Overview

* Target Hospitality ( TH ) Q2 revenue falls 39% yr/yr but beats analyst expectations

* Adjusted EBITDA declines significantly and misses analyst estimates, per LSEG data

* Net loss of $14.9 mln in Q2, reversing prior year's profit

Outlook

* Target raises 2025 revenue outlook to $310-$320 mln

* Company expects 2025 adjusted EBITDA between $50 mln and $60 mln

* Target anticipates increased government sector contributions in H2 2025

Result Drivers

* CONTRACT TERMINATIONS - Revenue decline primarily due to termination of Pecos Children's Center and South Texas Family Residential Center contracts

* NEW CONTRACTS - Dilley Contract and Workforce Hub Contract partially offset revenue decline

* CONSTRUCTION EXPENSES - Increased operating expenses related to construction services for Workforce Hub Contract impacted adjusted EBITDA

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Beat $61.60 $56.40

Revenue mln mln (3

Analysts

)

Q2 Net -$14.90

Income mln

Q2 Miss $3.50 $5.70

Adjusted mln mln (3

EBITDA Analysts

)

Analyst Coverage

* The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

* The average consensus recommendation for the hotels, motels & cruise lines peer group is "buy."

* Wall Street's median 12-month price target for Target Hospitality Corp ( TH ) is $8.75, about 16.6% above its August 6 closing price of $7.30

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)