0001389050-26-000019
SEC filingArchrock reported Q1 FY2026 revenue of $373.8M, up 7.7% year-over-year, and net income of $73.8M, up 4.2%, reflecting continued execution in contract operations amid softer aftermarket demand.
Revenue growth of 7.7% year-over-year reflects continued strength in our contract operations business, where demand for compression services remains stable and utilization is high. This growth offset softer performance in aftermarket services, which declined due to reduced customer demand for major maintenance activity — a dynamic consistent with broader industry patterns in natural gas infrastructure spending cycles.
Net income increased 4.2% to $73.8M, and diluted EPS rose 2.5% to $0.41. The increase was primarily driven by higher adjusted gross margin from our contract operations business, a decrease in transaction-related costs, and a higher gain on sale of assets, net. Management uses adjusted gross margin as a key internal metric to assess revenue and cost of sales performance, excluding depreciation and amortization — both necessary elements of our capital-intensive operations.
Net cash provided by operating activities totaled $185.9M, a meaningful increase from $115.6M in Q1 FY2025. This reflects not only higher net income but also improved working capital management and timing of receipts and payments. Strong operating cash flow remains central to our liquidity strategy and supports ongoing fleet optimization and disciplined capital allocation.
Our primary sources of liquidity are cash flows generated from operations and borrowing availability under our Credit Facility. As of March 31, 2026, all undrawn capacity on the Credit Facility remained available for borrowings, and we have no near-term debt maturities. We believe that operating cash flows and Credit Facility availability will be sufficient to meet our liquidity needs over the next twelve months and beyond.