Core Viewpoint - ProFrac Holding Corp. (NASDAQ:ACDC) is facing downward pressure on its share price, primarily due to a recent 'Underweight' rating from Morgan Stanley, which indicates a potential decline in value amid a challenging energy market environment [2][3]. Group 1: Stock Performance - The share price of ProFrac Holding Corp. fell by 4.06% between December 17 and December 24, 2025, ranking it among the energy stocks that lost the most during that week [1]. - On December 15, the stock slid after Morgan Stanley initiated coverage with an 'Underweight' rating and a price target of $3.5, suggesting a downside potential of over 7% from the current share price [3]. Group 2: Market Conditions - Global crude prices recently dropped to their lowest levels since February 2021, influenced by weak employment data and concerns about oversupply [4]. - Although oil prices have seen a slight rebound, ongoing uncertainties, including the potential for a peace deal in the Russia-Ukraine war, continue to exert pressure on the market [4]. Group 3: Investment Outlook - While there is recognition of ProFrac Holding's potential as an investment, certain AI stocks are perceived to offer greater upside potential with less downside risk [5].

Group 1 - ProFrac Holding Corp. (NASDAQ:ACDC) experienced a share price decline of 13.02% from December 10 to December 17, 2025, ranking it among the energy stocks that lost the most during that week [1] - Morgan Stanley initiated coverage of ProFrac Holding with an 'Underweight' rating and set a price target of $3.50, suggesting a potential downside of over 11% from the current share price [3] - The analyst noted that oil and gas services stocks have rebounded from their lows after a challenging 2025, but cautioned that it is premature to invest due to expected tight North American onshore spending amid an uncertain oil market [3] Group 2 - Global crude oil prices have fallen to their lowest levels since February 2021, influenced by weak employment data, oversupply, and the possibility of a peace deal between Ukraine and Russia [4]

Core Insights - ProFrac Holding Corp. (NASDAQ: ACDC) experienced a significant decline in share price, falling by 11.06% from November 11 to November 18, 2025, ranking among the energy stocks that lost the most during that week [1] Financial Performance - The company reported lower-than-expected results for Q3 on November 10, with both earnings and revenue falling below estimates [3] - Revenue decreased by 30% year-over-year, with the Stimulation Services division being the most affected [3] - Net cash provided by operating activities plummeted from $97 million in Q2 to $5 million in Q3, while free cash flow turned negative at $29 million [3] Profitability and Cost-Saving Measures - Although the net loss improved from $107 million in Q2 to $92 million in Q3, adjusted EBITDA was nearly halved to $41 million, indicating reduced profitability [4] - To enhance profitability, the company aims to achieve annualized cash savings of $85 to $115 million by the end of Q2 2026 through various strategic initiatives [4]

Group 1 - Deteriorating onshore activity levels in the US are negatively impacting ProFrac's business, with guidance indicating a worsening situation in the fourth quarter and little expectation for near-term improvement [1] - Narweena, an asset manager led by Richard Durant, focuses on identifying market dislocations due to poor understanding of long-term business prospects, aiming for excess risk-adjusted returns through secular growth opportunities in markets with barriers to entry [1] - The research process at Narweena emphasizes company and industry fundamentals to uncover unique insights, with a high risk appetite and long-term investment horizon targeting deeply undervalued stocks, particularly in smaller cap markets [1] Group 2 - An aging population with low growth and stagnating productivity is expected to create a different investment opportunity set compared to the past, with many industries facing stagnation or secular decline, potentially improving business performance due to reduced competition [1] - Conversely, some businesses may encounter rising costs and diseconomies of scale, while economies are increasingly dominated by asset-light businesses, leading to a declining need for infrastructure investments over time [1] - A large pool of capital is pursuing a limited set of investment opportunities, resulting in rising asset prices and compressing risk premia over time [1]

Core Insights - ProFrac Holding Corp. (NASDAQ:ACDC) experienced a significant decline in share price, falling by 27.53% from November 3 to November 10, 2025, making it one of the worst-performing energy stocks during that week [1]. Financial Performance - The company reported disappointing Q3 results on November 10, with earnings per share (EPS) of -$0.51, missing estimates by $0.09, and revenue of $403.1 million, which represented a 30% year-over-year decline [3]. - ProFrac's net loss for Q3 narrowed to $92 million from $107 million in the previous quarter, but adjusted EBITDA plummeted by 93% quarter-over-quarter, indicating significant challenges in the market [4]. - Net cash provided by operating activities dropped sharply to $5 million, down from $97 million in the prior quarter [4]. Strategic Initiatives - To enhance earnings, ProFrac aims to achieve annualized cash savings of $85 to $115 million by the end of Q2 2026, focusing on operational efficiency and cost reductions [5]. - The company's share price has decreased by over 51% since the start of 2025, reflecting ongoing struggles in the energy sector [5].

Financial Performance - Total revenue for Q3 2025 was $403.1 million, a decrease of $172.2 million (30%) from Q3 2024, and for the nine months ended September 30, 2025, it was $1,505.3 million, down $230.9 million (13%) from the same period in 2024[114]. - Net loss attributable to ProFrac Holding Corp. for Q3 2025 was $100.9 million, an increase of $55.7 million (122%) from Q3 2024, and for the nine months ended September 30, 2025, it was $226.4 million, up $116.3 million (106%) from the same period in 2024[114]. - Stimulation Services revenue for Q3 2025 decreased by $164.2 million (48%) to $342.9 million compared to Q3 2024, and for the nine months, it decreased by $230.6 million (15%) to $1,299.4 million[120]. - Proppant Production revenue for Q3 2025 increased by $23.6 million (45%) to $76.4 million compared to Q3 2024, and for the nine months, it increased by $21.2 million (11%) to $221.2 million[121]. - Manufacturing revenue for Q3 2025 decreased by $13.4 million (22%) to $48.1 million compared to Q3 2024, while for the nine months, it increased by $8.8 million (5%) to $169.7 million[123]. Cash Flow and Liquidity - Cash provided by operating activities for the nine months ended September 30, 2025, was $140.0 million, a decrease of $150.8 million (52%) from the same period in 2024[114]. - Net cash provided by operating activities was $140.0 million for the nine months ended September 30, 2025, down from $290.8 million in the same period in 2024[148]. - Total liquidity position at September 30, 2025, was $94.5 million, consisting of $53.4 million in cash and cash equivalents and $41.1 million available for borrowings[142]. Debt and Financing - Total principal amount of long-term debt was $1,094.0 million as of September 30, 2025, a decrease of $44.9 million (4%) from December 31, 2024[114]. - Total long-term debt outstanding as of September 30, 2025, was $1,094.0 million, with $158.6 million due within the next twelve months[153]. - The company plans to issue an additional $40.0 million of 2029 Senior Notes in December 2025, subject to customary closing conditions[143]. - A 1% increase in interest rates on variable-rate debt would increase annual interest payments by approximately $10.4 million[165]. - Interest expense, net decreased to $34.5 million and $105.5 million for the three and nine months ended September 30, 2025, respectively, compared to $40.6 million and $117.8 million in the same periods in 2024[135]. Expenses and Cost Management - Selling, general and administrative expenses decreased by $8.9 million (17%) and $8.6 million (5%) for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024[129]. - Depreciation, depletion, and amortization decreased by $9.7 million and $15.2 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024[130]. - Acquisition and integration costs were $0 for the three months and $0.2 million for the nine months ended September 30, 2025, down from $2.0 million and $5.1 million in the same periods in 2024[131]. Future Outlook - The company expects Q4 2025 results to improve relative to Q3 2025, focusing on financial and operational discipline amid challenging market conditions[118]. - For the full year of 2025, capital expenditures are estimated to range from $115 million to $135 million for maintenance and an additional $45 million to $55 million for growth initiatives[157]. - Capital expenditures for the nine months ended September 30, 2025, were $133.3 million, reflecting investments in maintenance and next-generation technology[156]. Strategic Initiatives - The company’s growth strategy includes potential acquisitions, which may be suspended if liquidity improvement actions are ineffective[161]. - Historical funding for acquisitions has been through equity securities issuances, borrowings under credit agreements, and debt securities issuance[164]. - As of September 30, 2025, the company had purchase commitments of $30.9 million for hydraulic fracturing equipment components[159]. Taxation - The effective tax rate for the nine months ended September 30, 2025, was 6.7%, compared to 19.0% in the same period in 2024[137]. - The estimated tax receivable agreement obligations amount to $86.4 million, with $3.4 million due in the next twelve months[160]. Other - The company recorded a loss of $10.5 million from the disposal of its EKU Power Drives subsidiary in June 2025[116]. - In June 2025, the company amended the Alpine 2023 Term Loan, reducing required amortization payments from $15.0 million to $5.0 million for certain dates[115].

Financial Data and Key Metrics Changes - In Q3, the company generated revenues of $403 million, adjusted EBITDA of $41 million, and free cash flow of negative $29 million, compared to revenues of $502 million, adjusted EBITDA of $79 million, and free cash flow of $54 million in Q2 [20][34][40] - The adjusted EBITDA margin decreased to 10% from 16% in the previous quarter, reflecting operational challenges and market volatility [34][40] Business Line Data and Key Metrics Changes - Stimulation services revenues declined to $343 million in Q3 from $432 million in Q2, with adjusted EBITDA falling to $20 million from $51 million, resulting in margins of 6% compared to 12% in Q2 [39][40] - The proppant production segment generated revenues of $76 million in Q3, effectively flat from $78 million in Q2, with adjusted EBITDA of $8 million compared to $15 million in Q2, and margins decreased from 19% to 10% [40][41] - The manufacturing segment's revenues decreased to $48 million from $56 million in Q2, with adjusted EBITDA of $4 million compared to $7 million in Q2 [41] Market Data and Key Metrics Changes - The U.S. onshore completions market is experiencing cautious capital deployment, leading to increased calendar white space and operational inefficiencies [7][12] - The natural gas sector's outlook remains favorable, driven by expanding LNG export capacity and rising power demand, which are expected to support improved completions fundamentals in 2026 [12][23] Company Strategy and Development Direction - The company is prioritizing dedicated fleets paired with operators conducting more robust, less volatile programs to build a sustainable and resilient business model [7][21] - A comprehensive cost management strategy has been implemented, targeting $100 million in annualized savings by the end of Q2 2026, with specific savings identified across COGS, SG&A, and capital expenditures [9][36] - The company is focusing on maintaining financial flexibility and building a resilient platform through strategic partnerships and capital raises, including a recent equity offering that netted approximately $80 million [14][22] Management's Comments on Operating Environment and Future Outlook - Management noted that while Q3 presented challenges, there are signs of stabilization in October, with some deferred programs returning to the calendar [11][27] - The company expects global supply imbalances to normalize in 2026 as operators will need to gradually accelerate completion activity to overcome natural production decline [11][12] - Management remains optimistic about the future, citing the potential for meaningful supply-demand tightening in the hydraulic fracturing market [12][21] Other Important Information - The company has identified initial savings of $100 million at the midpoint on an annualized basis, with $35 million-$45 million driven by labor reductions already implemented [9][36] - The company is pursuing up to $200 million in incremental capital through various means, including senior secured notes and non-collateralized asset sales [22][38] Q&A Session Summary Question: How does the company approach pricing in the current market? - The company focuses on reliable, consistent programs and expects spot pricing to return to historical levels where it is typically higher than committed work [51][56] Question: What is the current portion of dedicated versus spot work? - Approximately 80% of the current work is dedicated, with expectations to shift to high 90s by 2026 [67][70] Question: Are the cost cuts considered permanent? - All cost cuts are characterized as sustainable, with a focus on maintaining the right number of employees and optimizing maintenance programs [76][79] Question: What is the outlook for the proppant production segment? - The company anticipates improved volumes and pricing in the Haynesville and South Texas regions, contributing positively to the proppant segment's performance [95] Question: What is the current capacity and attrition expected? - The company has high utilization on E fleets and dual fuel programs, with expectations for continued demand in these areas [108]

Group 1 - U.S. stock futures are higher, with Nasdaq futures gaining approximately 1.5% [1] - Monday.Com Ltd is expected to report quarterly earnings of 88 cents per share, an increase from 85 cents per share year-over-year [2] - The consensus estimate for monday.com's quarterly revenue is $312.26 million, up from $251 million a year earlier [2] Group 2 - Monday.Com shares fell 2.6% to $184.70 in pre-market trading [2] - Metsera Inc shares dipped 15% to $70.68 in pre-market trading following Pfizer's $10 billion acquisition deal [4] - Ionis Pharmaceuticals Inc declined 11.5% to $65.00 after disclosing results from pivotal Phase 3 studies [4] - Other companies such as UniQure NV, Oscar Health Inc, Centene Corp, and Immunovant Inc also experienced declines in pre-market trading [4]

Group 1 - U.S. stock futures are higher, with Nasdaq futures gaining approximately 1.5% on Monday [1] - Monday.Com Ltd is expected to report quarterly earnings of 88 cents per share, an increase from 85 cents per share in the previous year [2] - The consensus estimate for monday.com's quarterly revenue is $312.26 million, up from $251 million a year earlier [2] Group 2 - Monday.Com shares fell 2.6% to $184.70 in pre-market trading [2] - Metsera Inc shares dipped 15% to $70.68 after Pfizer secured a $10 billion deal to acquire the company [4] - Ionis Pharmaceuticals Inc declined 11.5% to $65.00 following the disclosure of pivotal Phase 3 study results [4] - Other companies such as UniQure NV, Oscar Health Inc, Centene Corp, and Immunovant Inc also experienced declines in pre-market trading [4]

Financial Performance - Total revenue for Q3 2025 was $403 million, down from $502 million in Q2 2025, representing a decrease of approximately 20%[7] - Net loss for Q3 2025 was $92 million, an improvement from a net loss of $107 million in Q2 2025[7] - Adjusted EBITDA for Q3 2025 was $41 million, which is 10% of revenue, compared to $79 million or 16% of revenue in Q2 2025[7] - Total revenues for Q3 2025 were $403.1 million, a decrease from $501.9 million in the prior quarter, with stimulation services generating $342.9 million[34] - Adjusted EBITDA for the three months ended September 30, 2025, was $40.9 million, down from $78.6 million in the previous quarter[34] - Free cash flow for the three months ended September 30, 2025, was negative $29.2 million, compared to positive $54.4 million in the prior quarter[36] - The adjusted EBITDA for the nine months ended September 30, 2025, totaled $249.0 million, compared to $430.3 million for the same period in the previous year[34] Segment Performance - The Stimulation Services segment generated revenues of $343 million in Q3 2025, resulting in an Adjusted EBITDA of $20 million and a margin of 6%, down from $432 million and a margin of 12% in Q2 2025[9] - The Proppant Production segment reported revenues of $76 million in Q3 2025, with an Adjusted EBITDA of $8 million and a margin of 10%, compared to $78 million and a margin of 19% in Q2 2025[10] - The company expects fourth quarter profitability in the Proppant Production segment to improve compared to Q3 2025, driven by enhanced operational efficiency[6] - Approximately 73% of the Proppant Production segment's revenue was intercompany during Q3 2025[10] - ProFrac's proppant production segment generated revenues of $76.4 million for the three months ended September 30, 2025, compared to $77.5 million in the previous quarter[34] Financial Position - Total debt outstanding as of September 30, 2025, was $1.07 billion, with net debt of $1.04 billion[15] - The company’s total debt as of September 30, 2025, was $1,070.2 million, a slight decrease from $1,109.0 million at the end of the previous year[35] - ProFrac Holding Corp. had a total stockholders' equity of $953.9 million as of September 30, 2025, down from $1,076.1 million at the end of 2024[30] - Total assets decreased to $2,742.4 million as of September 30, 2025, down from $2,988.1 million at the end of 2024[30] - Total liabilities decreased to $1,721.1 million as of September 30, 2025, from $1,848.5 million at the end of 2024[30] Cash Flow and Expenditures - Cash flows from operating activities for Q3 2025 were $4.6 million, compared to $98.2 million in Q3 2024[32] - The company reported a net cash used in investing activities of $33.8 million for Q3 2025[32] - The Company expects capital expenditures for 2025 to be between $160 million and $190 million, a reduction of approximately $25 million from previous guidance[14] - The Company anticipates annualized cash savings of $85 to $115 million by the end of Q2 2026 through operational efficiency and cost optimization measures[4] Losses and Expenses - Operating loss for Q3 2025 was $78.8 million, compared to an operating loss of $4.3 million in Q3 2024[31] - Net loss attributable to ProFrac Holding Corp. for Q3 2025 was $100.9 million, compared to a net loss of $45.2 million in Q3 2024[31] - The company incurred $103.0 million in depreciation, depletion, and amortization for Q3 2025[32] - The company incurred $4.9 million in litigation expenses for the three months ended September 30, 2025[33]