Energy Recovery (ERII) 10-Q 30 Oct 24 2024 Q3 Quarterly report Financial data

Cover Page

Cover Page - shares	9 Months Ended
	Sep. 30, 2024	Oct. 24, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-34112
Entity Registrant Name	Energy Recovery, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	01-0616867
Entity Address, Address Line One	1717 Doolittle Drive
Entity Address, City or Town	San Leandro
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94577
City Area Code	510
Local Phone Number	483-7370
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	ERII
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		57,893,899
Entity Central Index Key	0001421517
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q3
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 63,261	$ 68,098
Short-term investments	55,364	40,445
Accounts receivable, net	31,845	46,937
Inventories, net	33,464	26,149
Prepaid expenses and other assets	5,980	3,843
Total current assets	189,914	185,472
Long-term investments	21,286	13,832
Deferred tax assets, net	11,029	10,324
Property and equipment, net	16,352	18,699
Operating lease, right of use asset	10,152	11,469
Goodwill	12,790	12,790
Other assets, non-current	1,182	388
Total assets	262,705	252,974
Current liabilities:
Accounts payable	3,414	3,000
Accrued expenses and other liabilities	10,524	15,583
Lease liabilities	1,964	1,791
Contract liabilities	2,969	1,097
Total current liabilities	18,871	21,471
Lease liabilities, non-current	9,861	11,488
Other liabilities, non-current	100	207
Total liabilities	28,832	33,166
Commitments and contingencies (Note 7)
Stockholders’ equity:
Common stock	66	65
Additional paid-in capital	231,909	217,617
Accumulated other comprehensive income (loss)	149	(44)
Treasury stock	(80,486)	(80,486)
Retained earnings	82,235	82,656
Total stockholders’ equity	233,873	219,808
Total liabilities and stockholders’ equity	$ 262,705	$ 252,974

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Statement [Abstract]
Revenue	$ 38,584	$ 37,036	$ 77,873	$ 71,160
Cost of revenue	13,472	11,154	28,060	23,580
Gross profit	25,112	25,882	49,813	47,580
Operating expenses:
General and administrative	7,673	7,369	24,771	21,704
Sales and marketing	6,413	5,411	18,669	15,397
Research and development	3,969	3,969	12,264	12,043
Total operating expenses	18,055	16,749	55,704	49,144
Income (loss) from operations	7,057	9,133	(5,891)	(1,564)
Other income (expense):
Interest income	1,711	1,083	4,816	2,486
Other non-operating income (expense), net	57	(38)	(45)	(129)
Total other income, net	1,768	1,045	4,771	2,357
Income (loss) before income taxes	8,825	10,178	(1,120)	793
Provision for (benefit from) income taxes	344	518	(699)	(906)
Net income (loss)	$ 8,481	$ 9,660	$ (421)	$ 1,699
Net income (loss) per share:
Basic (in dollars per share)	$ 0.15	$ 0.17	$ (0.01)	$ 0.03
Diluted (in dollars per share)	$ 0.15	$ 0.17	$ (0.01)	$ 0.03
Number of shares used in per share calculations:
Basic (in shares)	57,756	56,443	57,409	56,346
Diluted (in shares)	58,290	57,969	57,409	57,761

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 8,481	$ 9,660	$ (421)	$ 1,699
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments	(94)	(2)	(57)	95
Unrealized gain (loss) on investments	304	(54)	250	71
Total other comprehensive income (loss), net of tax	210	(56)	193	166
Comprehensive income (loss)	$ 8,691	$ 9,604	$ (228)	$ 1,865

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands	Total	Common stock	Additional paid-in capital	Accumulated other comprehensive income (loss)	Treasury stock	Retained earnings
Beginning balance at Dec. 31, 2022		$ 64	$ 204,957	$ (349)	$ (80,486)	$ 61,152
Beginning balance (in shares) at Dec. 31, 2022		64,225,391
Beginning balance, treasury stock (in shares) at Dec. 31, 2022					8,148,512
Increase (Decrease) in Stockholders' Equity
Issuance of common stock, net		$ 1	1,183
Issuance of common stock, net (in shares)		427,669
Stock-based compensation			5,642
Foreign currency translation adjustments				95
Unrealized gain (loss) on investments				71
Total other comprehensive income (loss), net of tax	$ 166			166
Net (loss) income	1,699					1,699
Ending balance, treasury stock (in shares) at Sep. 30, 2023					8,148,512
Ending balance at Sep. 30, 2023	$ 194,029	$ 65	211,782	(183)	$ (80,486)	62,851
Ending balance (in shares) at Sep. 30, 2023	56,504,548	64,653,060
Beginning balance at Jun. 30, 2023		$ 65	209,139	(127)	$ (80,486)	53,191
Beginning balance (in shares) at Jun. 30, 2023		64,553,969
Beginning balance, treasury stock (in shares) at Jun. 30, 2023					8,148,512
Increase (Decrease) in Stockholders' Equity
Issuance of common stock, net			805
Issuance of common stock, net (in shares)		99,091
Stock-based compensation			1,838
Foreign currency translation adjustments				(2)
Unrealized gain (loss) on investments				(54)
Total other comprehensive income (loss), net of tax	$ (56)			(56)
Net (loss) income	9,660					9,660
Ending balance, treasury stock (in shares) at Sep. 30, 2023					8,148,512
Ending balance at Sep. 30, 2023	$ 194,029	$ 65	211,782	(183)	$ (80,486)	62,851
Ending balance (in shares) at Sep. 30, 2023	56,504,548	64,653,060
Beginning balance at Dec. 31, 2023	$ 219,808	$ 65	217,617	(44)	$ (80,486)	82,656
Beginning balance (in shares) at Dec. 31, 2023		65,029,459
Beginning balance, treasury stock (in shares) at Dec. 31, 2023					8,148,512
Increase (Decrease) in Stockholders' Equity
Issuance of common stock, net		$ 1	5,794
Issuance of common stock, net (in shares)		1,001,128
Stock-based compensation			8,498
Foreign currency translation adjustments				(57)
Unrealized gain (loss) on investments				250
Total other comprehensive income (loss), net of tax	193			193
Net (loss) income	(421)					(421)
Ending balance, treasury stock (in shares) at Sep. 30, 2024					8,148,512
Ending balance at Sep. 30, 2024	$ 233,873	$ 66	231,909	149	$ (80,486)	82,235
Ending balance (in shares) at Sep. 30, 2024	57,882,075	66,030,587
Beginning balance at Jun. 30, 2024		$ 66	225,240	(61)	$ (80,486)	73,754
Beginning balance (in shares) at Jun. 30, 2024		65,571,275
Beginning balance, treasury stock (in shares) at Jun. 30, 2024					8,148,512
Increase (Decrease) in Stockholders' Equity
Issuance of common stock, net			4,293
Issuance of common stock, net (in shares)		459,312
Stock-based compensation			2,376
Foreign currency translation adjustments				(94)
Unrealized gain (loss) on investments				304
Total other comprehensive income (loss), net of tax	$ 210			210
Net (loss) income	8,481					8,481
Ending balance, treasury stock (in shares) at Sep. 30, 2024					8,148,512
Ending balance at Sep. 30, 2024	$ 233,873	$ 66	$ 231,909	$ 149	$ (80,486)	$ 82,235
Ending balance (in shares) at Sep. 30, 2024	57,882,075	66,030,587

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities:
Net (loss) income	$ (421)	$ 1,699
Adjustments to reconcile net (loss) income to cash provided by (used in) operating activities
Stock-based compensation	8,512	5,811
Depreciation and amortization	3,050	3,075
Right of use asset amortization	1,317	1,223
Accretion (amortization) of discounts (premiums) on investments	(1,049)	(613)
Deferred income taxes	(705)	(920)
Other non-cash adjustments	307	241
Changes in operating assets and liabilities:
Accounts receivable, net	15,060	10,756
Contract assets	(882)	1,720
Inventories, net	(7,686)	(5,745)
Prepaid and other assets	(2,159)	(1,292)
Accounts payable	879	1,043
Accrued expenses and other liabilities	(6,467)	(4,966)
Contract liabilities	1,811	240
Net cash provided by operating activities	11,567	12,272
Cash flows from investing activities:
Sales of marketable securities	0	2,966
Maturities of marketable securities	59,423	58,705
Purchases of marketable securities	(80,490)	(78,949)
Capital expenditures	(1,194)	(1,179)
Proceeds from sales of fixed assets	90	82
Net cash used in investing activities	(22,171)	(18,375)
Cash flows from financing activities:
Net proceeds from issuance of common stock	5,795	1,184
Net cash provided by financing activities	5,795	1,184
Effect of exchange rate differences on cash and cash equivalents	(23)	27
Net change in cash, cash equivalents and restricted cash	(4,832)	(4,892)
Cash, cash equivalents and restricted cash, beginning of year	68,225	56,458
Cash, cash equivalents and restricted cash, end of period	$ 63,393	$ 51,566

Description of Business and Sig

Description of Business and Significant Accounting Policies	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Description of Business and Significant Accounting Policies	Description of Business and Significant Accounting Policies Energy Recovery, Inc. and its wholly-owned subsidiaries (the “Company” or “Energy Recovery”) designs and manufactures reliable, high-performance solutions that provide cost savings through improved energy efficiency in commercial and industrial processes, with applications across several industries . Leveraging the Company’s pressure exchanger technology, which generates little to no emissions when operating , the Company believes its solutions lower costs, save energy, reduce waste, and minimize emissions for companies across a variety of commercial and industrial processes . As the world coalesces around the urgent need to address climate change and its impacts, the Company is helping companies reduce their energy consumption in their industrial processes, which in turn, reduces their carbon footprint. The Company believes that its customers do not have to sacrifice quality and cost savings for sustainability and the Company is committed to developing solutions that drive long-term value – both financial and environmental . The Company’s solutions are marketed, sold in, and developed for, the fluid-flow and gas markets, such as seawater and wastewater desalination, natural gas, chemical processing and CO 2 -based refrigeration systems, under the trademarks ERI ® , PX ® , Pressure Exchanger ® , PX ® Pressure Exchanger ® (“PX”), Ultra PX ™ , PX G ™ , PX G1300 ™ , PX PowerTrain ™ , AT ™ , and Aquabold ™ . The Company owns, manufactures and/or develops its solutions, in whole or in part, in the United States of America (the “U.S.”) . Basis of Presentation The Condensed Consolidated Financial Statements include the accounts of Energy Recovery, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying Condensed Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “ SEC ”). Certain information and footnote disclosures normally included in the financial statements prepared in accordance with U.S. generally accepted accounting principles (“ GAAP ”) have been condensed or omitted pursuant to such rules and regulations. The December 31, 2023 Condensed Consolidated Balance Sheet was derived from audited financial statements and may not include all disclosures required by GAAP; however, the Company believes that the disclosures are adequate to make the information presented not misleading. The September 30, 2024 unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto for the fiscal year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 21, 2024 (the “ 2023 Annual Report ”). The results of operations for the interim periods are not necessarily indicative of the operating results for the full fiscal year or any future periods Reclassifications Certain prior period amounts have been reclassified in certain notes to the Condensed Consolidated Financial Statements to conform to the current period presentation. Use of Estimates The preparation of Condensed Consolidated Financial Statements, in conformity with GAAP , requires the Company’s management to make judgments, assumptions and estimates that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. The accounting policies that reflect the Company’s significant estimates and judgments and that the Company believes are the most critical to aid in fully understanding and evaluating its reported financial results are revenue recognition; granted equity award valuations; equipment useful life and valuation; goodwill valuation and impairment; deferred taxes and valuation allowances on deferred tax assets; and evaluation and measurement of contingencies . Those estimates could change, and as a result, actual results could differ materially from those estimates. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of October 30, 2024 , the date of issuance of this Quarterly Report on Form 10-Q . These estimates may change, as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. The Company undertakes no obligation to publicly update these estimates for any reason after the date of this Quarterly Report on Form 10-Q , except as required by law. Significant Accounting Policies There have been no material changes to the Company’s significant accounting policies in Note 1, “ Description of Business and Significant Accounting Policies - Significant Accounting Policies ,” of the Notes to Consolidated Financial Statements included in Item 8, “Financial Statements and Supplementary Data,” of the 2023 Annual Report . Recently Issued Accounting Pronouncement Not Yet Adopted There have been no issued accounting pronouncements that have not yet been adopted during the nine months ended September 30, 2024 that apply to the Company other than the pronouncements disclosed in Note 1, “ Description of Business and Significant Accounting Policies - Recently Issued Accounting Pronouncement Not Yet Adopted ,” of the Notes to Consolidated Financial Statements included in Item 8, “Financial Statements and Supplementary Data,” of the 2023 Annual Report .

Revenue

Revenue	9 Months Ended
	Sep. 30, 2024
Revenue from Contract with Customer [Abstract]
Revenue	Revenue Disaggregation of Revenue The following table s present the disaggregated revenues by segment, and within each segment, by geographical market based on the customer “shipped to” address, and by channel customers. Sales and usage-based taxes are excluded from revenues. See Note 9 , “ Segment Reporting ,” for further discussion related to the Company’s segments. Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Geographical market Middle East and Africa $ 28,043 $ 153 $ 28,196 $ 47,295 $ 399 $ 47,694 Asia 6,829 — 6,829 16,770 36 16,806 Americas 1,051 — 1,051 6,957 — 6,957 Europe 2,421 87 2,508 6,329 87 6,416 Total revenue $ 38,344 $ 240 $ 38,584 $ 77,351 $ 522 $ 77,873 Channel Megaproject $ 29,009 $ — $ 29,009 $ 48,924 $ — $ 48,924 Original equipment manufacturer 4,832 87 4,919 15,087 123 15,210 Aftermarket 4,503 153 4,656 13,340 399 13,739 Total revenue $ 38,344 $ 240 $ 38,584 $ 77,351 $ 522 $ 77,873 Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Geographical market Middle East and Africa $ 24,543 $ — $ 24,543 $ 38,272 $ 108 $ 38,380 Asia 5,688 — 5,688 19,180 — 19,180 Americas 5,091 123 5,214 9,628 153 9,781 Europe 1,490 101 1,591 3,542 277 3,819 Total revenue $ 36,812 $ 224 $ 37,036 $ 70,622 $ 538 $ 71,160 Channel Megaproject $ 26,829 $ — $ 26,829 $ 42,283 $ — $ 42,283 Original equipment manufacturer 5,083 224 5,307 16,415 430 16,845 Aftermarket 4,900 — 4,900 11,924 108 12,032 Total revenue $ 36,812 $ 224 $ 37,036 $ 70,622 $ 538 $ 71,160 Contract Balances The following table presents contract balances by category. September 30, 2024 December 31, 2023 (In thousands) Accounts receivable, net $ 31,845 $ 46,937 Contract assets: Contract assets, current (included in prepaid expenses and other assets) $ 685 $ 592 Contract assets, non-current (included in other assets, non-current) 789 — Total contract assets $ 1,474 $ 592 Contract liabilities: Contract liabilities, current $ 2,969 $ 1,097 Contract liabilities, non-current (included in other liabilities, non-current) 29 90 Total contract liabilities $ 2,998 $ 1,187 Contract Liabilities The Company records contract liabilities, which consist of customer deposits and deferred revenue, when cash payments are received in advance of the Company’s performance. The following table presents changes in contract liabilities during the period. September 30, 2024 December 31, 2023 (In thousands) Contract liabilities, beginning of year $ 1,187 $ 1,316 Revenue recognized (1,063) (1,254) Cash received, excluding amounts recognized as revenue during the period 2,874 1,125 Contract liabilities, end of period $ 2,998 $ 1,187 Remaining Performance Obligations As of September 30, 2024 , t he following table presents the revenue that is expected to be recognized related to performance obligations that are unsatisfied or partially unsatisfied. Period Remaining Performance Obligations (In thousands) 2024 (remaining three months) $ 198 2025 6,957 2026 3,419 Total $ 10,574

Net Income (Loss) Per Share

Net Income (Loss) Per Share	9 Months Ended
	Sep. 30, 2024
Earnings Per Share [Abstract]
Net Income (Loss) Per Share	Net Income (Loss) Per Share Net income (loss) for the reported period is divided by the weighted average number of basic and diluted common shares outstanding during the reported period to calculate the basic and diluted net income (loss) per share , respectively. Outstanding stock options to purchase common shares and unvested restricted stock units (“RSUs”) are collectively referred to as “equity awards.” • Basic net income (loss) per share is computed using the weighted average number of common shares outstanding during the period . • Diluted net income (loss) per share is computed using the weighted average number of common and potentially dilutive shares outstanding during the period, using the treasury stock method. Any anti-dilutive effect of equity awards outstanding is not included in the computation of diluted net income (loss) per share . The following tables present the computation of basic and diluted net income (loss) per share . Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands, except per share amounts) Numerator Net income (loss) $ 8,481 $ 9,660 $ (421) $ 1,699 Denominator (weighted average shares) Basic common shares outstanding 57,756 56,443 57,409 56,346 Options 316 1,236 — 1,155 RSUs 218 290 — 260 Diluted common shares outstanding 58,290 57,969 57,409 57,761 Net income (loss) per share Basic $ 0.15 $ 0.17 $ (0.01) $ 0.03 Diluted $ 0.15 $ 0.17 $ (0.01) $ 0.03 The following tables present the equity awards that are excluded from diluted net income (loss) per share because their effect would have been anti-dilutive. Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands) Anti-dilutive equity award shares 1,077 125 2,876 126

Other Financial Information

Other Financial Information	9 Months Ended
	Sep. 30, 2024
Other Financial Information [Abstract]
Other Financial Information	Other Financial Information Cash, Cash Equivalents and Restricted Cash The Condensed Consolidated Statements of Cash Flows explain the changes in the total of cash, cash equivalents and restricted cash, such as cash amounts deposited in restricted cash accounts in connection with the Company’s credit cards. The following table presents a reconciliation of cash, cash equivalents and restricted cash, reported for each period within the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Cash Flows that sum to the total of such amounts. September 30, 2024 December 31, 2023 September 30, 2023 (In thousands) Cash and cash equivalents $ 63,261 $ 68,098 $ 51,440 Restricted cash, non-current (included in other assets, non-current) 132 127 126 Total cash, cash equivalents and restricted cash $ 63,393 $ 68,225 $ 51,566 Accounts Receivable, net September 30, 2024 December 31, 2023 (In thousands) Accounts receivable, gross $ 32,015 $ 47,075 Allowance for doubtful accounts (170) (138) Accounts receivable, net $ 31,845 $ 46,937 Inventories, net Inventory amounts are stated at the lower of cost or net realizable value, using the first-in, first-out method. September 30, 2024 December 31, 2023 (In thousands) Raw materials $ 8,731 $ 8,752 Work in process 6,929 5,234 Finished goods 18,990 13,319 Inventories, gross 34,650 27,305 Valuation adjustments for excess and obsolete inventory (1,186) (1,156) Inventories, net $ 33,464 $ 26,149 Goodwill Goodwill is tested for impairment annually in the third quarter of the Company’s fiscal year or more frequently if indicators of potential impairment exist. The Company monitors the industries in which it operates and reviews its business performance for indicators of potential impairment. The recoverability of goodwill is measured at the reporting unit level, which represents the operating segment. The carrying amount of goodwill as of September 30, 2024 and December 31, 2023 was $12.8 million . On July 1, 2024 , the Company estimated the fair value of its reporting units using the discounted cash flow approach and market approach. The forecast of future cash flows, which is based on the Company’s best estimate of future net sales and operating expenses, is based primarily on expected category expansion, pricing, market segment, and general economic conditions . The Company incorporates other significant inputs to its fair value calculations, including discount rate and market multiples, to reflect current market conditions. As a result, the analysis performed indicated that the fair value of each reporting unit, that is allocated goodwill, significantly exceeds its carrying value, and therefore, no impairment charges were recorded. Accrued Expenses and Other Liabilities September 30, 2024 December 31, 2023 (In thousands) Accrued expenses and other liabilities, current Payroll, incentives and commissions payable $ 7,134 $ 11,037 Warranty reserve 983 1,057 Other accrued expenses and other liabilities 2,407 3,489 Total accrued expenses and other liabilities 10,524 15,583 Other liabilities, non-current 100 207 Total accrued expenses, and current and non-current other liabilities $ 10,624 $ 15,790

Investments and Fair Value Meas

Investments and Fair Value Measurements	9 Months Ended
	Sep. 30, 2024
Investments, Fair Value Disclosure [Abstract]
Investments and Fair Value Measurements	Investments and Fair Value Measurements Fair Value of Financial Instruments The following table presents the Company’s financial assets measured on a recurring basis by contractual maturity, including pricing category, amortized cost, gross unrealized gains and losses, and fair value. As of the dates reported in the table, the Company had no financial liabilities and no Level 3 financial assets. September 30, 2024 December 31, 2023 Pricing Category Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (In thousands) Cash equivalents Money market securities Level 1 $ 13,653 $ — $ — $ 13,653 $ 18,767 $ — $ — $ 18,767 U.S. treasury securities Level 2 11,449 2 — 11,451 — — — — Total cash equivalents 25,102 2 — 25,104 18,767 — — 18,767 Short-term investments U.S. treasury securities Level 2 17,233 78 — 17,311 4,900 1 (1) 4,900 Corporate notes and bonds Level 2 32,408 65 (2) 32,471 25,674 11 (18) 25,667 Municipal and agency notes and bonds Level 2 5,584 — (2) 5,582 9,887 — (9) 9,878 Total short-term investments 55,225 143 (4) 55,364 40,461 12 (28) 40,445 Long-term investments Corporate notes and bonds Level 2 18,307 179 — 18,486 9,229 28 (3) 9,254 Municipal and agency notes and bonds Level 2 2,798 2 — 2,800 4,585 — (7) 4,578 Total long-term investments 21,105 181 — 21,286 13,814 28 (10) 13,832 Total short and long-term investments 76,330 324 (4) 76,650 54,275 40 (38) 54,277 Total $ 101,432 $ 326 $ (4) $ 101,754 $ 73,042 $ 40 $ (38) $ 73,044 The following table presents a summary of the fair value and gross unrealized losses on the available-for-sale securities that have been in a continuous unrealized loss position, aggregated by type of investment instrument. The available-for-sale securities that were in an unrealized gain position have been excluded from the table. September 30, 2024 December 31, 2023 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (In thousands) U.S. treasury securities $ — $ — $ 2,931 $ (1) Corporate notes and bonds 2,492 (2) 15,276 (21) Municipal and agency notes and bonds 5,582 (2) 12,956 (16) Total available-for-sale investments with unrealized loss positions $ 8,074 $ (4) $ 31,163 $ (38) Sales of Available-for-Sale Investments The following table presents the sales of available-for-sale investments. Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands) Corporate notes and bonds $ — $ — $ — $ 2,966 Realized losses on sales of securities were immaterial during the three and nine months ended September 30, 2024 and 2023.

Lines of Credit

Lines of Credit	9 Months Ended
	Sep. 30, 2024
Debt Disclosure [Abstract]
Lines of Credit	Lines of Credit Credit Agreement The Company entered into a credit agreement with JPMorgan Chase Bank, N.A. (“ JPMC ”) on December 22, 2021 (as amended, the “ Credit Agreement ”). The Credit Agreement , which will expire on December 21, 2026 , provides a committed revolving credit line of $50.0 million and includes both a revolving loan and a letters of credit (“ LCs ”) component. Under the Credit Agreement , as of September 30, 2024 , there were no revolving loans outstanding. In addition, under the LCs component, the Company utilized $18.4 million of the maximum allowable credit line of $30.0 million , which includes newly issued LCs , and previously issued and unexpired stand-by letters of credit (“SBLCs”) and certain non-expired commitments under the Company’s previous Loan and Pledge Agreement with Citibank, N.A. which are guaranteed under the Credit Agreement . Letters of Credit The following table presents the total outstanding LCs and SBLCs issued by the Company to its customers related to product warranty and performance guarantees . September 30, 2024 December 31, 2023 (In thousands) Outstanding letters of credit $ 17,398 $ 19,945

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Litigation From time-to-time, the Company has been named in and subject to various proceedings and claims in connection with its business. The Company may in the future become involved in litigation in the ordinary course of business, including litigation that could be material to its business. The Company considers all claims, if any, on a quarterly basis and, based on known facts, assesses whether potential losses are considered reasonably possible, probable and estimable. Based upon this assessment, the Company then evaluates disclosure requirements and whether to accrue for such claims in its consolidated financial statements. The Company records a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and are adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. As of September 30, 2024 , the Company was not involved in any lawsuits, legal proceedings or claims that would have a material effect on the Company’s financial position, results of operations, or cash flows. Therefore, there were no material losses which were probable or reasonably possible.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands, except percentages) Provision for (benefit from) income taxes $ 344 $ 518 $ (699) $ (906) Discrete items 426 357 566 986 Provision for (benefit from) income taxes, excluding discrete items $ 770 $ 875 $ (133) $ 80 Effective tax rate 3.9% 5.1% 62.4% (114.2%) Effective tax rate, excluding discrete items 8.7% 8.6% 11.8% 10.0% The Company’s interim period tax provision for (benefit from) income taxes is determined using an estimate of its annual effective tax rate, adjusted for discrete items, if any, that arise during the period . Each quarter, the Company update s its estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, the Company makes a cumulative adjustment in such period . The Company’s quarterly tax provision and estimate of its annual effective tax rate are subject to variation due to several factors, including variability in accurately predicting its pre-tax income or loss and the mix of jurisdictions to which they relate, the applicability of special tax regimes, and changes in how the Company does business . For the three and nine months ended September 30, 2024 , the recognized provision for and (benefit from) income taxes, respectively, resulted from the tax projection based on the full year forecasted profit and included benefits related to the U.S. federal foreign-derived intangible income (“FDII”), federal research and development (“ R&D ”) tax credit , certain permanent differences, such as share-based compensation shortfalls, and partial release of California valuation allowance . For the three and nine months ended September 30, 2023, the recognized provision for and (benefit from) income taxes, respectively, included benefits related to the U.S. FDII and federal R&D tax credit, along with a discrete tax benefit due primarily to share-based compensation windfalls and prior years’ discrete tax benefit largely related to increased tax credits. The effective tax rate excluding discrete items for the nine months ended September 30, 2024 , as compared to the prior year, differed primarily due to lower projected R&D tax credits, increased non-deductible officer share-based compensation, and lower projected U.S. FDII benefits .

Segment Reporting

Segment Reporting	9 Months Ended
	Sep. 30, 2024
Segment Reporting [Abstract]
Segment Reporting	Segment Reporting The Company’s Chief Operating Decision-Maker (“CODM”) is its President and Chief Executive Officer . The Company continue s to monitor and review its segment reporting structure in accordance with authoritative guidance to determine whether any changes have occurred that would impact its reportable segments . The following tables present a summary of the Company’s financial information by segment and corporate operating expenses. Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024 Water Emerging Technologies Corporate Total Water Emerging Technologies Corporate Total (In thousands) Revenue $ 38,344 $ 240 $ — $ 38,584 $ 77,351 $ 522 $ — $ 77,873 Cost of revenue 13,334 138 — 13,472 27,633 427 — 28,060 Gross profit 25,010 102 — 25,112 49,718 95 — 49,813 Operating expenses General and administrative 1,803 906 4,964 7,673 5,637 2,908 16,226 24,771 Sales and marketing 3,777 1,977 659 6,413 11,359 5,484 1,826 18,669 Research and development 1,145 2,824 — 3,969 3,318 8,946 — 12,264 Total operating expenses 6,725 5,707 5,623 18,055 20,314 17,338 18,052 55,704 Operating income (loss) $ 18,285 $ (5,605) $ (5,623) $ 7,057 $ 29,404 $ (17,243) $ (18,052) $ (5,891) Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Water Emerging Technologies Corporate Total Water Emerging Technologies Corporate Total (In thousands) Revenue $ 36,812 $ 224 $ — $ 37,036 $ 70,622 $ 538 $ — $ 71,160 Cost of revenue 11,114 40 — 11,154 23,136 444 — 23,580 Gross profit 25,698 184 — 25,882 47,486 94 — 47,580 Operating expenses General and administrative 2,039 1,061 4,269 7,369 5,837 2,976 12,891 21,704 Sales and marketing 3,272 1,560 579 5,411 9,567 4,171 1,659 15,397 Research and development 1,098 2,871 — 3,969 3,121 8,922 — 12,043 Total operating expenses 6,409 5,492 4,848 16,749 18,525 16,069 14,550 49,144 Operating income (loss) $ 19,289 $ (5,308) $ (4,848) $ 9,133 $ 28,961 $ (15,975) $ (14,550) $ (1,564)

Concentrations

Concentrations	9 Months Ended
	Sep. 30, 2024
Risks and Uncertainties [Abstract]
Concentrations	Concentrations Customer Revenue Concentration The following tables present the customers that account for 10% or more of the Company’s revenue and their related segment for each of the periods presented. Although certain customers might account for greater than 10% of the Company’s revenue at any one point in time, the concentration of revenue between a limited number of customers shifts regularly, depending on when revenue is recognized. The percentages by customer reflect specific relationships or contracts that would concentrate revenue for the periods presented and do not indicate a trend specific to any one customer. Three Months Ended September 30, Nine Months Ended September 30, Segment 2024 2023 2024 2023 Customer A Water 14% 20% 14% 16% Customer B Water 17% 15% ** ** Customer C Water ** 15% ** ** Customer D Water 11% ** 11% ** Customer E Water 10% ** ** ** Customer F Water ** 10% ** ** ** Zero or less than 10%.

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net (loss) income	$ 8,481	$ 9,660	$ (421)	$ 1,699

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Description of Business and S_2

Description of Business and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation	The Condensed Consolidated Financial Statements include the accounts of Energy Recovery, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying Condensed Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “ SEC ”). Certain information and footnote disclosures normally included in the financial statements prepared in accordance with U.S. generally accepted accounting principles (“ GAAP ”) have been condensed or omitted pursuant to such rules and regulations. The results of operations for the interim periods are not necessarily indicative of the operating results for the full fiscal year or any future periods .
Reclassifications	Certain prior period amounts have been reclassified in certain notes to the Condensed Consolidated Financial Statements to conform to the current period presentation.
Use of Estimates	The preparation of Condensed Consolidated Financial Statements, in conformity with GAAP , requires the Company’s management to make judgments, assumptions and estimates that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. The accounting policies that reflect the Company’s significant estimates and judgments and that the Company believes are the most critical to aid in fully understanding and evaluating its reported financial results are revenue recognition; granted equity award valuations; equipment useful life and valuation; goodwill valuation and impairment; deferred taxes and valuation allowances on deferred tax assets; and evaluation and measurement of contingencies . Those estimates could change, and as a result, actual results could differ materially from those estimates. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of October 30, 2024 , the date of issuance of this Quarterly Report on Form 10-Q . These estimates may change, as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. The Company undertakes no obligation to publicly update these estimates for any reason after the date of this Quarterly Report on Form 10-Q , except as required by law.
Net Income (Loss) Per Share	Net income (loss) for the reported period is divided by the weighted average number of basic and diluted common shares outstanding during the reported period to calculate the basic and diluted net income (loss) per share , respectively. Outstanding stock options to purchase common shares and unvested restricted stock units (“RSUs”) are collectively referred to as “equity awards.” • Basic net income (loss) per share is computed using the weighted average number of common shares outstanding during the period . • Diluted net income (loss) per share is computed using the weighted average number of common and potentially dilutive shares outstanding during the period, using the treasury stock method. Any anti-dilutive effect of equity awards outstanding is not included in the computation of diluted net income (loss) per share .
Goodwill	On July 1, 2024 , the Company estimated the fair value of its reporting units using the discounted cash flow approach and market approach. The forecast of future cash flows, which is based on the Company’s best estimate of future net sales and operating expenses, is based primarily on expected category expansion, pricing, market segment, and general economic conditions . The Company incorporates other significant inputs to its fair value calculations, including discount rate and market multiples, to reflect current market conditions.
Litigation	The Company considers all claims, if any, on a quarterly basis and, based on known facts, assesses whether potential losses are considered reasonably possible, probable and estimable. Based upon this assessment, the Company then evaluates disclosure requirements and whether to accrue for such claims in its consolidated financial statements. The Company records a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and are adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case.
Income Taxes	The Company’s interim period tax provision for (benefit from) income taxes is determined using an estimate of its annual effective tax rate, adjusted for discrete items, if any, that arise during the period . Each quarter, the Company update s its estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, the Company makes a cumulative adjustment in such period . The Company’s quarterly tax provision and estimate of its annual effective tax rate are subject to variation due to several factors, including variability in accurately predicting its pre-tax income or loss and the mix of jurisdictions to which they relate, the applicability of special tax regimes, and changes in how the Company does business .

Revenue (Tables)

Revenue (Tables)	9 Months Ended
	Sep. 30, 2024
Revenue from Contract with Customer [Abstract]
Schedule of Disaggregation of Revenue	The following table s present the disaggregated revenues by segment, and within each segment, by geographical market based on the customer “shipped to” address, and by channel customers. Sales and usage-based taxes are excluded from revenues. See Note 9 , “ Segment Reporting ,” for further discussion related to the Company’s segments. Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Geographical market Middle East and Africa $ 28,043 $ 153 $ 28,196 $ 47,295 $ 399 $ 47,694 Asia 6,829 — 6,829 16,770 36 16,806 Americas 1,051 — 1,051 6,957 — 6,957 Europe 2,421 87 2,508 6,329 87 6,416 Total revenue $ 38,344 $ 240 $ 38,584 $ 77,351 $ 522 $ 77,873 Channel Megaproject $ 29,009 $ — $ 29,009 $ 48,924 $ — $ 48,924 Original equipment manufacturer 4,832 87 4,919 15,087 123 15,210 Aftermarket 4,503 153 4,656 13,340 399 13,739 Total revenue $ 38,344 $ 240 $ 38,584 $ 77,351 $ 522 $ 77,873 Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Geographical market Middle East and Africa $ 24,543 $ — $ 24,543 $ 38,272 $ 108 $ 38,380 Asia 5,688 — 5,688 19,180 — 19,180 Americas 5,091 123 5,214 9,628 153 9,781 Europe 1,490 101 1,591 3,542 277 3,819 Total revenue $ 36,812 $ 224 $ 37,036 $ 70,622 $ 538 $ 71,160 Channel Megaproject $ 26,829 $ — $ 26,829 $ 42,283 $ — $ 42,283 Original equipment manufacturer 5,083 224 5,307 16,415 430 16,845 Aftermarket 4,900 — 4,900 11,924 108 12,032 Total revenue $ 36,812 $ 224 $ 37,036 $ 70,622 $ 538 $ 71,160
Schedule of Contract with Customer, Asset and Liability	The following table presents contract balances by category. September 30, 2024 December 31, 2023 (In thousands) Accounts receivable, net $ 31,845 $ 46,937 Contract assets: Contract assets, current (included in prepaid expenses and other assets) $ 685 $ 592 Contract assets, non-current (included in other assets, non-current) 789 — Total contract assets $ 1,474 $ 592 Contract liabilities: Contract liabilities, current $ 2,969 $ 1,097 Contract liabilities, non-current (included in other liabilities, non-current) 29 90 Total contract liabilities $ 2,998 $ 1,187
Schedule of Contract With Customer, Contract Liability, Activity	The following table presents changes in contract liabilities during the period. September 30, 2024 December 31, 2023 (In thousands) Contract liabilities, beginning of year $ 1,187 $ 1,316 Revenue recognized (1,063) (1,254) Cash received, excluding amounts recognized as revenue during the period 2,874 1,125 Contract liabilities, end of period $ 2,998 $ 1,187
Schedule of Revenue, Remaining Performance Obligation	As of September 30, 2024 , t he following table presents the revenue that is expected to be recognized related to performance obligations that are unsatisfied or partially unsatisfied. Period Remaining Performance Obligations (In thousands) 2024 (remaining three months) $ 198 2025 6,957 2026 3,419 Total $ 10,574

Net Income (Loss) Per Share (Ta

Net Income (Loss) Per Share (Tables)	9 Months Ended
	Sep. 30, 2024
Earnings Per Share [Abstract]
Schedule of Computation of Basic and Diluted Net Loss Per Common Share	The following tables present the computation of basic and diluted net income (loss) per share . Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands, except per share amounts) Numerator Net income (loss) $ 8,481 $ 9,660 $ (421) $ 1,699 Denominator (weighted average shares) Basic common shares outstanding 57,756 56,443 57,409 56,346 Options 316 1,236 — 1,155 RSUs 218 290 — 260 Diluted common shares outstanding 58,290 57,969 57,409 57,761 Net income (loss) per share Basic $ 0.15 $ 0.17 $ (0.01) $ 0.03 Diluted $ 0.15 $ 0.17 $ (0.01) $ 0.03
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	The following tables present the equity awards that are excluded from diluted net income (loss) per share because their effect would have been anti-dilutive. Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands) Anti-dilutive equity award shares 1,077 125 2,876 126

Other Financial Information (Ta

Other Financial Information (Tables)	9 Months Ended
	Sep. 30, 2024
Other Financial Information [Abstract]
Schedule of Cash, Cash Equivalents and Restricted Cash	The following table presents a reconciliation of cash, cash equivalents and restricted cash, reported for each period within the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Cash Flows that sum to the total of such amounts. September 30, 2024 December 31, 2023 September 30, 2023 (In thousands) Cash and cash equivalents $ 63,261 $ 68,098 $ 51,440 Restricted cash, non-current (included in other assets, non-current) 132 127 126 Total cash, cash equivalents and restricted cash $ 63,393 $ 68,225 $ 51,566
Schedule of Accounts Receivable, Net	September 30, 2024 December 31, 2023 (In thousands) Accounts receivable, gross $ 32,015 $ 47,075 Allowance for doubtful accounts (170) (138) Accounts receivable, net $ 31,845 $ 46,937
Schedule of Inventories, Net	Inventory amounts are stated at the lower of cost or net realizable value, using the first-in, first-out method. September 30, 2024 December 31, 2023 (In thousands) Raw materials $ 8,731 $ 8,752 Work in process 6,929 5,234 Finished goods 18,990 13,319 Inventories, gross 34,650 27,305 Valuation adjustments for excess and obsolete inventory (1,186) (1,156) Inventories, net $ 33,464 $ 26,149
Schedule of Accrued Expenses and Other Liabilities	September 30, 2024 December 31, 2023 (In thousands) Accrued expenses and other liabilities, current Payroll, incentives and commissions payable $ 7,134 $ 11,037 Warranty reserve 983 1,057 Other accrued expenses and other liabilities 2,407 3,489 Total accrued expenses and other liabilities 10,524 15,583 Other liabilities, non-current 100 207 Total accrued expenses, and current and non-current other liabilities $ 10,624 $ 15,790

Investments and Fair Value Me_2

Investments and Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2024
Investments, Fair Value Disclosure [Abstract]
Schedule of Amortized Cost and Fair Value of Available for Sale Securities	The following table presents the Company’s financial assets measured on a recurring basis by contractual maturity, including pricing category, amortized cost, gross unrealized gains and losses, and fair value. As of the dates reported in the table, the Company had no financial liabilities and no Level 3 financial assets. September 30, 2024 December 31, 2023 Pricing Category Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (In thousands) Cash equivalents Money market securities Level 1 $ 13,653 $ — $ — $ 13,653 $ 18,767 $ — $ — $ 18,767 U.S. treasury securities Level 2 11,449 2 — 11,451 — — — — Total cash equivalents 25,102 2 — 25,104 18,767 — — 18,767 Short-term investments U.S. treasury securities Level 2 17,233 78 — 17,311 4,900 1 (1) 4,900 Corporate notes and bonds Level 2 32,408 65 (2) 32,471 25,674 11 (18) 25,667 Municipal and agency notes and bonds Level 2 5,584 — (2) 5,582 9,887 — (9) 9,878 Total short-term investments 55,225 143 (4) 55,364 40,461 12 (28) 40,445 Long-term investments Corporate notes and bonds Level 2 18,307 179 — 18,486 9,229 28 (3) 9,254 Municipal and agency notes and bonds Level 2 2,798 2 — 2,800 4,585 — (7) 4,578 Total long-term investments 21,105 181 — 21,286 13,814 28 (10) 13,832 Total short and long-term investments 76,330 324 (4) 76,650 54,275 40 (38) 54,277 Total $ 101,432 $ 326 $ (4) $ 101,754 $ 73,042 $ 40 $ (38) $ 73,044
Schedule of Gross Unrealized Losses and Fair Values of Investments	The following table presents a summary of the fair value and gross unrealized losses on the available-for-sale securities that have been in a continuous unrealized loss position, aggregated by type of investment instrument. The available-for-sale securities that were in an unrealized gain position have been excluded from the table. September 30, 2024 December 31, 2023 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (In thousands) U.S. treasury securities $ — $ — $ 2,931 $ (1) Corporate notes and bonds 2,492 (2) 15,276 (21) Municipal and agency notes and bonds 5,582 (2) 12,956 (16) Total available-for-sale investments with unrealized loss positions $ 8,074 $ (4) $ 31,163 $ (38)
Schedule of Sales of Available-for-Sale Investments	The following table presents the sales of available-for-sale investments. Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands) Corporate notes and bonds $ — $ — $ — $ 2,966

Lines of Credit (Tables)

Lines of Credit (Tables)	9 Months Ended
	Sep. 30, 2024
Debt Disclosure [Abstract]
Schedule of Debt	The following table presents the total outstanding LCs and SBLCs issued by the Company to its customers related to product warranty and performance guarantees . September 30, 2024 December 31, 2023 (In thousands) Outstanding letters of credit $ 17,398 $ 19,945

Income Taxes (Tables)

Income Taxes (Tables)	9 Months Ended
	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Schedule of Components of Income Tax Expense (Benefit)	Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 (In thousands, except percentages) Provision for (benefit from) income taxes $ 344 $ 518 $ (699) $ (906) Discrete items 426 357 566 986 Provision for (benefit from) income taxes, excluding discrete items $ 770 $ 875 $ (133) $ 80 Effective tax rate 3.9% 5.1% 62.4% (114.2%) Effective tax rate, excluding discrete items 8.7% 8.6% 11.8% 10.0%

Segment Reporting (Tables)

Segment Reporting (Tables)	9 Months Ended
	Sep. 30, 2024
Segment Reporting [Abstract]
Schedule of Financial Information by Segment	The following tables present a summary of the Company’s financial information by segment and corporate operating expenses. Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024 Water Emerging Technologies Corporate Total Water Emerging Technologies Corporate Total (In thousands) Revenue $ 38,344 $ 240 $ — $ 38,584 $ 77,351 $ 522 $ — $ 77,873 Cost of revenue 13,334 138 — 13,472 27,633 427 — 28,060 Gross profit 25,010 102 — 25,112 49,718 95 — 49,813 Operating expenses General and administrative 1,803 906 4,964 7,673 5,637 2,908 16,226 24,771 Sales and marketing 3,777 1,977 659 6,413 11,359 5,484 1,826 18,669 Research and development 1,145 2,824 — 3,969 3,318 8,946 — 12,264 Total operating expenses 6,725 5,707 5,623 18,055 20,314 17,338 18,052 55,704 Operating income (loss) $ 18,285 $ (5,605) $ (5,623) $ 7,057 $ 29,404 $ (17,243) $ (18,052) $ (5,891) Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Water Emerging Technologies Corporate Total Water Emerging Technologies Corporate Total (In thousands) Revenue $ 36,812 $ 224 $ — $ 37,036 $ 70,622 $ 538 $ — $ 71,160 Cost of revenue 11,114 40 — 11,154 23,136 444 — 23,580 Gross profit 25,698 184 — 25,882 47,486 94 — 47,580 Operating expenses General and administrative 2,039 1,061 4,269 7,369 5,837 2,976 12,891 21,704 Sales and marketing 3,272 1,560 579 5,411 9,567 4,171 1,659 15,397 Research and development 1,098 2,871 — 3,969 3,121 8,922 — 12,043 Total operating expenses 6,409 5,492 4,848 16,749 18,525 16,069 14,550 49,144 Operating income (loss) $ 19,289 $ (5,308) $ (4,848) $ 9,133 $ 28,961 $ (15,975) $ (14,550) $ (1,564)

Concentrations (Tables)

Concentrations (Tables)	9 Months Ended
	Sep. 30, 2024
Risks and Uncertainties [Abstract]
Schedules of Concentration of Risk, by Risk Factor	The following tables present the customers that account for 10% or more of the Company’s revenue and their related segment for each of the periods presented. Although certain customers might account for greater than 10% of the Company’s revenue at any one point in time, the concentration of revenue between a limited number of customers shifts regularly, depending on when revenue is recognized. The percentages by customer reflect specific relationships or contracts that would concentrate revenue for the periods presented and do not indicate a trend specific to any one customer. Three Months Ended September 30, Nine Months Ended September 30, Segment 2024 2023 2024 2023 Customer A Water 14% 20% 14% 16% Customer B Water 17% 15% ** ** Customer C Water ** 15% ** ** Customer D Water 11% ** 11% ** Customer E Water 10% ** ** ** Customer F Water ** 10% ** ** ** Zero or less than 10%.

Revenue - Schedule of Disaggreg

Revenue - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Disaggregation of Revenue [Line Items]
Revenue	$ 38,584	$ 37,036	$ 77,873	$ 71,160
Water
Disaggregation of Revenue [Line Items]
Revenue	38,344	36,812	77,351	70,622
Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	240	224	522	538
Megaproject
Disaggregation of Revenue [Line Items]
Revenue	29,009	26,829	48,924	42,283
Megaproject | Water
Disaggregation of Revenue [Line Items]
Revenue	29,009	26,829	48,924	42,283
Megaproject | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	0	0	0
Original equipment manufacturer
Disaggregation of Revenue [Line Items]
Revenue	4,919	5,307	15,210	16,845
Original equipment manufacturer | Water
Disaggregation of Revenue [Line Items]
Revenue	4,832	5,083	15,087	16,415
Original equipment manufacturer | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	87	224	123	430
Aftermarket
Disaggregation of Revenue [Line Items]
Revenue	4,656	4,900	13,739	12,032
Aftermarket | Water
Disaggregation of Revenue [Line Items]
Revenue	4,503	4,900	13,340	11,924
Aftermarket | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	153	0	399	108
Middle East and Africa
Disaggregation of Revenue [Line Items]
Revenue	28,196	24,543	47,694	38,380
Middle East and Africa | Water
Disaggregation of Revenue [Line Items]
Revenue	28,043	24,543	47,295	38,272
Middle East and Africa | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	153	0	399	108
Asia
Disaggregation of Revenue [Line Items]
Revenue	6,829	5,688	16,806	19,180
Asia | Water
Disaggregation of Revenue [Line Items]
Revenue	6,829	5,688	16,770	19,180
Asia | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	0	36	0
Americas
Disaggregation of Revenue [Line Items]
Revenue	1,051	5,214	6,957	9,781
Americas | Water
Disaggregation of Revenue [Line Items]
Revenue	1,051	5,091	6,957	9,628
Americas | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	123	0	153
Europe
Disaggregation of Revenue [Line Items]
Revenue	2,508	1,591	6,416	3,819
Europe | Water
Disaggregation of Revenue [Line Items]
Revenue	2,421	1,490	6,329	3,542
Europe | Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	$ 87	$ 101	$ 87	$ 277

Revenue - Schedule of Contract

Revenue - Schedule of Contract with Customer, Asset and Liability (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Accounts receivable, net	$ 31,845	$ 46,937
Contract assets:
Contract assets, current (included in prepaid expenses and other assets)	685	592
Contract assets, non-current (included in other assets, non-current)	789	0
Total contract assets	1,474	592
Contract liabilities:
Contract liabilities	2,969	1,097
Contract liabilities, non-current (included in other liabilities, non-current)	29	90
Total contract liabilities	$ 2,998	$ 1,187	$ 1,316

Revenue - Schedule of Contrac_2

Revenue - Schedule of Contract With Customer, Contract Liability, Activity (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Contract With Customer, Liability [Roll Forward]
Contract liabilities, beginning of year	$ 1,187	$ 1,316
Revenue recognized	(1,063)	(1,254)
Cash received, excluding amounts recognized as revenue during the period	2,874	1,125
Contract liabilities, end of period	$ 2,998	$ 1,187

Revenue - Schedule of Remaining

Revenue - Schedule of Remaining Performance Obligation (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	$ 10,574
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	$ 198
Performance obligations expected to be satisfied, expected timing	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	$ 6,957
Performance obligations expected to be satisfied, expected timing	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	$ 3,419
Performance obligations expected to be satisfied, expected timing	1 year

Net Income (Loss) Per Share - S

Net Income (Loss) Per Share - Schedule of Computation of Basic and Diluted Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Numerator
Net income (loss)	$ 8,481	$ 9,660	$ (421)	$ 1,699
Denominator (weighted average shares)
Basic common shares outstanding (in shares)	57,756	56,443	57,409	56,346
Diluted common shares outstanding (in shares)	58,290	57,969	57,409	57,761
Net income (loss) per share
Basic (in dollars per share)	$ 0.15	$ 0.17	$ (0.01)	$ 0.03
Diluted (in dollars per share)	$ 0.15	$ 0.17	$ (0.01)	$ 0.03
Stock Options
Denominator (weighted average shares)
Options and RSUs (in shares)	316	1,236	0	1,155
RSUs
Denominator (weighted average shares)
Options and RSUs (in shares)	218	290	0	260

Net Income (Loss) Per Share -_2

Net Income (Loss) Per Share - Schedule of Antidilutive Securities Excluded From Computation of Diluted Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Earnings Per Share [Abstract]
Anti-dilutive equity award shares (in shares)	1,077	125	2,876	126

Other Financial Information - S

Other Financial Information - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023	Sep. 30, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Cash and cash equivalents	$ 63,261	$ 68,098	$ 51,440
Restricted cash, non-current (included in other assets, non-current)	132	127	126
Total cash, cash equivalents and restricted cash	$ 63,393	$ 68,225	$ 51,566	$ 56,458

Other Financial Information -_2

Other Financial Information - Schedule of Accounts Receivable, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Other Financial Information [Abstract]
Accounts receivable, gross	$ 32,015	$ 47,075
Allowance for doubtful accounts	(170)	(138)
Accounts receivable, net	$ 31,845	$ 46,937

Other Financial Information -_3

Other Financial Information - Schedule of Inventories, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Other Financial Information [Abstract]
Raw materials	$ 8,731	$ 8,752
Work in process	6,929	5,234
Finished goods	18,990	13,319
Inventories, gross	34,650	27,305
Valuation adjustments for excess and obsolete inventory	(1,186)	(1,156)
Inventories, net	$ 33,464	$ 26,149

Other Financial Information - G

Other Financial Information - Goodwill (Details) - USD ($)	9 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Other Financial Information [Abstract]
Goodwill	$ 12,790,000	$ 12,790,000
Goodwill impairment charge	$ 0

Other Financial Information -_4

Other Financial Information - Schedule of Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Accrued expenses and other liabilities, current
Payroll, incentives and commissions payable	$ 7,134	$ 11,037
Warranty reserve	983	1,057
Other accrued expenses and other liabilities	2,407	3,489
Total accrued expenses and other liabilities	10,524	15,583
Non-current
Other liabilities, non-current	100	207
Total accrued expenses, and current and non-current other liabilities	$ 10,624	$ 15,790

Investments and Fair Value Me_3

Investments and Fair Value Measurements - Narrative (Details) - Measured on Recurring Basis - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial liabilities	$ 0	$ 0
Level 3 Inputs
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial assets	$ 0	$ 0

Investments and Fair Value Me_4

Investments and Fair Value Measurements - Schedule of Amortized Cost and Fair Value of Available for Sale Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	$ 101,432	$ 73,042
Gross Unrealized Gains	326	40
Gross Unrealized Losses	(4)	(38)
Fair Value	101,754	73,044
Cash equivalents
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	25,102	18,767
Gross Unrealized Gains	2	0
Gross Unrealized Losses	0	0
Fair Value	25,104	18,767
Cash equivalents | U.S. treasury securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	11,449	0
Gross Unrealized Gains	2	0
Gross Unrealized Losses	0	0
Fair Value	11,451	0
Total short and long-term investments
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	76,330	54,275
Gross Unrealized Gains	324	40
Gross Unrealized Losses	(4)	(38)
Fair Value	76,650	54,277
Short-term investments
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	55,225	40,461
Gross Unrealized Gains	143	12
Gross Unrealized Losses	(4)	(28)
Fair Value	55,364	40,445
Long-term investments
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	21,105	13,814
Gross Unrealized Gains	181	28
Gross Unrealized Losses	0	(10)
Fair Value	21,286	13,832
Level 1 | Cash equivalents | Money market securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	13,653	18,767
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	13,653	18,767
Level 2 | Short-term investments | U.S. treasury securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	17,233	4,900
Gross Unrealized Gains	78	1
Gross Unrealized Losses	0	(1)
Fair Value	17,311	4,900
Level 2 | Short-term investments | Corporate notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	32,408	25,674
Gross Unrealized Gains	65	11
Gross Unrealized Losses	(2)	(18)
Fair Value	32,471	25,667
Level 2 | Short-term investments | Municipal and agency notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	5,584	9,887
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(2)	(9)
Fair Value	5,582	9,878
Level 2 | Long-term investments | Corporate notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	18,307	9,229
Gross Unrealized Gains	179	28
Gross Unrealized Losses	0	(3)
Fair Value	18,486	9,254
Level 2 | Long-term investments | Municipal and agency notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized Cost	2,798	4,585
Gross Unrealized Gains	2	0
Gross Unrealized Losses	0	(7)
Fair Value	$ 2,800	$ 4,578

Investments and Fair Value Me_5

Investments and Fair Value Measurements - Schedule of Gross Unrealized Losses and Fair Values of Investments (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Debt Securities, Available-for-sale [Line Items]
Fair Value	$ 8,074	$ 31,163
Gross Unrealized Losses	(4)	(38)
U.S. treasury securities
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	2,931
Gross Unrealized Losses	0	(1)
Corporate notes and bonds
Debt Securities, Available-for-sale [Line Items]
Fair Value	2,492	15,276
Gross Unrealized Losses	(2)	(21)
Municipal and agency notes and bonds
Debt Securities, Available-for-sale [Line Items]
Fair Value	5,582	12,956
Gross Unrealized Losses	$ (2)	$ (16)

Investments and Fair Value Me_6

Investments and Fair Value Measurements - Schedule of Sales of Available-for-Sale Investments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Debt Securities, Available-for-sale [Line Items]
Total sales of securities			$ 0	$ 2,966
Corporate notes and bonds
Debt Securities, Available-for-sale [Line Items]
Total sales of securities	$ 0	$ 0	$ 0	$ 2,966

Lines of Credit - Narrative (De

Lines of Credit - Narrative (Details) - Committed Revolving Credit Line - USD ($)	Sep. 30, 2024	Dec. 22, 2021
Line of Credit | Revolving Credit Facility
Line of Credit Facility [Line Items]
Long-term debt	$ 0
JP Morgan Chase Bank, N.A. | Letter of Credit
Line of Credit Facility [Line Items]
Maximum borrowing capacity	30,000,000
JP Morgan Chase Bank, N.A. | Line of Credit
Line of Credit Facility [Line Items]
Maximum borrowing capacity		$ 50,000,000
JP Morgan Chase Bank, N.A. | Line of Credit | Letter of Credit
Line of Credit Facility [Line Items]
Utilized amount of the maximum allowable credit line	$ 18,400,000

Lines of Credit - Schedule of D

Lines of Credit - Schedule of Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Standby Letters of Credit
Line of Credit Facility [Line Items]
Outstanding letters of credit	$ 17,398	$ 19,945

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Provision for (benefit from) income taxes	$ 344	$ 518	$ (699)	$ (906)
Discrete items	426	357	566	986
Provision for (benefit from) income taxes, excluding discrete items	$ 770	$ 875	$ (133)	$ 80
Effective tax rate	3.90%	5.10%	62.40%	(114.20%)
Effective tax rate, excluding discrete items	8.70%	8.60%	11.80%	10%

Segment Reporting - Schedule of

Segment Reporting - Schedule of Financial Information by Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Segment Reporting Information [Line Items]
Revenue	$ 38,584	$ 37,036	$ 77,873	$ 71,160
Cost of revenue	13,472	11,154	28,060	23,580
Gross profit	25,112	25,882	49,813	47,580
Operating expenses:
General and administrative	7,673	7,369	24,771	21,704
Sales and marketing	6,413	5,411	18,669	15,397
Research and development	3,969	3,969	12,264	12,043
Total operating expenses	18,055	16,749	55,704	49,144
Income (loss) from operations	7,057	9,133	(5,891)	(1,564)
Water
Segment Reporting Information [Line Items]
Revenue	38,344	36,812	77,351	70,622
Emerging Technologies
Segment Reporting Information [Line Items]
Revenue	240	224	522	538
Operating Segments | Water
Segment Reporting Information [Line Items]
Revenue	38,344	36,812	77,351	70,622
Cost of revenue	13,334	11,114	27,633	23,136
Gross profit	25,010	25,698	49,718	47,486
Operating expenses:
General and administrative	1,803	2,039	5,637	5,837
Sales and marketing	3,777	3,272	11,359	9,567
Research and development	1,145	1,098	3,318	3,121
Total operating expenses	6,725	6,409	20,314	18,525
Income (loss) from operations	18,285	19,289	29,404	28,961
Operating Segments | Emerging Technologies
Segment Reporting Information [Line Items]
Revenue	240	224	522	538
Cost of revenue	138	40	427	444
Gross profit	102	184	95	94
Operating expenses:
General and administrative	906	1,061	2,908	2,976
Sales and marketing	1,977	1,560	5,484	4,171
Research and development	2,824	2,871	8,946	8,922
Total operating expenses	5,707	5,492	17,338	16,069
Income (loss) from operations	(5,605)	(5,308)	(17,243)	(15,975)
Corporate
Segment Reporting Information [Line Items]
Revenue	0	0	0	0
Cost of revenue	0	0	0	0
Gross profit	0	0	0	0
Operating expenses:
General and administrative	4,964	4,269	16,226	12,891
Sales and marketing	659	579	1,826	1,659
Research and development	0	0	0	0
Total operating expenses	5,623	4,848	18,052	14,550
Income (loss) from operations	$ (5,623)	$ (4,848)	$ (18,052)	$ (14,550)

Concentrations (Details)

Concentrations (Details) - Revenue from Contract with Customer Benchmark - Customer Concentration Risk - Water	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Customer A
Concentration Risk [Line Items]
Percentage of revenue	14%	20%	14%	16%
Customer B
Concentration Risk [Line Items]
Percentage of revenue	17%	15%
Customer C
Concentration Risk [Line Items]
Percentage of revenue		15%
Customer D
Concentration Risk [Line Items]
Percentage of revenue	11%		11%
Customer E
Concentration Risk [Line Items]
Percentage of revenue	10%
Customer F
Concentration Risk [Line Items]
Percentage of revenue		10%