Hudson Technologies (NasdaqCM:HDSN) Q4 2025 Earnings call March 04, 2026 05:00 PM ET Company ParticipantsBrian Bertaux - CFOJennifer Belodeau - Lead Professional of Investor RelationsKate Houghton - SVP of Sales and MarketingKenneth Gaglione - President and CEOConference Call ParticipantsAustin Moeller - Senior Equity Research AnalystGerry Sweeney - Managing Director and Senior Research AnalystMatthew Moss - Senior Equity Research AnalystMatthew Robb - Research AnalystOperatorGreetings. Welcome to the Hudso ...

Financial Data and Key Metrics Changes - In Q4 2025, Hudson Technologies recorded revenue of $44.4 million, an increase of 28% compared to Q4 2024, primarily driven by increased sales volume [23] - For the full year 2025, the company achieved $246.6 million in revenue, a 4% increase from 2024, with a 6% increase in sales volume [27] - The gross margin for 2025 was 25.2%, down from 27.7% in 2024, reflecting lower refrigerant market prices and higher freight costs [26] - The company reported a net loss of $8.6 million in Q4 2025, compared to a net loss of $2.6 million in Q4 2024 [25] Business Line Data and Key Metrics Changes - The core business of refrigerant reclamation, sales, and associated services remains the focus of Hudson's organic growth strategy [5] - The company achieved an 18% increase in reclamation volume for the second consecutive year, attributed to increased awareness among contractors [11] - Revenue from the Defense Logistics Agency (DLA) contract was $38 million in 2025, with expectations to maintain this run rate through 2026 [27][64] Market Data and Key Metrics Changes - The average price of HFCs at the end of 2025 was slightly below $6 per pound, with a slight increase observed in early 2026 [16] - The market is currently balanced in terms of supply and demand, with signs of small price appreciation for refrigerants [50] Company Strategy and Development Direction - Hudson is focused on investing in infrastructure, inventory, and ERP systems to enhance operational efficiency and customer service [6] - The company aims to diversify revenue streams to reduce seasonality and dependence on a few dominant refrigerants [9] - Hudson plans to continue its disciplined approach to accretive acquisitions and strategic expansion in the commercial market [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth opportunities in 2026, supported by a strong foundation and a commitment to sustainable refrigerant lifecycle management [30][21] - The company is determined to maintain its position as a valued partner to the DLA while navigating the bid protest situation [14] Other Important Information - Hudson repurchased $20 million in stock during 2025 and plans to continue opportunistic buybacks in 2026 [28] - The company went live with a new ERP system in February 2026, which is expected to improve operational connectivity and efficiency [7] Q&A Session Summary Question: Discussion on service opportunities and HVAC optimization - Management highlighted the focus on proactive services for chiller operations and the potential to expand service offerings beyond traditional refrigerant distribution [35][42] Question: Update on HFC pricing trends and expectations for 2026 - Management noted that HFC pricing is currently stable with slight appreciation expected, and they do not foresee significant changes in pricing for 2026 [49][52] Question: Inventory needs for 2026 and factors affecting gross margin - Management confirmed they have sufficient inventory to meet demand for 2026 and emphasized the importance of pricing and operational efficiencies in improving gross margins [56][57] Question: Update on the DLA bid process and revenue expectations - Management indicated optimism regarding the DLA contract renewal process and projected a similar revenue run rate of $38 million for 2026 under the existing contract [64]