QRHC

Over the last six months, Quest Resource’s shares have sunk to $1.37, producing a disappointing 13.3% loss - a stark contrast to the S&P 500’s 12.7% gain. This might have investors contemplating their next move. Is there a buying opportunity in Quest Resource, or does it present a risk to your portfolio? Check out our in-depth research report to see what our analysts have to say, it’s free. Even though the stock has become cheaper, we’re passing on Quest Resource for now. Here are three reasons you should be careful with QRHC, plus one stock we’d rather own. Long-term growth is the most important, but within industrials, a stretched historical view may miss new industry trends or demand cycles. Quest Resource’s recent performance marks a sharp pivot from its five-year trend as its revenue has shown annualized declines of 6.8% over the last two years. If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills. Quest Resource broke even from a free cash flow perspective over the last five years, giving the company limited opportunities to return capital to shareholders. As long-term investors, the risk we care about most is the permanent loss of capital, which can happen when a company goes bankrupt or raises money from a disadvantaged position. This is separate from short-term stock price volatility, something we are much less bothered by. Quest Resource’s $60.64 million of debt exceeds the $1.02 million of cash on its balance sheet. Furthermore, its 6× net-debt-to-EBITDA ratio (based on its EBITDA of $9.64 million over the last 12 months) shows the company is overleveraged. At this level of debt, incremental borrowing becomes increasingly expensive and credit agencies could downgrade the company’s rating if profitability falls. Quest Resource could also be backed into a corner if the market turns unexpectedly – a situation we seek to avoid as investors in high-quality companies. We hope Quest Resource can improve its balance sheet and remain cautious until it increases its profitability or pays down its debt. Quest Resource doesn’t pass our quality test. After the recent drawdown, the stock trades at 7.4× forward EV-to-EBITDA (or $1.37 per share). While this valuation is optically cheap, the potential downside is huge given its shaky fundamentals. There are better investments elsewhere. We’d recommend looking at our favorite semiconductor picks and shovels play. ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively. Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.

Quest Resource’s second quarter saw notable revenue growth and a positive market response, driven by ongoing expansion in non-industrial markets and improved customer diversification. Management cited contributions from recent customer wins, especially in food service, retail, and automotive sectors, as key drivers. CEO Perry Moss emphasized, “We returned to top-line revenue and adjusted EBITDA growth compared to both the prior year and the prior quarter,” highlighting the benefit of wallet share expansions and stabilizing industrial volumes. The company’s operational initiatives, including cost controls and process optimization, also played an important role in results. Is now the time to buy QRHC? Find out in our full research report (it’s free). Revenue: $64.07 million vs analyst estimates of $63.55 million (7.6% year-on-year growth, 0.8% beat) EPS (GAAP): -$0.57 vs analyst estimates of -$0.07 (significant miss) Adjusted EBITDA: $2.79 million vs analyst estimates of $2.4 million (4.4% margin, relatively in line) Operating Margin: 1.8%, up from 0.7% in the same quarter last year Market Capitalization: $29.95 million While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Aaron Spychalla (Craig-Hallum) asked for details on the size and growth prospects of recent automotive customer wallet share wins. CEO Perry Moss explained these are seven-figure opportunities with potential for further expansion and higher initial margins. Aaron Spychalla (Craig-Hallum) inquired about the sustainability of wallet share pipeline growth and whether Quest remains open to industrial sector expansions. Moss confirmed ongoing efforts in both areas, highlighting the importance of diversification. Aaron Spychalla (Craig-Hallum) questioned the expected EBITDA conversion from gross profit given operational improvements. Moss stated conversion rates would be slightly higher for wallet share opportunities due to lower onboarding costs. Aaron Spychalla (Craig-Hallum) asked for an update on operational initiatives and areas of focus moving forward. Moss pointed to standardized processes, improved training, and a 20% reduction in SG&A as evidence of progress. No additional analyst questions were asked on the call. In the coming quarters, the StockStory team will monitor (1) the pace of new customer additions and wallet share expansions in non-industrial end-markets, (2) continued improvements in operational efficiency and SG&A leverage, and (3) stabilization or further recovery within the industrial portfolio. Additional attention will be paid to Quest’s cash generation and progress on debt reduction targets. Quest Resource currently trades at $1.42, up from $1.27 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 5:00 p.m. ET Alpha IR Group - Nick Nelson Chief Executive Officer - Perry Moss Chief Financial Officer - Brett Johnston Operator: Thank you for standing by and welcome to the Quest Resource Holding Corporation's Second Quarter 2026 Earnings Call. I'd like to remind everyone that this call is being recorded. [Operator Instructions] I would now like to turn the call over to Nick Nelson, Alpha IR Group. Please go ahead. Nick Nelson: Thank you, Operator, and thank you, everyone, for joining us for Quest Resource's second quarter 2026 earnings call. Before we begin, we'd like to remind everyone that this conference call may contain predictions, estimates, and other forward-looking statements regarding future events or future performance of the company. Use of words like anticipate, project, estimate, expect, intend, believe, and other similar expressions are intended to identify those forward-looking statements. Such forward-looking statements are based on the company's current expectations, estimates, projections, beliefs, and assumptions, and involve significant risks and uncertainties. Actual events or the company's results could differ materially from those discussed in the forward-looking statements as a result of various factors which are discussed in greater detail in the company's filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on such statements and to consult SEC filings for additional risks and uncertainties. The company's forward-looking statements are presented as of the date made, and the company undertakes no obligation to update such statements unless required by law to do so. In addition, this call may include industry and market data and other statistical information, as well as the company's observations and views about industry conditions and developments. The data and information are based on the company's estimates, independent publications, government publications, and reports by market research firms and other sources. Although Quest believes these sources are reliable and the data and other information are accurate, we caution that Quest has not independently verified the reliability of the sources or the accuracy of the information. Certain non-GAAP financial measures will be disclosed during this call. These non-GAAP measures are used by management to make strategic decisions, forecast future results, and evaluate the company's current performance. Management believes the presentation of these non-GAAP financial measures is useful to investors' understanding and assessment of the company's ongoing core operations and prospects for the future. Unless it is stated otherwise, it should be assumed that any financials discussed in this call will be on a non-GAAP basis. Full reconciliations of non-GAAP to GAAP financial measures are included in today's earnings release. With that, I'd like to turn the call over to Perry Moss, Chief Executive Officer. Perry Moss: Thanks, Nick, and thanks, everyone, for joining this afternoon. Quest delivered a solid quarter of results as the sequential improvements in momentum we experienced in the first quarter carried forward into the second period. We returned to top-line revenue and adjusted EBITDA growth compared to both the prior year and the prior quarter. This was supported by the growing contributions of recent customer wins and wallet share expansions, stabilizing volumes from our industrial customers, and ongoing productivity improvements across the business. We're encouraged by this progress, but understand that the macro environment remains complex and at times uneven. Within our industrial portfolio, we also saw positive trends carry forward into Q2. This drove sequential volume improvements as well as meaningful year-over-year growth from some of our largest customers. That said, volumes still remain subdued relative to a few years ago at a few select accounts and are likely the new norm. We will continue to monitor the broader macro environment closely. Given how the first half of the year played out, we're cautiously optimistic that our industrial portfolio has stabilized. The non-industrial portion of the portfolio, meanwhile, continues to perform as well as or better than expected, as we've grown meaningfully in markets like food service, retail, hospitality, and more. The comprehensive efforts we have taken over the past several quarters designed to streamline our operations, diversify the business, and improve productivity levels are clearly showing results. I'm incredibly proud of the entire Quest team for their hard work and commitment through this period, and the way they've bought into the changes we've implemented. While there remains significant work to be done, we are encouraged by what appears to be a gradually improving operating environment, as well as the wins our initiatives are delivering. We're mindful that these trends can shift, so we're staying disciplined rather than getting ahead of ourselves. Along those lines, we'll continue to seek ways to drive incremental improvements in the business through our operational excellence initiatives, effectively control our cost structure, and ensure the business is well positioned to drive stronger financial results going forward. Moving to specific results for the period, revenue in the second quarter grew by 8% compared to the prior year and 4% sequentially. That growth was driven by a renewed sales and go-to-market effort that elevated our focus on non-industrial markets, as well as wallet share opportunities across our existing portfolio. With the internal tools and processes we've implemented to better identify, track, and close these opportunities, the results have followed. Over the past 4 quarters, we've successfully onboarded several new customer wins. Importantly, as I've noted earlier, many of these wins are outside the industrial sector and are helping diversify the portfolio. They include a customer in the food products market, a large restaurant chain, a large retailer, and one of the largest franchisees in the quick service restaurant industry. At the same time, we've landed several new wallet share gains with existing customers, including an expansion with an existing retail customer, the addition of several hundred new locations with a customer in the automotive services end market, and expansions with two other major customers. More recently, in the second quarter, we landed four new share of wallet wins, including a significant one with a large national automotive parts retailer. Each of these wins over the past year is helping create a better balance across our portfolio and demonstrates both the capability of our sales team and the appeal of the Quest model across markets. We also continue to expand our sales pipeline during the period. Our pipeline remains healthy and we're engaged with several promising opportunities to add large national brands to our portfolio. Some of these opportunities are in markets that are new for Quest, which would further diversify our customer list and provide incremental offsets to the seasonally slower periods for many of our industrial customers. That said, many of these companies are also actively monitoring the current macroeconomic backdrop, which is elongating the sales cycle. We like our positioning, but the timing on closing these opportunities will ultimately depend on how quickly these companies gain confidence in the broader environment. Operationally, we continue to execute well and I believe we're operating more efficiently than at any point in my time here. Brett and his team have done a terrific job optimizing our cost structure, improving our cash cycle, and reducing debt, which will put us on firmer financial footing as volumes improve. Some of this is already evident in the strong flow-through of our sequential gross profit gains to adjusted EBITDA in the most recent quarter. On the cost side, diesel prices have risen amid geopolitical events around the world, yet Quest has experienced only a limited impact on our financials through this extended period of elevated prices. We view this as a good proof point for our model and its relative resilience to short-term commodity fluctuations, as well as our ability to use our scale to push back on cost increases where we can or to pass through unavoidable costs to our customers. Lastly, we continue to evolve our organizational structure and make personnel changes to attract, develop, and retain the best team possible. This holds true across the organization, from sales and key accounts to IT, finance, and more. We made some exciting changes so far this year through the addition of high-quality talent in key areas, and we'll keep finding ways to put the team in the best position to succeed and serve our customers. Looking ahead, our priorities remain focused on growing the business with new and existing customers, driving margin improvements, continuing the development of our operating platform, improving cash generation, and reducing our debt balance. With that, I'd like to turn the call over to Brett to review our second quarter financial results in greater detail. Brett? Brett Johnston: Thanks, Perry, and good afternoon, everyone. Before I walk through the financials, I want to underscore the themes from Perry's remarks regarding our second quarter results. First, we returned to top-line and adjusted EBITDA growth, which came from parts of the portfolio we have been deliberately building. This includes new customer wins and wallet share expansions in non-industrial markets. Further, our industrial business has stabilized and contributed meaningfully to our year-over-year growth, which is encouraging to see. We're not taking this stabilization for granted and remain optimistic about the environment. Lastly, the progress on operational excellence is being reflected in our financials as we saw lower SG&A on higher revenues, strong operating cash flow, and continued debt reduction. Taken together, we are building a more diversified revenue base with a leaner cost structure and a healthier balance sheet. So let's talk through our results. Revenue for the second quarter was $64.1 million, an 8% increase from 1 year ago, and a sequential increase of 4% compared to the first quarter. The increase was primarily driven by volume improvements from certain clients in the industrial end market, which increased revenue by approximately $3.3 million compared to the prior year. As well as new business, net of customer attrition of approximately $1.2 million from new client wins and wallet share expansion with existing customers. This marks an encouraging reversal from the industrial headwinds we experienced in recent quarters. While we believe the stabilization we are seeing across several of our largest industrial accounts can continue, we know that conditions can change quickly, especially given the ongoing macroeconomic complexity. This return to growth reflects the team's focus on diversifying the business into non-industrial markets and also the resonance of the Quest value proposition with customers across economic sectors and which is centered on operational efficiency. Also, as a brief reminder, we are now reporting much cleaner, comparable results year over year, as we have sunsetted the majority of the significant headwinds experienced across 2024 and 2025. As we look ahead to Q3, we expect another quarter of sequential growth in revenue. Moving on to gross profit, in the second quarter, gross profit dollars totaled $10.4 million, a decline of roughly 6% compared to the prior year, but a sequential increase of 8%. This resulted in a gross margin of 16.3%, which was down from 18.5% in the prior year, up from 15.7% sequentially. The year-over-year decline in gross profit dollars and gross margin is primarily isolated to margin pressure with select industrial clients, despite the volume improvements noted above. This was offset by both higher gross profit dollars and improving gross margins across the remainder of the business, as margins from recent new customer and wallet share wins are maturing, and we continue to employ a continuous improvement approach to optimizing our cost structure. We still anticipate gross margins to be flat to slightly up in the third quarter as industrial volumes ramp at a few select larger customers. However, we are clearly demonstrating our ability to help offset this impact by focusing on what we can control, growing in non-industrial markets, optimizing service levels across the portfolio, winning incremental wallet share with existing customers, and executing our land and expand strategy to grow margin levels at recently onboarded accounts. Now moving on to SG&A, which was $8.2 million, an 11% reduction compared to the prior year, despite revenue growth of 8%. It was also a sequential decline of 2% despite a 4% sequential increase in revenue. These productivity improvements are tangible examples of our operational excellence initiatives, delivering real results and focusing on elements directly within our control. We'll continue to be disciplined on the cost front and remain vigilant for incremental ways to improve efficiency levels. During the quarter, we incurred a non-cash goodwill impairment charge of $11 million, triggered by the decline in our market capitalization. The charge has no impact on our liquidity, cash flow, or compliance with our debt covenants. Moving on to a review of the cash flows and balance sheet. We ended the quarter with $1 million in cash and approximately $19.4 million in availability on our ABL credit facility. Net notes payable was approximately $59.4 million, a reduction of $4.6 million year-to-date, and approximately $17 million over the last 6 quarters. We delivered $4.5 million of operating cash flow in the quarter, driven by higher revenues, cost discipline, the ongoing optimization of our billing and collections processes, and our improved vendor payment processes, all contributing to improvements in our cash cycle. This facilitated the further reduction of our term debt held by Monroe Capital as we utilized our strong cash flow to make another voluntary $2 million early payment. We expect continued progress on cash generation paired with the lower future interest expense to free up additional cash to allocate toward debt reduction, and we will execute additional early payments as appropriate. Year to date in 2026, we have now reduced the term balance by over $4 million and debt reduction remains a key priority. Our DSOs finished the quarter at roughly 70, which was a nice improvement from the mid-70s at the end of the first quarter. Accounts receivable declined by roughly $2.5 million sequentially, despite the sequential increase in revenues. We will continue to implement ways to improve our cash cycle and believe that we have a clear path to our near-term target of the mid-60s. During the second quarter, we also reduced the number of working capital days to 5 days, an improvement from 12 days at the end of the first quarter and 19 days 1 year ago. Overall, as Perry noted, we are cautiously optimistic that the operating landscape is slowly improving. Stabilizing volumes from the industrial portion of the portfolio, coupled with the organic initiatives we've taken to diversify the business and elevate productivity across the organization, are driving improved financial performance, despite what remains a difficult environment. We are continuing to focus on what is within our control, and our financial priorities are unchanged. Beyond investing in our talent and growth opportunities, these include optimizing our cost structure, leveraging our operational excellence initiatives to drive cash flow, and paying down debt. Our continuous improvement approach to our cash cycle is centered around elevating our billing and collection practices and further optimizing working capital. Collectively, these actions are providing the financial flexibility to position Quest for continued success as our business moves forward and will allow us to deliver improved financial results as conditions continue to improve. With that, I'll turn the call back over to Perry for some closing comments before we open it up for Q&A. Perry? Perry Moss: Great. Thank you, Brett. Our second quarter was another step in the right direction, as the proactive efforts we've taken over the past year plus to improve operations are being supported by a gradually improving macroeconomic backdrop. While this optimism is tempered somewhat by renewed geopolitical risks, we are cautiously optimistic that the current trajectory of the business, combined with the ongoing initiatives within our control, have us on a path towards improved financial results. With that, I'd like to turn the call over to our operator to move us to Q&A. Operator: We will now begin the question and answer session. [Operator Instructions] Your first question comes from the line of Aaron Spychalla from Craig-Hallum. Aaron Spychalla: Good afternoon, Perry and Brett. Good to see the traction on the wallet share wins. Any details on the automotive customer size, locations, or waste streams? And then can you just speak to confidence or growth in that wallet share pipeline? I know you've targeted some industrial expansions. Are those still possibilities and just maybe some color there, please. Perry Moss: Yes, so, Aaron, you know, we don't typically talk too directly about individual customers. The share of wallet opportunity that I referenced in the call is similar to a target for a new business account, so 7-figure plus. And it's in the commodities sector. So those opportunities come to us at kind of our normal margin and not the land and expand option. So they come in a little higher from the very beginning. So they help to drive incremental GP. And I think there's still future or additional, I should say, opportunity to grow with that account and perhaps some of their competitors. So it's a little niche solution that we offer that has kind of gotten some traction. As we've talked about, you know, we'll continue to attempt to diversify our portfolio. It certainly doesn't imply that we wouldn't pursue an attractive industrial opportunity. In fact, there are several in the pipeline, but I think diversification is very important. We are working on share of wallet opportunities with our current industrial customers, and we'll continue to do, to find those efforts. Just since the back half of... We probably haven't said this before, in the back half of '25 into this year, we've now closed nine different meaningful share of wallet opportunities and they are all 6-, 7-figure opportunities. So we'll certainly continue that effort. Our relationship with these customers certainly makes the sales effort easier. We're trusted, we're proven, and I guess we're a known commodity. So it's a little quicker and easier to land those deals. And they certainly have been accretive to our gross profit. Aaron Spychalla: Great. Yes, that's good to hear. And then, you know, just with that kind of combination of growth and new and existing and the operational initiatives you had, I know in the past you've talked about, like a 50% conversion from gross profit dollars to EBITDA. I mean, is that still fair or is the target maybe a little bit higher just given some of those operational improvements you've made? Perry Moss: Yes, I think it's fair to say it's a little higher. It's certainly higher with the share of wallet opportunities. As we've talked about before, the implementation or onboarding costs are significantly lower with the share of wallet because we've already got these customers set up in the system. They know us. The transition goes much smoother. So I don't really want to have a quote, an actual figure, but I would say it's fair to assume that it's slightly higher. Aaron Spychalla: Makes sense. And then just maybe last, any update on just operational initiatives over the last year plus that you've made and any other areas of notable focus moving forward? Perry Moss: Yes, I mean, our focus has been on, you know, redefining all of our internal processes, optimizing those, getting them documented, training our folks so we have very standardized processes. That makes the work a lot easier because everyone is doing the work the same way. It's easier for us to train. And the goal is do it right the first time so there isn't remedial work to do. We have found our productivity levels increase significantly in certain areas because of those efforts. You know, when you're not tracking or measuring, it's very difficult to improve, right? You have to have a starting point or a baseline. You have to create an improvement plan. You have to implement it, and then you have to track it every week. That's what we do. So there's been, as you can see through the reduction in SG&A, you know, the first 6 months this year compared to last year is a 20% reduction. The initiatives are certainly paying off. Operator: [Operator Instructions] Since there are no more questions, that will conclude our question-and-answer session. We'll now turn the call back over to Perry Moss for closing remarks. Perry Moss: Great. Thank you, Operator. And thank you and thanks to everyone for joining this afternoon. We really appreciate your continued support and interest in Quest, and we look forward to updating all of you for the next quarter. Thank you. Operator: Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect. Before you buy stock in Quest Resource, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Quest Resource wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,209!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,375,393!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 13, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Quest Resource (QRHC) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved a return to top-line revenue and adjusted EBITDA growth driven by the growing contribution of recent customer wins and wallet share expansions. Stabilized the industrial portfolio with sequential volume improvements, though management notes volumes at select accounts remain subdued relative to historical peaks and likely represent a new norm. Successfully diversified the revenue base by onboarding new customers in food products, retail, and quick service restaurant sectors to offset industrial cyclicality. Improved operational efficiency through standardized internal processes and productivity gains, resulting in an 11% year-over-year reduction in SG&A despite higher revenues. Demonstrated business model resilience against elevated diesel prices by leveraging scale to push back on cost increases or passing through unavoidable costs to customers. Attributed margin pressure in the industrial segment to select client dynamics, which was partially offset by maturing margins from new customer wins and wallet share gains. Anticipates gross margins to be flat to slightly up in the third quarter as industrial volumes ramp at a few select larger customers. Quest anticipates gross margins to be flat to slightly up in the third quarter as industrial volumes ramp at a few select larger customers. Maintains a healthy sales pipeline with large national brands, though management notes macroeconomic uncertainty is currently elongating the sales cycle. Prioritizes debt reduction and cash flow generation, with plans to utilize improved cash cycles to make additional voluntary early payments on term debt. Targets a near-term improvement in Days Sales Outstanding (DSO) to the mid-60s through optimized billing and collection practices. Recorded a non-cash goodwill impairment charge of $11 million triggered by a decline in market capitalization, with no impact on liquidity or debt covenants. Reduced working capital days to 5 days, down from 19 days a year ago, reflecting significant improvements in the cash cycle. Acknowledged that while the operating environment is gradually improving, renewed geopolitical risks and macro complexity warrant a disciplined and cautious outlook. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management identified a recent wallet share win as a 7-figure opportunity in the commodities sector with margins that are accretive from the start. Confirmed that nine meaningful share of wallet opportunities (6- to 7-figure range) have closed since the back half of 2025. Noted that selling into existing accounts is more efficient because Quest is already a 'known commodity' with established system integrations. Indicated that the historical 50% conversion target from gross profit to EBITDA is likely higher now, particularly for wallet share wins. Explained that onboarding costs for existing customers are significantly lower, allowing for stronger flow-through to the bottom line. Focused on redefining and documenting all internal processes to ensure standardization and eliminate remedial work. Reported a 20% reduction in SG&A for the first six months of the year compared to the prior year as a direct result of these productivity efforts.

This article first appeared on GuruFocus. Revenue: $64.1 million, an 8% increase year-over-year and a 4% sequential increase. Gross Profit: $10.4 million, down roughly 6% year-over-year but up 8% sequentially. Gross Margin: 16.3%, down from 18.5% in the prior year but up from 15.7% sequentially. SG&A: $8.92 million, an 11% reduction year-over-year and a 2% sequential decline. Goodwill Impairment Charge: Non-cash charge of $11 million, triggered by a decline in market capitalization. Operating Cash Flow: $4.5 million in the quarter. Cash Position: Ended the quarter with $1 million in cash and approximately $19.4 million in availability on its ABL credit facility. Net Notes Payable: Approximately $59.4 million, a reduction of $4.6 million year to date. Debt Reduction: Made a voluntary $2 million early payment on term debt; reduced term balance by over $4 million year to date. DSOs: Finished the quarter at roughly 70, an improvement from the mid-70s at the end of the first quarter. Working Capital Days: Reduced to 5, an improvement from 12 days at the end of the first quarter and 19 days one year ago. Warning! GuruFocus has detected 4 Warning Signs with QRHC. Is QRHC fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Quest Resource Holding Corp (NASDAQ:QRHC) returned to top-line revenue and adjusted EBITDA growth in Q2 2026, with revenue up 8% year-over-year and 4% sequentially. The company successfully diversified its portfolio with new customer wins in non-industrial markets, including food service, retail, and hospitality, reducing reliance on industrial sectors. Industrial volumes stabilized, with meaningful year-over-year growth from some of the largest customers, contributing approximately $3.3 million to revenue. Operational excellence initiatives drove significant cost savings, with SG&A down 11% year-over-year despite revenue growth, and a 20% reduction in SG&A for the first half of 2026. Strong cash flow generation of $4.5 million in the quarter enabled continued debt reduction, with net notes payable down $4.6 million year-to-date and $17 million over the last six quarters. The company landed nine meaningful share-of-wallet wins since the back half of 2025, including a significant win with a large national automotive-parts retailer, which are accretive to gross profit. Working capital improved, with DSOs down to roughly 70 days from mid-70s, and working capital days reduced to 5 from 12 at the end of Q1 and 19 a year ago. Gross profit dollars declined 6% year-over-year, and gross margin fell to 16.3% from 18.5%, due to margin pressure with select industrial clients. The company recorded a non-cash goodwill impairment charge of $11 million, triggered by a decline in market capitalization, which negatively impacted reported earnings. Industrial volumes remain subdued at a few select accounts compared to a few years ago, and management notes this may be the new norm. The macroeconomic environment remains complex and uneven, with renewed geopolitical risks potentially impacting operations and elongating sales cycles for new opportunities. Diesel prices have risen due to geopolitical events, and while the impact has been limited, it remains a cost pressure that could affect margins if sustained. The sales cycle for new large national brand opportunities is elongating as potential customers monitor the macroeconomic backdrop, delaying potential revenue contributions. Despite revenue growth, the company's cash position is relatively low at $1 million, though availability on the ABL facility provides some buffer. Q: Can you provide details on the recent wallet-share wins, particularly the automotive customer, and the confidence or growth in that pipeline? Are industrial expansions still possible?A: Perry Moss, CEO, noted that while they don't typically discuss individual customers, the recent share-of-wallet opportunity is a seven-figure-plus account in the commodities sector. These opportunities come in at normal margins, not the lower land-and-expand margins, and help drive incremental gross profit. He confirmed there is future growth potential with this account and possibly its competitors. While diversification is a key focus, they are still pursuing attractive industrial opportunities, with several in the pipeline. Since the back half of 2025, they have closed nine meaningful share-of-wallet opportunities, all six- or seven-figure deals, which are accretive to gross profit and easier to land due to existing trusted relationships. Q: Given the growth in new and existing business and operational initiatives, is the previous target of a 50% conversion from gross profit dollars to EBITDA still fair, or is it higher now?A: Perry Moss, CEO, stated that it is fair to assume the conversion rate is slightly higher than 50%, especially with share-of-wallet opportunities. These deals have significantly lower implementation and onboarding costs because the customers are already set up in the system, making the transition smoother. He declined to give a specific figure but affirmed the rate is higher. Q: Can you provide an update on the operational initiatives implemented over the past year and any other areas of notable focus moving forward?A: Perry Moss, CEO, explained that the focus has been on redefining and optimizing all internal processes, documenting them, and training staff to ensure standardized work. This approach increases productivity and reduces remedial work. He emphasized that tracking and measuring performance is critical for improvement, and they have implemented weekly tracking of improvement plans. The success of these initiatives is evident in the 20% reduction in SG&A for the first six months of the year compared to the prior year. Q: What were the key drivers behind the return to top-line revenue and adjusted EBITDA growth in the second quarter?A: Perry Moss, CEO, attributed the growth to a renewed sales and go-to-market effort focused on non-industrial markets and wallet-share opportunities. Over the past four quarters, they onboarded several new customers outside the industrial sector, including a food-products company, a large restaurant chain, a large retailer, and a major QSR franchisee. They also landed wallet-share gains with existing customers, including an expansion with a retail customer and the addition of several hundred locations with an automotive-services customer. In Q2 alone, they landed four new share-wallet wins, including a significant one with a large national automotive-parts retailer. Q: Can you elaborate on the financial results for the second quarter, including revenue, gross profit, and SG&A?A: Brett Johnston, CFO, reported revenue of $64.1 million, an 8% increase year-over-year and a 4% sequential increase. The growth was driven by volume improvements from certain industrial clients (adding ~$3.3 million) and new business net of attrition (~$1.2 million). Gross profit totaled $10.4 million, down 6% year-over-year but up 8% sequentially, with a gross margin of 16.3%. The year-over-year decline was due to margin pressure with select industrial clients, offset by higher margins from new wins. SG&A was $8.92 million, an 11% reduction year-over-year despite the 8% revenue growth, demonstrating productivity improvements. Q: What is the outlook for gross margins in the third quarter?A: Brett Johnston, CFO, stated that they anticipate gross margins to be flat to slightly up in the third quarter as industrial volumes ramp at a few select larger customers. He acknowledged that the macro environment remains complex and uneven, but they are focused on what they can control, such as growing in non-industrial markets, optimizing service levels, and winning incremental wallet share to offset any potential margin pressure. Q: Can you provide details on the cash flow, balance sheet, and debt reduction efforts?A: Brett Johnston, CFO, reported ending the quarter with $1 million in cash and approximately $19.4 million in availability on their ABL credit facility. Net notes payable were approximately $59.4 million, a reduction of $4.6 million year-to-date and about $17 million over the last six quarters. They delivered $4.5 million of operating cash flow in the quarter, driven by higher revenues, cost discipline, and improved billing and collections processes. This allowed them to make another voluntary $2 million early payment on their term debt with Monroe Capital. DSOs improved to roughly 70 days from the mid-70s, and working capital days improved to 5 from 12 at the end of Q1. Q: How is the company addressing the impact of rising diesel prices on its financials?A: Perry Moss, CEO, noted that despite rising diesel prices due to geopolitical events, Quest has experienced only a limited impact on its financials. He viewed this as a proof point for the resilience of their model to short-term commodity fluctuations. The company uses its scale to push back on cost increases where possible and passes through unavoidable costs to customers. Q: What is the company's stance on the stabilization of its industrial portfolio?A: Perry Moss, CEO, stated that they are cautiously optimistic that the industrial portfolio has stabilized, given the positive trends in Q2 and sequential volume improvements. However, he noted that volumes at a few select accounts remain subdued relative to a few years ago and are likely the new norm. They will continue to monitor the broader macro environment closely. Q: Can you discuss the non-cash goodwill impairment charge and its impact?A: Brett Johnston, CFO, explained that during the quarter, they incurred a non-cash goodwill impairment charge of $11 million, triggered by the decline in their market capitalization. He emphasized that the charge has no impact on their liquidity, cash flow, or compliance with their debt covenants. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Revenue of $64.1 million increased 7.6% compared to the prior year period Secured four new share-of-wallet wins, including a significant share-of-wallet win with a large national automotive parts retailer Productivity initiatives drove an 11% reduction in SG&A compared to the prior year period Strong operating cash flow of $4.5 million facilitated the voluntary reduction of $2.0 million of term debt, bringing year-to-date voluntary debt reduction to $4.0 million IRVING, Texas, Aug. 06, 2026 (GLOBE NEWSWIRE) -- Quest Resource Holding Corporation (Nasdaq: QRHC) (“Quest” or the “Company”), a national leader in environmental waste and recycling services, today announced financial results for the second quarter ended June 30, 2026. Second Quarter 2026 Highlights Revenue was $64.1 million, a 7.6% increase compared with the second quarter of 2025, and a 3.8% increase from the first quarter of 2026. Gross profit was $10.4 million, a 5.5% decrease compared with the second quarter of 2025, and a 7.9% increase from the first quarter of 2026. Gross margin was 16.3% of revenue, compared with 18.5% of revenue for the second quarter of 2025, and 15.7% of revenue for the first quarter of 2026. GAAP net loss was $(12.2) million, which included a non-cash goodwill impairment loss of $(11.0) million, compared with a net loss of $(2.0) million for the second quarter of 2025, and a net loss of $(2.3) million for the first quarter of 2026. GAAP net loss per basic and diluted share attributable to common stockholders was $(0.57), compared with $(0.09) for the second quarter of 2025 and $(0.11) for the first quarter of 2026. Adjusted EBITDA was $2.8 million, compared with $2.7 million for the second quarter of 2025 and $1.8 million for the first quarter of 2026. Recent Highlights Second quarter was driven by strong contributions from new customer wins and wallet share expansions that were onboarded during the second half of 2025 and the first quarter of 2026. Successfully launched a large franchisee customer in the quick-service restaurant industry in May with minimal start-up costs. Secured four new share-of-wallet wins, including a significant share-of-wallet win with a large national automotive parts retailer. Productivity initiatives and cost optimization drove strong operating cash flow of $4.5 million for the second quarter. Utilized funds from further progress on working capital initiatives to pay down early another $2.0 million of higher rate term debt, reducing future interest expense. “We returned to top-line and Adjusted EBITDA growth during the second quarter, both sequentially and compared to the prior year, supported by the growing contributions of recent customer wins and wallet share expansions, stabilizing volumes from our Industrial customers and achieved ongoing efficiencies across the business,” said Perry W. Moss, Quest’s Chief Executive Officer. “Looking ahead, our sales pipeline remains healthy, and we are encouraged by what appears to be a gradually improving operating landscape. We remain focused on executing our Operational Excellence initiatives to drive productivity enhancements and expect to deliver improved financial results as conditions normalize.” Brett Johnston, Quest’s Chief Financial Officer, added, “Recent customer wins and wallet share expansions delivered more meaningful margin contributions in the second quarter as the one-time start-up costs subsided late in the first quarter. Combined with our continued focus on SG&A reduction and cost optimization, which drove 100% flow through of our gross profit gains, we achieved strong sequential Adjusted EBITDA growth. These, combined with further progress on our working capital initiatives, helped generate strong operating cash flow of $4.5 million, which facilitated the reduction of our term loan balance by another $2.0 million. Our financial focus remains on cost optimization, debt reduction, and the ongoing improvement of our cash cycle.” Second Quarter 2026 Earnings Conference Call and Webcast Quest will host a conference call on Thursday, August 6, 2026, at 5:00 PM ET, to review the financial results for the second quarter ended June 30, 2026. To participate, dial 1-800-715-9871 or 1-646-307-1963 (International). The conference call, which may include forward-looking statements, is also being webcast and is available via the investor relations section of Quest’s website at https://investors.qrhc.com/. A replay of the webcast will be archived on Quest’s investor relations website for at least 90 days. About Quest Resource Holding Corporation Quest is a national provider of waste and recycling services that empower larger businesses to excel in achieving their environmental and sustainability goals and responsibilities. Quest delivers focused expertise across multiple industry sectors to build single-source, customer-specific solutions that generate quantifiable business and sustainability results. Addressing a wide variety of waste streams and recyclables, Quest provides information and data that tracks and reports the environmental results of Quest’s services, gives actionable data to improve business operations, and enables Quest’s customers to excel in their business and sustainability responsibilities. For more information, visit https://questrmg.com/. Reconciliation of U.S. GAAP to Non-GAAP Financial Measures In this press release, the non-GAAP financial measure “Adjusted EBITDA” is presented. From time-to-time, Quest considers and uses supplemental measures of operating performance in order to provide an improved understanding of underlying performance trends. Quest believes it is useful to review, as applicable, both (1) GAAP measures that include (i) depreciation and amortization, (ii) interest expense, (iii) stock-based compensation expense, (iv) income tax expense, and (v) certain other adjustments, and (2) non-GAAP measures that exclude such items. Quest presents this non-GAAP measure because it considers it an important supplemental measure of Quest's performance. Quest’s definition of this adjusted financial measure may differ from a similar measure used by others. Quest believes this measure facilitates operating performance comparisons from period to period by eliminating potential differences caused by the existence and timing of certain expense items that would not otherwise be apparent on a GAAP basis. This non-GAAP measure has limitations as an analytical tool and should not be considered in isolation or as a substitute for the Company’s GAAP measures. (See attached table “Reconciliation of Net Loss to Adjusted EBITDA”). Safe Harbor Statement This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which provides a “safe harbor” for such statements in certain circumstances. The forward-looking statements include, but are not limited to, our belief that our sales pipeline remains healthy, our expectation that the operating landscape is slowly improving, and our expectation that we will be able to deliver improved financial results as conditions normalize. Actual events or results could differ materially from those discussed in the forward-looking statements as a result of various factors, including, but not limited to, competition in the environmental services industry, the impact of the current economic environment, interruptions to supply chains, commodity price fluctuations, and extended shut down of businesses, and other factors discussed in greater detail in our filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the year ended December 31, 2025. You are cautioned not to place undue reliance on such statements and to consult our SEC filings for additional risks and uncertainties that may apply to our business and the ownership of our securities. Our forward-looking statements are presented as of the date made, and we disclaim any duty to update such statements unless required by law to do so. Investor Relations Contact: Alpha IR GroupNick Nelson or Chris [email protected] Financial Tables Follow

Quest Resource’s first quarter results were met with a negative market reaction, as revenue declined year-over-year and missed Wall Street’s expectations. Management attributed the underperformance to ongoing weakness in its industrial segment, particularly from clients in the agricultural sector experiencing lower production volumes. However, CEO Perry Moss noted that the company’s diversification into non-industrial end markets, such as restaurants and retail, partially offset these declines. Moss acknowledged, “The industrial portfolio as a whole remains challenged as a result of the softer manufacturing environment,” but highlighted improvements throughout the quarter due to new customer wins and cost control initiatives. Is now the time to buy QRHC? Find out in our full research report (it’s free). Revenue: $61.74 million vs analyst estimates of $62.2 million (9.8% year-on-year decline, 0.7% miss) EPS (GAAP): -$0.11 vs analyst estimates of -$0.10 (in line) Adjusted EBITDA: $1.79 million vs analyst estimates of $1.8 million (2.9% margin, relatively in line) Operating Margin: 0.4%, up from -3% in the same quarter last year Market Capitalization: $22.43 million While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Aaron Michael Spychalla (Craig-Hallum): Asked about the scale and ramp-up potential of the new quick-service restaurant (QSR) win. CEO Perry W. Moss explained it was a seven-figure account, covering over half the portfolio, and highlighted ample room for continued expansion. Aaron Michael Spychalla (Craig-Hallum): Inquired about the success and growth potential of the share-of-wallet initiatives. Moss detailed that the company has several major opportunities with existing customers and is seeing a robust pipeline, expecting further growth in this area. Aaron Michael Spychalla (Craig-Hallum): Sought clarification on inflation and commodity cost impacts. Moss responded that the company proactively manages vendor contracts to minimize cost pass-throughs and has not seen significant negative effects to date. Gerard J. Sweeney (ROTH Capital): Questioned the industrial segment's revenue exposure and the impact of macro recovery signals. CFO Brett W. Johnston and Moss clarified that headwinds are concentrated in a few agricultural clients and that recent volume trends are cautiously optimistic. Gerard J. Sweeney (ROTH Capital): Queried further about the QSR account’s split and service lines. Moss confirmed Quest Resource captured just over half the locations and expects similar proportions across service lines, with potential for further expansion. In the upcoming quarters, our analysts will be monitoring (1) the pace at which new non-industrial customer wins, particularly in restaurants and retail, contribute to gross profit growth, (2) the effectiveness of operational excellence initiatives in driving margin improvements and cash generation, and (3) any recovery in industrial waste volumes as manufacturing and agricultural sectors stabilize. Additionally, we will track progress on share-of-wallet expansion and continued debt reduction as key markers of strategic execution. Quest Resource currently trades at $1.08, in line with $1.08 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free for active Edge members). ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum - both boxes checked at the same time. Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks - FREE. Get Our Strong Momentum Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.

Higher sequential volumes from Industrial customers and continued growth from non-Industrial portfolio drove 5% revenue growth and 6% gross profit growth compared to prior quarter Improved revenue and gross profit performance throughout the quarter Added a large franchisee in the quick-service restaurant industry in April, which launched in May IRVING, Texas, May 07, 2026 (GLOBE NEWSWIRE) -- Quest Resource Holding Corporation (Nasdaq: QRHC) (“Quest” or the “Company”), a national leader in environmental waste and recycling services, today announced financial results for the first quarter ended March 31, 2026. First Quarter 2026 Highlights Revenue was $61.7 million, a 9.8% decrease compared with the first quarter of 2025, and a 4.8% increase from the fourth quarter of 2025. Gross profit was $9.7 million, an 11.6% decrease compared with the first quarter of 2025, and a 6.1% increase from the fourth quarter of 2025. Gross margin was 15.7% of revenue, compared with 16.0% for the first quarter of 2025, and 15.5% for the fourth quarter of 2025. GAAP net loss was $2.3 million, compared with a net loss of $10.4 million for the first quarter of 2025 (which includes a $4.4 million loss on the sale of assets and a $1.7 million impairment loss), and a net loss of $1.7 million for the fourth quarter of 2025. GAAP net loss per basic and diluted share attributable to common stockholders was $(0.11), compared with $(0.50) for the first quarter of 2025 and $(0.08) for the fourth quarter of 2025. Adjusted EBITDA was $1.8 million, compared with $1.6 million for the first quarter of 2025, and $2.1 million for the fourth quarter of 2025. Recent Highlights Successfully onboarded recent new customer wins and wallet share expansions with existing customers, all of which were fully contributing to financial results by quarter end. Added a large franchisee in the quick-service restaurant industry in April, which launched in May. Utilized recently refinanced ABL credit facility with Texas Capital Bank to pay down $2.0 million of higher rate term debt, reducing expected interest expense. “Throughout the first quarter, we experienced steady improvement, which is consistent with the seasonal acceleration,” said Perry W. Moss, Quest’s Chief Executive Officer. “Importantly, recent new customer wins and wallet share expansions with existing customers that we secured during the latter half of 2025 are now fully onboarded and finished the first quarter as full contributors to our results.” Moss added, “Our sales pipeline also remains healthy as we continue to advance meaningful opportunities for both new sales and wallet share expansions. Overall, the operating environment remains difficult, though we are cautiously optimistic given improvements achieved in the quarter, and we remain acutely focused on elements within our control.” Brett Johnston, Quest’s Chief Financial Officer, added, “Our financial strategy remains focused on managing our cost structure, leveraging our Operational Excellence initiatives to drive cash flow, and paying down debt. We’ve demonstrated a firm grasp on our operating cost structure, reducing SG&A in the first quarter by roughly 26% compared to the same quarter in the prior year and lower than the guidance provided last quarter. We simultaneously continue to seek ways to elevate our billing and collection practices, optimizing working capital and improving our cash conversion cycle in the process. Lastly, the recent refinancing of our ABL credit facility allowed us to immediately swap $2.0 million of term debt for ABL debt, reducing our interest expense, which we expect will free up additional cash to allocate toward additional debt paydown. As macroeconomic conditions improve and lend incremental visibility, we anticipate executing similar voluntary paydowns going forward as appropriate. We expect these measures, along with our focus on continuous improvement, to improve our cash cycle, strengthen our balance sheet, and provide incremental financial flexibility as the operating landscape improves.” First Quarter 2026 Earnings Conference Call and Webcast Quest will host a conference call on Thursday, May 7, 2026, at 5:00 PM ET, to review the financial results for the first quarter ended March 31, 2026. To participate, dial 1-877-270-2148 or 1-412-317-6060 (International). The conference call, which may include forward-looking statements, is also being webcast and is available via the investor relations section of Quest’s website at https://investors.qrhc.com/. A replay of the webcast will be archived on Quest’s investor relations website for at least 90 days. About Quest Resource Holding Corporation Quest is a national provider of waste and recycling services that empower larger businesses to excel in achieving their environmental and sustainability goals and responsibilities. Quest delivers focused expertise across multiple industry sectors to build single-source, customer-specific solutions that generate quantifiable business and sustainability results. Addressing a wide variety of waste streams and recyclables, Quest provides information and data that tracks and reports the environmental results of Quest’s services, gives actionable data to improve business operations, and enables Quest’s customers to excel in their business and sustainability responsibilities. For more information, visit https://questrmg.com/. Reconciliation of U.S. GAAP to Non-GAAP Financial Measures In this press release, the non-GAAP financial measure “Adjusted EBITDA” is presented. From time-to-time, Quest considers and uses supplemental measures of operating performance in order to provide an improved understanding of underlying performance trends. Quest believes it is useful to review, as applicable, both (1) GAAP measures that include (i) depreciation and amortization, (ii) interest expense, (iii) stock-based compensation expense, (iv) income tax expense, and (v) certain other adjustments, and (2) non-GAAP measures that exclude such items. Quest presents this non-GAAP measure because it considers it an important supplemental measure of Quest's performance. Quest’s definition of this adjusted financial measure may differ from a similar measure used by others. Quest believes this measure facilitates operating performance comparisons from period to period by eliminating potential differences caused by the existence and timing of certain expense items that would not otherwise be apparent on a GAAP basis. This non-GAAP measure has limitations as an analytical tool and should not be considered in isolation or as a substitute for the Company’s GAAP measures. (See attached table “Reconciliation of Net Loss to Adjusted EBITDA”). Safe Harbor Statement This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which provides a “safe harbor” for such statements in certain circumstances. The forward-looking statements include, but are not limited to, our expectation that as macroeconomic conditions improve and lend incremental visibility, we may execute similar voluntary paydowns of our debt going forward as appropriate, and our expectation that these measures, along with our focus on continuous improvement, could improve our cash cycle, strengthen our balance sheet, and provide incremental financial flexibility as the operating landscape improves. Actual events or results could differ materially from those discussed in the forward-looking statements as a result of various factors, including, but not limited to, competition in the environmental services industry, the impact of the current economic environment, interruptions to supply chains, commodity price fluctuations, and extended shut down of businesses, and other factors discussed in greater detail in our filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the year ended December 31, 2025. You are cautioned not to place undue reliance on such statements and to consult our SEC filings for additional risks and uncertainties that may apply to our business and the ownership of our securities. Our forward-looking statements are presented as of the date made, and we disclaim any duty to update such statements unless required by law to do so. Investor Relations Contact: Alpha IR Group Ryan Coleman or Nick Nelson [email protected] 312-445-2870

Waste and recycling services provider Quest Resource (NASDAQ:QRHC) missed Wall Street’s revenue expectations in Q1 CY2026, with sales falling 9.8% year on year to $61.74 million. Its GAAP loss of $0.11 per share was in line with analysts’ consensus estimates. Is now the time to buy Quest Resource? Find out in our full research report. Revenue: $61.74 million vs analyst estimates of $62.2 million (9.8% year-on-year decline, 0.7% miss) EPS (GAAP): -$0.11 vs analyst estimates of -$0.10 (in line) Adjusted EBITDA: $1.79 million vs analyst estimates of $1.8 million (2.9% margin, relatively in line) Operating Margin: 0.4%, up from -3% in the same quarter last year Market Capitalization: $23.06 million “Throughout the first quarter, we experienced steady improvement, which is consistent with the seasonal acceleration,” said Perry W. Moss, Quest’s Chief Executive Officer. Recycling corporate waste to help companies be more sustainable, Quest Resource (NASDAQ:QRHC) is a provider of waste and recycling services. A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Luckily, Quest Resource’s sales grew at an incredible 17.6% compounded annual growth rate over the last five years. Its growth beat the average industrials company and shows its offerings resonate with customers. Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Quest Resource’s recent performance marks a sharp pivot from its five-year trend as its revenue has shown annualized declines of 7.9% over the last two years. This quarter, Quest Resource missed Wall Street’s estimates and reported a rather uninspiring 9.8% year-on-year revenue decline, generating $61.74 million of revenue. Looking ahead, sell-side analysts expect revenue to grow 6.8% over the next 12 months. While this projection suggests its newer products and services will fuel better top-line performance, it is still below average for the sector. ALSO WORTH WATCHING: Nvidia’s Quiet Partner. Nvidia’s chips cost a hundred grand. The connectors that make them work cost even more. One company makes them all. Every AI server needs specialized infrastructure the chip companies don’t make. High-speed cables. Power connectors. Thermal sensors. This 90-year-old company built a monopoly on it. The AI boom just started. This stock is still flying under the radar. Claim The Stock Ticker Here for FREE. Quest Resource was profitable over the last five years but held back by its large cost base. Its average operating margin of 1% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point. Looking at the trend in its profitability, Quest Resource’s operating margin decreased by 1.4 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Quest Resource’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers. In Q1, Quest Resource’s breakeven margin was 0.4%, up 3.3 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead. We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable. Sadly for Quest Resource, its EPS declined by 35.8% annually over the last five years while its revenue grew by 17.6%. This tells us the company became less profitable on a per-share basis as it expanded. We can take a deeper look into Quest Resource’s earnings to better understand the drivers of its performance. As we mentioned earlier, Quest Resource’s operating margin expanded this quarter but declined by 1.4 percentage points over the last five years. Its share count also grew by 9.2%, meaning the company not only became less efficient with its operating expenses but also diluted its shareholders. Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business. For Quest Resource, its two-year annual EPS declines of 10.2% show it’s still underperforming. These results were bad no matter how you slice the data. In Q1, Quest Resource reported EPS of negative $0.11, up from negative $0.50 in the same quarter last year. Despite growing year on year, this print missed analysts’ estimates. We also like to analyze expected EPS growth based on Wall Street analysts’ consensus projections, but there is insufficient data. We were impressed by how significantly Quest Resource blew past analysts’ adjusted operating income expectations this quarter. On the other hand, its EPS was in line and its revenue fell slightly short of Wall Street’s estimates. Overall, this was a softer quarter. The stock traded down 4.2% to $1.04 immediately following the results. Quest Resource may have had a tough quarter, but does that actually create an opportunity to invest right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.