Quest Resource Holding is an asset-light waste broker that spent two years watching industrial volumes hollow out the print, and the second quarter is the first clean test of whether that slide has stopped. Management framed the period as a return to year-over-year growth in both revenue and adjusted EBITDA, the earnings measure that strips interest, taxes, depreciation, amortization, and specified items. The growth is not a boom. It is a stabilization of the old industrial book plus a handful of wallet-share expansions in food service, retail, and hospitality. The market still prices the equity as if the industrial drag is the whole company.
The operating tension sits in the gap between volume recovery and margin recovery. Revenue rose to $64 million. Gross profit still declined versus the year-ago quarter because a few industrial accounts accepted volume only at worse terms. Cash generation told a different story. Operating cash flow of $5 million funded a voluntary $2 million paydown on the Monroe Capital term loan. That is the turnaround the equity has to prove is durable rather than a working-capital one-off.
The second-quarter GAAP loss is almost entirely an $11 million goodwill write-down triggered by the stock's own decline, not by a covenant breach or a cash event. What matters from here is whether sequential revenue growth continues, whether gross margin climbs back toward last year's high-teens, and whether cash conversion keeps shrinking the term loan faster than interest consumes it. The next few prints decide if this is a real earnings reset or a volume bounce on a still-compressed industrial book.