Quest Resource Holding Corporation Reports Q3 2025 Revenue Decline and Increased Net Loss

Quest Resource Holding Corporation (QRHC) reported its financial results for the third quarter and the first nine months of 2025, revealing a decline in revenue and an increase in net loss compared to the same periods in 2024. For the three months ended September 30, 2025, the company generated revenue of $63.3 million, a decrease of 13% from $72.8 million in the prior year. For the nine months, revenue totaled $191.3 million, down 12.5% from $218.6 million. The decline was attributed to the divestiture of the mall-related business, which reduced revenue by approximately $3 million in the quarter and $12 million year-to-date, alongside ongoing softness in the industrial market.

The company's cost of revenue also decreased, falling to $51.9 million for the third quarter, down 15% from $61.1 million in 2024. Gross profit for the quarter was $11.5 million, slightly lower than the $11.7 million reported in the same period last year, but the gross profit margin improved to 18.1% from 16.1%. For the nine months, gross profit was $33.4 million, down from $39.3 million, with a gross margin of 17.5%. Operating expenses for the third quarter were $10.4 million, down from $12.6 million, while for the nine months, they increased to $40.1 million from $36.6 million, primarily due to one-time costs related to a CEO transition.

QRHC's net loss for the third quarter was $1.3 million, an improvement from a loss of $3.4 million in the same quarter of 2024. However, for the nine months, the net loss widened to $13.7 million from $5.6 million. The company reported a basic and diluted net loss per share of $(0.06) for the third quarter, compared to $(0.16) in the prior year, and $(0.66) for the nine months, up from $(0.27). The increase in net loss for the nine-month period was largely due to the aforementioned divestiture and ongoing market challenges.

In terms of operational developments, QRHC's customer base showed signs of stability, with new client growth contributing approximately $5.5 million in incremental revenue during the third quarter, offsetting some attrition from previous client losses. The company also completed the sale of its mall-related business assets for approximately $5 million in cash, which was used to repay debt. Additionally, QRHC entered into an equipment sale leaseback agreement, recognizing a gain of $23,000.

Looking ahead, QRHC anticipates that its existing cash reserves, combined with borrowing capacity and expected cash generation from operations, will be sufficient to fund its operations for the next 12 months. The company remains focused on enhancing operational efficiencies and addressing market challenges, while continuing to pursue growth opportunities in its core waste and recycling services.