Energy Recovery (ERII) 10-Q1 Nov 232023 Q3 Quarterly reportFinancial data

Company Profile

Cover Page

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2023	Oct. 26, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
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)		56,517,933
Entity Central Index Key	0001421517
Document Fiscal Year Focus	2023
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, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 51,440	$ 56,354
Short-term investments	33,095	33,479
Accounts receivable, net	23,337	34,062
Inventories, net	33,888	28,366
Prepaid expenses and other assets	4,508	5,606
Total current assets	146,268	157,867
Long-term investments	21,394	3,058
Deferred tax assets, net	11,183	10,263
Property and equipment, net	18,747	19,580
Operating lease, right of use asset	11,892	13,115
Goodwill	12,790	12,790
Other assets, non-current	387	366
Total assets	222,661	217,039
Current liabilities:
Accounts payable	1,809	814
Accrued expenses and other liabilities	11,402	14,693
Lease liabilities	1,740	1,600
Contract liabilities	1,467	1,195
Total current liabilities	16,418	18,302
Lease liabilities, non-current	11,992	13,278
Other liabilities, non-current	222	121
Total liabilities	28,632	31,701
Commitments and contingencies (Note 7)
Stockholders’ equity:
Common stock	65	64
Additional paid-in capital	211,782	204,957
Accumulated other comprehensive loss	(183)	(349)
Treasury stock	(80,486)	(80,486)
Retained earnings	62,851	61,152
Total stockholders’ equity	194,029	185,338
Total liabilities and stockholders’ equity	$ 222,661	$ 217,039

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Revenue	$ 37,036	$ 30,462	$ 71,160	$ 83,300
Cost of revenue	11,154	9,417	23,580	25,835
Gross profit	25,882	21,045	47,580	57,465
Operating expenses:
General and administrative	7,369	7,608	21,704	21,155
Sales and marketing	5,411	4,703	15,397	11,916
Research and development	3,969	3,828	12,043	14,170
Total operating expenses	16,749	16,139	49,144	47,241
Income (loss) from operations	9,133	4,906	(1,564)	10,224
Other income (expense):
Interest income	1,083	259	2,486	486
Other non-operating expense, net	(38)	(5)	(129)	(9)
Total other income, net	1,045	254	2,357	477
Income before income taxes	10,178	5,160	793	10,701
Provision for (benefit from) income taxes	518	371	(906)	377
Net income	$ 9,660	$ 4,789	$ 1,699	$ 10,324
Net income per share:
Basic (in dollars per share)	$ 0.17	$ 0.09	$ 0.03	$ 0.18
Diluted (in dollars per share)	$ 0.17	$ 0.08	$ 0.03	$ 0.18
Number of shares used in per share calculations:
Basic (in shares)	56,443	55,881	56,346	56,291
Diluted (in shares)	57,969	57,372	57,761	57,708

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 9,660	$ 4,789	$ 1,699	$ 10,324
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments	(2)	34	95	38
Unrealized gain (loss) on investments	(54)	(28)	71	(398)
Total other comprehensive income (loss), net of tax	(56)	6	166	(360)
Comprehensive income	$ 9,604	$ 4,795	$ 1,865	$ 9,964

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands	Total	Common stock	Additional paid-in capital	Accumulated other comprehensive loss	Treasury stock	Retained earnings
Beginning balance at Dec. 31, 2021		$ 64	$ 195,593	$ (149)	$ (53,832)	$ 37,103
Beginning balance (in shares) at Dec. 31, 2021		63,544,419
Beginning balance, treasury stock (in shares) at Dec. 31, 2021					6,721,153
Increase (Decrease) in Stockholders' Equity
Issuance of common stock, net			2,244
Issuance of common stock, net (in shares)		587,069
Stock-based compensation			4,970
Foreign currency translation adjustments				38
Unrealized gain (loss) on investments				(398)
Total other comprehensive income (loss), net of tax	$ (360)			(360)
Common stock repurchased					$ (26,654)
Net income	10,324					10,324
Common stock repurchased (in shares)					1,427,359
Ending balance, treasury stock (in shares) at Sep. 30, 2022					8,148,512
Ending balance at Sep. 30, 2022	$ 169,303	$ 64	202,807	(509)	$ (80,486)	47,427
Ending balance (in shares) at Sep. 30, 2022	55,982,976	64,131,488
Beginning balance at Jun. 30, 2022		$ 64	200,129	(515)	$ (80,455)	42,638
Beginning balance (in shares) at Jun. 30, 2022		63,935,378
Beginning balance, treasury stock (in shares) at Jun. 30, 2022					8,146,859
Increase (Decrease) in Stockholders' Equity
Issuance of common stock, net			1,259
Issuance of common stock, net (in shares)		196,110
Stock-based compensation			1,419
Foreign currency translation adjustments				34
Unrealized gain (loss) on investments				(28)
Total other comprehensive income (loss), net of tax	$ 6			6
Common stock repurchased					$ (31)
Net income	4,789					4,789
Common stock repurchased (in shares)					1,653
Ending balance, treasury stock (in shares) at Sep. 30, 2022					8,148,512
Ending balance at Sep. 30, 2022	$ 169,303	$ 64	202,807	(509)	$ (80,486)	47,427
Ending balance (in shares) at Sep. 30, 2022	55,982,976	64,131,488
Beginning balance at Dec. 31, 2022	$ 185,338	$ 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 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 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

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Cash flows from operating activities:
Net income	$ 1,699	$ 10,324
Adjustments to reconcile net income to cash provided by (used in) operating activities
Stock-based compensation	5,811	5,101
Depreciation and amortization	3,075	3,803
Right of use asset depreciation	1,223	1,143
(Accretion) amortization of premiums and discounts on investments	(613)	647
Deferred income taxes	(920)	207
Other non-cash adjustments	241	235
Changes in operating assets and liabilities:
Accounts receivable, net	10,756	2,208
Contract assets	1,720	(398)
Inventories, net	(5,745)	(11,848)
Prepaid and other assets	(1,292)	(461)
Accounts payable	1,043	1,121
Accrued expenses and other liabilities	(4,966)	(4,617)
Contract liabilities	240	(1,197)
Net cash provided by operating activities	12,272	6,268
Cash flows from investing activities:
Sales of marketable securities	2,966	0
Maturities of marketable securities	58,705	34,107
Purchases of marketable securities	(78,949)	(35,964)
Capital expenditures	(1,179)	(2,999)
Proceeds from sales of fixed assets	82	734
Net cash used in investing activities	(18,375)	(4,122)
Cash flows from financing activities:
Net proceeds from issuance of common stock	1,184	2,244
Repurchase of common stock	0	(26,654)
Net cash provided by (used in) financing activities	1,184	(24,410)
Effect of exchange rate differences on cash and cash equivalents	27	38
Net change in cash, cash equivalents and restricted cash	(4,892)	(22,226)
Cash, cash equivalents and restricted cash, beginning of year	56,458	74,461
Cash, cash equivalents and restricted cash, end of period	$ 51,566	$ 52,235

Description of Business and Sig

Description of Business and Significant Accounting Policies	9 Months Ended
Description of Business and Significant Accounting Policies	Sep. 30, 2023
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 solutions that make industrial processes more efficient and sustainable. Leveraging the Company’s pressure exchanger technology, which generates little to no emissions when operating, the Company’s solutions lower costs, save energy, reduce waste and minimize emissions for companies across a variety of 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 is committed to developing solutions that drive long-term value – both financial and environmental. The Company’s solutions are marketed, sold in, or developed for, the fluid-flow and gas markets, such as seawater and wastewater desalination, natural gas, chemical processing and 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, 2022 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, 2023 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, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 23, 2023 (the “2022 Annual Report”). Reclassifications Certain prior period amounts have been reclassified in the Condensed Consolidated Statements of Cash Flows and 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; valuation of stock options; useful life and valuation of equipment; valuation and impairment of goodwill; 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. Although there has been uncertainty and disruption in the global economy, supply chain and financial markets, 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 November 1, 2023, 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 update publicly these estimates for any reason after the date of this Quarterly Report on Form 10-Q, except as required by law.

Revenue

Revenue	9 Months Ended
Revenue	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue	Revenue Disaggregation of Revenue The following tables 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, 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 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Geographical market Middle East and Africa $ 16,722 $ — $ 16,722 $ 53,629 $ 79 $ 53,708 Asia 8,168 — 8,168 17,771 — 17,771 Americas 3,156 — 3,156 6,951 30 6,981 Europe 2,416 — 2,416 4,840 — 4,840 Total revenue $ 30,462 $ — $ 30,462 $ 83,191 $ 109 $ 83,300 Channel Megaproject $ 17,347 $ — $ 17,347 $ 51,178 $ 79 $ 51,257 Original equipment manufacturer 9,032 — 9,032 21,392 — 21,392 Aftermarket 4,083 — 4,083 10,621 30 10,651 Total revenue $ 30,462 $ — $ 30,462 $ 83,191 $ 109 $ 83,300 Contract Balances The following table presents contract balances by category. September 30, December 31, (In thousands) Accounts receivable, net $ 23,337 $ 34,062 Contract assets, current (included in prepaid expenses and other assets) — 1,720 Contract liabilities: Contract liabilities, current $ 1,467 $ 1,195 Contract liabilities, non-current (included in other liabilities, non-current) 89 121 Total contract liabilities $ 1,556 $ 1,316 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 significant changes in contract liabilities during the period. September 30, December 31, (In thousands) Contract liabilities, beginning of year $ 1,316 $ 3,406 Revenue recognized (1,117) (3,123) Cash received, excluding amounts recognized as revenue during the period 1,357 1,033 Contract liabilities, end of period $ 1,556 $ 1,316 Future Performance Obligations As of September 30, 2023, the following table presents the future estimated revenue by year expected to be recognized related to performance obligations that are unsatisfied or partially unsatisfied. Year Future Performance Obligations (In thousands) 2023 (remaining three months) $ 5,924 2025 6,861 Total $ 12,785

Net Income Per Share

Net Income Per Share	9 Months Ended
Net Income Per Share	Sep. 30, 2023
Earnings Per Share [Abstract]
Net Income Per Share	Net Income Per Share Net income for the reported period is divided by the weighted average number of common shares outstanding during the reported period to calculate basic net income per common share. • Basic net income per common share excludes any dilutive effect of stock options and restricted stock units (“RSUs”). • Diluted net income per common share reflects the potential dilution that would occur if outstanding stock options to purchase common stock were exercised for shares of common stock, using the treasury stock method, and if the shares of common stock underlying each unvested RSU were issued. The following table presents the computation of basic and diluted net income per common share. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 (In thousands, except per share amounts) Numerator Net income $ 9,660 $ 4,789 $ 1,699 $ 10,324 Denominator (weighted average shares) Basic common shares outstanding 56,443 55,881 56,346 56,291 Dilutive stock awards 1,526 1,491 1,415 1,417 Diluted common shares outstanding 57,969 57,372 57,761 57,708 Net income per share Basic $ 0.17 $ 0.09 $ 0.03 $ 0.18 Diluted $ 0.17 $ 0.08 $ 0.03 $ 0.18 Certain shares of common stock issuable under stock awards have been omitted from the diluted net income per common share calculations because their inclusion is considered anti-dilutive. The following table presents the weighted potential common shares issuable under stock awards that were excluded from the computation of diluted net income per common share. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 (In thousands) Anti-dilutive stock award shares 125 387 126 522

Other Financial Information

Other Financial Information	9 Months Ended
Other Financial Information	Sep. 30, 2023
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 within the Condensed Consolidated Balance Sheets that sum to the total of such amounts presented for each period presented on the Condensed Consolidated Statements of Cash Flows. September 30, December 31, September 30, (In thousands) Cash and cash equivalents $ 51,440 $ 56,354 $ 52,131 Restricted cash, non-current (included in other assets, non-current) 126 104 104 Total cash, cash equivalents and restricted cash $ 51,566 $ 56,458 $ 52,235 Accounts Receivable, net September 30, December 31, (In thousands) Accounts receivable, gross $ 23,446 $ 34,210 Allowance for doubtful accounts (109) (148) Accounts receivable, net $ 23,337 $ 34,062 Inventories, net September 30, December 31, (In thousands) Raw materials $ 9,050 $ 11,178 Work in process 4,905 2,628 Finished goods 20,560 15,062 Inventories, gross 34,515 28,868 Valuation adjustments for excess and obsolete inventory (627) (502) Inventories, net $ 33,888 $ 28,366 Inventory amounts are stated at the lower of cost or net realizable value, using the first-in, first-out method. 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, 2023 and December 31, 2022 was $12.8 million. On July 1, 2023, the Company estimated the fair value of its reporting units using both the discounted cash flow and market approaches. 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. The analysis performed indicated that the fair value of each reporting unit that is allocated goodwill significantly exceeds its carrying value. As a result of the Company’s annual impairment test, there was no impairment charge recorded during the three months ended September 30, 2023. Accrued Expenses and Other Liabilities September 30, December 31, (In thousands) Current Payroll, incentives and commissions payable $ 8,261 $ 10,479 Warranty reserve 944 968 Other accrued expenses and other liabilities 2,197 3,246 Total accrued expenses and other liabilities 11,402 14,693 Other liabilities, non-current 222 121 Total accrued expenses, and current and non-current other liabilities $ 11,624 $ 14,814

Investments and Fair Value Meas

Investments and Fair Value Measurements	9 Months Ended
Investments and Fair Value Measurements	Sep. 30, 2023
Investments, Fair Value Disclosure [Abstract]
Investments and Fair Value Measurements	Investments and Fair Value Measurements Available-for-Sale Investments The Company’s investments in investment-grade short-term and long-term marketable debt instruments, such as U.S. treasury securities, corporate notes and bonds, and municipal and agency notes and bonds, are classified as available-for-sale. Available-for-sale investments are classified on the Condensed Consolidated Balance Sheets as either short-term and/or long-term investments. The classification of available-for-sale investments on the Condensed Consolidated Balance Sheets and definition of each of these classifications are provided in Note 1, “Description of Business and Significant Accounting Policies - Significant Accounting Policies,” subsections “Cash and Cash Equivalents” and “Short-term and Long-term Investments,” of the Notes to Consolidated Financial Statements included in Item 8, “Financial Statements and Supplementary Data,” in the 2022 Annual Report. Expected maturities can differ from contractual maturities because borrowers may have the right to prepay obligations without prepayment penalties. The Company generally holds available-for-sale investments until maturity; however, from time-to-time, the Company may elect to sell certain available-for-sale investments prior to contractual maturity. All of the Company’s financial assets and liabilities are remeasured and reported at fair value at each reporting period, and are classified and disclosed in one of the following three pricing category levels: Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 — Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; and Level 3 — Unobservable inputs in which little or no market activity exists, thereby requiring an entity to develop its own assumptions that market participants would use in pricing. 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, 2023 December 31, 2022 Pricing Category Amortized Gross Gross Fair Amortized Gross Gross Fair (In thousands) Cash equivalents Money market securities Level 1 $ 17,408 $ — $ — $ 17,408 $ 33,268 $ — $ — $ 33,268 Short-term investments U.S. treasury securities Level 2 2,894 — (5) 2,889 3,629 1 — 3,630 Corporate notes and bonds Level 2 19,939 — (95) 19,844 26,060 — (208) 25,852 Municipal and agency notes and bonds Level 2 10,387 — (25) 10,362 3,992 5 — 3,997 Total short-term investments 33,220 — (125) 33,095 33,681 6 (208) 33,479 Long-term investments Corporate notes and bonds Level 2 13,417 — (74) 13,343 3,178 — (120) 3,058 Municipal and agency notes and bonds Level 2 8,084 — (33) 8,051 — — — — Total long-term investments 21,501 — (107) 21,394 3,178 — (120) 3,058 Total short and long-term investments 54,721 — (232) 54,489 36,859 6 (328) 36,537 Total $ 72,129 $ — $ (232) $ 71,897 $ 70,127 $ 6 $ (328) $ 69,805 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, 2023 December 31, 2022 Fair Gross Fair Gross (In thousands) U.S. treasury securities $ 2,889 $ (5) $ — $ — Corporate notes and bonds 31,687 (169) 28,911 (328) Municipal and agency notes and bonds 18,413 (58) — — Total available-for-sale investments with unrealized loss positions $ 52,989 $ (232) $ 28,911 $ (328) 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, 2023 2022 2023 2022 (In thousands) Corporate notes and bonds $ — $ — $ 2,966 $ — Realized losses on sales of securities were immaterial during the nine months ended September 30, 2023.

Lines of Credit

Lines of Credit	9 Months Ended
Lines of Credit	Sep. 30, 2023
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 (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. During September 2023, the Company and JPMC amended the Credit Agreement (the “Second Amendment”) to increase the LC maximum allowable credit line component from $25.0 million to $30.0 million. No other components or features under the Credit Agreement (including the First Amendment Under the Credit Agreement, as of September 30, 2023, there were no revolving loans outstanding. In addition, under the LCs component, the Company utilized $20.4 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 credits (“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 our customers related to product warranty and performance guarantees. September 30, December 31, (In thousands) Outstanding letters of credit $ 19,501 $ 15,487

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2023
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, 2023, 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
Income Taxes	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 (In thousands, except percentages) Provision for (benefit from) income taxes $ 518 $ 371 $ (906) $ 377 Discrete items 357 331 986 1,134 Provision for income taxes, excluding discrete items $ 875 $ 702 $ 80 $ 1,511 Effective tax rate 5.1 % 7.2 % (114.2 %) 3.5 % Effective tax rate, excluding discrete items 8.6 % 13.6 % 10.0 % 14.1 % The Company’s interim period tax provision for and (benefit from) income taxes, respectively, 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 updates 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, intercompany transactions, the applicability of special tax regimes, and changes in how the Company does business. 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. federal foreign-derived intangible income (“FDII”) and federal research and development (“R&D”) tax credit, along with a discrete tax benefit due primarily to stock-based compensation windfalls and prior years’ discrete tax benefit largely related to increased tax credits. For the three and nine months ended September 30, 2022, the recognized provision for income taxes included a benefit primarily related to the FDII and federal R&D tax credit, along with a discrete tax benefit due primarily to stock-based compensation windfalls.

Segment Reporting

Segment Reporting	9 Months Ended
Segment Reporting	Sep. 30, 2023
Segment Reporting [Abstract]
Segment Reporting	Segment ReportingThe Company’s chief operating decision-maker (“CODM”) is its chief executive officer. The Company continues 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, 2023 Nine Months Ended September 30, 2023 Water Emerging Technologies Total Water Emerging Technologies 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 3,100 5,837 2,976 8,813 Sales and marketing 3,272 1,560 4,832 9,567 4,171 13,738 Research and development 1,098 2,871 3,969 3,121 8,922 12,043 Total operating expenses 6,409 5,492 11,901 18,525 16,069 34,594 Operating income (loss) $ 19,289 $ (5,308) 13,981 $ 28,961 $ (15,975) 12,986 Less: Corporate operating expenses 4,848 14,550 Income (loss) from operations $ 9,133 $ (1,564) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Revenue $ 30,462 $ — $ 30,462 $ 83,191 $ 109 $ 83,300 Cost of revenue 9,417 — 9,417 25,817 18 25,835 Gross profit 21,045 — 21,045 57,374 91 57,465 Operating expenses General and administrative 1,911 878 2,789 4,909 3,140 8,049 Sales and marketing 3,242 960 4,202 8,197 2,120 10,317 Research and development 1,216 2,612 3,828 3,159 11,011 14,170 Total operating expenses 6,369 4,450 10,819 16,265 16,271 32,536 Operating income (loss) $ 14,676 $ (4,450) 10,226 $ 41,109 $ (16,180) 24,929 Less: Corporate operating expenses 5,320 14,705 Income from operations $ 4,906 $ 10,224

Concentrations

Concentrations	9 Months Ended
Concentrations	Sep. 30, 2023
Risks and Uncertainties [Abstract]
Concentrations	Concentrations Customer Revenue Concentration The following table presents 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 2023 2022 2023 2022 Customer A Water 29% 15% Customer B Water 20% 16% Customer C Water 17% Customer D Water 15% Customer E Water 15% 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
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net income	$ 9,660	$ 4,789	$ 1,699	$ 10,324

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended	9 Months Ended
Insider Trading Arrangements	Sep. 30, 2023 shares	Sep. 30, 2023 shares
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		Name Title Date of Adoption or Termination (1) Status (2) Plan Type Joshua Ballard Chief Financial Officer 9/13/2023 Adoption Rule 10b5-1 trading arrangement (3) (1) Effective (1) date of adoption; or (2) date of termination, of registrant’s Rule 10b5-1 trading arrangement. (2) Activity related to registrant’s Rule 10b5-1 trading arrangement.
Joshua Ballard [Member]
Trading Arrangements, by Individual
Name	Joshua Ballard
Title	Chief Financial Officer
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	9/13/2023
Arrangement Duration	255 days
Aggregate Available	12,500	12,500

Description of Business and S_2

Description of Business and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2023
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.All adjustments consisting of normal recurring adjustments that are necessary to present fairly the financial position, results of operations and cash flows for the interim periods have been made. 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 the Condensed Consolidated Statements of Cash Flows and 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; valuation of stock options; useful life and valuation of equipment; valuation and impairment of goodwill; 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. Although there has been uncertainty and disruption in the global economy, supply chain and financial markets, 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 November 1, 2023, 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 update publicly these estimates for any reason after the date of this Quarterly Report on Form 10-Q, except as required by law.
Goodwill	On July 1, 2023, the Company estimated the fair value of its reporting units using both the discounted cash flow and market approaches. 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 and (benefit from) income taxes, respectively, 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 updates 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, intercompany transactions, the applicability of special tax regimes, and changes in how the Company does business.

Revenue (Tables)

Revenue (Tables)	9 Months Ended
Revenue (Tables)	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Schedule of Disaggregation of Revenue	The following tables 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, 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 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Geographical market Middle East and Africa $ 16,722 $ — $ 16,722 $ 53,629 $ 79 $ 53,708 Asia 8,168 — 8,168 17,771 — 17,771 Americas 3,156 — 3,156 6,951 30 6,981 Europe 2,416 — 2,416 4,840 — 4,840 Total revenue $ 30,462 $ — $ 30,462 $ 83,191 $ 109 $ 83,300 Channel Megaproject $ 17,347 $ — $ 17,347 $ 51,178 $ 79 $ 51,257 Original equipment manufacturer 9,032 — 9,032 21,392 — 21,392 Aftermarket 4,083 — 4,083 10,621 30 10,651 Total revenue $ 30,462 $ — $ 30,462 $ 83,191 $ 109 $ 83,300
Schedule of Contract with Customer, Asset and Liability	The following table presents contract balances by category. September 30, December 31, (In thousands) Accounts receivable, net $ 23,337 $ 34,062 Contract assets, current (included in prepaid expenses and other assets) — 1,720 Contract liabilities: Contract liabilities, current $ 1,467 $ 1,195 Contract liabilities, non-current (included in other liabilities, non-current) 89 121 Total contract liabilities $ 1,556 $ 1,316
Schedule of Contract With Customer, Contract Liability, Activity	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 significant changes in contract liabilities during the period. September 30, December 31, (In thousands) Contract liabilities, beginning of year $ 1,316 $ 3,406 Revenue recognized (1,117) (3,123) Cash received, excluding amounts recognized as revenue during the period 1,357 1,033 Contract liabilities, end of period $ 1,556 $ 1,316
Schedule of Revenue, Remaining Performance Obligation	As of September 30, 2023, the following table presents the future estimated revenue by year expected to be recognized related to performance obligations that are unsatisfied or partially unsatisfied. Year Future Performance Obligations (In thousands) 2023 (remaining three months) $ 5,924 2025 6,861 Total $ 12,785

Net Income Per Share (Tables)

Net Income Per Share (Tables)	9 Months Ended
Net Income Per Share (Tables)	Sep. 30, 2023
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	The following table presents the computation of basic and diluted net income per common share. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 (In thousands, except per share amounts) Numerator Net income $ 9,660 $ 4,789 $ 1,699 $ 10,324 Denominator (weighted average shares) Basic common shares outstanding 56,443 55,881 56,346 56,291 Dilutive stock awards 1,526 1,491 1,415 1,417 Diluted common shares outstanding 57,969 57,372 57,761 57,708 Net income per share Basic $ 0.17 $ 0.09 $ 0.03 $ 0.18 Diluted $ 0.17 $ 0.08 $ 0.03 $ 0.18
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	The following table presents the weighted potential common shares issuable under stock awards that were excluded from the computation of diluted net income per common share. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 (In thousands) Anti-dilutive stock award shares 125 387 126 522

Other Financial Information (Ta

Other Financial Information (Tables)	9 Months Ended
Other Financial Information (Tables)	Sep. 30, 2023
Other Financial Information [Abstract]
Schedule of Restrictions on Cash and Cash Equivalents	The following table presents a reconciliation of cash, cash equivalents and restricted cash, reported within the Condensed Consolidated Balance Sheets that sum to the total of such amounts presented for each period presented on the Condensed Consolidated Statements of Cash Flows. September 30, December 31, September 30, (In thousands) Cash and cash equivalents $ 51,440 $ 56,354 $ 52,131 Restricted cash, non-current (included in other assets, non-current) 126 104 104 Total cash, cash equivalents and restricted cash $ 51,566 $ 56,458 $ 52,235
Schedule of Accounts Receivable, net	September 30, December 31, (In thousands) Accounts receivable, gross $ 23,446 $ 34,210 Allowance for doubtful accounts (109) (148) Accounts receivable, net $ 23,337 $ 34,062
Schedule of Inventories, Net	September 30, December 31, (In thousands) Raw materials $ 9,050 $ 11,178 Work in process 4,905 2,628 Finished goods 20,560 15,062 Inventories, gross 34,515 28,868 Valuation adjustments for excess and obsolete inventory (627) (502) Inventories, net $ 33,888 $ 28,366
Schedule of Accrued Expenses and Other Liabilities	September 30, December 31, (In thousands) Current Payroll, incentives and commissions payable $ 8,261 $ 10,479 Warranty reserve 944 968 Other accrued expenses and other liabilities 2,197 3,246 Total accrued expenses and other liabilities 11,402 14,693 Other liabilities, non-current 222 121 Total accrued expenses, and current and non-current other liabilities $ 11,624 $ 14,814

Investments and Fair Value Me_2

Investments and Fair Value Measurements (Tables)	9 Months Ended
Investments and Fair Value Measurements (Tables)	Sep. 30, 2023
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, 2023 December 31, 2022 Pricing Category Amortized Gross Gross Fair Amortized Gross Gross Fair (In thousands) Cash equivalents Money market securities Level 1 $ 17,408 $ — $ — $ 17,408 $ 33,268 $ — $ — $ 33,268 Short-term investments U.S. treasury securities Level 2 2,894 — (5) 2,889 3,629 1 — 3,630 Corporate notes and bonds Level 2 19,939 — (95) 19,844 26,060 — (208) 25,852 Municipal and agency notes and bonds Level 2 10,387 — (25) 10,362 3,992 5 — 3,997 Total short-term investments 33,220 — (125) 33,095 33,681 6 (208) 33,479 Long-term investments Corporate notes and bonds Level 2 13,417 — (74) 13,343 3,178 — (120) 3,058 Municipal and agency notes and bonds Level 2 8,084 — (33) 8,051 — — — — Total long-term investments 21,501 — (107) 21,394 3,178 — (120) 3,058 Total short and long-term investments 54,721 — (232) 54,489 36,859 6 (328) 36,537 Total $ 72,129 $ — $ (232) $ 71,897 $ 70,127 $ 6 $ (328) $ 69,805
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, 2023 December 31, 2022 Fair Gross Fair Gross (In thousands) U.S. treasury securities $ 2,889 $ (5) $ — $ — Corporate notes and bonds 31,687 (169) 28,911 (328) Municipal and agency notes and bonds 18,413 (58) — — Total available-for-sale investments with unrealized loss positions $ 52,989 $ (232) $ 28,911 $ (328)
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, 2023 2022 2023 2022 (In thousands) Corporate notes and bonds $ — $ — $ 2,966 $ —

Lines of Credit (Tables)

Lines of Credit (Tables)	9 Months Ended
Lines of Credit (Tables)	Sep. 30, 2023
Debt Disclosure [Abstract]
Schedule of Debt	The following table presents the total outstanding LCs and SBLCs issued by the Company to our customers related to product warranty and performance guarantees. September 30, December 31, (In thousands) Outstanding letters of credit $ 19,501 $ 15,487

Income Taxes (Tables)

Income Taxes (Tables)	9 Months Ended
Income Taxes (Tables)	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Schedule of Components of Income Tax Expense (Benefit)	Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 (In thousands, except percentages) Provision for (benefit from) income taxes $ 518 $ 371 $ (906) $ 377 Discrete items 357 331 986 1,134 Provision for income taxes, excluding discrete items $ 875 $ 702 $ 80 $ 1,511 Effective tax rate 5.1 % 7.2 % (114.2 %) 3.5 % Effective tax rate, excluding discrete items 8.6 % 13.6 % 10.0 % 14.1 %

Segment Reporting (Tables)

Segment Reporting (Tables)	9 Months Ended
Segment Reporting (Tables)	Sep. 30, 2023
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, 2023 Nine Months Ended September 30, 2023 Water Emerging Technologies Total Water Emerging Technologies 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 3,100 5,837 2,976 8,813 Sales and marketing 3,272 1,560 4,832 9,567 4,171 13,738 Research and development 1,098 2,871 3,969 3,121 8,922 12,043 Total operating expenses 6,409 5,492 11,901 18,525 16,069 34,594 Operating income (loss) $ 19,289 $ (5,308) 13,981 $ 28,961 $ (15,975) 12,986 Less: Corporate operating expenses 4,848 14,550 Income (loss) from operations $ 9,133 $ (1,564) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Water Emerging Technologies Total Water Emerging Technologies Total (In thousands) Revenue $ 30,462 $ — $ 30,462 $ 83,191 $ 109 $ 83,300 Cost of revenue 9,417 — 9,417 25,817 18 25,835 Gross profit 21,045 — 21,045 57,374 91 57,465 Operating expenses General and administrative 1,911 878 2,789 4,909 3,140 8,049 Sales and marketing 3,242 960 4,202 8,197 2,120 10,317 Research and development 1,216 2,612 3,828 3,159 11,011 14,170 Total operating expenses 6,369 4,450 10,819 16,265 16,271 32,536 Operating income (loss) $ 14,676 $ (4,450) 10,226 $ 41,109 $ (16,180) 24,929 Less: Corporate operating expenses 5,320 14,705 Income from operations $ 4,906 $ 10,224

Concentrations (Tables)

Concentrations (Tables)	9 Months Ended
Concentrations (Tables)	Sep. 30, 2023
Risks and Uncertainties [Abstract]
Schedules of Concentration of Risk, by Risk Factor	The following table presents 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 2023 2022 2023 2022 Customer A Water 29% 15% Customer B Water 20% 16% Customer C Water 17% Customer D Water 15% Customer E Water 15% 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, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Disaggregation of Revenue [Line Items]
Revenue	$ 37,036	$ 30,462	$ 71,160	$ 83,300
Water
Disaggregation of Revenue [Line Items]
Revenue	36,812	30,462	70,622	83,191
Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	224	0	538	109
Megaproject
Disaggregation of Revenue [Line Items]
Revenue	26,829	17,347	42,283	51,257
Megaproject \| Water
Disaggregation of Revenue [Line Items]
Revenue	26,829	17,347	42,283	51,178
Megaproject \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	0	0	79
Original equipment manufacturer
Disaggregation of Revenue [Line Items]
Revenue	5,307	9,032	16,845	21,392
Original equipment manufacturer \| Water
Disaggregation of Revenue [Line Items]
Revenue	5,083	9,032	16,415	21,392
Original equipment manufacturer \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	224	0	430	0
Aftermarket
Disaggregation of Revenue [Line Items]
Revenue	4,900	4,083	12,032	10,651
Aftermarket \| Water
Disaggregation of Revenue [Line Items]
Revenue	4,900	4,083	11,924	10,621
Aftermarket \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	0	108	30
Middle East and Africa
Disaggregation of Revenue [Line Items]
Revenue	24,543	16,722	38,380	53,708
Middle East and Africa \| Water
Disaggregation of Revenue [Line Items]
Revenue	24,543	16,722	38,272	53,629
Middle East and Africa \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	0	108	79
Asia
Disaggregation of Revenue [Line Items]
Revenue	5,688	8,168	19,180	17,771
Asia \| Water
Disaggregation of Revenue [Line Items]
Revenue	5,688	8,168	19,180	17,771
Asia \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	0	0	0	0
Americas
Disaggregation of Revenue [Line Items]
Revenue	5,214	3,156	9,781	6,981
Americas \| Water
Disaggregation of Revenue [Line Items]
Revenue	5,091	3,156	9,628	6,951
Americas \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	123	0	153	30
Europe
Disaggregation of Revenue [Line Items]
Revenue	1,591	2,416	3,819	4,840
Europe \| Water
Disaggregation of Revenue [Line Items]
Revenue	1,490	2,416	3,542	4,840
Europe \| Emerging Technologies
Disaggregation of Revenue [Line Items]
Revenue	$ 101	$ 0	$ 277	$ 0

Revenue - Schedule of Contract

Revenue - Schedule of Contract with Customer, Asset and Liability (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Dec. 31, 2021
Revenue from Contract with Customer [Abstract]
Accounts receivable, net	$ 23,337	$ 34,062
Contract assets, current (included in prepaid expenses and other assets)	0	1,720
Contract liabilities:
Contract liabilities, current	1,467	1,195
Contract liabilities, non-current (included in other liabilities, non-current)	89	121
Total contract liabilities	$ 1,556	$ 1,316	$ 3,406

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, 2023	Dec. 31, 2022
Contract With Customer, Liability [Roll Forward]
Contract liabilities, beginning of year	$ 1,316	$ 3,406
Revenue recognized	(1,117)	(3,123)
Cash received, excluding amounts recognized as revenue during the period	1,357	1,033
Contract liabilities, end of period	$ 1,556	$ 1,316

Revenue - Schedule of Remaining

Revenue - Schedule of Remaining Performance Obligation (Details) $ in Thousands	Sep. 30, 2023 USD ($)
Revenue from Contract with Customer [Abstract]
Performance obligations expected to be satisfied	$ 12,785
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	12,785
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Revenue from Contract with Customer [Abstract]
Performance obligations expected to be satisfied	5,924
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	$ 5,924
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 from Contract with Customer [Abstract]
Performance obligations expected to be satisfied	$ 6,861
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations expected to be satisfied	$ 6,861
Performance obligations expected to be satisfied, expected timing	1 year

Net Income Per Share - Schedule

Net Income Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Numerator
Net income	$ 9,660	$ 4,789	$ 1,699	$ 10,324
Denominator (weighted average shares)
Basic common shares outstanding (in shares)	56,443	55,881	56,346	56,291
Dilutive stock awards (in shares)	1,526	1,491	1,415	1,417
Diluted common shares outstanding (in shares)	57,969	57,372	57,761	57,708
Net income per share
Basic (in dollars per share)	$ 0.17	$ 0.09	$ 0.03	$ 0.18
Diluted (in dollars per share)	$ 0.17	$ 0.08	$ 0.03	$ 0.18

Net Income Per Share - Antidilu

Net Income Per Share - Antidilutive Securities Excluded From Computation of Diluted Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Earnings Per Share [Abstract]
Anti-dilutive stock awards (in shares)	125	387	126	522

Other Financial Information - S

Other Financial Information - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Sep. 30, 2022	Dec. 31, 2021
Other Financial Information [Abstract]
Cash and cash equivalents	$ 51,440	$ 56,354	$ 52,131
Restricted cash, non-current (included in other assets, non-current)	126	104	104
Total cash, cash equivalents and restricted cash	$ 51,566	$ 56,458	$ 52,235	$ 74,461

Other Financial Information -_2

Other Financial Information - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Accounts receivable, gross	$ 23,446	$ 34,210
Allowance for doubtful accounts	(109)	(148)
Accounts receivable, net	$ 23,337	$ 34,062

Other Financial Information -_3

Other Financial Information - Schedule of Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Raw materials	$ 9,050	$ 11,178
Work in process	4,905	2,628
Finished goods	20,560	15,062
Inventories, gross	34,515	28,868
Valuation adjustments for excess and obsolete inventory	(627)	(502)
Inventories, net	$ 33,888	$ 28,366

Other Financial Information - N

Other Financial Information - Narrative (Details) - USD ($)	3 Months Ended
Other Financial Information - Narrative (Details) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
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, 2023	Dec. 31, 2022
Current
Payroll, incentives and commissions payable	$ 8,261	$ 10,479
Warranty reserve	944	968
Other accrued expenses and other liabilities	2,197	3,246
Total accrued expenses and other liabilities	11,402	14,693
Other liabilities, non-current	222	121
Total accrued expenses, and current and non-current other liabilities	$ 11,624	$ 14,814

Investments and Fair Value Me_3

Investments and Fair Value Measurements - Schedule of Amortized Cost and Fair Value of Available for Sale Securities (Details) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	$ 72,129,000	$ 70,127,000
Gross unrealized gain	0	6,000
Gross unrealized losses	(232,000)	(328,000)
Fair value	71,897,000	69,805,000
Total short and long-term investments
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	54,721,000	36,859,000
Gross unrealized gain	0	6,000
Gross unrealized losses	(232,000)	(328,000)
Fair value	54,489,000	36,537,000
Short-term investments
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	33,220,000	33,681,000
Gross unrealized gain	0	6,000
Gross unrealized losses	(125,000)	(208,000)
Fair value	33,095,000	33,479,000
Long-term investments
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	21,501,000	3,178,000
Gross unrealized gain	0	0
Gross unrealized losses	(107,000)	(120,000)
Fair value	21,394,000	3,058,000
Level 1 \| Cash equivalents \| Money market securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	17,408,000	33,268,000
Gross unrealized gain	0	0
Gross unrealized losses	0	0
Fair value	17,408,000	33,268,000
Level 2 \| Short-term investments \| U.S. treasury securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	2,894,000	3,629,000
Gross unrealized gain	0	1,000
Gross unrealized losses	(5,000)	0
Fair value	2,889,000	3,630,000
Level 2 \| Short-term investments \| Corporate notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	19,939,000	26,060,000
Gross unrealized gain	0	0
Gross unrealized losses	(95,000)	(208,000)
Fair value	19,844,000	25,852,000
Level 2 \| Short-term investments \| Municipal and agency notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	10,387,000	3,992,000
Gross unrealized gain	0	5,000
Gross unrealized losses	(25,000)	0
Fair value	10,362,000	3,997,000
Level 2 \| Long-term investments \| Corporate notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	13,417,000	3,178,000
Gross unrealized gain	0	0
Gross unrealized losses	(74,000)	(120,000)
Fair value	13,343,000	3,058,000
Level 2 \| Long-term investments \| Municipal and agency notes and bonds
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Amortized cost	8,084,000	0
Gross unrealized gain	0	0
Gross unrealized losses	(33,000)	0
Fair value	8,051,000	0
Measured On Recurring Basis
Debt Securities, Available-for-sale [Line Items]
Total fair value of financial liabilities	0	0
Measured On Recurring Basis \| Level 3
Debt Securities, Available-for-sale [Line Items]
Total fair value of financial assets	$ 0	$ 0

Investments and Fair Value Me_4

Investments and Fair Value Measurements - Schedule of Gross Unrealized Losses and Fair Values of Investments (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Debt Securities, Available-for-sale [Line Items]
Fair value	$ 52,989	$ 28,911
Gross unrealized losses	(232)	(328)
U.S. treasury securities
Debt Securities, Available-for-sale [Line Items]
Fair value	2,889	0
Gross unrealized losses	(5)	0
Corporate notes and bonds
Debt Securities, Available-for-sale [Line Items]
Fair value	31,687	28,911
Gross unrealized losses	(169)	(328)
Municipal and agency notes and bonds
Debt Securities, Available-for-sale [Line Items]
Fair value	18,413	0
Gross unrealized losses	$ (58)	$ 0

Investments and Fair Value Me_5

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, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Debt Securities, Available-for-sale [Line Items]
Sales of marketable securities			$ 2,966	$ 0
Corporate notes and bonds
Debt Securities, Available-for-sale [Line Items]
Sales of marketable securities	$ 0	$ 0	$ 2,966	$ 0

Lines of Credit - Narrative (De

Lines of Credit - Narrative (Details) - Committed Revolving Credit Line - USD ($)	Sep. 30, 2023	Aug. 31, 2023	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	$ 25,000,000
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	$ 20,400,000

Lines of Credit - Schedule of D

Lines of Credit - Schedule of Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Standby Letters of Credit
Line of Credit Facility [Line Items]
Outstanding letters of credit	$ 19,501	$ 15,487

Income Taxes - Schedule of Comp

Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Tax Disclosure [Abstract]
Provision for (benefit from) income taxes	$ 518	$ 371	$ (906)	$ 377
Discrete items	357	331	986	1,134
Provision for income taxes, excluding discrete items	$ 875	$ 702	$ 80	$ 1,511
Effective tax rate	5.10%	7.20%	(114.20%)	3.50%
Effective tax rate, excluding discrete items	8.60%	13.60%	10%	14.10%

Segment Reporting - Financial I

Segment Reporting - Financial Information by Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Segment Reporting Information [Line Items]
Revenue	$ 37,036	$ 30,462	$ 71,160	$ 83,300
Cost of revenue	11,154	9,417	23,580	25,835
Gross profit	25,882	21,045	47,580	57,465
Operating expenses:
General and administrative	7,369	7,608	21,704	21,155
Sales and marketing	5,411	4,703	15,397	11,916
Research and development	3,969	3,828	12,043	14,170
Total operating expenses	16,749	16,139	49,144	47,241
Income (loss) from operations	9,133	4,906	(1,564)	10,224
Water
Segment Reporting Information [Line Items]
Revenue	36,812	30,462	70,622	83,191
Emerging Technologies
Segment Reporting Information [Line Items]
Revenue	224	0	538	109
Operating Segments
Segment Reporting Information [Line Items]
Revenue	37,036	30,462	71,160	83,300
Cost of revenue	11,154	9,417	23,580	25,835
Gross profit	25,882	21,045	47,580	57,465
Operating expenses:
General and administrative	3,100	2,789	8,813	8,049
Sales and marketing	4,832	4,202	13,738	10,317
Research and development	3,969	3,828	12,043	14,170
Total operating expenses	11,901	10,819	34,594	32,536
Income (loss) from operations	13,981	10,226	12,986	24,929
Operating Segments \| Water
Segment Reporting Information [Line Items]
Revenue	36,812	30,462	70,622	83,191
Cost of revenue	11,114	9,417	23,136	25,817
Gross profit	25,698	21,045	47,486	57,374
Operating expenses:
General and administrative	2,039	1,911	5,837	4,909
Sales and marketing	3,272	3,242	9,567	8,197
Research and development	1,098	1,216	3,121	3,159
Total operating expenses	6,409	6,369	18,525	16,265
Income (loss) from operations	19,289	14,676	28,961	41,109
Operating Segments \| Emerging Technologies
Segment Reporting Information [Line Items]
Revenue	224	0	538	109
Cost of revenue	40	0	444	18
Gross profit	184	0	94	91
Operating expenses:
General and administrative	1,061	878	2,976	3,140
Sales and marketing	1,560	960	4,171	2,120
Research and development	2,871	2,612	8,922	11,011
Total operating expenses	5,492	4,450	16,069	16,271
Income (loss) from operations	(5,308)	(4,450)	(15,975)	(16,180)
Corporate
Operating expenses:
Total operating expenses	$ 4,848	$ 5,320	$ 14,550	$ 14,705

Concentrations - Schedules of C

Concentrations - Schedules of Concentration of Risk, by Risk Factor (Details) - Revenue from Contract with Customer Benchmark - Customer Concentration Risk - Water	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Customer A
Concentration Risk [Line Items]
Percentage of revenue		29%		15%
Customer B
Concentration Risk [Line Items]
Percentage of revenue	20%		16%
Customer C
Concentration Risk [Line Items]
Percentage of revenue				17%
Customer D
Concentration Risk [Line Items]
Percentage of revenue	15%
Customer E
Concentration Risk [Line Items]
Percentage of revenue	15%
Customer F
Concentration Risk [Line Items]
Percentage of revenue	10%