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Jun 30
Archrock Q2 2025 Earnings Report
Archrock reported strong second quarter 2025 results, driven by increased revenue in both contract operations and aftermarket services, and raised its full-year 2025 financial guidance.
Key Takeaways
Archrock delivered an outstanding second quarter in 2025, with significant increases in revenue, net income, and adjusted EBITDA compared to the prior year. The company successfully completed the acquisition of NGCS, grew its operating horsepower, and maintained a high utilization rate. Strong customer demand and a robust contract compression backlog contributed to the positive performance, leading to an increase in full-year adjusted EBITDA guidance and enhanced shareholder returns through increased dividends and share repurchases.
Revenue for Q2 2025 increased by 41.6% to $383.2 million, up from $270.5 million in Q2 2024.
Net income rose by 84.2% to $63.4 million, and adjusted EBITDA increased by 64% to $212.7 million, demonstrating strong profitability.
Total operating horsepower grew to 4.7 million, and horsepower utilization remained high at 96%, indicating efficient operations and strong demand.
Archrock raised its full-year 2025 Adjusted EBITDA guidance to a range of $810 million to $850 million and increased its quarterly dividend by approximately 27%.
Archrock
Archrock
Archrock Revenue by Segment
Revenue by Segment
Contract Operations Revenue
CapyFin.comAftermarket Services Revenue
CapyFin.com Forward Guidance
Archrock has raised its full-year 2025 financial guidance, reflecting continued strong performance and the positive impact of the NGCS acquisition, despite recent commodity price volatility. The company anticipates sustained demand for its equipment and services, particularly in the Permian basin, driven by growing LNG exports and power generation needs.
Positive Outlook
- Raised full-year 2025 Adjusted EBITDA guidance to a range of $810 million to $850 million.
- Anticipates strong customer demand for equipment and services to remain elevated.
- Contract compression backlog remains strong into 2026, led by demand in the Permian.
- Expects growing LNG exports and power generation needs to drive significant demand for natural gas compression.
- Committed to prudent capital allocation, prioritizing profitable growth, balance sheet strength, free cash flow generation, and increased shareholder returns.
Challenges Ahead
- Guidance incorporates the divestiture of certain compression assets to Flowco Holdings Inc. for the months of August through December 2025.
- Net income guidance includes $11.8 million of long-lived and other asset impairment as of June 30, 2025, with potential for future unforecasted costs.
- Forward-looking estimate of cash provided by operating activities is not provided due to the inability to estimate changes in assets and liabilities.
- Reflects an estimate of expenses incurred related to the acquisitions of Total Operations and Production Services, LLC and NGCS.
- Recent commodity price volatility is noted, though customer demand remains elevated.
Revenue & Expenses
Visualization of income flow from segment revenue to net income