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Quarterhill (TSE:QTRH)
TSX:QTRH
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Quarterhill (QTRH) AI Stock Analysis

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TSE:QTRH

Quarterhill

(TSX:QTRH)

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Neutral 45 (OpenAI - 4o)
Rating:45Neutral
Price Target:
C$1.00
▼(-8.26% Downside)
Quarterhill's overall stock score reflects significant financial and operational challenges. The company's declining financial performance and bearish technical indicators are major concerns. While the earnings call provided some positive strategic initiatives, the immediate financial outlook remains pressured, impacting the overall score.

Quarterhill (QTRH) vs. iShares MSCI Canada ETF (EWC)

Quarterhill Business Overview & Revenue Model

Company DescriptionQuarterhill Inc. operates in the intelligent transportation system and intellectual property licensing industries worldwide. Its Licensing segment includes patents relating to wireless communications, memory interface technologies, semiconductor manufacturing and packaging technologies, wired connectivity, automotive applications, computer gaming, intelligent personal assistant technologies, enhanced image processing, streaming video technologies, non-volatile Flash memory, DRAM and other memory technologies, and semiconductor analog circuitry technologies. The company's Intelligent Systems segment provides international road dynamics products and services, such as red light and speed enforcement systems, automated truck weigh stations; toll road systems and equipment; traffic management and safety systems; VectorSense, a tire sensor suite; Vehicle Information-In-Motion, a traffic intelligence system; integrated traffic control systems; permanent and portable slow speed weigh-in-motion systems; portable wheel load scales; traffic data collection products; vehicle and axle detection equipment; and automated vehicle identification services and equipment, and other hardware and software products and offerings for the intelligent transportation systems industry. This segment serves through direct salespeople, distributors, agents, contractors, and systems integrators. The company was formerly known as Wi-LAN Inc. and changed its name to Quarterhill Inc. in June 2017. Quarterhill Inc. was incorporated in 1992 and is headquartered in Toronto, Canada.
How the Company Makes MoneyQuarterhill generates revenue primarily through licensing agreements, royalties, and the commercialization of its patented technologies. The company acquires technology firms that own valuable intellectual property, which it then monetizes by licensing these patents to other businesses. This revenue model is bolstered by strategic partnerships with technology companies and organizations that seek to utilize Quarterhill's patented innovations. Additionally, Quarterhill may earn income through the sale of technology products developed by its subsidiaries, further diversifying its revenue streams.

Quarterhill Earnings Call Summary

Earnings Call Date:Aug 13, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive developments such as revenue growth, international expansion, and cost-saving measures, alongside significant challenges like negative EBITDA, problem contracts, and a debt covenant violation. The company is taking steps to address these issues, but the current financial performance is under pressure.
Q2-2025 Updates
Positive Updates
Revenue Growth and New Business Wins
Q2 revenue was $43.1 million, up 4% from the same quarter last year and up 27% from Q1. The company added $85 million in change orders and wins this year, with a recent $25 million annual renewal for an existing contract.
Cost-Saving Restructuring
Quarterhill implemented a restructuring that is expected to save approximately $12 million per year, with most savings in the cost of sales line. The restructuring involved a reduction of around 100 positions, or roughly 15% of total headcount.
Strong Performance in Safety and Enforcement Business
The Safety and Enforcement business grew its top line in the quarter, delivering strong margins, increasing gross margin from about 20% to over 40% over the last six quarters.
Expansion into International Markets
Recent international wins in Djibouti, Thailand, and South Korea reflect global demand for Quarterhill's enforcement solutions, including a $2.8 million contract with the Louisiana Department of Transportation.
Investment in Next-Gen Technology
Quarterhill is investing in a new technology platform built on microservices and AI architecture, with a planned launch in Q3. This includes AI-driven features like vehicle fingerprinting and predictive analytics.
Negative Updates
Negative Adjusted EBITDA
Q2 adjusted EBITDA was negative $2.7 million, compared to positive $1.7 million in Q2 last year, although up from negative $3.4 million in Q1.
Problem Contracts Impact
Two problem contracts reduced Q2 adjusted EBITDA by $3.9 million. Despite cost reductions, these contracts still present challenges, with ongoing mediation efforts.
Debt Covenant Violation
Quarterhill was not in compliance with its financial covenants at June 30, although an amendment to the credit agreement provides a waiver through Q3.
Decreased Gross Margin
Q2 gross margin was 15%, down from 21% in Q2 last year, primarily due to poor margins on two tolling projects.
Company Guidance
During the Q2 2025 financial results conference call, Quarterhill reported a Q2 revenue of $43.1 million and an adjusted EBITDA of negative $2.7 million, indicating performance below expectations. The company has implemented a restructuring plan, reducing its workforce by approximately 15% to save around $12 million annually, with benefits expected in Q3 2025. The restructuring primarily targets two problematic tolling contracts, which contributed $3.9 million in losses to Q2 adjusted EBITDA. Despite these challenges, Quarterhill secured $85 million in new orders and a $25 million annual contract renewal, highlighting strong performance in its Safety and Enforcement unit. This unit achieved a gross margin growth from 20% to over 40% in recent quarters. The company is also investing in new AI-driven technology platforms to enhance its offerings and operational efficiency. Looking forward, Quarterhill aims to achieve sustainable profitability and margin expansion by resolving the problem contracts, realizing cost savings, and growing its higher-margin business.

Quarterhill Financial Statement Overview

Summary
Quarterhill is facing significant financial challenges with declining revenues and profitability, negative cash flows, and a concerning trend in financial health. While the balance sheet shows manageable leverage, the overall financial position is weak.
Income Statement
45
Neutral
Quarterhill experienced a challenging period with declining revenues and profitability. The Gross Profit Margin decreased significantly, and the Net Profit Margin turned negative, reflecting increased costs or decreased pricing power. The revenue decline from the previous year indicates potential market share loss or decreased demand for products. Negative EBIT and EBITDA margins highlight struggles in operational efficiency and cost management. Overall, the income statement shows a concerning trend of declining financial health.
Balance Sheet
55
Neutral
The balance sheet reveals a moderately leveraged position with a Debt-to-Equity Ratio of 0.47, indicating manageable debt levels relative to equity. However, the Return on Equity (ROE) has turned negative due to net losses, impacting shareholder value. The Equity Ratio remains healthy at 57%, showing a solid equity base. Despite these strengths, the declining net income and equity raise concerns about future financial stability.
Cash Flow
40
Negative
The cash flow analysis shows significant weaknesses, with negative Operating Cash Flow and Free Cash Flow, indicating issues in generating cash from operations. The Free Cash Flow to Net Income Ratio is unfavorable, and the Operating Cash Flow to Net Income Ratio is negative, reflecting cash flow strains. The Free Cash Flow Growth Rate is also negative, highlighting declining cash generation capability. This weak cash flow position raises concerns about liquidity and the ability to fund operations and investments.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue153.86M153.31M194.32M305.69M125.69M144.53M
Gross Profit23.18M27.78M40.60M117.54M37.44M58.86M
EBITDA-1.78M7.96M-8.92M-15.67M3.90M30.53M
Net Income-19.04M-11.02M-49.99M2.77M-22.18M4.43M
Balance Sheet
Total Assets227.86M230.11M332.08M411.94M427.19M303.81M
Cash, Cash Equivalents and Short-Term Investments22.66M31.89M56.62M67.91M72.60M141.25M
Total Debt63.13M61.07M86.54M89.94M115.90M3.76M
Total Liabilities108.08M98.98M142.02M154.28M186.08M31.88M
Stockholders Equity119.78M131.12M190.06M257.66M241.12M271.93M
Cash Flow
Free Cash Flow-9.33M-9.86M-23.38M30.92M-19.92M32.63M
Operating Cash Flow-3.30M-4.42M-27.56M39.61M-13.34M35.22M
Investing Cash Flow5.84M-1.99M27.77M-10.30M-158.09M41.44M
Financing Cash Flow-4.18M-4.54M-9.05M-42.89M108.26M-19.48M

Quarterhill Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price1.09
Price Trends
50DMA
1.11
Negative
100DMA
1.22
Negative
200DMA
1.36
Negative
Market Momentum
MACD
-0.01
Negative
RSI
52.13
Neutral
STOCH
61.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:QTRH, the sentiment is Neutral. The current price of 1.09 is above the 20-day moving average (MA) of 1.07, below the 50-day MA of 1.11, and below the 200-day MA of 1.36, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 52.13 is Neutral, neither overbought nor oversold. The STOCH value of 61.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:QTRH.

Quarterhill Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
C$952.68M15.5623.51%6.82%0.34%-3.86%
C$77.68M133.856.61%37.78%-48.82%
$37.18B12.37-10.20%1.83%8.50%-7.62%
C$248.01M69.03-7.92%2.18%-1.78%-191.59%
C$613.53M-14.04%-24.21%-440.28%
C$42.71M
$125.04M-14.86%3.11%4.00%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:QTRH
Quarterhill
1.09
-0.55
-33.54%
TSE:BEW
BeWhere Holdings
0.89
0.05
5.95%
TSE:BYL
Baylin Tech
0.30
-0.23
-43.40%
TSE:ET
Evertz Technologies
12.82
1.70
15.29%
TSE:VCM
Vecima Networks
10.09
-9.32
-48.02%
TSE:TSAT
Telesat Corp
42.22
25.23
148.50%

Quarterhill Corporate Events

Financial Disclosures
Quarterhill to Release Q3 2025 Financial Results
Neutral
Oct 23, 2025

Quarterhill Inc. announced it will release its Q3 2025 financial results on November 6, 2025, with a conference call and webcast hosted by CEO Chuck Myers and CFO David Charron. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and strategic positioning in the ITS industry, potentially impacting its market perception and investor decisions.

The most recent analyst rating on (TSE:QTRH) stock is a Hold with a C$1.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Business Operations and StrategyProduct-Related Announcements
Quarterhill and WSDOT Launch $2.3 Million Truck Parking Safety Initiative on I-5
Positive
Oct 14, 2025

Quarterhill Inc., in collaboration with the Washington State Department of Transportation, has launched a $2.3 million Truck Parking Information Management System (TPIMS) to enhance truck parking safety along Washington’s I-5 corridor. This initiative aims to address the critical issue of secure truck parking by providing real-time information on available spaces, thereby reducing fatigue-related risks and improving freight efficiency. The project highlights Quarterhill’s role as a comprehensive solutions provider, enhancing roadway safety and supporting the state’s transportation network resilience.

The most recent analyst rating on (TSE:QTRH) stock is a Hold with a C$1.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Business Operations and Strategy
Quarterhill and Arkansas DOT Collaborate to Enhance Freight Operations with AI Technology
Positive
Oct 9, 2025

Quarterhill Inc. has partnered with the Arkansas Department of Transportation and the Arkansas Highway Police to launch a $2.7 million project aimed at modernizing freight operations on two major trucking corridors in Arkansas. The initiative will implement AI-driven and sensor-based technologies, including weigh-in-motion sensors and tire anomaly classification systems, to enhance safety and efficiency without expanding roadways. This project is expected to strengthen Arkansas’ position as a leader in freight movement, addressing increasing freight volumes and supporting sustainable transportation infrastructure.

The most recent analyst rating on (TSE:QTRH) stock is a Hold with a C$1.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Business Operations and StrategyLegal Proceedings
Quarterhill Strengthens Tolling Partnership with New Mediation Agreement
Positive
Sep 2, 2025

Quarterhill Inc. announced a successful mediation agreement with a tolling customer, resolving past contract issues and setting new terms that enhance their partnership. The agreement includes a one-time payment, improved payment terms, and a structure that increases revenue while reducing costs, marking a significant step in Quarterhill’s operational transformation and strengthening its customer relationships.

The most recent analyst rating on (TSE:QTRH) stock is a Hold with a C$1.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Quarterhill Inc. Navigates Mixed Earnings Landscape
Sep 1, 2025

Quarterhill Inc. Faces Mixed Fortunes in Latest Earnings Call

Quarterhill Inc. Reports Q2 2025 Financial Results
Aug 14, 2025

Quarterhill Inc., a prominent player in the Intelligent Transportation System (ITS) industry, specializes in providing tolling and enforcement solutions. The company is known for its technology-driven approach and acquisition-oriented investment strategy aimed at achieving global leadership in ITS.

Business Operations and StrategyFinancial Disclosures
Quarterhill Reports Q2 2025 Financial Results and Announces Restructuring
Neutral
Aug 13, 2025

Quarterhill Inc. reported its Q2 2025 financial results, showing a revenue increase to $43.1 million, up 4% from the previous year, driven by strong performance in its safety and enforcement unit. Despite this growth, the company faced a net loss of $6.8 million, attributed to cost overruns on tolling projects and increased operating expenses. The company announced a restructuring plan expected to save $12 million annually, alongside efforts to renegotiate tolling contracts and invest in new technology, aiming to enhance financial performance and shareholder value.

The most recent analyst rating on (TSE:QTRH) stock is a Buy with a C$2.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Business Operations and StrategyProduct-Related Announcements
Quarterhill Expands Global Reach with New Weigh-In-Motion Contracts
Positive
Aug 5, 2025

Quarterhill Inc. has announced new international contracts for its weigh-in-motion solutions in Djibouti, Thailand, and South Korea. This marks the company’s first deployment in Djibouti, expanding its presence in East Africa, and highlights the growing demand for its innovative technologies. The Djibouti project, part of a World Bank-funded infrastructure upgrade, features a comprehensive overweight enforcement solution with advanced technology for efficient traffic flow and accurate weight regulation. Repeat orders from Thailand and South Korea validate the reliability of Quarterhill’s systems, which are engineered for durability and accuracy in high-traffic environments, underscoring the company’s commitment to improving roadway safety and efficiency globally.

The most recent analyst rating on (TSE:QTRH) stock is a Buy with a C$2.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Financial Disclosures
Quarterhill to Release Q2 2025 Financial Results
Neutral
Jul 30, 2025

Quarterhill Inc. is set to release its Q2 2025 financial results on August 13, 2025, with a conference call and webcast hosted by CEO Chuck Myers and CFO David Charron. This announcement is significant for stakeholders as it provides insights into the company’s financial health and strategic direction within the ITS industry.

The most recent analyst rating on (TSE:QTRH) stock is a Buy with a C$2.00 price target. To see the full list of analyst forecasts on Quarterhill stock, see the TSE:QTRH Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 23, 2025