National Energy Services Reunited (NESR) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 2026 revenue of $520.8 million, up 28.7% sequentially and 59.1% year-over-year, driven by strong performance in Saudi Arabia, Oman, and Egypt, with the Jafurah contract as a key contributor.

• Net income reached $44.0 million, a 189.6% increase year-over-year and 84.7% sequentially.

• Surpassed $2 billion revenue run rate target ahead of schedule, setting new, more ambitious growth objectives.

• Maintained uninterrupted operations and supply chain reliability during regional geopolitical disruptions, leveraging a diversified and proactive logistics strategy.

• Continued execution of the 3B3 strategy, targeting a $3 billion revenue run rate within three years, with progress in contract wins, geographic expansion, and technology innovation.

Financial highlights

• Adjusted EBITDA reached $106.2 million (20.4% margin), up 50.5% year-over-year, with margin expansion despite $4 million in incremental freight/logistics costs.

• Adjusted net income was $45.5 million, up 70.1% sequentially and 125.9% year-over-year; adjusted diluted EPS hit $0.44.

• Operating cash flow rose to $174 million in Q2 2026, with free cash flow at $99.9 million, reflecting strong working capital execution and proactive inventory management.

• Gross debt reduced to $274.6 million, net debt to $99.6 million, and net debt/adjusted EBITDA at 0.3x.

• Cash and cash equivalents stood at $175.0 million as of June 30, 2026.

Outlook and guidance

• 2026 revenue of at least $2 billion now seen as a minimum, with full-year adjusted EBITDA margins expected to remain in line with 2025 levels.

• Full-year capital expenditures guided to $210–$215 million, supporting growth and new contract execution.

• Free cash flow conversion expected at 35–40% of adjusted EBITDA; net income margins projected at 9–9.5%.

• Third quarter expected to see continued strong revenue growth, sequential margin improvement, and stable cash flow.

• Management expressed confidence in continued growth, citing recent contract wins and expanding technology offerings.