Quest Resource Holding Corporation Reports Decline in Revenue and Profitability for Q2 2025

Quest Resource Holding Corporation reported its financial results for the second quarter of 2025, revealing a decline in both revenue and profitability compared to the same period in the previous year. For the three months ended June 30, 2025, the company generated revenue of $59.5 million, a decrease of 18.6% from $73.1 million in the same quarter of 2024. The six-month revenue also fell to $128.0 million, down 12.2% from $145.8 million year-over-year. The gross profit for the quarter was $11.0 million, compared to $13.5 million in the prior year, while the gross profit margin remained stable at 18.5%. However, the net loss for the quarter increased to $2.0 million, compared to a loss of $1.5 million in the same quarter of 2024.

The decline in revenue was attributed primarily to the divestiture of the mall-related business, which reduced revenues by approximately $5 million, and ongoing softness in the industrial end market, which accounted for an additional $11 million decrease. Despite these challenges, the company noted growth in its remaining business, which contributed approximately $3 million in incremental revenue, driven by new client acquisitions. The cost of revenue also decreased, reflecting the overall decline in revenue, with costs dropping to $48.5 million for the quarter.

In terms of operational developments, Quest Resource completed the sale of its mall-related business assets on March 31, 2025, for approximately $5.0 million in cash, along with potential future performance-based payments. This strategic move was part of the company's efforts to streamline operations and focus on its core waste and recycling services. The company recognized a loss of $4.5 million on the sale of these assets, which included a $61,000 loss in the second quarter due to post-closing adjustments. Additionally, the company recorded a $1.7 million impairment charge related to certain customer relationship intangible assets.

As of June 30, 2025, Quest Resource's total assets were reported at $153.1 million, down from $175.6 million at the end of 2024. The company’s liabilities also decreased to $110.1 million from $121.5 million, reflecting a reduction in notes payable and other long-term liabilities. The company’s stockholders' equity fell to $42.9 million, down from $54.2 million at the end of the previous fiscal year, primarily due to the net loss incurred during the period. Looking ahead, Quest Resource expects to leverage its existing cash and borrowing capacity to fund operations and navigate the ongoing economic challenges, while continuing to focus on enhancing operational efficiencies and customer acquisition strategies.