Sky Quarrys Earnings Big Loss Shrink, But Revenue Plummets 93%

Sky Quarry (SKYQ) reported its 2025 Q4 earnings on March 31, 2026, revealing a significant drop in revenue but a narrower net loss compared to the prior year. The company's results highlighted ongoing operational challenges and a difficult market environment, despite some progress in cost and loss management.

Revenue

Sky Quarry's total revenue for 2025 Q4 plummeted to $279,687, a 93.3% decline from $4.19 million in 2024 Q4. The sharp drop reflects continued industry headwinds, lower volumes, and weaker product pricing linked to WTI benchmarks. These factors contributed to a historically low revenue quarter, underscoring the company’s struggle to maintain consistent revenue streams amid operational disruptions and market volatility.

Earnings/Net Income

The company narrowed its net loss to $2.87 million in 2025 Q4 from $4.20 million in 2024 Q4, representing a 31.8% reduction in losses. Earnings per share (EPS) improved as well, with a loss of $0.11 per share compared to $0.22 per share in the prior year—showing a 49.2% improvement in per-share losses. Despite the reduction in losses, the company still reported a negative EPS and net income, indicating that operational challenges remain a key drag on performance. The narrowing of the loss is a positive sign, but the fundamental earnings remain weak.

Price Action

The stock price of Sky Quarry surged 481.58% month-to-date as of the reporting date, though it edged down slightly during the most recent full trading week. On the day of the earnings report, the shares climbed 8.44%, reflecting some optimism or trading activity tied to the results. However, the stock’s long-term trajectory remains uncertain given the company's financial difficulties and the broader market context.

Post-Earnings Price Action Review

The strategy of purchasing Sky Quarry shares after the revenue drop quarter-over-quarter on the financial report release date and holding for 30 days resulted in a significant loss. The strategy had a CAGR of -68.59% and an excess return of -92.03%, with a maximum drawdown of 95.59% and a Sharpe ratio of -0.30, indicating it was a high-risk strategy with substantial losses.

CEO Commentary

CEO John D. Carter, President and Chief Executive Officer, stated that the company is navigating through a difficult operating environment characterized by reduced volumes, weak pricing, and high fixed costs. While the Q4 results show some progress in reducing net losses, the business continues to face headwinds that impact revenue and profitability. Strategic investments in production capacity and operational efficiency remain a top priority, with a focus on restoring throughput and supporting long-term sustainability. Management remains cautiously optimistic about the company’s ability to stabilize operations and explore new growth opportunities in the coming quarters.

Guidance

Management outlined forward-looking expectations, guiding to continued focus on cost management and operational improvements to drive better financial performance. The company expects to maintain disciplined capital spending and is targeting increased crude purchases to boost production and throughput. While no specific quantitative targets for revenue or EPS were provided, management emphasized the importance of returning to profitability through operational optimization and market positioning.

Additional News

In the three weeks leading up to the earnings release on March 31, 2026, Sky Quarry announced several key developments. The company executed a 1-for-8 reverse stock split to support listing compliance and improve liquidity. Additionally, it launched an at-the-market (ATM) equity program to enhance access to capital and provide flexibility for future funding needs. On the operational front, management confirmed plans to implement an ECOSolv recycling retrofit at the PR Spring facility, with an estimated cost of $3.5–4.0 million. These initiatives aim to strengthen the company’s financial and environmental sustainability profile as it works toward long-term recovery and growth.