Environmental waste treatment and services provider Perma-Fix (NASDAQ: PESI) met Wall Street’s revenue expectations in Q2 CY2026, but sales fell by 11.7% year on year to $12.89 million. Its non-GAAP loss of $0.32 per share was 3.2% below analysts’ consensus estimates.

Is now the time to buy PESI? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

Perma-Fix’s second quarter results were met with a negative market reaction, reflecting concerns about both operational execution and delayed revenue recognition. Management attributed the weaker quarter to customer-driven changes in waste treatment protocols, which shifted significant processing and associated revenue into future periods. CEO Mark Duff acknowledged, “That is not the quarter we wanted to deliver,” and cited unplanned delays in processing Hanford-related waste streams as a primary factor behind the loss. Additional contributors included late-starting service projects and a shift to lower-margin inventory waste.

Looking ahead, Perma-Fix’s forward outlook relies heavily on its role in the Department of Energy’s Hanford tank waste remediation program. Management is focused on scaling up treatment capacity and securing permit modifications to handle much larger waste volumes in the coming years. Duff stated, “We have the capacity, the permits and the balance sheet to support it,” and emphasized that the company’s facility is positioned to benefit from DOE’s dual glass-plus-grout strategy, which could significantly increase throughput and long-term revenue visibility.

Key Insights from Management’s Remarks

Management stressed that, while the quarter was financially disappointing, strategic milestones were achieved, particularly in securing a role in the Hanford tank waste cleanup initiative.

• Hanford contract milestone: Perma-Fix was awarded a master subcontract as part of the Department of Energy’s Hanford Tank Waste Operations, enabling it to support the grouting and disposal of hazardous waste over a multi-year period. This contract is structured as an Indefinite Delivery/Indefinite Quantity (IDIQ) with a ceiling shared among multiple subcontractors, but Perma-Fix’s facility is uniquely positioned adjacent to the Hanford site, offering local treatment advantages.
• Operational delays shift revenue: Customer-directed changes in treatment protocols for Hanford-related waste led to delays in processing and revenue recognition, with costs incurred in Q2 while revenue will be realized in the second half of the year. This mismatch was the primary reason for the quarter’s loss, according to management.
• Backlog and pipeline expansion: Treatment-related backlog grew by 29% during the quarter, rising from $12.2 million to $15.7 million. Management considers this increase in backlog as a leading indicator of future processing activity and revenue visibility.
• Capacity and permit upgrades: The company is advancing facility upgrades and seeking regulatory approval to expand its grouting capacity from the current 1.2 million gallons per year to potentially 9 million gallons annually by 2030. Upgrades include new mixing equipment, expanded storage, and workforce development.
• PFAS platform development: Perma-Fix continues to develop its platform for treating per- and polyfluoroalkyl substances (PFAS), a class of persistent environmental pollutants. The installation of a next-generation unit and recent contract awards from regional airports and commercial entities support a growing pipeline for PFAS destruction services.

Drivers of Future Performance

Management’s outlook hinges on ramping up Hanford waste treatment, regulatory approvals for expanded capacity, and continued progress in new services and PFAS remediation.

• Hanford throughput acceleration: The company expects volumes from the Hanford program to grow as the Department of Energy transitions to its dual glass-plus-grout strategy. This approach is designed to increase waste treatment throughput and reduce costs, with Perma-Fix named as a primary grouting provider in near-term DOE plans.
• Permit and facility expansion: A successful permit modification with the State of Washington is required to scale grouting capacity to 9 million gallons annually by 2030. Facility upgrades, including new mixers and enhanced storage, are underway, and management believes regulatory cooperation is progressing as planned.
• PFAS and services diversification: Growth in the company’s PFAS destruction platform and increased services segment backlog are expected to provide additional revenue streams and operational stability, lessening reliance on a single waste treatment contract and supporting year-over-year revenue consistency.

Catalysts in Upcoming Quarters

Going forward, our team is watching (1) regulatory progress on the Washington State permit modification for expanded grouting capacity, (2) the pace and volume of Hanford-related waste shipments as new DOE task orders are issued, and (3) the ramp-up of PFAS destruction services and their contribution to revenue stability. Execution on facility upgrades and backlog conversion will be key signposts.

Perma-Fix currently trades at $18.45, down from $19.43 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).

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