Energy Recovery shares plunge on weak outlook

Investing.com -- Energy Recovery Inc. shares tumbled over 32% on Thursday after the desalination equipment maker issued a 2026 revenue forecast that missed analyst expectations and announced plans to exit its carbon dioxide retail grocery business.

The company projected full year revenue between $115 million and $140 million, falling short of the average analyst estimate of $165 million. Energy Recovery also forecast adjusted earnings per share between 50 cents and 70 cents, compared to the analyst estimate of 88 cents.

For the fourth quarter, Energy Recovery reported adjusted diluted earnings per share of 53 cents, missing the estimate of 67 cents. Revenue came in at $66.9 million, below the $82.6 million estimate.

Additionally, Energy Recovery said it will wind down its carbon dioxide retail grocery business effective immediately. In a letter to shareholders posted on its website, the company stated that scaled adoption would require significant time, investment, and risk.

The shares fell as much as 34% during Thursday's session, marking their biggest intraday drop on record.

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