Hudson Technologies (HDSN) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenue increased 8% year-over-year to $78.3 million, driven by a 12% rise in sales volume despite a 6% decline in pricing and challenging HFC market conditions.

• Net income for Q2 2026 was $4.9 million ($0.12 per diluted share), down from $10.2 million ($0.23 per share) in Q2 2025, primarily due to higher SG&A costs and lower gross margin.

• Focused on operational excellence, diversification, and reducing dependency on spot refrigerant pricing, with continued investments in talent, technology, and advanced distillation capabilities.

• Completed the acquisition of Refrigerants Inc. in December 2025, expanding reach in key markets and adding $3.0 million in goodwill.

• Awarded a bridge contract and subsequently re-awarded a five-year, $210 million DLA contract, providing revenue visibility through August 2031.

Financial highlights

• Q2 2026 gross profit was $20.7 million (26% margin), down from $22.8 million (31% margin) in Q2 2025, mainly due to lower pricing and higher freight and operating costs.

• Six-month 2026 revenues were $138.5 million, up 8% year-over-year; net income was $5.3 million, down from $12.9 million.

• SG&A expenses rose to $12.4 million in Q2 2026 from $9.3 million in Q2 2025, reflecting increased personnel, professional fees, IT, and ERP optimization costs.

• Ended quarter with $25.6 million in cash and no debt, a $6 million sequential increase.

• Working capital at June 30, 2026 was $150.6 million.

Outlook and guidance

• Full-year 2026 gross margin guidance revised downward to low-to-mid-20% range due to continued subdued pricing and inflationary pressures.

• SG&A expenses expected to remain elevated in the second half, but increase at a slower rate than in the first half.

• The new DLA contract provides revenue visibility through August 2031, with a five-year extension option.

• Optimism for improved market conditions with potential benefits from El Niño and enforcement against illegal imports.