Core Insights - Liberty Energy Inc. (LBRT) is a North American oilfield services provider focused on hydraulic fracturing and related completion services for onshore shale producers, playing a crucial role in the energy value chain [1] - The company has diversified into power solutions, but the majority of its revenue still comes from its core fracking operations [1] - Over the past 12 months, LBRT's stock has dramatically underperformed, declining by 45.4%, significantly worse than the 10.1% drop in the oilfield services sub-industry and the nearly flat performance of the broader oil and energy sector at -0.3% [3][4] Financial Performance - For Q2 2025, LBRT reported an adjusted net income of $20 million, down from $103 million in Q2 2024, and adjusted EBITDA fell to $181 million from $273 million year-over-year, indicating a significant deterioration in financial performance [5] - The decline in earnings is attributed to softening completion activity and increasing pricing pressures in the industry [5] Market Challenges - Management has warned of emerging pricing headwinds expected to negatively impact results in the second half of 2025, with anticipated pricing erosion across its fleet [6][9] - The company has cut its 2025 capital expenditure (CapEx) by $75 million, signaling reduced demand and a cautious outlook [8][12] - LBRT plans to reduce the number of active fleets, indicating falling demand for its services, which may lead to lower revenues and earnings in the coming quarters [11] Strategic Adjustments - The withdrawal of full-year financial guidance highlights elevated near-term uncertainty and volatility in the macro environment [10] - The anticipated slowdown in activity is expected to accelerate equipment attrition, with the attrition rate projected to climb into the "mid-teens" [13] - Despite efforts to diversify into power solutions, these ventures have long gestation periods, with revenues not expected until at least 2027 [15] Cash Management - The suspension of share buybacks in Q2 2025 reflects a priority on cash preservation and balance sheet strength amid market uncertainties [16] - Management's cautious stance is further evidenced by the reduction in capital expenditures, indicating a focus on preserving cash rather than pursuing growth opportunities [12] Industry Context - Liberty's heavy reliance on the cyclical U.S. onshore fracking market exposes it to volatility and inconsistent revenues, contrasting with more diversified peers [14] - The company faces execution risks in its non-core power business expansion, which may impact performance if integration issues arise [17]

Liberty Energy (LBRT) Conference Summary Company Overview - Liberty Energy is a leading fracking company in the United States, celebrating its 15th anniversary in 2026, having been founded in 2011 [4][2] - The company has been ranked as the number one frack company in the U.S. for eight consecutive years according to the Kimberlite survey [4] Financial Performance - Liberty Energy reported over $4 billion in revenue last year [6] - The company has a cash return on capital invested averaging 24%, which is 50% higher than the S&P 500 and significantly higher than the OSX average [18] Business Strategy - The company aims to control critical inputs for successful fracking operations, including fuel, sand, and logistics [25] - Liberty has expanded its operations to include a power generation business, launching a CNG (Compressed Natural Gas) business to ensure fuel supply for its operations [27][28] - The company has made strategic acquisitions during downturns, such as acquiring the U.S. assets of Sangio and Schlumberger's onshore North American frac business [22][23] Technological Innovations - Liberty has introduced several technological advancements, including e-frac systems and various iterations of its DigiPrime technology [16] - The company has a complete engineering department that includes geology, reservoir evaluation, frac engineering, and big data analysis teams [17] - Liberty is focused on increasing efficiency through methods like simul frac, which has led to higher utilization of assets [35] Market Dynamics - The fracking market is currently experiencing downward pricing trends, prompting Liberty to explore additional service offerings to maintain margins [24] - The company is adapting to market conditions by lowering its headline fleet count while ensuring that all pumps are utilized effectively [34] Future Outlook - Liberty is investing in power generation, with plans to order 400 megawatts of power generation capacity [39] - The company is exploring partnerships for advanced energy solutions, including small modular nuclear reactors and enhanced geothermal energy [45][46] - Liberty aims to address global energy disparities through initiatives like the Bettering Human Lives Foundation, which focuses on transitioning homes in Sub-Saharan Africa to clean-burning LPG [50][51] Key Takeaways - Liberty Energy has established itself as a leader in the fracking industry with a strong focus on technology, efficiency, and strategic growth [4][18] - The company is well-positioned to navigate current market challenges and capitalize on future opportunities in energy generation and sustainability [39][50]

Financial Performance - Liberty Energy Inc. reported a second-quarter 2025 adjusted net income of 12 cents per share, missing the Zacks Consensus Estimate of 14 cents, and down significantly from 61 cents in the same quarter last year [1][10] - The company's revenues totaled $1 billion, exceeding the Zacks Consensus Estimate by $37 million, but decreased by 10% from $1.2 billion in the prior-year quarter due to a softening of completions activity [2][10] - Adjusted EBITDA was reported at $180.8 million, down from $273.3 million in the year-ago quarter and below the prediction of $194.1 million [2] Costs and Expenses - Total costs and expenses for Liberty Energy were $1 billion in the second quarter, a decrease of 1.2% from the previous year, but higher than the estimated $963.3 million [6] Shareholder Returns - The board of directors declared a quarterly dividend of 8 cents per share, unchanged from the previous quarter, with a total of $13 million returned to shareholders through dividends during the quarter [4] Strategic Initiatives - Liberty Energy announced a collaboration with Oklo to develop advanced power solutions, integrating distributed natural gas power with future small modular nuclear reactors [3] - The company is advancing its technology leadership with the introduction of a variable-speed gas engine and sand slurry system aimed at reducing costs, boosting reliability, and minimizing emissions [5] - Strategic alliances were formed in Pennsylvania and Colorado to develop power facilities that utilize on-site generation and microgrids to meet evolving energy needs [5] Balance Sheet and Capital Expenditure - As of June 30, Liberty Energy had approximately $19.6 million in cash and cash equivalents, with long-term debt of $160 million, resulting in a debt-to-capitalization ratio of 7.3% [7] - The company spent $134 million on its capital program during the quarter, which was lower than the estimated $165.7 million [7] Market Outlook - The oil markets are experiencing volatility due to global economic shifts and geopolitical tensions, yet North America's production remains stable [11] - Producers are maintaining stable production levels while cautiously managing capital spending, which may lead to increased equipment attrition and a tightening of service supply [12] - Liberty Energy plans to scale down its deployed fleet slightly while reallocating capacity to support its growing simul frac business for key long-term clients [14]

[PART I: FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Liberty Energy Inc.'s unaudited condensed consolidated financial statements for the quarter ended June 30, 2025, including balance sheets, statements of operations, comprehensive income, equity changes, and cash flows [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$3.44 billion** as of June 30, 2025, from **$3.30 billion** at year-end 2024, with total liabilities rising to **$1.41 billion** and stockholders' equity reaching **$2.03 billion** Condensed Consolidated Balance Sheet Highlights (in thousands of USD) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $921,377 | $848,523 | | **Property and equipment, net** | $1,929,426 | $1,890,998 | | **Total Assets** | **$3,441,048** | **$3,296,394** | | **Total Current Liabilities** | $793,378 | $666,523 | | **Long-term debt** | $160,000 | $190,500 | | **Total Liabilities** | **$1,406,065** | **$1,317,525** | | **Total Stockholders' Equity** | **$2,034,983** | **$1,978,869** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 revenue decreased to **$1.04 billion** from **$1.16 billion** year-over-year, with net income falling to **$71.0 million**, while six-month revenue declined to **$2.02 billion** and net income to **$91.1 million** Statement of Operations Summary (in thousands of USD, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | $1,042,521 | $1,159,884 | $2,019,982 | $2,233,009 | | **Operating Income** | $37,073 | $141,833 | $55,245 | $257,266 | | **Net Income** | $71,016 | $108,421 | $91,127 | $190,313 | | **Diluted EPS** | $0.43 | $0.64 | $0.55 | $1.12 | - A significant contributor to net income in Q2 2025 was a **$68.2 million** gain on investments, compared to a **$7.2 million** gain in Q2 2024[17](index=17&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities for H1 2025 was **$362.7 million**, a decrease from the prior year, with net cash used in investing activities decreasing and financing activities increasing, leading to a slight overall decrease in cash Cash Flow Summary for Six Months Ended June 30 (in thousands of USD) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $362,707 | $407,587 | | **Net cash used in investing activities** | ($189,293) | ($292,130) | | **Net cash used in financing activities** | ($174,083) | ($121,988) | | **Net decrease in cash and cash equivalents** | ($669) | ($6,531) | | **Cash and cash equivalents—end of period** | $19,563 | $30,043 | - Key financing activities in H1 2025 included **$24.9 million** in share repurchases and **$26.9 million** in dividend payments[25](index=25&type=chunk) - Investing activities in H1 2025 included **$271.4 million** in property and equipment purchases and proceeds of **$80.8 million** from the sale of equity securities[25](index=25&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section details accounting policies, recent acquisitions, debt facilities, equity transactions, and subsequent events, highlighting the IMG Energy Solutions acquisition, ABL Facility replacement, share repurchases, dividends, and equity investment gains - On March 3, 2025, the Company acquired IMG Energy Solutions for approximately **$19.6 million** in cash, recording **$12.6 million** in goodwill and intangible assets[38](index=38&type=chunk) - The Company's investment in Oklo Inc. was valued at **$58.0 million** as of June 30, 2025, resulting in a gain of **$87.2 million** during the first six months of 2025, with **$80.8 million** in shares sold during this period[75](index=75&type=chunk) - Subsequent to the quarter end, on July 24, 2025, the Company terminated its **$525.0 million** ABL Facility and entered into a new Credit Agreement for a **$750.0 million** Revolving Credit Facility[63](index=63&type=chunk)[133](index=133&type=chunk)[134](index=134&type=chunk) - During the six months ended June 30, 2025, the Company repurchased **1.55 million** shares for **$24.0 million** and paid cash dividends of **$0.16 per share** totaling **$25.9 million**[89](index=89&type=chunk)[95](index=95&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a **10%** year-over-year revenue decline for Q2 2025 due to lower pricing and reduced activity, anticipating a gradual slowdown in completions for H2 2025, while highlighting strong operating cash flow and a new credit facility [Recent Trends and Outlook](index=29&type=section&id=Recent%20Trends%20and%20Outlook) North American oil production remains stable, but a gradual slowdown in completions activity is anticipated for H2 2025, leading to pricing pressure and planned modest reductions in the company's deployed fleet count - Completions activity is expected to gradually slow during the second half of 2025 due to disciplined capital deployment by producers[146](index=146&type=chunk) - The Company plans to modestly reduce its deployed fleet count for the remainder of 2025 and reposition horsepower to support expanded simul-frac offerings[147](index=147&type=chunk) Key Market Indicators | Indicator | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | **Avg. WTI Price ($/Bbl)** | $64.57 | $71.78 | $81.81 | | **Avg. Henry Hub Price ($/MMBtu)** | $3.19 | $4.14 | $2.06 | | **Avg. US & Canada Rig Count** | 686 | 788 | 716 | [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Q2 2025 revenue decreased **10%** year-over-year to **$1.0 billion** due to lower pricing and activity, significantly impacting operating income, though a **$87.5 million** gain on investments partially offset the decline in H1 2025 net income Results of Operations Comparison (in thousands of USD) | Description | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenue** | $1,042,521 | $1,159,884 | ($117,363) | | **Operating income** | $37,073 | $141,833 | ($104,760) | | **Net income** | $71,016 | $108,421 | ($37,405) | Non-GAAP Reconciliation: Net Income to Adjusted EBITDA (in thousands of USD) | Description | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net income** | $71,016 | $108,421 | $91,127 | $190,313 | | **EBITDA** | $234,681 | $272,339 | $399,883 | $510,958 | | **Adjusted EBITDA** | $180,798 | $273,256 | $348,948 | $518,042 | - The decrease in Adjusted EBITDA for Q2 2025 compared to Q2 2024 was primarily driven by lower pricing, partially offset by changes in activity levels[169](index=169&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by operating cash flow and a new **$750.0 million** Revolving Credit Facility, replacing the prior ABL Facility, with H1 2025 operating cash flow at **$362.7 million** used for capital expenditures, share repurchases, and dividends - As of June 30, 2025, the company had **$160.0 million** outstanding on its ABL Facility with **$256.4 million** of remaining availability[174](index=174&type=chunk) - Effective July 24, 2025, the ABL Facility was terminated and replaced by a new Credit Agreement with a **$750.0 million** revolving credit facility, enhancing financial flexibility[176](index=176&type=chunk) Cash Flow Summary for Six Months Ended June 30 (in thousands of USD) | Description | 2025 | 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $362,707 | $407,587 | | **Net cash used in investing activities** | ($189,293) | ($292,130) | | **Net cash used in financing activities** | ($174,083) | ($121,988) | [Item 3. Quantitative and Qualitative Disclosure about Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) The company's primary market risk is foreign currency exchange rates from Canadian and Australian operations, resulting in a **$6.1 million** translation gain for H1 2025, with no other material changes to market risk exposures - The company's operations in Canada and Australia expose it to foreign currency translation risk[193](index=193&type=chunk) - For the six months ended June 30, 2025, a foreign currency translation gain of **$6.1 million** was recorded, compared to a loss of **$5.4 million** for the same period in 2024[194](index=194&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, following the integration of IMG Energy Solutions' accounting functions and corresponding internal control updates - The principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of June 30, 2025[196](index=196&type=chunk) - During Q2 2025, the company integrated the accounting functions of the recently acquired IMG Energy Solutions, modifying business processes and internal controls accordingly[197](index=197&type=chunk) [PART II: OTHER INFORMATION](index=37&type=section&id=PART%20II%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) Information on legal proceedings is incorporated by reference from Note 14, with management not expecting any current matters to materially adversely affect the company's financial position - The company is subject to various legal proceedings from time to time, but management does not expect them to have a material adverse effect on financial results[129](index=129&type=chunk)[201](index=201&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K have been identified - No material changes to the risk factors set forth in the Annual Report were identified[203](index=203&type=chunk) [Item 5. Other Information](index=37&type=section&id=Item%205.%20Other%20Information) This section details significant post-quarter corporate financing activities, including the termination of the existing ABL Facility and the establishment of a new, larger **$750.0 million** revolving credit facility on July 24, 2025 - On July 24, 2025, the Company terminated its ABL Facility and entered into a new Credit Agreement[208](index=208&type=chunk)[209](index=209&type=chunk) - The new Credit Agreement provides for a revolving credit facility with initial commitments of **$750.0 million**, an increase from the previous facility, and includes an accordion feature for an additional **$200.0 million**[210](index=210&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section indexes exhibits filed with the Form 10-Q, including corporate governance documents, the new Credit Agreement, officer certifications, and XBRL data files - Key exhibits filed include the new Credit Agreement dated July 24, 2025, and officer certifications pursuant to the Sarbanes-Oxley Act[219](index=219&type=chunk)

Financial Data and Key Metrics Changes - Revenue for the second quarter of 2025 was $1,000 million, a 7% increase from $977 million in the prior quarter [19] - Net income rose to $71 million from $20 million in the previous quarter, while adjusted net income increased to $20 million from $7 million [19] - Adjusted EBITDA for the quarter was $181 million, up 8% from $168 million in the prior quarter [20] - General and administrative expenses decreased to $58 million from $66 million in the previous quarter [20] - The company ended the quarter with a cash balance of $20 million and net debt of $140 million, a decrease of $46 million from the prior quarter [20] Business Line Data and Key Metrics Changes - The company experienced increased activity across nearly all business lines, which helped offset pricing headwinds and softer conditions in the Permian sand markets [18] - The company is planning to reduce its deployed fleet count and reposition horsepower to support expanded demand for simul frac offerings [5][18] Market Data and Key Metrics Changes - The energy sector faced renewed uncertainty due to tariff policies, OPEC production changes, and geopolitical tensions [5] - Completions activity is expected to gradually slow in the second half of 2025, reflecting disciplined capital deployment and contributing to market pricing pressures [15] Company Strategy and Development Direction - The company is focusing on leveraging its full suite of completion products and services to drive increased engagement with customers [5] - Strategic alliances have been formed for power facility development in Pennsylvania and Colorado, addressing barriers faced by commercial and industrial developers [11] - The company is committed to innovation in high-efficiency, low-emission technologies, with advancements in its DigiPrime enhancement and the introduction of a sand slurry system [6][10] Management's Comments on Operating Environment and Future Outlook - Management noted that while the second quarter was strong, a reduction in activity is anticipated due to falling rig counts and pricing headwinds [38][42] - The company expects third-quarter revenue and EBITDA to soften sequentially, with a potential low single-digit pricing headwind [22][43] - Management expressed confidence in the company's ability to navigate market uncertainties and create value through strategic investments [23] Other Important Information - The company announced a $225 million increase in its credit facility to support strategic growth in power generation [21] - Total capital expenditures for 2025 are expected to be approximately $575 million, with a reduction in planned spending due to market conditions [22] Q&A Session Summary Question: Can you talk about the current supply chain for incremental capacity in power generation? - Management indicated that there is incremental capacity available, and they could significantly expand their order book for 2026 if desired [26][27] Question: How do you view the relationship with Aqua regarding long-term power solutions? - Management stated that the partnership provides a bridge for immediate power needs until SMRs can be deployed, with a focus on flexibility and reliability [30][32] Question: What is the outlook for revenue and EBITDA in the third quarter? - Management expects a mid-single-digit reduction in activity and low single-digit pricing headwinds, with more clarity on fourth-quarter expectations to come [38][43] Question: Can you clarify the CapEx reduction and its components? - Management noted that the reduction is approximately split between frac and power generation delays, with no significant concerns about delivery times [66][67] Question: What is the expected timeline for revenue from the Oklo partnership? - Management anticipates revenue from initial power generation to begin in 2027, with nuclear power revenue expected in the early 2030s [108]

Company Performance - Liberty Oilfield Services reported quarterly earnings of $0.12 per share, missing the Zacks Consensus Estimate of $0.14 per share, and down from $0.61 per share a year ago [1] - The quarterly report represents an earnings surprise of -14.29%, while the previous quarter saw a positive surprise of +33.33% [2] - The company posted revenues of $1.04 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.70%, but down from $1.16 billion year-over-year [3] Stock Performance - Liberty Oilfield Services shares have lost about 33.4% since the beginning of the year, contrasting with the S&P 500's gain of 8.1% [4] - The current consensus EPS estimate for the coming quarter is $0.06 on revenues of $985.9 million, and $0.29 on revenues of $3.88 billion for the current fiscal year [8] Industry Outlook - The Oil and Gas - Field Services industry is currently in the bottom 4% of over 250 Zacks industries, indicating a challenging environment for stocks in this sector [9] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [6]

[Financial & Operational Highlights](index=1&type=section&id=Financial%20%26%20Operational%20Highlights) [Q2 2025 Performance Summary](index=1&type=section&id=Q2%202025%20Performance%20Summary) Liberty Energy reported strong Q2 2025 results, achieving sequential revenue and Adjusted EBITDA growth through record efficiencies and increased utilization, despite market pricing pressures, and distributed $13 million to shareholders Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Sequential Change | | :--- | :--- | :--- | | Revenue | $1.0 billion | +7% | | Net Income | $71 million | - | | Fully Diluted EPS | $0.43 | - | | Adjusted EBITDA | $181 million | +8% | - Strong performance was attributed to record efficiencies and increased utilization, which more than compensated for industry pricing headwinds amidst softening completions activity[3](index=3&type=chunk) - The company delivered a **7%** Trailing Twelve Months (TTM) Adjusted Pre-Tax Return on Capital Employed (ROCE)[5](index=5&type=chunk) - Distributed **$13 million** to shareholders via cash dividends during the quarter[5](index=5&type=chunk)[12](index=12&type=chunk) [Strategic Developments & Technology](index=1&type=section&id=Strategic%20Developments%20%26%20Technology) The company advanced its technology leadership by field-testing its digiPrime enhancement and a last-mile sand slurry pipe system, while forming strategic alliances for integrated power solutions for data centers and industrial users, including small modular nuclear reactors - Commenced field testing of the digiPrime technology using a natural gas variable speed engine, aiming for high efficiency and low emissions[3](index=3&type=chunk)[5](index=5&type=chunk) - Successfully completed a field trial of the PropX slurry pipe system, designed to reduce costs, improve reliability, and decrease the environmental footprint of last-mile sand delivery[3](index=3&type=chunk)[5](index=5&type=chunk) - Announced strategic collaborations to supply integrated power solutions for potential data center and industrial developments in Pennsylvania (with Range Resources) and Colorado (with AltitudeX Aviation Group)[3](index=3&type=chunk)[5](index=5&type=chunk) - Formed a strategic alliance with Oklo to provide integrated utility-scale power solutions, combining Liberty's Forte℠ natural gas power with a path to integrate small modular nuclear reactors for large load customers[5](index=5&type=chunk)[6](index=6&type=chunk) [Market Outlook](index=2&type=section&id=Market%20Outlook) Despite global economic uncertainties, North American production remains stable due to well-capitalized producers, though completions activity is expected to slow in H2, leading Liberty to modestly reduce its deployed fleet and reposition horsepower to support expanded simulfrac offerings - North American production has remained relatively stable, with larger producers weathering commodity price volatility due to strong balance sheets and efficient operations[7](index=7&type=chunk)[8](index=8&type=chunk) - Completions activity is expected to gradually slow in the second half of the year due to disciplined capital deployment, which will contribute to market pricing pressure on services[9](index=9&type=chunk) - In response to market pressures, Liberty plans to modestly reduce its deployed fleet count and reposition assets to support its expanded simulfrac offering[11](index=11&type=chunk) [Financial Results](index=3&type=section&id=Financial%20Results) [Second Quarter 2025 Results](index=3&type=section&id=Second%20Quarter%202025%20Results) For Q2 2025, Liberty generated $1.0 billion in revenue, a 7% sequential increase but a 10% year-over-year decrease, with net income of $71 million and Adjusted EBITDA of $181 million, reflecting mixed performance compared to prior periods Comparative Financial Performance | Financial Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Revenue | $1.0B | $977M | $1.2B | | Net Income | $71M | $20M | $108M | | Adjusted EBITDA | $181M | $168M | $273M | | Diluted EPS | $0.43 | $0.12 | $0.64 | | Adjusted Diluted EPS | $0.12 | $0.04 | $0.61 | [Balance Sheet and Liquidity](index=3&type=section&id=Balance%20Sheet%20and%20Liquidity) As of June 30, 2025, Liberty maintained $20 million in cash and $160 million in total debt, with total liquidity of $276 million, further enhancing its financial flexibility by expanding its credit facility to $750 million in July 2025 Balance Sheet Snapshot | Balance Sheet Item | As of June 30, 2025 | | :--- | :--- | | Cash on Hand | $20 million | | Total Debt | $160 million | | Total Liquidity | $276 million | - In July 2025, the company expanded its credit facility from **$525 million to $750 million** to support strategic growth in power generation[5](index=5&type=chunk)[17](index=17&type=chunk) [Shareholder Returns](index=2&type=section&id=Shareholder%20Returns) During Q2, Liberty paid a cash dividend of $0.08 per share, totaling approximately $13 million, and the Board of Directors declared another quarterly dividend of $0.08 per share payable on September 18, 2025 - Paid a quarterly cash dividend of **$0.08 per share** of Class A common stock, totaling approximately **$13 million**, during Q2 2025[12](index=12&type=chunk) - On July 15, 2025, the Board declared a cash dividend of **$0.08 per share**, to be paid on September 18, 2025[12](index=12&type=chunk) [Appendix: Financial Statements and Reconciliations](index=6&type=section&id=Appendix%3A%20Financial%20Statements%20and%20Reconciliations) [Selected Financial Data (Statements of Operations)](index=6&type=section&id=Selected%20Financial%20Data%20%28Statements%20of%20Operations%29) This section provides unaudited consolidated statements of operations for Q2 2025 and Q2 2024, detailing revenue, costs, operating income, net income, and earnings per share Selected Statements of Operations Data (Unaudited) | (In thousands) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenue | $1,042,521 | $1,159,884 | | Operating Income | $37,073 | $141,833 | | Net Income | $71,016 | $108,421 | | Diluted EPS | $0.43 | $0.64 | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents unaudited condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, outlining the company's assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (Unaudited) | (In thousands) | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $921,377 | $848,523 | | Total Assets | $3,441,048 | $3,296,394 | | Total Current Liabilities | $793,378 | $666,523 | | Long-term debt | $160,000 | $190,500 | | Total Stockholders' Equity | $2,034,983 | $1,978,869 | [Non-GAAP Reconciliations](index=8&type=section&id=Non-GAAP%20Reconciliations) This section provides detailed reconciliations of non-GAAP financial measures to their most directly comparable GAAP counterparts, including EBITDA, Adjusted EBITDA, Adjusted Net Income, and Adjusted Pre-Tax Return on Capital Employed (ROCE) [Reconciliation of Net Income to EBITDA and Adjusted EBITDA](index=8&type=section&id=Reconciliation%20of%20Net%20Income%20to%20EBITDA%20and%20Adjusted%20EBITDA) For Q2 2025, Net Income of $71.0 million was reconciled to EBITDA of $234.7 million and Adjusted EBITDA of $180.8 million, with key adjustments including depreciation & amortization, a gain on investments, and stock-based compensation Reconciliation of Net Income to EBITDA and Adjusted EBITDA (Unaudited) | (In thousands) | Q2 2025 | | :--- | :--- | | Net Income | $71,016 | | EBITDA | $234,681 | | Adjustments | ($53,883) | | **Adjusted EBITDA** | **$180,798** | [Reconciliation of Net Income to Adjusted Net Income](index=8&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20Net%20Income) For Q2 2025, GAAP Net Income of $71.0 million ($0.43 per diluted share) was reconciled to Adjusted Net Income of $20.1 million ($0.12 per diluted share), primarily by excluding a $68.2 million pre-tax gain on investments Reconciliation of Net Income to Adjusted Net Income (Unaudited) | (In thousands, except per share) | Q2 2025 | | :--- | :--- | | Net Income | $71,016 | | Total adjustments, before income taxes | ($68,242) | | **Adjusted Net Income** | **$20,147** | | Net income per diluted share | $0.43 | | **Adjusted Net Income per Diluted Share** | **$0.12** | [Calculation of Adjusted Pre-Tax Return on Capital Employed (ROCE)](index=9&type=section&id=Calculation%20of%20Adjusted%20Pre-Tax%20Return%20on%20Capital%20Employed%20%28ROCE%29) For the twelve months ended June 30, 2025, the company calculated an Adjusted Pre-Tax Return on Capital Employed (ROCE) of 7%, derived from an Adjusted Pre-tax net income of $151.5 million and an Average Capital Employed of $2.14 billion Adjusted Pre-Tax Return on Capital Employed (ROCE) Calculation (Unaudited) | (In thousands) | Twelve Months Ended June 30, 2025 | | :--- | :--- | | Adjusted Pre-tax net income | $151,465 | | Average Capital Employed | $2,139,439 | | **Adjusted Pre-Tax ROCE** | **7%** |

Core Viewpoint - Liberty Energy Inc. (LBRT) is expected to report second-quarter earnings on July 24, with earnings estimated at 15 cents per share and revenues at $1.01 billion, reflecting significant year-over-year declines in both metrics [1][9]. Group 1: Recent Performance - In the previous quarter, LBRT reported adjusted net income of 4 cents per share, exceeding the Zacks Consensus Estimate by 1 cent, driven by improved operational efficiency and higher utilization of its frac and wireline fleets [3]. - The company's revenues for the last quarter were $977.5 million, surpassing the Zacks Consensus Estimate by 3.4% [3]. - LBRT has beaten the Zacks Consensus Estimate three times in the last four quarters, with an average surprise of 6.98% [3]. Group 2: Q2 Earnings Expectations - The Zacks Consensus Estimate for second-quarter earnings indicates a 75.41% year-over-year decline, while revenues are expected to decrease by 13.04% from the previous year's $1.16 billion [4][5][9]. - Factors contributing to the anticipated revenue decline include a subdued global macroeconomic environment and fluctuating energy prices, which typically affect demand for hydraulic fracturing services [6]. Group 3: Cost Management - LBRT is expected to see a reduction in operating expenses, projected to reach $963.3 million, down 5.4% from the previous year [7]. - The cost of services is anticipated to decrease from $835.8 million to $783.6 million, which may help mitigate the impact of lower revenues [7][9]. Group 4: Earnings Prediction Model - The Zacks model does not indicate a conclusive earnings beat for LBRT this quarter, with an Earnings ESP of -6.21% and a Zacks Rank of 4 (Sell) [8][10].

Core Insights - Liberty Energy Inc. (LBRT) has experienced a significant share price decline of 40.9% over the past six months, contrasting sharply with the broader oil and energy sector's 3.6% gain and the 10.2% drop in the oil and gas field services sub-industry [1] - The company's net income for Q1 2025 was $20 million, down 75.4% year-over-year from $82 million, indicating severe profitability challenges [5][6] - Liberty Energy's operations are primarily focused on hydraulic fracturing services and related technologies for onshore oil and gas producers in North America, managing around 40 active frac spreads [4] Financial Performance - Adjusted net income fell to $7 million in Q1 2025 from $82 million in Q1 2024, highlighting significant profitability concerns [5] - Adjusted EBITDA decreased by 31% year-over-year to $168 million in Q1 2025, reflecting operational difficulties [14] - The company's capital expenditures (CapEx) reached $121 million in Q1 2025, with plans for $450 million on completions and $200 million on power assets for the year [9] Market Challenges - Liberty Energy faces pricing pressures in its core frac services, with CEO Ron Gusek noting a "modestly lower" pricing reset for 2025 [11] - The company is exposed to tariff and macroeconomic risks, with management acknowledging that tariff announcements and OPEC+ production strategies create uncertainty in the energy sector [7] - Volatility in commodity prices poses a risk to Liberty Energy's revenues and profitability, particularly if oil prices fall below $60 per barrel [8] Operational Risks - High capital expenditures and rising debt levels, with net debt at $186 million and liquidity at $164 million, raise concerns about financial flexibility [9] - The company's dependence on the North American market makes it vulnerable to regional downturns, especially if OPEC+ adjusts production [10] - Customer concentration risks exist, as revenues depend on a limited number of large exploration and production customers [15] Strategic Initiatives - Liberty Energy's expansion into distributed power systems through the acquisition of IMG Energy Solutions carries execution risks, with project timelines extending to Q1 2026 [12] - The company repurchased $24 million in shares in Q1 2025 but indicated a cautious approach due to macroeconomic risks, prioritizing balance sheet strength [13]

Liberty Energy Overview - Liberty Energy is the 4th largest North American Oilfield Services (OFS) company based on TTM revenue through December 31, 2023[7, 9, 25, 27] - The company's average Cash Return on Capital Invested (CROCI) from 2012-2023 is 24%[11, 25] - Liberty Energy's trailing twelve month (TTM) revenue is $47 billion and adjusted EBITDA is $12 billion as of December 31, 2023[25] Technology and Fleet Transition - Liberty Energy expects 90% of its fleet to be primarily natural gas powered by the end of 2024[19] - The company's digiFleets and dual fuel fleets earn premium pricing[19] - digiFleets are expected to comprise the majority of Liberty's fleet within 5-7 years[19] Capital Returns - Liberty Energy has returned $328 million to shareholders through buybacks[20] - The company has repurchased 12% of shares outstanding since the buyback reinstatement in July 2022[20, 25] - Liberty Energy raised the quarterly cash dividend to $007 per share in Q4 2023[20]