Quarterly report [Sections 13 or 15(d)]

Business Segments

v3.26.1
Business Segments
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
Business Segments

12. BUSINESS SEGMENTS

The Company's segments are determined as those operations whose results are reviewed regularly by the chief operating decision maker ("CODM"), who is our Executive Chairman, in deciding how to allocate resources and assess performance. Our CODM manages our business segments primarily by the type of product or services provided. We have four reportable segments which we operate within the United States of America: Stimulation Services, Proppant Production, Manufacturing and Flotek. Amounts in the other category reflect our business activities that are not separately reportable, which includes Livewire Power, LLC (“Livewire”). Livewire enables onsite power generation services for oilfield and non-oilfield customers that require off-grid power solutions.

The CODM assesses the performance of the segments based on segment Adjusted EBITDA, which is defined as our net income (loss) before (i) interest expense, net, (ii) income taxes, (iii) depreciation, depletion and amortization, (iv) (loss) gain on disposal of assets, net, (v) stock-based compensation, and (vi) other charges, such as certain credit losses, gain (loss) on extinguishment of debt, gain (loss) on investments, acquisition and integration expenses, litigation expenses and accruals for legal contingencies, acquisition earnout adjustments, severance charges, goodwill impairments, gains on insurance recoveries, transaction costs, third-party supply commitment charges, lease termination costs and impairments of long-lived assets.

We account for intersegment transactions as if the transactions were with third parties, that is, at estimated current market prices.

Summarized financial information for our reportable segments is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stimulation Services

 

 

Proppant Production

 

 

Manufacturing

 

 

Flotek

 

 

Other

 

 

Eliminations

 

 

Total

 

Three Months Ended March 31 2026:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

External customers — services

 

$

407.0

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

3.3

 

 

$

410.3

 

External customers — product sales (1)

 

 

—

 

 

 

14.1

 

 

 

7.0

 

 

 

18.2

 

 

 

—

 

 

 

—

 

 

 

39.3

 

Intercompany (2)

 

 

—

 

 

 

105.5

 

 

 

41.4

 

 

 

54.1

 

 

 

2.9

 

 

 

(203.9

)

 

 

—

 

Total Revenue

 

$

407.0

 

 

$

119.6

 

 

$

48.4

 

 

$

72.3

 

 

$

2.9

 

 

$

(200.6

)

 

$

449.6

 

Cost of revenues, exclusive of depreciation, depletion, and amortization (3)

 

 

349.3

 

 

 

108.5

 

 

 

38.1

 

 

 

53.6

 

 

 

3.0

 

 

 

(198.1

)

 

 

354.4

 

Selling, general and administrative, excluding stock-based compensation

 

 

25.7

 

 

 

4.6

 

 

 

3.5

 

 

 

7.4

 

 

 

—

 

 

 

—

 

 

 

41.2

 

Other income

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Adjusted EBITDA

 

$

32.0

 

 

$

6.5

 

 

$

6.8

 

 

$

11.3

 

 

$

(0.1

)

 

$

(2.5

)

 

$

54.0

 

Depreciation, depletion and amortization

 

 

75.1

 

 

 

18.7

 

 

 

2.8

 

 

 

1.0

 

 

 

0.8

 

 

 

(1.3

)

 

 

97.1

 

Investment in property, plant & equipment

 

 

36.0

 

 

 

4.9

 

 

 

0.2

 

 

 

2.2

 

 

 

—

 

 

 

(2.6

)

 

 

40.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2026:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

20.1

 

 

$

5.1

 

 

$

2.6

 

 

$

5.7

 

 

$

—

 

 

$

—

 

 

$

33.5

 

Total current assets

 

 

454.4

 

 

 

89.6

 

 

 

315.3

 

 

 

117.5

 

 

 

4.4

 

 

 

(446.8

)

 

 

534.4

 

Property, plant, and equipment, net

 

 

635.6

 

 

 

711.6

 

 

 

40.5

 

 

 

30.8

 

 

 

9.6

 

 

 

(14.7

)

 

 

1,413.4

 

Total assets

 

 

2,801.0

 

 

 

1,113.8

 

 

 

459.2

 

 

 

272.7

 

 

 

35.0

 

 

 

(2,131.1

)

 

 

2,550.6

 

Current portion of long-term debt

 

 

92.6

 

 

 

55.7

 

 

 

3.1

 

 

 

4.8

 

 

 

—

 

 

 

—

 

 

 

156.2

 

Long-term debt

 

 

602.4

 

 

 

251.7

 

 

 

14.5

 

 

 

39.8

 

 

 

—

 

 

 

—

 

 

 

908.4

 

Total liabilities

 

 

1,941.6

 

 

 

446.5

 

 

 

378.0

 

 

 

113.7

 

 

 

40.7

 

 

 

(1,154.7

)

 

 

1,765.8

 

 

 

 

 

Stimulation Services

 

 

Proppant Production

 

 

Manufacturing

 

 

Flotek

 

 

Other

 

 

Eliminations

 

 

Total

 

Three Months Ended March 31, 2025:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

External customers — services

 

$

523.8

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

0.1

 

 

$

—

 

 

$

523.9

 

External customers — product sales (1)

 

 

—

 

 

 

43.3

 

 

 

8.7

 

 

 

24.4

 

 

 

—

 

 

 

—

 

 

 

76.4

 

Intercompany (2)

 

 

0.7

 

 

 

24.0

 

 

 

57.1

 

 

 

32.4

 

 

 

5.3

 

 

 

(119.5

)

 

 

—

 

Total Revenue

 

$

524.5

 

 

$

67.3

 

 

$

65.8

 

 

$

56.8

 

 

$

5.4

 

 

$

(119.5

)

 

$

600.3

 

Cost of revenues, exclusive of depreciation, depletion, and amortization (3)

 

 

387.8

 

 

 

43.2

 

 

 

55.3

 

 

 

42.5

 

 

 

5.0

 

 

 

(114.4

)

 

 

419.4

 

Selling, general and administrative, excluding stock-based compensation

 

 

33.1

 

 

 

5.8

 

 

 

6.5

 

 

 

6.4

 

 

 

0.7

 

 

 

—

 

 

 

52.5

 

Other expense (income)

 

 

(1.0

)

 

 

—

 

 

 

—

 

 

 

(0.1

)

 

 

—

 

 

 

—

 

 

 

(1.1

)

Adjusted EBITDA

 

$

104.6

 

 

$

18.3

 

 

$

4.0

 

 

$

8.0

 

 

$

(0.3

)

 

$

(5.1

)

 

$

129.5

 

Depreciation, depletion and amortization

 

 

82.4

 

 

 

19.2

 

 

 

4.6

 

 

 

0.7

 

 

 

—

 

 

 

(0.9

)

 

$

106.0

 

Investment in property, plant & equipment

 

 

51.3

 

 

 

3.7

 

 

 

—

 

 

 

0.4

 

 

 

1.0

 

 

 

(3.9

)

 

$

52.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2025:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

14.0

 

 

$

1.1

 

 

$

2.1

 

 

$

5.7

 

 

$

—

 

 

$

—

 

 

$

22.9

 

Total current assets

 

 

403.1

 

 

 

78.5

 

 

 

315.7

 

 

 

110.4

 

 

 

3.5

 

 

 

(427.7

)

 

 

483.5

 

Property, plant, and equipment, net

 

 

669.4

 

 

 

725.6

 

 

 

42.7

 

 

 

29.6

 

 

 

10.4

 

 

 

(13.4

)

 

 

1,464.3

 

Total assets

 

 

2,795.6

 

 

 

1,115.8

 

 

 

455.8

 

 

 

266.2

 

 

 

37.0

 

 

 

(2,097.3

)

 

 

2,573.1

 

Current portion of long-term debt

 

 

94.1

 

 

 

48.5

 

 

 

3.6

 

 

 

3.5

 

 

 

—

 

 

 

—

 

 

 

149.7

 

Long-term debt

 

 

554.8

 

 

 

266.4

 

 

 

14.6

 

 

 

39.8

 

 

 

—

 

 

 

—

 

 

 

875.6

 

Total liabilities

 

 

1,855.2

 

 

 

425.2

 

 

 

378.0

 

 

 

114.2

 

 

 

41.9

 

 

 

(1,122.1

)

 

 

1,692.4

 

 

(1)
Our Proppant Production segment recognized noncash revenue associated with acquired contract liabilities of zero and $5.7 million for the three months ended March 31, 2026 and 2025, respectively. Refer to Item 8 "Financial Statements and Supplementary Data" in our Annual Report for information about our acquired contract liabilities.
(2)
In our other business activities, Flotek recorded revenue of $2.7 million and $7.5 million for the three months ended March 31, 2026 and 2025, respectively, related to contract shortfalls because the Stimulation Services segment did not purchase the minimum contractual commitment of chemistry products from Flotek.
(3)
Cost of revenues, exclusive of depreciation, depletion, and amortization, for the Stimulation Services segment included an intercompany supply commitment charge of $2.7 million and $7.5 million for the three months ended March 31, 2026 and 2025, respectively, because this segment did not purchase the minimum contractual commitment of chemistry products from Flotek.

 

The following table reconciles consolidated Adjusted EBITDA to net income (loss):

 

 

Three Months Ended March 31,

 

 

 

2026

 

 

2025

 

Adjusted EBITDA

 

$

54.0

 

 

$

129.5

 

Interest expense, net

 

 

(32.8

)

 

 

(35.9

)

Depreciation, depletion and amortization

 

 

(97.1

)

 

 

(106.0

)

Income tax expense

 

 

(1.6

)

 

 

(0.3

)

Gain (loss) on disposal of assets, net

 

 

2.0

 

 

 

(3.4

)

Stock-based compensation (1)

 

 

(2.4

)

 

 

(1.1

)

Lease termination

 

 

(0.2

)

 

 

—

 

Transaction costs

 

 

(0.3

)

 

 

(0.2

)

Acquisition and integration costs

 

 

—

 

 

 

(0.1

)

Litigation expenses

 

 

(2.4

)

 

 

(1.6

)

Gain on investments, net

 

 

—

 

 

 

3.7

 

Net loss

 

$

(80.8

)

 

$

(15.4

)
(1)
Stock-based compensation is reported in “Selling, general and administrative” in the unaudited condensed consolidated statements of operations and is not allocated to the segments.