Energy Recovery, Inc. reported a revenue of $9.7 million for the first quarter of 2026, marking a 20% increase from $8.1 million in the same period of the previous year. However, the company experienced a net loss of $12.3 million, compared to a loss of $9.9 million in Q1 2025. The increase in revenue was primarily driven by a significant rise in original equipment manufacturer sales, which grew by 65% to $6.6 million, largely due to higher shipments to the Europe and Middle East markets. In contrast, aftermarket revenue decreased by 32% to $2.8 million, attributed to lower shipments in Asia and the Middle East.
The company's financial position showed a decline in total assets, which decreased from $231.5 million at the end of 2025 to $209.0 million by March 31, 2026. This decline was influenced by a reduction in accounts receivable, which fell to $38.9 million from $76.6 million, and a decrease in retained earnings, which dropped to $116.4 million from $128.7 million. The company also recorded a restructuring charge of approximately $1.5 million related to the wind down of its CO2 retail grocery business, contributing to the overall net loss.
Operationally, Energy Recovery has made strategic changes, including the separation of its Water segment into two distinct segments: Desalination and Wastewater. This restructuring aims to better align with how the company manages its business. The company also reported an impairment of goodwill amounting to $1.7 million due to the wind down of the CO2 retail grocery business. As of March 31, 2026, the company had a total employee headcount of 23, reflecting the impact of the restructuring efforts.
Looking ahead, Energy Recovery anticipates that sales outside the U.S. will continue to represent a significant portion of its revenue. The company believes that its pressure exchanger technology will unlock new commercial opportunities, particularly in the desalination and wastewater treatment markets. Despite the challenges faced in the first quarter, including increased operational costs and restructuring charges, the company remains optimistic about its long-term growth prospects and plans to leverage its technological advancements to drive future revenue.
About Energy Recovery, Inc.
Energy Recovery, Inc. specializes in designing and manufacturing energy efficiency solutions, primarily pressure exchangers and related devices, for water treatment, desalination, wastewater, and industrial refrigeration markets. Its core technology reduces energy consumption and environmental impact in processes like seawater desalination and CO2 refrigeration. The company serves global markets through direct sales, OEM partnerships, and aftermarket support, emphasizing innovation, durability, and sustainability.
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