Financial Performance & Growth - Total revenue reached $35.1 million, a 1% year-over-year increase, driven by strong pricing in the foundational Powdered Activated Carbon (PAC) business[7, 12] - Adjusted EBITDA was $5.2 million, marking the 6th consecutive quarter of positive Adjusted EBITDA, though negatively impacted by low volume and early Granular Activated Carbon (GAC) ramp-up[7, 12] - PAC pricing grew by 7% year-over-year, with an approximate 15% average quarterly growth in PAC Average Sales Price (ASP) since Q2 2023, showing strong visibility in PAC contract renewals into 2026 and beyond[8] - A $25+ million Adjusted EBITDA improvement has been achieved since Q3 2023 on a trailing twelve-month basis, driven by the PAC turnaround and cost management[7] GAC Business & Strategy - Initial commercial phase GAC production and sales were achieved, with robust GAC market dynamics[7] - The company is exploring blending or replacing Corbin GAC feedstock and advancing alternative product developments for Corbin feedstock[9] - The Final Investment Decision (FID) for Phase II is now anticipated to coincide with reaching Phase I GAC nameplate capacity around mid-2026[36] Market & Regulatory Landscape - Regulations could boost municipal water market demand 3-5x from approximately 170 million lb/year, serving as a major catalyst for demand and potential supply shortages[88] - The company expects the annual GAC market to grow approximately 75% to over 700 million lbs, resulting in an approximate 370 million lbs supply shortfall by 2030[103] - Approximately 35% of the approximately 153,000 public water systems in the U S are estimated to require PFAS treatment facilities by 2030[101]

Core Insights - Arq, Inc. reported a revenue of $35.1 million for Q3 2025, marking a 1% increase year-over-year, primarily driven by a 7% increase in average sales price (ASP) despite slightly lower sales volumes [5][8] - The company achieved an Adjusted EBITDA of $5.2 million, representing the sixth consecutive quarter of positive Adjusted EBITDA, although it faced non-recurring costs impacting this figure [5][15] - The initial commercial phase of Granular Activated Carbon (GAC) production and sales was successfully launched, contributing to revenue generation [5][6] Financial Highlights - Revenue for Q3 2025 totaled $35.1 million, up from $34.8 million in the prior year [8] - Gross margin decreased to 28.8% from 38.6% year-over-year, primarily due to lower GAC production volumes and higher fixed production costs [10] - The company reported a net loss of $0.7 million in Q3 2025, compared to a net income of $1.6 million in the same period last year [14] Operational Highlights - The company successfully commenced its first commercial GAC production and sales at the Red River facility, which is expected to enhance revenue streams [5][6] - GAC market dynamics remain strong, with increased demand for spot purchases and anticipated growth in contracted volumes [6] - The ramp-up of GAC Phase I production has faced challenges due to design issues, with nameplate capacity expected to be achieved around mid-2026 [6][7] Cost and Expense Management - Costs of revenue increased by approximately 17% to $25.0 million in Q3 2025, driven by higher direct labor, utilities, and equipment rental costs [9] - Selling, general, and administrative expenses decreased by 43% to $4.6 million, attributed to lower payroll and benefit costs [11] - Research and development costs rose to $2.6 million, reflecting expenses related to pre-commencement testing of the GAC facility [12] Capital Expenditures and Balance Sheet - Capital expenditures for the full year 2025 are projected to remain between $8 million and $12 million, with Q3 2025 capex totaling $2.2 million [17] - As of September 30, 2025, the company had cash and restricted cash totaling $15.5 million, down from $22.2 million at the end of 2024 [17] - Total debt increased to $25.9 million as of September 30, 2025, compared to $24.8 million at the end of 2024, primarily due to the revolving credit facility [18]

Financial Performance - Total revenue reached $28.6 million, a 13% year-over-year increase driven by improved Average Selling Price (ASP) and end-market diversification[6] - Gross margin was 33.3%, reflecting sustainable improvement in PAC performance[6] - Adjusted EBITDA was $3.7 million, compared to $1.1 million in the prior year period, marking 5 consecutive quarters of positive Adjusted EBITDA[7, 11] - PAC pricing grew by 9% year-over-year in Q2 2025, with an average quarterly growth of approximately 16% in PAC ASP since Q2 2023[6, 16] GAC Commissioning and Expansion - The company completed the commissioning of its transformational GAC facility at Red River, with ramp-up to nameplate capacity underway[6, 24] - The company is targeting a Final Investment Decision (FID) for a 2nd GAC line prior to year-end 2025[8, 27] - The Red River plant is expected to add production of GAC and expand the plant to deliver an incremental 25 million pounds of GAC product[32] Market and Regulatory Landscape - EPA regulations could boost municipal water market demand by 3 to 5 times from approximately 170 million pounds per year[37] - The company is benefiting from U S tariffs due to its fully integrated domestic supply chain[38] Strategic Initiatives - The company is developing new markets, including the Arq-Enabled Great Lakes Restoration Project, which is the largest PAC sediment remediation in U S history[41, 42] - The company is exploring growth beyond activated carbon, with multiple initiatives focused on developing additional product opportunities and revenue streams from Corbin feedstock[43]

Financial Performance - Total revenue reached $27.2 million, a 25% year-over-year increase, driven by improved Average Selling Price (ASP) and end-market diversification[6, 10] - Adjusted EBITDA was $4.1 million, compared to a loss of $0.4 million in the prior year period, marking four consecutive quarters of positive Adjusted EBITDA[7, 10] - The company achieved net profitability during Q1 2025, with a net income of $0.2 million compared to a net loss of $3.4 million in Q1 2024[10] - Gross margin remained strong at 36.4% in Q1 2025[6, 20] PAC Business - The company achieved its 8th consecutive quarter of double-digit year-over-year growth in PAC ASP, with an approximately 13% ASP increase year-over-year[6, 11, 18] - 100% of PAC contracts are now net cash producers, as loss-making contracts have been eliminated[6, 7, 18] GAC Business & Red River Project - The Red River project is expected to add 25 million pounds of incremental GAC product capacity[27, 31] - The company has entered into supply contracts for approximately 16 million pounds of the Red River plant's nameplate capacity[31] - First commercial-scale production of on-specification GAC product is anticipated by the end of Q2 or early Q3 2025[31, 35] PFAS Regulations & Market Impact - EPA regulations potentially increase municipal water market demand by 3-5x vs the existing approximately 170 million pounds per year[39] - The company estimates that the annual GAC market could grow approximately 75% to over 700 million pounds[108]

Core Insights - Arq, Inc. achieved 8 consecutive quarters of double-digit year-over-year average sales price (ASP) growth, with a strong gross margin of 36.4% and positive adjusted EBITDA for four consecutive quarters, indicating a solid financial performance [1][5][14] - The company signed the second largest PAC contract in its history, showcasing the sustainability and value of its foundational business [1][6] - The timeline for the first commercial GAC production at the Red River facility has been updated to the end of Q2 or early Q3 2025 [1][6] - Jay Voncannon has been appointed as Chief Financial Officer, bringing 35 years of finance experience to oversee the company's transformation and growth [1][6] Financial Highlights - Revenue for Q1 2025 was $27.2 million, a 25% increase from $21.7 million in the prior year, driven by higher ASP, positive product mix changes, and increased volumes sold [5][8] - ASP increased by approximately 13% in Q1 2025 compared to the prior year, marking the eighth consecutive quarter of double-digit year-over-year growth [5][8] - Gross margin was 36.4% in Q1 2025, slightly down from 36.9% in the prior year, influenced by improved pricing and customer mix, offset by start-up costs related to the GAC line [10][13] - Net income for Q1 2025 was $0.2 million, a significant improvement from a net loss of $3.4 million in the prior year [13][14] - Adjusted EBITDA for Q1 2025 was $4.1 million, compared to an adjusted EBITDA loss of $0.4 million in the prior year, reflecting four consecutive quarters of positive adjusted EBITDA [14][15] Operational Highlights - All powder activated carbon (PAC) contracts are now net cash producers following the resolution of negative margin agreements as of December 31, 2024 [5] - The company completed mechanical construction of the GAC facility in January 2025, with small non-commercial scale volumes produced, but not yet at the consistency required for commercial production [6][7] - The company maintains a guidance of a 3-6 month ramp-up phase to reach a 25-million-pound nameplate capacity at Red River after the first commercial production [6] Capital Expenditures and Balance Sheet - Capital expenditures for 2025 are forecasted to remain between $8 million and $12 million, with $3.7 million spent in Q1 2025 [16] - As of March 31, 2025, cash and restricted cash totaled $14.8 million, down from $22.2 million as of December 31, 2024, primarily due to capital expenditures and inventory buildup [16] - Total debt, including financing leases, was $26.8 million as of March 31, 2025, an increase from $24.8 million as of December 31, 2024, driven by the revolving credit facility [17]