Quarterhill (QTRH) Q2 2026 earnings summary

Executive summary

• Achieved revenue of $42.5 million and adjusted EBITDA of $4.6 million (11% margin), marking the strongest adjusted EBITDA in over three years and the fourth consecutive quarter of positive adjusted EBITDA.

• Revenue for Q2 2026 was slightly down from $43.1 million year-over-year, mainly due to lower tolling project activity, partially offset by growth in commercial vehicle and enforcement business.

• Secured major new contracts in Utah, Illinois, Oklahoma, South Korea, and Thailand, expanding both domestic and international presence.

• Announced the acquisition of Conduent's tolling solutions business, expected to triple tolling revenue, create a combined backlog of approximately $2 billion, and make the company the second-largest tolling operator in the U.S.

• Maintains a robust commercial opportunity pipeline above $2 billion and an actionable M&A pipeline of approximately $3 billion.

Financial highlights

• Q2 2026 revenue was $42.5 million, down slightly from $43.1 million in Q2 2025; first half 2026 revenue grew 5% year-over-year to $81.1 million.

• Gross profit in Q2 was $12.2 million (29% margin), up from $6.3 million (15% margin) in Q2 2025, driven by restructuring and improved contract economics.

• Adjusted EBITDA improved to $4.6 million (11% margin) from a loss of $2.7 million (-6% margin) year-over-year.

• Net loss for Q2 2026 was $5.6 million ($0.05 per share), compared to a net loss of $6.8 million ($0.06 per share) in Q2 2025.

• Cash from operations was $5.7 million, compared to a use of $4.6 million in the prior year period; ended Q2 with $26.2 million in cash, up from $14.7 million at the end of Q1 2026.

Outlook and guidance

• Expects Conduent acquisition to close in Q4 2026, with integration planning underway and significant day-one synergies identified.

• Pro forma combined annual revenue post-acquisition expected to exceed $400 million, with adjusted EBITDA margin between 10%-15%.

• Combined revenue backlog projected at approximately $2 billion, providing strong visibility into future growth.

• Targeting 10%-15% EBITDA margin run rate by 2027.

• Management expects continued margin expansion and growth in the organic pipeline, supported by strong industry demand and infrastructure modernization funding.