Flexible Solutions International, Inc. announced revenue for the second quarter of 2026, reporting a significant decline in top-line figures primarily due to non-recurring items and operational challenges. The company recorded revenue of $7.4 million for Q2 2026, a decrease of approximately 35% compared to $11.4 million in the same period of 2025. The reduction was largely attributed to a one-time $2.5 million research and development services figure recorded in Q2 2025 that did not repeat in the current quarter.

Factors Impacting Revenue

Beyond the absence of the prior year's R&D revenue, the company faced headwinds from poor sales performance by its FL LLC subsidiary, which it has since exited. Additionally, Flexible Solutions experienced delays in shipping certain orders, with those shipments moving into the third quarter. CEO Dan O’Brien noted that the quarter was unusual and reflected an historical anomaly, stating that while future R&D revenue is possible, it is expected to be random rather than recurring.

Operational Outlook

O’Brien expressed optimism regarding the recovery of business in the territory formerly managed by the FL LLC, now that the company controls products and sales directly in the region. Despite the revenue dip, management emphasized that execution remained strong during the period. The company continues to operate across its core segments, including biodegradable polymers for oil extraction, detergent ingredients, water treatment, and crop nutrient availability chemistry.

Upcoming Financial Disclosures

Complete financial results for Q2 2026 are scheduled for release after market close on Friday, August 14, 2026, concurrent with the company's SEC filings. A conference call is set for the following business day, Monday, August 17, 2026, at 8:00 am Pacific Time (11:00 am Eastern Time). Dial-in details will be provided in the financials news release on August 14.

Financial Comparison

Flexible Solutions International has traded its remaining 19.9% equity in the Florida LLC for perpetual, exclusive rights to manufacture and sell four agricultural products across Central and South America. The transaction grants the company control over the intellectual property for these products in a territory defined as south of the Mexico/US border, including all of Central America, South America, and the Caribbean.

The agreement follows the acquirer's failure to fund annual payments from a prior deal. On August 12, 2024, the company had sold 30.1% of the equity in the FL LLC for $2 million and five annual payments of $800,000. As the acquirer has been unable to meet these financial obligations, the company secured the product rights as a result.

Dan O’Brien, CEO, stated that the company has manufactured these products for the region for a decade. He noted that securing sales rights will allow the recovery of lost sales and the realization of historic revenue previously seen from the FL LLC investment. O’Brien added that while full revenue recovery will not be immediate, significant progress is anticipated in the second half of 2026.

Transaction Details

The exchange involves the transfer of the remaining equity stake for specific commercial advantages. The table below outlines the key components of the original 2024 agreement and the current outcome.

Flexible Solutions International develops biodegradable polymers for oil extraction, detergent ingredients, and water treatment, alongside crop nutrient availability chemistry. The company also produces biodegradable water and energy conservation technologies.