ProPetro (PUMP) - 2025 Q2 - Quarterly Results

Q2 2025 Financial and Operational Results This section details ProPetro's Q2 2025 financial and operational performance, highlighting revenue decline, net loss, strategic capital allocation, and a revised outlook amidst a challenging market Management Commentary and Market Overview Management described Q2 2025 as a challenging quarter where the company maintained stability by focusing on cost control and its capital-light strategy - The company faced a challenging quarter but maintained financial stability through a capital-light investment strategy and cost control[3] - The Permian Basin completions market is facing challenges, with active frac fleet counts estimated to have dropped from approximately 90-100 at the start of the year to around 70[4] - ProPetro has chosen to idle certain fleets rather than operate them at sub-economic levels, preserving assets for more favorable market conditions[4] - The company's strengths, including low debt, strategic M&A, PROPWR growth, and the FORCE® electric fleet, provide a strong foundation to withstand market turbulence[4] Second Quarter 2025 Financial Performance ProPetro reported a 9% sequential decrease in revenue to $326 million for Q2 2025, primarily due to lower utilization and weather impacts Q2 2025 Key Financial Metrics (vs. Q1 2025) | Metric | Q2 2025 | Q1 2025 | Change | | :--- | :--- | :--- | :--- | | Revenue | $326 million | $359 million | -9% | | Net (Loss) Income | ($7 million) | $10 million | - | | (Loss) Income per Diluted Share | ($0.07) | $0.09 | - | | Adjusted EBITDA | $50 million | $73 million | -32% | - The decrease in revenue was largely attributed to lower utilization and adverse weather impacts across all service lines[5] - General and administrative (G&A) expense was flat at $28 million compared to the first quarter of 2025[7] Capital Management and Shareholder Returns As of June 30, 2025, ProPetro maintained a solid liquidity position of $178 million - Total liquidity at the end of Q2 2025 was $178 million, consisting of $75 million in cash and $103 million available under its ABL Credit Facility[13] - Capital expenditures incurred were $73 million, with $30 million for completions business maintenance and $43 million supporting PROPWR orders[14] - The company extended its $200 million share repurchase program to December 2026, with no shares repurchased in Q2 2025 to prioritize the PROPWR business launch[10] Business Segment and Strategic Updates The company highlighted significant progress in its PROPWR power generation business, securing an inaugural 10-year contract for 80 megawatts of capacity - Secured an inaugural 10-year contract for 80 megawatts of PROPWR® service capacity with a Permian-focused E&P operator[6][11] - The company has approximately 220 megawatts of power generation equipment on order, with deliveries expected to be completed by mid-year 2026[11] - Management is confident it will secure long-term agreements for all 220 megawatts of currently ordered equipment by the end of 2025[12] - Over 50% of ProPetro's active hydraulic horsepower is now under long-term contracts[6] Outlook and Guidance Reflecting decreased market activity, ProPetro has lowered its full-year 2025 capital expenditure guidance to a range of $270 million to $310 million - Full-year 2025 capital expenditures guidance has been lowered to between $270 million and $310 million, down 9% at the midpoint from prior guidance[16] - The company anticipates operating an average of 10 to 11 active hydraulic fracturing fleets in Q3 2025, a decrease from 13 to 14 active fleets in Q2 2025[17] - Management believes market cycles create opportunities and that ProPetro is well-positioned to emerge stronger due to its disciplined approach, next-generation technology, and strong balance sheet, while smaller competitors may struggle[18][19] Financial Statements and Reconciliations This section presents ProPetro's unaudited condensed consolidated financial statements, including statements of operations, balance sheets, cash flows, and reconciliations of non-GAAP financial measures for Q2 2025 Condensed Consolidated Statements of Operations The unaudited statement of operations for the three months ended June 30, 2025, shows total revenues of $326.2 million and a net loss of $7.2 million Condensed Consolidated Statements of Operations (Unaudited, In thousands) | | Three Months Ended June 30, 2025 | Three Months Ended March 31, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | Service Revenue | $326,151 | $359,416 | $357,021 | | Operating (Loss) Income | ($3,167) | $9,501 | ($533) | | Net (Loss) Income | ($7,155) | $9,602 | ($3,660) | | Diluted (Loss) Income Per Share | ($0.07) | $0.09 | ($0.03) | Condensed Consolidated Balance Sheets As of June 30, 2025, ProPetro's balance sheet shows total assets of $1.229 billion, a slight increase from $1.224 billion at year-end 2024 Condensed Consolidated Balance Sheet Highlights (Unaudited, In thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $74,840 | $50,443 | | Total current assets | $327,463 | $292,221 | | Total Assets | $1,229,147 | $1,223,645 | | Total current liabilities | $231,050 | $222,266 | | Total Liabilities | $405,174 | $407,372 | | Total Shareholders' Equity | $823,973 | $816,273 | Condensed Consolidated Statements of Cash Flows For the six months ended June 30, 2025, net cash provided by operating activities was $108.9 million, resulting in a net increase in cash and cash equivalents of $24.4 million Condensed Consolidated Statement of Cash Flows Highlights (Unaudited, In thousands, Six Months Ended June 30) | | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $108,903 | $179,763 | | Net cash used in investing activities | ($68,524) | ($90,923) | | Net cash used in financing activities | ($15,982) | ($55,308) | | Net increase in cash and cash equivalents | $24,397 | $33,532 | | Cash and cash equivalents - End of period | $74,840 | $66,886 | Segment Information and Non-GAAP Reconciliations The Hydraulic Fracturing segment remains the largest contributor to revenue, generating $245.7 million in Q2 2025, with Adjusted EBITDA of $49.6 million Q2 2025 Service Revenue by Segment (In thousands) | Segment | Service Revenue | Adjusted EBITDA | | :--- | :--- | :--- | | Hydraulic Fracturing | $245,741 | $51,983 | | Wireline | $47,995 | $7,855 | | Cementing | $32,443 | $4,651 | Reconciliation of Net (Loss) Income to Adjusted EBITDA (In thousands) | | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Net (loss) income | ($7,155) | $9,602 | | Adjustments | ... | ... | | Adjusted EBITDA | $49,607 | $72,686 | Reconciliation to Free Cash Flow for Completions Business (In thousands) | | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Net Cash provided by Operating Activities | $54,214 | $54,689 | | Net Cash used in Investing Activities | ($35,688) | ($32,836) | | Free Cash Flow | $18,526 | $21,853 | | PROPWR Adjustments | ... | ... | | Free Cash Flow for Completions Business | $26,206 | $40,681 |