ProPetro Q2 Earnings Call Highlights

ProPetro NYSE: PUMP reported second-quarter 2026 revenue of $306 million, up 13% from the prior quarter, while its net loss widened to $8 million, or $0.07 per diluted share, from a $4 million loss in the first quarter. Adjusted EBITDA rose 23% sequentially to $45 million, equal to 15% of revenue.

Chief Executive Officer Sam Sledge said the company’s underlying completions business remained resilient and generated free cash flow despite operational disruptions during the quarter. Those headwinds included severe June weather in the Permian Basin, costs associated with increasing the active frac fleet count from 11 to 12, and unexpected downtime on a temporary customer project outside the Permian.

“Standing up a new fleet requires upfront maintenance and deployment costs before the full earnings benefit is realized,” Sledge said. The temporarily relocated fleet has since returned to the Permian Basin.

Completions outlook and fleet expansion

ProPetro said it plans to activate a 13th frac fleet, which is expected to begin contributing near the end of the third quarter. Sledge said the fleet will serve a new blue-chip exploration and production customer and represents an addition beyond the company’s expectations entering the year.

President and Chief Operating Officer Adam Muñoz said redeploying a fleet generally takes roughly 60 to 90 days. Sledge said ProPetro does not currently intend to add a 14th fleet, citing higher redevelopment costs, the need for portfolio optimization, and a need for further pricing gains and customer contract demand before making such an investment.

Management said it sees a tighter market for completion services in the Permian. Sledge said the basin is operating at roughly a mid-70s active frac-fleet count and that raising the count above the mid-80s would require meaningful investment in new growth capacity rather than replacement equipment. He said there are very few readily available fleets in the market.

The company expects pricing and recontracting opportunities as contracts on much of its active horsepower come up for renewal in the next six to nine months. Management said a significant share of those fleets use next-generation natural gas-burning equipment, which it said remains in strong demand amid the spread between diesel and natural gas prices.

Sledge also said customer planning activity has increased, with some larger public operators bringing forward requests for proposals for 2027 work. He said ProPetro intends to maintain a mix of dedicated contracts and operational flexibility rather than placing all capacity under long-term commitments.

PROPWR adds contracted capacity

ProPetro’s PROPWR power-generation business increased contracted capacity to approximately 350 megawatts, up from about 240 megawatts at the time of the company’s prior earnings call. The increase included about 110 megawatts across two projects: one for a leading integrated upstream operator in the Permian and another for an industrial customer.

The company is also in advanced contract negotiations for more than 100 megawatts of additional oil-and-gas-related power capacity. Management said contracts in oil and gas and industrial applications tend to have shorter initial terms than data-center arrangements but offer attractive pricing and returns.

Travis Simmering, president of PROPWR, said one newly contracted Permian microgrid project is close to 100 megawatts and is designed primarily for production-related power needs rather than hydraulic fracturing. He said the company sees additional opportunities with large upstream operators and midstream companies in areas without grid connectivity.

While oil and gas and industrial projects are contributing to near-term earnings, management said it still expects most future PROPWR capacity to serve data centers. The company has a 60-megawatt data-center project operating live and meeting performance obligations, according to Sledge. Simmering said the project began operating ahead of schedule after the company met its targeted deployment timeline.

PROPWR generated positive EBITDA in each of the final two months of the second quarter, management said. The company expects the business to contribute increasingly meaningful earnings in the second half of 2026 and into 2027 as more assets are deployed.

Management said its data-center pipeline includes several hundred megawatts in advanced negotiations, though it acknowledged that long-term agreements can take time because they involve substantial capital commitments, project scheduling, and risk-allocation discussions. Sledge said most data-center contract discussions begin at terms of 10 years, with many extending beyond that period.

Capital spending, liquidity and financing

Cash flow from operating activities totaled $66 million in the second quarter, compared with $3 million in the prior quarter. Chief Financial Officer Caleb Weatherl attributed the improvement to higher adjusted EBITDA and working-capital benefits. Working capital provided roughly $20 million of cash in the second quarter, compared with a $32 million use of cash in the first quarter.

Capital expenditures paid totaled $61 million, while capital expenditures incurred were $71 million. Of the incurred total, approximately $24 million supported the completions business and $47 million supported PROPWR equipment orders.

ProPetro lowered its full-year 2026 capital expenditure guidance to $525 million to $595 million from a prior range of $540 million to $610 million. The company now expects completions capital spending of $125 million to $145 million, down from $140 million to $160 million, primarily because one planned buyout of a FORCE electric fleet has shifted into early 2027.

• PROPWR capital expenditures are still expected to total approximately $400 million to $450 million in 2026.
• The company maintained its expected PROPWR equipment cost of roughly $1.4 million to $1.5 million per megawatt, including balance-of-plant costs.
• ProPetro expects to complete one electric-fleet buyout late in 2026, about three in 2027, and one in 2028.

As of June 30, ProPetro held $784 million in cash and cash equivalents, including proceeds from its May issuance of $690 million in convertible senior notes. Total liquidity was $905 million, including $121 million of unused borrowing capacity under its asset-based lending facility. Borrowings under the company’s Caterpillar Financial Services financing agreement stood at $130 million, and that facility was recently expanded to $167 million.

Sledge said ProPetro has raised approximately $1.5 billion over the past 18 months to support PROPWR’s expansion and does not see a near- to medium-term funding need, though management will continue to assess capital-raising opportunities.

About ProPetro (NYSE:PUMP)

ProPetro Holding Corp is a publicly traded oilfield services company that specializes in hydraulic fracturing and well completion solutions for exploration and production operators. Headquartered in Midland, Texas, the company delivers a comprehensive suite of pressure pumping services designed to optimize reservoir stimulation and enhance hydrocarbon recovery. Its integrated approach encompasses well design, proppant selection, fluid systems and pressure management to support clients' development targets across unconventional plays.

The company's core offerings include high-pressure fracturing, coiled tubing, cementing, acidizing and flowback services, all supported by in-house logistics and digital monitoring tools.

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