DIRTT ENVIRONMENTAL SOLUTIONS LTD SEC 10-Q Report
DIRTT Environmental Solutions Ltd, a leading provider of highly customized, prefabricated interior construction solutions, has released its Form 10-Q report for the second quarter of 2025. The report outlines the company's financial performance and operational highlights, reflecting the challenges and strategic initiatives undertaken during the period.
Financial Highlights
Total Revenue: $38.9 million, a decrease of 6% from $41.2 million in the same period of 2024, attributed to macroeconomic factors and scheduling delays.
Gross Profit: $10.8 million, representing 27.8% of revenue, down from $15.4 million or 37.3% of revenue in the same period of 2024, impacted by lower revenues and tariff costs.
Operating (loss) income: $(4.3) million, compared to $1.0 million in the same period of 2024, reflecting increased operating expenses and decreased gross profit.
Net (loss) income after tax: $(6.6) million, compared to $0.6 million net income in the same period of 2024, primarily due to decreased gross profit and increased foreign exchange losses.
Net (loss) income per share − basic: $(0.03), compared to $0.00 in the same period of 2024, reflecting the net loss incurred during the period.
Business Highlights
Revenue Segments
- Commercial sales decreased by 26% in Q2 2025 compared to Q2 2024, attributed to fewer large commercial projects.
- Healthcare revenues increased by 91% due to four key projects shipping in Q2 2025.
- Government sales decreased by 41% due to a customer order delay.
- Education sales increased by 119% due to a higher volume of large projects.
Geographical Performance
- Revenue from Canada decreased by 13% in Q2 2025 compared to Q2 2024.
- U.S. revenue decreased by 5%. Historically, 10-15% of revenues are derived from Canada and 85-90% from the U.S., a trend expected to continue.
New Product Launches
The company introduced new product solutions such as COVE™ and Applied Headwalls, aiming to increase product placement in healthcare and life science construction projects.
Future Outlook
The company anticipates returning to positive Adjusted EBITDA by Q4 2025 despite current challenges from macroeconomic uncertainty and tariffs. The twelve-month forward pipeline increased by 18% year-over-year, indicating potential future growth.
Impact of Tariffs
The imposition of tariffs, particularly a 50% tariff on aluminum and steel imports, has impacted margins. The company has implemented price adjustments and strategic sourcing to mitigate these effects, expecting full impact realization later in 2025.
SEC Filing: DIRTT ENVIRONMENTAL SOLUTIONS LTD [ DRT ] - 10-Q - Jul. 30, 2025