2026 Second Quarter
Filed Aug 14, 2026Filed under $STRRStar Equity Holdings Reports 2026 Second Quarter Results
Revenue and adjusted EBITDA increased year-over-year, led by Energy Services and the addition of Building Solutions, but the Company reported a larger net loss attributable to common shareholders, Business Services gross profit and adjusted EBITDA declined, Building Solutions was below expectations, and operating cash flow was negative.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $ 54,941 | – | 54.6% |
| Total cost of revenuesGAAP | $ 32,146 | – | – |
| Gross profitGAAP | $ 22,795 | – | 22.3% |
| Total operating expensesGAAP | $ 24,165 | – | – |
| Operating lossGAAP | $ (1,370) | – | – |
| Loss before income taxesGAAP | $ (1,578) | – | – |
| Provision for income taxesGAAP | 270 | – | – |
| Net lossGAAP | $ (1,848) | – | – |
| Net loss attributable to common shareholdersGAAP | $ (2,451) | – | – |
| Loss per share attributable to common shareholders, dilutedGAAP | $ (0.66) | – | – |
| Adjusted net lossnon-GAAP | $ (557) | – | – |
| Adjusted net loss per diluted sharenon-GAAP | $ (0.15) | – | – |
| Adjusted EBITDAnon-GAAP | $ 2,219 | – | – |
| Cash flow from operationsGAAP | used $1.7 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Building SolutionsMarket softness and contract timing, including revenue from one large project largely constructed in Q2 that will now be recognized mainly in Q3. | $14.6 million | – | – |
| Business ServicesAmericas gross profit grew 10%, offset by gross-profit declines of 10% in EMEA and 13% in Asia Pacific amid sustained pressure in the professional talent market. | $36.4 million | – | – |
| Energy ServicesActivity increases and new client wins in the geothermal and mining industries. | $3.9 million | – | – |
| InvestmentsNo operating driver was provided. | $ 158 | – | – |
Capital returns
- In the second quarter of 2026, the Company repurchased 15,833 shares for approximately $0.2 million.
- As of the end of the second quarter of 2026, the Company has approximately $1.6 million remaining under its $3 million repurchase program authorized in September 2025.
- Dividends declared per share of Series A Perpetual preferred stock were $ 0.25.
What drove it
- Revenue of $54.9 million increased 54.6% from the second quarter of 2025.
- Energy Services posted strong year-over-year gains in revenue, gross profit, and adjusted EBITDA, reflecting activity increases and new client wins in the geothermal and mining industries.
- Business Services revenue was $36.4 million, up from $35.5 million in the prior year quarter.
- The Company realized merger synergies of $3.0 million on an annualized basis.
- Building Solutions quarter-end backlog was $10.6 million, up from $8.0 million at Q1 2026.
Concerns
- Net loss attributable to common shareholders was $2.5 million, or $0.66 per diluted share, compared to net loss attributable to common shareholders of $0.7 million, or $0.23 per diluted share, for the second quarter of 2025.
- Building Solutions remained below expectations due to market softness and contract timing.
- Business Services gross profit was $17.8 million, down from $18.6 million a year ago, while adjusted EBITDA was $1.6 million, down from $2.2 million.
- The Company used $1.7 million in cash flow from operations during the second quarter of 2026.
- Residential and commercial construction markets remained challenging in the second quarter.
What to watch
- Recognition mainly in Q3 of revenue from one large Building Solutions project that was largely constructed in Q2.
- Building Solutions backlog of $10.6 million and trailing 12-month book-to-bill ratio of 0.77.
- Business Services performance in Asia Pacific and EMEA, where gross profit declined by 13% and 10%, respectively.
- Energy Services activity and client wins in geothermal and mining industries.
- Further merger synergies, disciplined cost management, and the active evaluation of M&A opportunities across all three operating divisions.
Balance sheet and cash flow
- Total cash including restricted cash was $8.9 million at June 30, 2026.
- Cash and cash equivalents were $ 6,834 at June 30, 2026, compared with $ 10,269 at December 31, 2025.
- Restricted cash, current was $ 1,540 at June 30, 2026, compared with $ 1,819 at December 31, 2025.
- Restricted cash, non-current was $ 551 at June 30, 2026, compared with $ 1,322 at December 31, 2025.
- Short-term debt was $ 8,962 at June 30, 2026, compared with $ 8,473 at December 31, 2025.
- Long-term debt, net of current portion was $ 5,123 at June 30, 2026, compared with $ 6,056 at December 31, 2025.
- The Company used $1.7 million in cash flow from operations during the second quarter of 2026 compared to generating $0.1 million in cash flow from operations in the second quarter of 2025.
- As of December 31, 2025, Star had $215 million of usable net operating losses in the U.S.
Analysis
Star Equity reported second-quarter revenue of $54.9 million, up 54.6% from the second quarter of 2025, and gross profit of $22.8 million, up 22.3%. The year-over-year revenue comparison includes Building Solutions and Energy Services, which did not appear in the reported 2025 consolidated quarterly statements. On a pro forma basis, total second-quarter 2025 revenue was $59.249 million and gross profit was $24.888 million, compared with reported 2026 revenue of $54.941 million and gross profit of $22.795 million.
Energy Services supplied the strongest operating momentum. The division generated $3.9 million of revenue, $1.9 million of gross profit, and $1.2 million of adjusted EBITDA, versus pro forma second-quarter 2025 revenue of $3.3 million, gross profit of $1.1 million, and adjusted EBITDA of $0.5 million. Management attributed the gains to higher activity and new geothermal and mining clients. Building Solutions reported $14.6 million of revenue, $3.2 million of gross profit, and $0.5 million of adjusted EBITDA, but management said market softness and contract timing kept the division below expectations. A large project largely constructed in Q2 is now expected to have revenue recognized mainly in Q3.
Business Services remained the largest division, with revenue of $36.4 million versus $35.5 million in the prior-year quarter. However, gross profit declined to $17.8 million from $18.6 million and adjusted EBITDA declined to $1.6 million from $2.2 million. The division invested $1.5 million in growth-related digital offerings, new geographies, and other items, compared with $0.8 million in Q2 2025. Regionally, Americas gross profit grew 10%, while EMEA and Asia Pacific gross profit declined by 10% and 13%, respectively.
Profitability remained negative on a GAAP basis. Operating loss was $1.370 million, net loss was $1.848 million, and net loss attributable to common shareholders was $2.451 million, or $0.66 per diluted share. Adjusted EBITDA increased to $2.219 million from $1.316 million, but adjusted net loss per diluted share was $0.15 compared with adjusted net income per diluted share of $0.20 in the prior-year quarter. Corporate costs were $1.7 million, up from $0.9 million in the prior-year quarter, although management said they were down $0.8 million on a pro forma basis due primarily to merger synergies.
Liquidity and capital allocation warrant attention. The Company ended the quarter with $8.9 million in total cash including restricted cash and used $1.7 million of operating cash flow, compared with generating $0.1 million in the second quarter of 2025. It repurchased 15,833 shares for approximately $0.2 million and had approximately $1.6 million remaining under its repurchase authorization. Management provided no forward financial guidance. Near-term execution will center on Q3 recognition from the delayed Building Solutions project, conversion of the $10.6 million Building Solutions backlog, Business Services regional trends, and sustained Energy Services growth.
Management, verbatim
In the second quarter, Business Services delivered modest revenue growth, with gross profit down slightly year-over-year, while Energy Services posted strong year-over-year gains in revenue, gross profit, and adjusted EBITDA, reflecting activity increases and new client wins in the geothermal and mining industries.
Jeff Eberwein, CEO of Star
HTS's revenues were up modestly year-over-year, despite continued macroeconomic uncertainty and sustained pressure in the professional talent market.
Jake Zabkowicz, Global CEO of Hudson Talent Solutions
We remain focused on disciplined execution, rigorous cost management, and returns‑driven capital allocation, including the active evaluation of M&A opportunities across all three operating divisions.
Jeff Eberwein, CEO of Star
Not in the filing
stated, not guessed- Forward revenue guidance
- Forward gross-margin guidance
- Forward operating-expense guidance
- Forward tax-rate guidance
- Prior-quarter comparisons for quarterly income-statement metrics
- Reported gross margin
- Free cash flow
- Common-stock dividend declaration
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.