Arq 2025 Q3 Earnings Misses Revenue Estimates, Reports Net Loss

Arq (ARQ) reported Q3 2025 earnings on Nov 5, 2025, with revenue rising slightly to $35.07 million but missing estimates by $0.63 million. The company swung to a loss of $0.02 per share, a 150% decline from 2024’s profit. Management raised 2025 guidance, citing improved TPV growth and strategic expansion.

Revenue

Total revenue increased by 0.9% year-over-year to $35.07 million, driven by strong performance in the Powder Activated Carbon (PAC) business and initial Granular Activated Carbon (GAC) sales. However, the figure fell short of estimates by $0.63 million, reflecting ongoing challenges in scaling GAC production.

Earnings/Net Income

Arq reported a net loss of $653,000, or $0.02 per share, compared to a profit of $1.62 million ($0.04 per share) in 2024 Q3. The earnings decline was attributed to lower gross margins due to early-stage GAC production inefficiencies and higher operating costs. The EPS performance indicates a significant deterioration in profitability.

Price Action

The stock has underperformed in the short term, with a 0.94% drop on the latest trading day, a 4.65% decline over the past week, and a 9.54% slump month-to-date.

Post-Earnings Price Action Review

Arq’s stock historically showed mixed returns after quarterly revenue increases, averaging +7.8% over 30 days in the 2015–2021 period. However, the lack of recent revenue growth data for 2023–2025 limits the reliability of this strategy. Recent volatility underscores the risks of relying on earnings-driven trading without updated performance metrics.

CEO Commentary

CEO Mike Milotich highlighted 33% TPV growth and 28% net revenue growth, driven by BNPL and European expansion. He emphasized scaling bank partnerships and addressing production delays at the GAC facility. Milotich expressed confidence in achieving profitability by 2025 despite macroeconomic challenges.

Guidance

Arq raised 2025 full-year guidance to ~22% net revenue growth (from 22–24% in Q4) and ~23% gross profit growth. Q4 guidance includes 22–24% net revenue growth, though headwinds from a customer renewal and accounting policy changes are expected.

Additional News

Arq announced initial commercial GAC production at its Red River facility, a key milestone for the company. Strategic initiatives include exploring lower-moisture coal feedstock to reduce costs and diversifying into rare earth materials and synthetic graphite. Management also highlighted progress in asphalt testing and a non-binding MOU for purified coal applications, signaling long-term growth opportunities.

Backtest Limitations

A comprehensive backtest for 2023–2025 is infeasible due to missing revenue growth data beyond 2021. Historical analysis from 2015–2021 showed mixed 30-day returns, averaging +7.8%, but recent performance remains unverified. Investors should consider updated data for accurate strategy validation.