DIRTT Environmental Solutions Ltd. (“DIRTT”, the “Company”, “we”, “our”, “us” or “ours”) (TSX: DRT; OTCQX: DRTTF), a leader in industrialized construction, today announced its financial results for the three and six months ended June 30, 2026. All financial information in this news release is presented in U.S. dollars, unless otherwise stated.
Second Quarter 2026 Highlights and Recent Developments
Revenue of $40.3 million in the second quarter of 2026, an increase of 4% from the second quarter of 2025.
Gross profit and gross profit margin for the second quarter of 2026 was $14.0 million or 34.7% of revenue, an increase from $10.8 million or 27.8% of revenue for the same period of 2025.
Net income after tax for the second quarter of 2026 was $1.1 million compared to net loss after tax of $6.6 million for the same period of 2025.
Adjusted EBITDA1 for the second quarter of 2026 was $4.7 million, or 11.8% of revenue, an increase of $6.8 million from $(2.0) million or (5.2%) of revenue for the second quarter of 2025. Higher Adjusted EBITDA was mainly driven by a $3.1 million increase in Adjusted Gross Profit1, offset by a decrease in operating expenses (excluding reorganization costs and stock-based compensation) of $3.5 million.
Following recent tariff revisions announced by the U.S. Government earlier in the quarter, the Company believes it is no longer subject to certain tariffs under Section 232 of the Trade Expansion Act of 1962 on steel and aluminum. We incurred $0.3 million in tariffs and related costs for the quarter ended June 30, 2026 compared to $2.0 million in the same period of 2025.
Liquidity, comprising unrestricted cash and available borrowings, was $21.5 million at June 30, 2026, compared to $32.1 million at December 31, 2025.
On February 2, 2026, the Company’s 10-week trial against Falkbuilt Ltd. (“Falkbuilt”), Messrs. Smed and Loberg and several other former DIRTT employees alleging breaches of restrictive covenants, fiduciary duties, employment duties and confidentiality commenced. DIRTT is pursuing damages and losses it suffered in Canada, the U.S., and abroad in the Court of King’s Bench of Alberta. An additional three weeks of trial began July 20, 2026.
On June 30, 2026, the Company amended the employment agreements for Scott Robinson and Adrian Zarate to extend their respective terms as Executive Chairman of the Board and Chief Transformation Officer through December 31, 2026.
Management Commentary
Benjamin Urban, chief executive officer, remarked “While uncertainty remains across certain segments of the construction industry, we believe the broader market backdrop has become more constructive than it was a year ago. Customer engagement remains active, project planning activity continues to advance, and we are seeing greater alignment around project schedules and execution timelines. We remain focused on strengthening pipeline quality and forecasting discipline, enhancing commercial execution, and continuing to advance our streamlined operating model through the Transformation Office. Together, these efforts position DIRTT to drive sustainable growth and create long-term value for shareholders, partners, and employees.”
Fareeha Khan, chief financial officer, added “During the second quarter, we continued to make progress on our transformation initiatives while maintaining a strong liquidity position and disciplined cost management. Based on our performance to date and current expectations for project timing and revenue conversion, we are updating our 2026 outlook to revenue of $175.0 million to $185.0 million and Adjusted EBITDA (see “– Non-GAAP Financial Measures”) of $21.0 million to $25.0 million. Despite the revised outlook, we remain confident in the underlying health of the business and our ability to drive further operational improvements, support profitability, and create long-term value for shareholders.”
Outlook
As we progress through the back-half of 2026, DIRTT continues to build on the operational and commercial improvements achieved over the past eighteen months. While customer decision-making timelines remain measured in certain markets, we are seeing increased consistency in project qualification, stronger alignment between commercial activity and forecasted revenue opportunities, and improved visibility into the timing of potential project awards. We believe these trends reflect the progress achieved through our transformation initiatives and provide a stronger foundation for disciplined execution.
Our commercial activity continues to support confidence in the business. While our twelve-month forward opportunity set has moderated from the beginning of the year, this reflects deliberate efforts to improve qualification standards, strengthen forecasting discipline, and prioritize opportunities that align with our strategic and financial objectives. We believe these actions have improved the overall quality of opportunities being pursued and enhanced visibility into future demand.
Construction Services continues to evolve as an important component of our commercial strategy and remains a meaningful contributor to business development activity. Compared to traditional product-led opportunities, Construction Services engagements are generally supported by contractual arrangements that provide greater visibility once awarded and can contribute to more predictable revenue realization. As this channel matures, we expect it to further strengthen market coverage and anticipate changes to our project execution practices to improve margin and broaden our ability to serve customers.
We continue to execute our transformation initiatives, including process standardization, cost optimization, partner enablement, and enhancements to our commercial organization. Targeted investments in leadership, organizational capability, and go-to-market effectiveness are strengthening commercial execution and supporting more efficient conversion of opportunities into revenue. Collectively, these efforts are enhancing organizational effectiveness and positioning the Company to drive sustainable, profitable growth.
With a strong liquidity position, improving commercial discipline, and a streamlined operating model, DIRTT remains focused on disciplined execution and long-term value creation for shareholders, partners, and employees.
Financial Guidance
We are downgrading the initial 2026 guidance communicated earlier this year to:
2026 Revenue: $175.0 - $185.0 million
2026 Adjusted EBITDA: $21.0 - $25.0 million
This updated guidance reflects management’s current assessment of macroeconomic conditions and underlying business fundamentals and incorporates tariff impacts and recent increases in raw material and oil prices arising from geopolitical developments, including the Iran war. Changes in trade policy, tariffs, input costs, or demand and project timing may impact future results. The Company will update guidance if and when such impacts become quantifiable.
Conference Call and Webcast Details
A conference call and webcast for the investment community is scheduled for July 30, 2026 at 08:00 a.m. MDT (10:00 a.m. EDT). The call and webcast will be hosted by Benjamin Urban, chief executive officer, and Fareeha Khan, chief financial officer.
The call is being webcast live on the Company’s website at dirtt.com.
A webcast replay of the call will be available on DIRTT’s website. Click here to listen to the live webcast of the call. Following the presentation, DIRTT will take questions from covering analysts. To participate in the question-and-answer session, register here.
Special Note Regarding Forward-Looking Statements
Certain statements contained in this news release are “forward-looking statements” within the meaning of “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934 and “forward-looking information” within the meaning of applicable Canadian securities laws. All statements, other than statements of historical fact included in this news release, regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this news release, the words “anticipate,” “believe,” “expect,” “estimate,” “intend,” “plan,” “project,” “outlook,” “may,” “will,” “should,” “would,” “could,” “can,” “continue,” the negatives thereof, variations thereon and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. In particular and without limitation, this news release contains forward-looking information pertaining to proposed financings and the terms, timing and use of proceeds thereof; the effect of our Transformation Office on our business and the timing thereof; the benefit of fixed cost leverage; the effect of our strategic priorities on increasing value creation; the impacts of macroeconomic conditions on the Company’s business; the Company’s pipeline; forecast operating and financial results and the impact of certain cost-saving measures; the competitiveness of the Company’s solutions; the liquidity and capital resources of the Company; the outcome and effects that current claims and litigation against the Company; financial condition, results of operations and growth prospects; the effect of tariffs and economic uncertainty on our business, including on our 2026 guidance, and our ability to mitigate any such effects and timing thereof; our 2026 guidance including with respect to revenue and Adjusted EBITDA, and the timing thereof; project demand and delivery and the timing thereof; capital expenditures and allocation; general economic conditions; our ability to weather economic conditions; the effects and benefits of DIRTT’s tariff response; DIRTT’s ability to convert its pipeline into revenue; and DIRTT’s ability to support its partners, grow its business and invest in long-term growth. Forward-looking statements are based on certain estimates, beliefs, expectations, and assumptions made in light of management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors that may be appropriate. Forward-looking statements necessarily involve unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from those contained in, or expressed or implied by such statements. Due to the risks, uncertainties, and assumptions inherent in forward-looking information, you should not place undue reliance on forward-looking statements. Factors that could have a material adverse effect on our business, financial condition, results of operations and growth prospects include, but are not limited to, risks described under the sections titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission and applicable securities commissions or similar regulatory authorities in Canada on February 25, 2026 (our “2025 Annual Report”). Information in this news release regarding the Company’s financial performance targets may also constitute a financial outlook within the meaning of applicable securities laws and provides information as to management's expectation as to DIRTT’s financial performance. Readers are cautioned that the financial outlook may not be appropriate for other purposes. Our past results of operations are not necessarily indicative of our future results. You should not place undue reliance on any forward-looking statements, which represent our beliefs, assumptions and estimates only as of the dates on which they were made, as predictions of future events. We undertake no obligation to update these forward-looking statements, even though circumstances may change in the future, except as required under applicable securities laws. We qualify all of our forward-looking statements by these cautionary statements.
About DIRTT
DIRTT is a leader in industrialized construction. DIRTT’s system of physical products and digital tools empowers organizations, together with construction and design leaders, to build high-performing, adaptable, interior environments. Operating in the workplace, healthcare, education, and public sector markets, DIRTT’s system provides total design freedom, and greater certainty in cost, schedule, and outcomes. DIRTT’s interior construction solutions are designed to be highly flexible and adaptable, enabling organizations to easily reconfigure their spaces as their needs evolve. Headquartered in Calgary, AB Canada, DIRTT trades on the Toronto Stock Exchange under the symbol “DRT” and on the OTCQX under the symbol “DRTTF”.
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