Westport Fuel Systems Inc. reported a challenging second quarter for 2025, with consolidated revenue from continuing operations declining 11% year-over-year to $12.5 million, largely due to reduced volumes in its High-Pressure Controls & Systems and Heavy-Duty OEM segments. Despite this, total revenue, including discontinued operations, increased to $88.8 million, bolstered by the recent divestiture of its Light-Duty segment, which generated $62.5 million in net proceeds.
The company’s gross margin plummeted to 3% from 31%, driven by lower sales and rising material costs. Although Westport’s Cespira joint venture with Volvo showed promising growth, generating $12 million in revenue, it continues to require significant financial support. Management highlighted ongoing restructuring efforts and a strategic pivot towards high-impact commercial transportation markets, particularly in China, where over 50% of High-Pressure Controls & Systems revenue is derived.
Looking ahead, Westport aims to leverage its divestiture to enhance operational efficiency and focus on growth in the heavy-duty transportation sector, despite acknowledging ongoing funding challenges. The market’s response will hinge on the company’s ability to stabilize cash flows and capitalize on emerging opportunities in the natural gas and hydrogen markets.
Source: fool.com