Q2 2025 Quarterhill Inc Earnings Call Transcript
Key Points
- Quarterhill Inc (QTRHF) has implemented a restructuring plan expected to save approximately $12 million annually, with benefits starting to flow through in Q3.
- The company has made significant progress in resolving two problematic contracts, reducing costs by $900,000 per month.
- Quarterhill Inc (QTRHF) continues to win new business with higher margins, adding $85 million in change orders and wins year-to-date.
- The enforcement business unit is performing well, with international wins in Djibouti, Thailand, and South Korea, reflecting global demand for their solutions.
- Quarterhill Inc (QTRHF) is investing in next-generation technology, including AI-driven solutions, to enhance operational efficiency and expand into new verticals.
- Q2 revenue was $43.1 million, with an adjusted EBITDA of negative $2.7 million, indicating financial challenges.
- The company is not in compliance with its financial covenants, leading to the reclassification of long-term debt to current liabilities.
- Gross margin percentage decreased to 15% in Q2 from 21% in the same quarter last year, primarily due to poor margins on two tolling projects.
- Operating expenses increased to $12.9 million in Q2, up from $10.8 million in the previous year, due to investments in leadership and resources.
- The company is still experiencing losses from two problematic contracts, with ongoing mediation efforts to resolve these issues.
Good morning and welcome to Quarterhill Q2 2025 Financial results conference call.
On this morning's call, we have Chuck Myers, Chief Executive Officer, and David Charron, Chief Financial Officer.
(Operator Instructions)
Earlier this morning, Quarterhill issued a news release announcing its financial results for the 3 and 6 months ended June 30, 2025. This news release, along with the company's MD&A and financial statements are available on Quarterhill's website and on Cedar Plus.
Certain matters discussed during today's conference call or answers that may be given to questions could constitute forward-looking statements.
Actual results go deeper materially from those anticipated.
Risk factors that could affect results are detailed in the company's annual information form and other public filings that are available on Cedar Plus.
During this conference call, Porter Hill will refer to adjusted EBITDA.
Adjusted EBITDA does not have any standardized meaning prescribed by IFRS.
Please refer to the company's Q2 2025 MD
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