KGS · Kodiak Gas Services, Inc.

Kodiak Gas Services delivered exceptional Q1 2026 results, highlighted by record Contract Services revenues of $307.0 million and adjusted gross margin percentage of 70.6%, fueled by strong natural gas compression demand amid tight market conditions with long lead times for new equipment. Adjusted EBITDA hit a record $190.1 million, up 7.0% from Q1 2025, supported by operational leverage and fleet utilization of 98.0%. Net income of $17.8 million reflected a $36.5 million loss on debt extinguishment from refinancing senior notes due 2029 and $8.3 million DPS-related transaction costs, but adjusted net income of $52.0 million underscored underlying strength. Discretionary cash flow rose 9.0% to $126.5 million, enabling growth investments including a 20,700 horsepower purchase-leaseback in the Permian Basin and $18.0 million in power capacity within growth capex of $85.6 million. The April 1, 2026 DPS acquisition marks entry into distributed power, with over 260 MWs procured and plans for 61 MWs delivery in 2026, scaling to over 650 MWs total and 300-500 MWs annual growth through 2030 amid data center demand. CEO Mickey McKee emphasized robust commercial pipeline and long-term contracts. Revised 2026 guidance reflects three quarters of DPS impact, boosting adjusted EBITDA to $820-$860 million, with new Power Infrastructure segment at $95-$125 million revenue and 60-70% margins, Compression Infrastructure at 68.5-70.0% margins, and total growth capex $645-$775 million. Issuance of $1 billion senior unsecured notes lowered borrowing costs, with leverage at 3.6x and $1.5 billion ABL availability on $2.8 billion debt as of March 31.