Hudson Technologies (NASDAQ: HDSN) Q2 income drops as margin outlook lowered
Rhea-AI Filing Summary
Hudson Technologies reported Q2 2026 revenue of $78,345, up 8% year over year, driven by 12% higher sales volume and 6% lower pricing. Despite this growth, gross profit and operating income declined, and net income fell to $4,947 from $10,168 in the prior-year quarter. For the first half of 2026, revenue increased but net income decreased, and management lowered its full-year 2026 gross margin target from mid-twenty percent to low-to-mid-twenty percent amid subdued refrigerant pricing and inflationary pressures.
The company highlighted an unlevered balance sheet with $25.6 million of cash at June 30, 2026, but cash flow from operations shifted to a $5,956 outflow versus strong inflows a year earlier. An Illinois facility damaged by a tornado was quickly restored with minimal customer impact, and all related restoration and business-interruption costs are expected to be covered through insurance. Hudson also outlined a planned partnership with Icorium to commercialize patented extractive distillation technology, aiming to improve refrigerant reclamation efficiency and support its longer-term growth and diversification strategy.
Positive
- None.
Negative
- Profitability under pressure: Q2 2026 net income declined to $4,947 from $10,168 a year earlier, as gross profit fell and operating expenses increased despite higher revenue.
- Weaker cash generation: Cash flow from operations for the first half of 2026 was a $5,956 outflow, compared with $20,569 provided in the prior-year period, contributing to lower cash balances.
- Lowered margin outlook: Full-year 2026 gross margin guidance was reduced from mid-twenty percent to low-to-mid-twenty percent, reflecting ongoing refrigerant pricing and cost headwinds.
Filing Explained
The filing reports a
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 Revenue: $78,345
Q2 2026 Net Income: $4,947
Q2 2025 Net Income: $10,168
+5 more
8 metrics
Q2 2026 Revenue
$78,345
Three months ended June 30, 2026; amounts in thousands
Q2 2026 Net Income
$4,947
Three months ended June 30, 2026; amounts in thousands
Q2 2025 Net Income
$10,168
Prior-year quarter ended June 30, 2025; amounts in thousands
Six Months 2026 Revenue
$138,496
Six months ended June 30, 2026; amounts in thousands
Six Months 2026 Net Income
$5,277
Six months ended June 30, 2026; amounts in thousands
Cash and Cash Equivalents
$25.6 million
Balance at June 30, 2026
Operating Cash Flow
$(5,956)
Cash provided by (used in) operating activities, six months ended June 30, 2026; amounts in thousands
Repurchase of Common Shares
$2,491
Cash used for share repurchases, six months ended June 30, 2026; amounts in thousands
Key Terms
unlevered balance sheet, extractive distillation technology, trailing twelve months, RefrigerantSide® Services, +2 more
6 terms
unlevered balance sheet financial
"Maintains unlevered balance sheet with $25.6 million cash position"
An unlevered balance sheet shows a company's assets and equity as if it had no debt, essentially removing loans, bonds and other borrowings from the picture. Investors use it to see the business’s underlying resources and owner value without the distorting effects of different borrowing choices — like judging a house by its contents and structure rather than the size of its mortgage — which makes comparisons and valuation clearer.
extractive distillation technology technical
"to commercialize and scale their patented extractive distillation technology"
trailing twelve months financial
"In fact, our trailing twelve months volume is up double-digits"
Trailing twelve months is a rolling measure of a company’s financial performance that adds together the most recent four quarters of results to show how the business has done over the last 12 months, rather than a fixed fiscal year. Investors use it like checking a car’s last 12 months of fuel use to see current efficiency — it highlights recent trends, evens out seasonal swings, and provides an up-to-date basis for comparing and valuing companies.
RefrigerantSide® Services technical
"refrigerant management services consisting primarily of recovery and RefrigerantSide® Services"
A suite of professional services focused on the handling, recovery, reclamation, replacement and regulatory compliance of industrial and commercial refrigerants. Like a car’s maintenance shop that keeps an engine running cleanly and legally, these services reduce the risk of leaks, fines and operational downtime, help companies meet environmental rules, and can lower long‑term costs—factors that affect profitability, liabilities and asset value for investors.
carbon offset projects financial
"As a component of the Company’s products and services, the Company also generates carbon offset projects"
Carbon offset projects are activities that reduce, avoid, or remove greenhouse gas emissions and produce measurable credits that can be sold or retired to compensate for emissions elsewhere. Examples include planting trees, funding renewable power, capturing methane, and engineered carbon removal. They matter to investors because the credits become tradable assets and affect a company’s carbon accounting, regulatory exposure, reputational risk, and potential revenue or costs—like vouchers that represent quantified environmental outcomes.
forward-looking statements regulatory
"Statements contained herein which are not historical facts constitute forward-looking statements"
Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.
Earnings Snapshot
Q2 2026 revenue: $78,345 (thousands) · Guidance included
Quarter and six months ended June 30, 2026
Q2 2026 revenue
$78,345 (thousands)
from $72,849 (thousands) in Q2 2025
Q2 2026 net income
$4,947 (thousands)
from $10,168 (thousands) in Q2 2025
Six months 2026 operating cash flow
$(5,956) (thousands)
from $20,569 (thousands) in six months 2025
Guidance
Full year 2026 gross margin target revised from mid-twenty percent to low-to-mid-twenty percent.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What were Hudson Technologies (HDSN) key Q2 2026 financial results?
Hudson Technologies posted Q2 2026 revenue of $78,345, up 8% year over year, with net income of $4,947 versus $10,168 a year earlier. Higher sales volumes were offset by lower pricing and increased operating expenses.
How did Hudson Technologies’ first-half 2026 performance compare with 2025?
For the six months ended June 30, 2026, revenue increased to $138,496 from $128,192, but net income fell to $5,277 from $12,926. Margin compression and higher operating expenses outweighed the benefit of higher sales.
What is Hudson Technologies’ cash position and leverage as of June 30, 2026?
Hudson reported cash and cash equivalents of $25.6 million at June 30, 2026 and highlighted an unlevered balance sheet. Cash declined from $39,456 at December 31, 2025, partly due to negative operating cash flow and share repurchases.
What guidance did Hudson Technologies (HDSN) give for 2026 gross margins?
Management revised 2026 gross margin guidance from mid-twenty percent to low-to-mid-twenty percent. The change reflects expectations of continued subdued refrigerant pricing and inflationary pressures through the rest of 2026.
How was Hudson Technologies affected by the Illinois tornado and insurance coverage?
An Illinois facility experienced an operational disruption in mid-June due to tornado damage but was quickly restored to pre-storm output with minimal customer interruption. All restoration and business-interruption costs are expected to be covered by insurance.
What is the Icorium partnership mentioned by Hudson Technologies?
Hudson intends to partner with Icorium, a Kansas-based advanced separation technology company, to commercialize patented extractive distillation technology. The goal is to purify more complex refrigerant mixtures, convert more recovered refrigerant into saleable product, and enhance long-term competitiveness.
How did pricing and volume trends impact Hudson Technologies’ Q2 2026 results?
In Q2 2026, sales volume rose 12% while pricing declined 6%. This mix produced 8% revenue growth, but lower prices and higher operating expenses contributed to reduced gross profit, operating income, and net income versus the prior-year quarter.