ACDC Q1 2026 Update – ACDC

Key Takeaways

• Q1 revenue fell 25% YoY to $449.6M.
• Adjusted EBITDA dropped 58% YoY to $54M, margin 12%.
• Stimulation Services revenue down 22%, but Flotek EBITDA up 183%.
• Capex rose 12% YoY to $41M; 2026 plan up to $185M.
• Pricing improvements slated for late Q2, crucial for cash flow.

Pulse Analysis

ACDC (American Drilling & Completion) posted its first‑quarter 2026 results amid a tightening oilfield‑services market. Total revenue slipped to $449.6 million, a 25% decline from the prior year, while adjusted EBITDA contracted to $54 million, down 58% and compressing the margin to 12% from roughly 22% a year earlier. The drop was driven primarily by weaker stimulation‑services demand, a segment that fell 22% YoY to $407 million. Weather‑related disruptions cost the company about $9 million in adjusted EBITDA, underscoring the sensitivity of completion operations to seasonal conditions. The earnings miss sent the shares down 7.7% on the day.

Despite the overall slowdown, ACDC’s Flotek subsidiary delivered a standout performance, generating $72.3 million in revenue and a 182% surge in adjusted EBITDA to $11.3 million, reflecting higher demand for specialized fluid‑management solutions. Proppant production revenue rose 78% YoY, yet its profitability deteriorated, with EBITDA falling 65% as intercompany sales dominate the mix. Capital spending rose to $41 million, a 12% increase, as the firm invests in dual‑fuel fleet conversions and modular electric blenders (e‑blenders). Management reported that 65‑70% of a $100 million annual savings program has already been realized, while cost inflation in chemicals and steel remains a headwind.

Looking ahead, ACDC expects Q2 to rebound in stimulation services as tighter completion calendars and secured pricing lifts begin to materialize in the second half of 2026. The company’s 2026 capex target of $155‑$185 million, including Flotek, signals continued emphasis on technology such as the Machina automation platform, which could become a differentiator if adoption accelerates. Valued at roughly 8.8 times forward 2026 EBITDA, the stock appears cheap relative to peers, but the leveraged balance sheet and exposure to geopolitical shocks, notably the Iran conflict, keep risk elevated. Investors will gauge whether pricing improvements and cost‑saving initiatives can translate into sustainable cash flow and debt reduction.