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Sep 30, 2024
Nine Energy Q3 2024 Earnings Report
Nine Energy reported increased revenue and adjusted EBITDA, with revenue exceeding original guidance, driven by market share gains in the cementing division.
Key Takeaways
Nine Energy Service reported Q3 2024 revenues of $138.2 million, a net loss of $(10.1) million, and adjusted EBITDA of $14.3 million. Revenue exceeded the company's original guidance due to market share gains in the cementing division, which saw a 12% increase in revenue despite a declining rig count.
Revenue increased by approximately 4% quarter over quarter, despite a decline in the average US rig count.
Net loss improved sequentially, decreasing by approximately 28% for the third quarter of 2024.
Adjusted EBITDA increased by approximately 47% sequentially for the third quarter of 2024.
Cementing revenue increased by approximately 12% quarter over quarter, driven by market share gains.
Forward Guidance
The company anticipates Q4 revenue and profitability to be down compared to Q3 due to typical budget exhaustion, weather, holiday slow-downs, and an expected decrease in international tool sales. However, Nine remains positive on demand and the outlook for oil and natural gas, anticipating a moderate activity pick up in 2025 if commodity prices remain supportive.
Positive Outlook
- Positive on demand and the outlook for oil and natural gas
- Well positioned in the natural gas basins
- Earnings respond significantly and quickly with increased market activity
- Service and commodity diversity is critical
- Differentiated through technology and service offerings
Challenges Ahead
- Anticipate Q4 revenue and profitability to be down compared to Q3
- Typical budget exhaustion
- Weather slow-downs
- Holiday slow-downs
Historical Earnings Impact
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Avg. Return Before/After Earnings
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