Energy Recovery Shares Plunge 30% on CO2 Business Exit and Weak Guidance

Shares of Energy Recovery (ERII) crashed by more than 30% following the company's decision to exit its CO2 refrigeration business and pivot its strategy. This move removes a significant long-term growth catalyst that had been a key part of the company's value proposition. Furthermore, the company issued disappointing revenue guidance for its core desalination segment, projecting between $105 million and $125 million for 2026. Management attributed the lowered outlook to substantial project delays, forcing a more conservative financial stance for the coming years. To mitigate the impact, the company plans to redirect resources toward its wastewater treatment segment to capture new opportunities. The sharp sell-off reflects deep investor concerns over the fundamental shift in the company’s business model and its future revenue reliability.

स्रोत:seekingalpha.com