DNOW (DNOW) Q2 2026 earnings summary

Executive summary

• Achieved Q2 2026 revenue of $1,307 million, up 10% sequentially and 108% year-over-year, with 13% U.S. growth, driven by the MRC Global acquisition and operational improvements.

• Adjusted EBITDA rose to $60 million (4.6% margin), up 54% sequentially, with record $133 million in cash flow from operations.

• Net loss attributable to shareholders was $21 million GAAP, while adjusted net income was $21 million non-GAAP.

• Integration of MRC Global progressing, with ERP conversions and synergy realization underway.

• $25 million in share repurchases in Q2, totaling $75 million in H1 2026, exceeding the previous 10 quarters combined.

Financial highlights

• U.S. revenue was $1,109 million (85% of total), Canada $47 million, International $151 million.

• Adjusted gross profit was $272 million (20.8% margin); gross profit was $243 million (18.6% margin).

• SG&A expenses were $238 million, reflecting integration costs and synergy realization.

• Net debt reduced by $95 million in the quarter, ending at $360 million; net debt leverage ratio at 1.7x.

• Cash and cash equivalents stood at $114 million; total liquidity at $472 million.

Outlook and guidance

• Q3 2026 revenue expected to grow low- to mid-single digits sequentially; full-year 2026 revenue guidance raised to $5.0–$5.1 billion.

• Adjusted EBITDA margin targeted at 4.5%-5.5% for 2026; net cash from operating activities guidance increased to $125–$200 million.

• Confident in achieving $350 million EBITDA in 2027, driven by sector growth and efficiency gains.

• Seasonal Q4 revenue decline anticipated, consistent with historical patterns.

• Management expects continued growth from cross-selling and integration synergies post-MRC Global acquisition.