Energy Recovery, Inc.ERII

Energy Recovery, Inc. Segments Disclosure

10-KFiled Feb 25, 20263 min read
Segment Reporting
The Company’s Chief Operating Decision-Maker (“CODM”) is its President and Chief Executive Officer.  The Company continues to
monitor and review its segment reporting structure in accordance with authoritative guidance to determine whether any changes have
occurred that would impact its reportable segments.Segment Definition
Income and type of expense activities that are included in the Water and Emerging Technologies segments and corporate operating
expenses are as follows:
Water segment:  The continued development, sales and support of the PX, hydraulic turbochargers and pumps used in
seawater desalination and wastewater treatment activities.
Emerging Technologies segment:  The continued development, sales and support of activities related to emerging
technologies, such as the PX G1300 used in industrial and commercial refrigeration applications.
Corporate operating expenses:  The corporate expenses include certain unallocated expenses outside of the operating
segments, such as audit and accounting services, legal services, board of director fees and expenses, human resources
activities, information systems activities and other separately managed general expenses not related to the identified
segments. 
Segment Financial Information
The CODM allocates resources to, and assesses the performance of, each operating segment using information about its revenue
and operating income.  The CODM reviews consolidated reports and analysis at the levels presented in the following tables.  In addition, the
operating income (loss) for each segment excludes other income, other expenses, and corporate operating expenses that are not included
when the CODM assesses the performance of the operating segments, such as income taxes and other separately managed expenses not
attributed to the operating segments.  Assets and liabilities are reviewed at the consolidated level by the CODM and are not attributed to the
segments. 
The following table presents a summary of the Company’s financial information by segment, including significant segment expenses,
and corporate operating expenses.
Year Ended December 31, 2025
Year Ended December 31, 2024
Year Ended December 31, 2023
Water
Emerging
Technologies
Corporate
Total
Water
Emerging
Technologies
Corporate
Total
Water
Emerging
Technologies
Corporate
Total
(In thousands)
Revenue
$134,702
$285
$—
$134,987
$144,310
$638
$—
$144,948
$127,725
$624
$—
$128,349
Cost of revenue
46,923
133
—
47,056
47,389
626
—
48,015
40,290
980
—
41,270
Gross profit
(loss)
87,779
152
—
87,931
96,921
12
—
96,933
87,435
(356)
—
87,079
Operating
expenses
General and
administrative
5,686
2,350
21,733
29,769
8,127
3,821
21,126
33,074
7,751
3,927
17,186
28,864
Sales and
marketing
13,664
5,449
1,813
20,926
15,683
7,340
2,400
25,423
13,691
6,053
2,420
22,164
Research and
development
6,344
6,690
—
13,034
4,523
11,713
—
16,236
4,251
12,750
—
17,001
Restructuring
charges
105
47
161
313
1,147
832
497
2,476
—
—
—
—
Total
operating
expenses
25,799
14,536
23,707
64,042
29,480
23,706
24,023
77,209
25,693
22,730
19,606
68,029
Operating income
(loss)
$61,980
$(14,384)
$(23,707)
$23,889
$67,441
$(23,694)
$(24,023)
$19,724
$61,742
$(23,086)
$(19,606)
$19,050
The following table presents a summary of the Company’s depreciation and amortization by segment and corporate operating
expenses.
 
Years Ended December 31,
2025
2024
2023
(In thousands)
Water
$2,788
$2,875
$2,779
Emerging Technologies
310
478
521
Corporate
662
693
802
Total depreciation and amortization
$3,760
$4,046
$4,102

Historical Timeline

Fiscal YearFiled
2025Feb 25, 2026Showing above
2024Feb 26, 2025
2023Feb 21, 2024
2022Feb 22, 2023
2021Feb 24, 2022
2020Mar 12, 2021
2019Mar 6, 2020
2018Mar 7, 2019
2017Mar 8, 2018
2016Mar 10, 2017
2015Mar 4, 2016

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Other Available Disclosures

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