Archrock (AROC) Q1 2025 earnings summary

Executive summary

• Revenue increased 29% to $347.2 million for Q1 2025, with net income rising 75% year-over-year to $70.9 million, driven by strong contract operations and the TOPS and NGCS acquisitions.

• Adjusted EBITDA reached $198 million, up more than 50% year-over-year, and adjusted EPS increased over 60%.

• Fleet utilization remained high at 96%, with over 70,000 horsepower added sequentially and total available horsepower at 4.3 million.

• Completed integration of TOPS and closed the NGCS acquisition in May 2025, expanding scale, customer reach, and large horsepower assets.

• Maintained sector-leading financial position and increased shareholder returns through higher dividends and expanded buybacks.

Financial highlights

• Q1 2025 adjusted net income was $74.5 million or $0.42 per share, with adjusted EBITDA at $198 million.

• Contract operations revenue was $300.4 million, up 35% year-over-year, with adjusted gross margin at 70%.

• Aftermarket services revenue was $47 million, up 3% year-over-year, with adjusted gross margin at 25%.

• Adjusted gross margin percentage for total revenue was 64% in Q1 2025, up from 58% year-over-year.

• Operating cash flow was $115.6 million, with capital expenditures totaling $162.2 million.

Outlook and guidance

• Raised 2025 adjusted EBITDA guidance to $790–$830 million, reflecting Q1 outperformance and NGCS acquisition.

• Growth CapEx for 2025 projected at $330–$370 million; maintenance CapEx at $110–$120 million.

• Net income guidance for 2025 is $245–$285 million; cash available for dividend expected at $480–$495 million.

• Expect to maintain fleet utilization in the mid-90% range for the year.

• Board declared a quarterly dividend of $0.19 per share, payable in May 2025.