ACDC earnings call summary

Prepared Highlights

• Q1 2026 revenue was $450M, up slightly from $437M in Q4 2025 (CFO).
• Adjusted EBITDA was $54M, with an 11.9% margin; weather impact estimated at $9.3M reduction; pro forma margin would have been ~13.6% (CFO).
• Free cash flow was negative $25M in Q1 vs. $14M in Q4 2025 (CFO).
• Stimulation Services revenue: $407M (up from $384M in Q4); adjusted EBITDA $32M, margin 7.8% (weather headwind ~$7.8M) (CFO).
• Proppant Production revenue: $120M (up from $115M in Q4); adjusted EBITDA $7M, margin 5.4% (weather impact ~$1.5M) (CFO).
• Manufacturing revenue: $48M (up from $43M in Q4); adjusted EBITDA $7M (up from $4M) (CFO).
• Flotek revenue: $72M (up from $43M in Q4); adjusted EBITDA $11M (up from $10M) (CFO).
• SG&A was $44M vs. $43M in Q4 (CFO).
• Cash CapEx Q1: $41M (up from $37M in Q4) (CFO).
• Total liquidity at quarter end: ~$108M, including $80M available under ABL; ABL borrowings $116M (up from $69M at year end) (CFO).
• Total debt outstanding: ~$1.09B, majority not due until 2029 (CFO).
• Fleet count maintained in low 20s; record efficiency in March with average pumping hours >600 per active fleet (CEO, Ladd).
• Makena platform in active price discovery; customer feedback encouraging; potential to unlock stranded inventory (CEO, Ladd).

Official Guidance

• 2026 total CapEx (including Flotek): $155M–$185M; excluding Flotek: $145M–$175M (CFO).
• Q2 2026 expected to trend higher sequentially (CEO).
• Proppant Production volumes expected to be down from Q1 (Ladd).
• Price increases implemented on majority of active fleets, layering in through H2 2026 (CEO).

Mgmt Quotes

• "Our first quarter results exceeded our expectations that we discussed in March." (Matt Wilkes, CEO)
• "We have successfully implemented price increases for the majority of our active fleets." (Matt Wilkes, CEO)
• "In March, we delivered record efficiency performance with average pumping hours per active fleet exceeding 600 hours." (Ladd Wilkes, CEO)
• "We have achieved the majority of our 100 million annualized savings target." (Matt Wilkes, CEO)
• "Q2 is shaping up to be a meaningful step forward." (Matt Wilkes, CEO)

Prepared Metrics

Q&A Batch (1-3 of 3)

Q1 — Analyst

• Topic: Pricing clarification and Q2 outlook
• Key points:
  • Pricing was stable from Q4 to Q1 sequentially; Q2 and back half of year expected to show material price increases, mostly due to tight horsepower market.
  • Cost savings initiatives (target $100M) are 65%–70% realized by Q1; additional upside expected from e-blender program (delayed by supply chain) and R&M/CapEx optimizations.
  • Q2 net-net will be up versus Q1, with price increases feathering in, offset by operational issues at Alpine and weather/schedule headwinds.
• Mgmt stance: Bullish – pricing improvements already secured, cost savings exceeding expectations, and market tightness supporting positive trajectory.

Q2 — Pat (for Steven Juguera)

• Topic: Current pricing levels and frac sand pricing
• Key points:
  • Current pricing is at 55%–60% of 2022 peak; would need 80%–90% increase to return to that level, but industry efficiency is higher (more pump hours per fleet).
  • Goal is positive net income within next couple of quarters; price improvement expected without stressing customer partnerships.
  • Sand market tightening across all regions (South Texas extremely tight, East Texas improving, West Texas climbing); pricing improving in volume and price.
• Mgmt stance: Bullish – pricing has long runway for improvement, sand market tightening supports further gains, net income target achievable near-term.

Q3 — Analyst

• Topic: Incremental frac spreads mix (public vs. private operators)
• Key points:
  • Private operators driving new activity, including spot work and full dedicated programs; public operator mix not detailed.
  • Company remains disciplined: will only activate fleets and commit capital with strong customer commitment, not on spec.
  • “Drill baby drill” sentiment not factored into guidance; expects positive net income in very short order this year.
• Mgmt stance: Bullish – sees market in early innings, win-win for customers and ProFrac, but will only deploy capital with direct customer signals.