This article first appeared on GuruFocus .
Release Date: August 12, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Westport Fuel Systems Inc ( NASDAQ:WPRT ) reported strong revenue growth at its joint venture, with Q2 2026 product revenue up 127% year-over-year, driven by increased LNG truck adoption.
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The company signed a hydrogen engine development agreement with Volvo Group, which is customer-funded and validates the HPDI technology's relevance across multiple low-carbon fuels.
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Westport Fuel Systems Inc ( NASDAQ:WPRT ) completed a $10 million offering in June, strengthening its near-term liquidity and providing working capital for ongoing operations.
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The company's joint venture, Suspira, is progressing toward its 2027 breakeven target, with capital contributions decreasing and net loss improving by 65% year-over-year.
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Westport Fuel Systems Inc ( NASDAQ:WPRT ) is seeing growing market interest in its high-pressure CNG solution in North America, with positive fleet feedback and demonstrations at its Vancouver facility.
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Regulatory developments in the EU, such as the ability to generate additional CO2 credits, are creating stronger incentives for early adoption of HPDI technology, potentially boosting future demand.
Negative Points
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Westport Fuel Systems Inc ( NASDAQ:WPRT )'s high-pressure controls business saw a revenue decline in Q2 2026, down to $2.7 million from $2.9 million in Q2 2025, due to lower sales volumes.
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The company's cash position slightly decreased to $23.9 million from $24.5 million at the end of Q1, impacted by operating losses, one-time costs, and JV funding.
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The high-pressure controls segment faced production bottlenecks from relocating equipment from Europe to Canada and China, leading to a backlog of unfulfilled demand and a temporary impact on volumes.
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The hydrogen market is not growing at the rate previously expected, which could limit near-term growth opportunities for Westport Fuel Systems Inc ( NASDAQ:WPRT )'s high-pressure controls business.
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The company's warrants are accounted for as liabilities, which will be remeasured to fair value each reporting period, potentially causing earnings volatility until they are exercised or expire.
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Westport Fuel Systems Inc ( NASDAQ:WPRT ) continues to incur operating losses, and the timing of additional warrant exercise proceeds is uncertain, adding financial risk.
Q & A Highlights
Q: Can you provide more color on the tactical drivers behind the strong performance at the Suspira JV, and how should we think about future growth? A: Dan Clay (CEO): The market for the current LNG system can be broken into two chunks: the European Union and other countries. In Europe, the market is moving forward with its emission commission credit system and new mandates, with EUR7 being a big part of that for the new Volvo engine with our HPDI 3.0. The technology is proven and reliable, and now the economic solutions are becoming prevalent, driving the growth we expected. Outside the EU, Volvo is creating beachheads in South America and India. We are in 37 countries with over 12,000 trucks on the road, so adoption will continue to grow rapidly. Our plan to bring HPDI to North America with a new CNG storage system is also mission-critical.
Q: Regarding the HPDI hydrogen efforts between Suspira and Volvo, is there any requirement for Westport to fund this, or is it just between Suspira and Volvo? A: Dan Clay (CEO): It is a development contract that Volvo is funding for the development of the HPDI system for hydrogen. It is a customer-funded development program.
Q: In the high-pressure segment, you alluded to unfulfilled demand as your two locations in Canada and China ramp up. Is this just the typical ramp-up now that equipment has been moved, or is something else limiting near-term impact? A: Dan Clay (CEO): It's a combination of factors. The primary issue was the time needed to shut down, pick up the equipment, move it from Europe to Canada and China, install it, get the facilities certified, and then ramp up production. This is a typical changeover impact from transferring capital equipment, launching it, and training people, which has left us a bit behind on volume. Q1 and Q2 were transition periods, and as we go into Q3 and Q4, we are just ramping up volume to meet customer demands. We don't foresee any more roadblocks or bottlenecks to hitting the volumes in our plan.
Q: You mentioned 2027 as the target for Suspira's breakeven, and you've had two consecutive quarters of positive gross margin. Once you get to breakeven, what does that do in terms of reducing your capital contribution to the joint venture? A: Dan Clay (CEO): The moment they flip over to breakeven and don't need cash contributions, it's a huge step in the right direction for both Westport and Volvo. Volumes are up 125% over the same period last year, with strong growth in all 37 countries. With Volvo launching the new EUR7 engine combined with our new HPDI 3.0, we think the market pull will be even stronger. We originally thought it would take 3 or 4 years to get there, but with the volumes we're seeing, we're getting there sooner than expected. The contributions are really based on cash need, not fixed numbers in the agreement. Since we built out the full overhead cost structure from day one as a certified tier one, we don't need to add more as volumes scale, so we will not have the cash calls we've seen for the last 2.5 years.
Q: Can you expand on the additional work with the second potential OEM customer at Suspira and the possible timing of additional milestones? A: Dan Clay (CEO): The second OEM completed the original field trial of about 200 trucks. We are now at the stage where they are planning the second phase of their field trials, which would be much larger than the original. We are imminently awaiting to hear their planning for that, which will probably take at least another month. What we've heard so far is that phase one, the initial field trials, went extremely well.
Q: If you weren't bottlenecked on the manufacturing side for high-pressure systems, would you anticipate revenue growth in the back half of this year? A: Dan Clay (CEO): Revenue growth is going to come. We lost about 6 months in picking up the equipment, moving it, installing it, and getting the facilities recertified, so there is still a bit of backlog we're filling. The hydrogen market itself is not growing at the rate we thought a year ago, but specifically in China, as the government continues to push for rapid growth of hydrogen across mobility markets, we're going to see volume increases. In North America and Europe, we expect to get right back to plan and beat our plan this year on volume.
Q: What were the key financial highlights for the second quarter of 2026? A: Elizabeth Owen (CFO): The June financing strengthened our near-term liquidity profile. We closed the sale of 1.6 million common shares and 3.3 million pre-funded warrants in a registered direct offering, along with private placement warrants, generating gross proceeds of approximately $10 million. If the private placement warrants are exercised in full, we would receive an additional $10 million. Cash and cash equivalents stood at $23.9 million at the end of June, compared to $24.5 million at March 31, 2026. Capital contributions to Suspira decreased to $3.5 million in Q2 2026 from Q2 2025, reflecting improved financial performance. We also paid $1.0 million in debt repayments to EDC and will make our final debt repayment in Q3.
Q: How did the Suspira JV perform financially in Q2 2026? A: Elizabeth Owen (CFO): Since Suspira's beginning, we have driven quarter-over-quarter revenue growth, with Q2 2026 being the strongest at 125% compared to Q2 2025. Product revenue was up 127% to $18.9 million, aftermarket revenue was $5.5 million, and service revenue was $2.6 million. Gross profit was $3.8 million compared to a gross loss of $1.9 million in Q2 2025. Suspira had a net loss of $2.4 million, a 65% improvement over the $6.7 million loss in Q2 2025, as they meaningfully increased product revenue and lowered their cost base. One of Suspira's significant long-term engineering service revenue projects is expected to complete in Q4 2026 in advance of the anticipated launch of their EUR7 product.
Q: What were the results for the high-pressure controls business segment in Q2
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
