price of $3.22

The stock recently traded at 41 times the next 12-month earnings vs. a P/E of 29 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.)