Drilling Tools International Corp. Reports 2025 Second Quarter Results

Core Insights - Drilling Tools International Corp. (DTI) reported total consolidated revenue of $39.4 million for Q2 2025, with tool rental revenue at $32.8 million and product sales at $6.7 million [2][3] - The company experienced a net loss of approximately $2.4 million for the quarter, with an adjusted net loss of $725,000 [2][3] - DTI's adjusted EBITDA for Q2 was $9.3 million, marking a 4% increase compared to Q2 2024, despite market softness [4][6] Financial Performance - DTI's Q2 2025 revenue increased by 5% compared to Q2 2024, while adjusted EBITDA rose by 4% [4][6] - The company achieved its first positive adjusted free cash flow for any second quarter since going public, amounting to $1.8 million [3][4] - As of June 30, 2025, DTI had approximately $1.1 million in cash and cash equivalents, with net debt of $55.8 million [2][3] Market Conditions - The second quarter was impacted by lower commodity prices, leading to a reduction in rig count and customer activity, particularly in the US land market [3][5] - Despite the decline in activity, DTI's performance remained solid, with a 46% revenue growth in the Eastern Hemisphere segment, contributing 14% of total revenue [4][5] - The company anticipates continued uncertainty in the market, prompting a $6 million expense reduction program to align spending with customer activity levels [5][6] Outlook - DTI maintains its full-year 2025 revenue guidance of $145 million to $165 million, with adjusted EBITDA expected to range from $32 million to $42 million [6][29] - The adjusted EBITDA margin is projected to be between 22% and 25% for the year [6][29] - The company is committed to identifying cost reduction opportunities and maintaining operational flexibility in response to market challenges [5][6]