DIRTT Environmental Solutions Reports Decline in Revenue and Increased Net Loss for Q2 2025

DIRTT Environmental Solutions Ltd. reported a decline in financial performance for the second quarter of 2025, with total revenue of $38.9 million, down 6% from $41.2 million in the same period of 2024. The decrease in revenue was attributed to macroeconomic factors, including scheduling delays and lower signed awards, exacerbated by the imposition of tariffs. Gross profit for the quarter was $10.8 million, representing a gross profit margin of 27.8%, a significant drop from 37.3% in the prior year. The company incurred $2.0 million in tariffs during the quarter, which contributed to the decline in gross profit.

The net loss after tax for the quarter was $6.6 million, compared to a net income of $0.6 million in the same quarter of 2024. This loss was primarily driven by a $4.6 million decrease in gross profit, an increase in operating expenses, and a reduction in foreign exchange gains. For the first half of 2025, DIRTT reported a net loss of $7.3 million, a stark contrast to a net income of $3.6 million in the same period of 2024. The company’s cash position also weakened, with cash and cash equivalents decreasing to $23.1 million from $29.3 million at the end of 2024.

Operationally, DIRTT's customer base remained stable, with 70 Construction Partners as of June 30, 2025, down from 76 a year earlier. The company is focusing on expanding its Integrated Solutions team to drive revenue growth and increase direct sales opportunities. The twelve-month forward pipeline increased by 18% year-over-year, indicating potential for future revenue growth despite current challenges. The company also launched new product innovations, including fire-rated walls, which are expected to enhance its market offerings.

In terms of strategic developments, DIRTT has been actively managing its debt and equity structure. The company repurchased common shares under its normal course issuer bid and has been repurchasing convertible debentures as part of its debt management strategy. As of June 30, 2025, DIRTT had $12.2 million in principal due under its January Debentures, which mature in January 2026. The company is evaluating options for settling or refinancing this debt.

Looking ahead, DIRTT anticipates continued challenges due to macroeconomic uncertainties and tariff pressures. The company expects to implement various mitigation strategies, including price adjustments and strategic sourcing, to preserve margins. Despite these challenges, DIRTT remains optimistic about returning to positive Adjusted EBITDA by the fourth quarter of 2025, supported by a strong pipeline and ongoing product innovations.