DIRTT Environmental Solutions Reports 13% Revenue Decline in Q3 2025

DIRTT Environmental Solutions Ltd. reported a decline in financial performance for the third quarter of 2025, with total revenue of $37.7 million, down 13% from $43.4 million in the same period last year. The decrease was attributed to delays in project start dates, particularly related to job site readiness. Gross profit also fell to $11.5 million, representing a gross profit margin of 30.4%, compared to 38.8% in the prior year. The company incurred $1.9 million in tariffs during the quarter, which impacted profitability, although mitigation strategies have begun to take effect.

In terms of operational changes, DIRTT has been restructuring its business through the establishment of a Transformation Office aimed at streamlining processes and enhancing productivity. This initiative has led to reorganization expenses of $2.6 million in the third quarter. The company also reported a net loss of $3.5 million for the quarter, a significant decline from a net income of $7.1 million in the same period of 2024. The loss was primarily driven by a decrease in gross profit and a reduction in gains from extinguished convertible debentures.

DIRTT's customer base remains stable, with 69 Construction Partners as of September 30, 2025, down from 74 a year earlier. The company is focusing on expanding its Construction Services team to increase direct sales opportunities. The twelve-month forward pipeline has shown growth, increasing by 31% year-over-year to $333 million as of October 1, 2025. This growth is expected to contribute positively to future revenue.

The company’s cash position improved, with cash and cash equivalents totaling $26.1 million at the end of the quarter, an increase from $23.3 million at the beginning of the period. DIRTT is also in discussions for financing of up to C$15 million with the Business Development Bank of Canada, which is intended to strengthen its balance sheet and assist in repaying upcoming debt obligations. The company has a significant amount of debt maturing in January 2026, which it plans to address through a combination of cash reserves and potential financing.

Looking ahead, DIRTT anticipates revenues between $48 million and $52 million for the fourth quarter of 2025, with an expected Adjusted EBITDA of $5 million to $7 million. The company is optimistic about its growth trajectory, driven by its expanding pipeline and ongoing transformation efforts, despite the challenges posed by market conditions and tariffs.