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]