Energy Recovery

Q2 FY2026 EarningsQ2 FY26 results significantly missed consensus expectations on the top and bottom lines, with revenue of $12.0M falling 36.3% short of the $18.8M estimate due to geopolitical impacts on projects in Iran. Despite the revenue miss, gross margin reached a record 74.7%, far exceeding the 62.0% consensus due to a favorable channel mix and indirect cost efficiencies. While GAAP EPS of ($0.06) missed the ($0.02) expectation, the company delivered a massive beat in free cash flow, reporting $15.4M against a projected outflow, driven by aggressive working capital management and strong collections.