BRC Group Posts $243 Million Loss on Babcock & Wilcox

The Tip Desk · November 5, 2026 · 3 min read

Third-quarter revenue was $33.0 million as $128.3 million of investment losses offset $161.3 million of operating revenue, and the company booked a $243.0 million net loss, or $6.04 a share, after $226.7 million of pre-tax Babcock & Wilcox losses.

BRC Group Holdings, Inc. (RILY), a diversified holding company, reported a third-quarter net loss available to common shareholders of $243.0 million, or $6.04 a share, after $226.7 million of pre-tax losses on its investment in Babcock & Wilcox and a $14.6 million non-cash impairment of its remaining stake in GA Group.

Total revenues were $33.0 million, as Operating Revenues of $161.3 million were offset by Investment Losses of $128.3 million. Adjusted EBITDA was $(219.1) million. Operating Adjusted EBITDA was $2.9 million, reduced by $17.4 million from the reversal of an unrealized second-quarter gain on structured equity financings and a net markdown of the SpaceX carried interest. The company said it updated the Operating Adjusted EBITDA definition to exclude GA Group equity-method income and the noncontrolling interest tied to B. Riley Securities Holdings investment gains and losses, applied consistently across comparable periods.

Capital Markets was the operating break. Segment revenue was a $(90.2) million loss, and segment income was $(120.0) million, primarily on trading losses of $(125.7) million concentrated in Babcock & Wilcox. The company said third-quarter results also reflected lower ATM, private placement and underwriting revenues amid smaller average deal sizes, partially offset by higher M&A and advisory revenues. Excluding Babcock & Wilcox, trading and realized and unrealized results on other investments were net gains of $4.8 million. The Babcock & Wilcox position was valued at $160.3 million at September 30, 2026.

Wealth Management revenue was $24.3 million, with segment income of $(3.7) million, as carried interest, trading gains and commissions fell and advisory fees rose. B. Riley Wealth had about $12.8 billion of client assets under management at quarter-end. Consumer Products revenue was $39.3 million and the segment loss widened to $(4.3) million, which the company attributed to weaker consumer demand and lower sales volume. Communications Business Group combined income grew as cost-reduction initiatives more than offset a revenue decline from expected customer attrition; Lingo revenue was $36.2 million, magicJack $8.5 million, Marconi Wireless $7.1 million and UOL $2.8 million.

Net debt declined 10%, or $64.7 million, to $562.3 million at September 30, 2026 from $627.0 million at December 31, 2025. Total debt was reduced to $1.14 billion from $1.43 billion over the same period, driven primarily by debt paydowns and senior note exchanges, including $142.1 million of senior notes redeemed in September. Cash, cash equivalents and restricted cash totaled $145.7 million. Total investments decreased to $408.6 million from $520.5 million at year-end 2025, including the $14.6 million GA Group impairment.

On November 3, 2026, the company completed the sale of its remaining equity interest in Great American Holdings to Oaktree affiliates for $62.3 million in cash. It used $51.7 million to repay Oaktree term loans, reducing those loans to $43.7 million from $65.6 million and adding $36.5 million of liquidity net of a $3.3 million fee.

On September 28, 2026, BRC Group entered a definitive agreement to acquire Sangoma Technologies for a $203.7 million enterprise value. The deal is expected to be funded with $212.3 million of committed senior secured term loans at its telecommunications subsidiaries, adding $140.8 million of incremental debt versus $71.5 million outstanding at September 30, 2026, with $54 million of equity contributions. The transaction is not subject to a financing condition and is expected to close no later than early 2027, subject to shareholder, court and regulatory approvals.

The company said it restored 100% ownership of B. Riley Securities Holdings on October 22 and continues to advance integration with B. Riley Wealth.