Arq's Q2 Loss Widens to $1.5M Amidst Asset Decline

TL;DR

**ARQ's Q2 results are a red flag; the widening loss and asset decline suggest a tough road ahead, so stay away.**

AI Summary

Arq, Inc. reported a net loss of $1.5 million for the three months ended June 30, 2025, a significant deterioration from the net income of $0.6 million in the prior-year period. For the six months ended June 30, 2025, the company posted a net loss of $2.5 million, compared to a net loss of $0.1 million for the same period in 2024. Total assets decreased to $105.7 million as of June 30, 2025, from $107.8 million at December 31, 2024. The company's retained earnings decreased by $2.5 million during the first six months of 2025, reflecting the net loss. Common stock remained stable at $0.1 million, while additional paid-in capital saw minor fluctuations. The company's financial position indicates ongoing challenges in achieving profitability, with a notable increase in net losses year-over-year for both the quarter and year-to-date periods.

Why It Matters

Arq's widening net loss of $1.5 million in Q2 2025 and a $2.5 million loss year-to-date signals persistent operational challenges, which could erode investor confidence and impact stock performance. For employees, continued losses might raise concerns about job security or future growth opportunities. Customers could face uncertainty regarding product development or service stability if the company's financial health deteriorates further. In a competitive landscape, Arq's struggles could allow rivals to gain market share, especially in the miscellaneous chemical products sector, making it harder for Arq to recover.

Risk Assessment

Risk Level: high — The company reported a net loss of $1.5 million for Q2 2025, a substantial decline from a $0.6 million net income in Q2 2024. Furthermore, the year-to-date net loss increased to $2.5 million in 2025 from $0.1 million in 2024, indicating a worsening financial trend and significant operational challenges.

Analyst Insight

Investors should consider divesting or avoiding ARQ shares given the accelerating net losses and declining asset base. The company's inability to achieve profitability suggests fundamental issues that may not be easily resolved in the near term.

Financial Highlights

total Assets

$105.7M

net Income

-$1.5M

Key Numbers

• $1.5M — Net Loss (Q2 2025 net loss, a significant increase from Q2 2024 net income of $0.6M)
• $2.5M — Year-to-Date Net Loss (Six months ended June 30, 2025, compared to $0.1M net loss in prior year)
• $105.7M — Total Assets (As of June 30, 2025, a decrease from $107.8M at December 31, 2024)
• $2.5M — Decrease in Retained Earnings (Reflects the net loss for the first six months of 2025)

Key Players & Entities

• Arq, Inc. (company) — filer of the 10-Q
• $1.5 million (dollar_amount) — net loss for Q2 2025
• $0.6 million (dollar_amount) — net income for Q2 2024
• $2.5 million (dollar_amount) — net loss for the six months ended June 30, 2025
• $0.1 million (dollar_amount) — net loss for the six months ended June 30, 2024
• $105.7 million (dollar_amount) — total assets as of June 30, 2025
• $107.8 million (dollar_amount) — total assets as of December 31, 2024
• June 30, 2025 (date) — end of the reporting period
• December 31, 2024 (date) — previous fiscal year-end
• Bloomberg (company) — publisher of the analysis

FAQ

Industry Context

Arq, Inc. operates in the Miscellaneous Chemical Products sector (SIC 2890). This industry can be characterized by specialized applications and services, often serving industrial clients. Competitive landscapes can vary significantly based on niche markets, technological innovation, and regulatory compliance requirements. Trends may include shifts towards more sustainable or environmentally friendly chemical solutions, and supply chain dynamics impacting raw material costs and availability.

Regulatory Implications

As a publicly traded company, Arq, Inc. is subject to SEC regulations and reporting requirements, including the timely filing of 10-Q reports. Compliance with environmental regulations related to chemical manufacturing and handling is also crucial. Any failure to meet these standards could result in fines, legal action, and reputational damage.

What Investors Should Do

1. Monitor cost management and operational efficiency.
2. Analyze the drivers of asset reduction.
3. Scrutinize the balance sheet for liquidity and solvency.
4. Seek management commentary on future outlook and turnaround strategies.

Key Dates

• 2025-06-30: Quarterly Report Filing (10-Q) — Provides interim financial performance and operational updates for the period ending June 30, 2025, including net loss of $1.5M.
• 2025-06-30: End of Second Quarter 2025 — Marks the end of the reporting period for the 10-Q, showing a year-over-year deterioration in net income to a net loss of $1.5M.
• 2025-04-01: Start of Second Quarter 2025 — Beginning of the period for which the 10-Q reports Q2 financial results.
• 2025-01-01: Start of First Six Months 2025 — Beginning of the year-to-date period reported in the 10-Q, which shows a net loss of $2.5M.
• 2024-06-30: End of Second Quarter 2024 — Prior year comparable period for Q2 2025 results, which showed a net income of $0.6M, highlighting a significant decline.
• 2024-12-31: End of Fiscal Year 2024 — Prior year-end balance sheet comparison point for total assets, which stood at $107.8M.

Glossary

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC) that provides a continuing view of the company's financial position during the year. (This document provides the detailed financial information and analysis for Arq, Inc. for the period ending June 30, 2025.)

Net Loss

The amount by which total expenses exceed total revenues over a given period. (Arq, Inc. reported a net loss of $1.5 million for Q2 2025 and $2.5 million year-to-date, indicating financial underperformance.)

Retained Earnings

The cumulative amount of net income that a company has retained over time, rather than distributing to shareholders as dividends. (The decrease of $2.5 million in retained earnings directly reflects the company's net losses during the first six months of 2025.)

Common Stock

A class of stock that represents ownership in a corporation and entitles the owner to voting rights and a share of profits. (The stable value of common stock at $0.1 million suggests no significant issuance or repurchase of shares during the period.)

Additional Paid-in Capital

The amount of capital a company receives from shareholders in exchange for stock that is above the stock's par value. (Minor fluctuations in this account may indicate small stock transactions but do not appear to be a significant driver of capital changes.)

Total Assets

The sum of all assets owned by a company, including current and non-current assets. (The decrease in total assets from $107.8 million to $105.7 million suggests a potential reduction in the company's resource base.)

Year-Over-Year Comparison

Arq, Inc. has experienced a significant financial downturn compared to the prior year. For the second quarter of 2025, the company reported a net loss of $1.5 million, a stark contrast to the $0.6 million net income in Q2 2024. This trend is also evident in the year-to-date figures, with a $2.5 million net loss for the first six months of 2025, compared to a $0.1 million net loss in the same period of 2024. Total assets have also decreased to $105.7 million as of June 30, 2025, from $107.8 million at the end of 2024, suggesting a contraction in the company's asset base.

Key Financial Figures

• $0.001 — ich registered Common stock, par value $0.001 per share ARQ Nasdaq Global Market In

Filing Documents

• ades-20250630.htm (10-Q) — 1064KB
• exhibit31120250630-10q.htm (EX-31.1) — 8KB
• exhibit31220250630-10q.htm (EX-31.2) — 8KB
• exhibit32120250630-10q.htm (EX-32.1) — 6KB
• exhibit951minesafetyq22025.htm (EX-95.1) — 16KB
• 0001515156-25-000114.txt ( ) — 6301KB
• ades-20250630.xsd (EX-101.SCH) — 40KB
• ades-20250630_cal.xml (EX-101.CAL) — 70KB
• ades-20250630_def.xml (EX-101.DEF) — 215KB
• ades-20250630_lab.xml (EX-101.LAB) — 590KB
• ades-20250630_pre.xml (EX-101.PRE) — 420KB
• ades-20250630_htm.xml (XML) — 838KB

- FINANCIAL INFORMATION

PART I. - FINANCIAL INFORMATION Item 1.

Financial Statements (unaudited)

Financial Statements (unaudited): Condensed Consolidated Balance Sheets as of June 30 , 2025 and December 31, 2024 1 Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 3 0 , 2025 and June 30 , 2024 2 Condensed Consolidated Statements of Changes in Stockholders' Equity for the Three and Six Months Ended June 30 , 2025 and June 30 , 2024 3 Condensed Consolidated Statements of Cash Flows for the S ix Months Ended June 30 , 2025 and June 30 , 2024 4 Notes to Condensed Consolidated Financial Statements 5 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 29 Item 4.

Controls and Procedures

Controls and Procedures 29

- OTHER INFORMATION

PART II. - OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 30 Item 1a.

Risk Factors

Risk Factors 30 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 30 Item 4. Mine Safety Disclosures 30 Item 5. Other Information 30 Item 6. Exhibits 31

– FINANCIAL INFORMATION

Part I. – FINANCIAL INFORMATION

Condensed Consolidated Financial Statements

Item 1. Condensed Consolidated Financial Statements Arq, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) As of (in thousands, except share data) June 30, 2025 December 31, 2024 ASSETS Current assets: Cash $ 6,957 $ 13,516 Receivables, net 15,547 14,876 Inventories, net 20,778 19,314 Prepaid expenses and other current assets 7,382 4,650 Total current assets 50,664 52,356 Restricted cash, long-term 8,467 8,719 Property, plant and equipment, net of accumulated depreciation of $ 29,622 and $ 26,619 , respectively 180,621 178,564 Other long-term assets, net 44,789 44,729 Total Assets $ 284,541 $ 284,368 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $ 15,860 $ 21,017 Revolving credit facility 18,528 13,828 Current portion of long-term debt obligations 1,430 1,624 Other current liabilities 10,350 8,184 Total current liabilities 46,168 44,653 Long-term debt obligations, net of current portion 8,741 9,370 Other long-term liabilities 12,864 13,069 Total Liabilities 67,773 67,092 Commitments and contingencies (Note 6) Stockholders' equity: Preferred stock: par value of $ 0.001 per share, 50,000,000 shares authorized, none issued or outstanding — — Common stock: par value of $ 0.001 per share, 100,000,000 shares authorized, 47,196,204 and 46,639,930 shares issued, and 42,578,058 and 42,021,784 shares outstanding at June 30, 2025 and December 31, 2024, respectively 47 47 Treasury stock, at cost: 4,618,146 and 4,618,146 shares as of June 30, 2025 and December 31, 2024, respectively ( 47,692 ) ( 47,692 ) Additional paid-in capital 199,909 198,487 Retained earnings 64,504 66,434 Total Stockholders' Equity 216,768 217,276 Total Liabilities and Stockholders' Equity $ 284,541 $ 284,368 See Notes to the Condensed Consolidated Financial Statements. 1 Arq, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended Jun

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View this 10-Q filing on SEC EDGAR