DNOW Inc. Earnings Call Transcripts
Fiscal Year 2026
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Q1 2026 saw strong sequential revenue growth from the MRC Global merger, but profitability was impacted by ERP stabilization costs and lower margins. Cost synergies are ahead of plan, with full-year revenue expected near $5 billion and EBITDA margin approaching 4.5%.
Fiscal Year 2025
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Merger with MRC Global drove record revenue and EBITDA in 2025, despite ERP challenges impacting U.S. operations. Integration is progressing, with accelerated cost synergies and strong liquidity, while guidance for 2026 is delayed pending operational stabilization.
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Q3 2025 delivered record revenue of $634M and EBITDA of $51M, with strong free cash flow and a robust balance sheet. The imminent MRC Global merger is expected to drive $70M in annual synergies, while midstream and digital initiatives support future growth.
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Record Q2 EBITDA of $51M and revenue of $628M were driven by strong midstream and water management growth, despite market headwinds. The upcoming MRC Global merger targets $70M in annual synergies, with 2025 guidance reaffirmed for flat to high single-digit revenue growth and $150M free cash flow.
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A transformational all-stock merger will create a leading global energy and industrial solutions provider with $5.3 billion in revenue, targeting $70 million in annual cost synergies within three years. The deal leverages complementary strengths, expands offerings, and is expected to close in Q4 2025, pending approvals.
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Q1 2025 revenue grew 6% year-over-year to $599 million, with EBITDA up 18% to $46 million and gross margin at 23.2%. Guidance for 2025 is reaffirmed, targeting flat to high single-digit revenue growth and $150 million in free cash flow. Share repurchases and a strategic acquisition in Singapore support growth.
Fiscal Year 2024
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Revenue grew 2% in 2024 despite market headwinds, with record free cash flow and strong EBITDA margins. The outlook for 2025 is flat to high single-digit revenue growth, supported by midstream expansion, acquisitions, and continued cost discipline.
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Celebrating a decade as a public company, the firm has transformed its business model, improved earnings, and expanded into midstream, downstream, and renewables. Strong cash flow, operational efficiency, and a focus on value-driven service underpin its growth strategy.
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Q3 2024 saw strong EBITDA and free cash flow despite market headwinds, with upgraded full-year cash flow guidance and continued focus on M&A and digital growth. Revenue was resilient due to diversification, and capital allocation remains disciplined with zero debt and robust liquidity.
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EBITDA margins and free cash flow have improved significantly, supporting organic growth, acquisitions, and share buybacks. Diversification into midstream, industrial, and Energy Evolution markets is accelerating, with technology and operational efficiency as key drivers.
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Q2 2024 revenue rose 12% sequentially to $633 million, driven by Whitco and organic growth, with EBITDA at $50 million and strong free cash flow. Outlook for Q3 is flat to slightly down, but full-year revenue and Energy Evolution sales are expected to grow, supported by a robust balance sheet.