DNOW (DNOW) Q4 2025 earnings summary

Executive summary

• Completed merger with MRC Global in November 2025, expanding scale, sector reach, and end-market diversification.

• Achieved fifth consecutive year of revenue growth, with full-year revenue of $2.82 billion, and record adjusted EBITDA of $209 million in 2025.

• Integration efforts are underway, with cost synergies expected to reach $23 million in the first year, 35% above initial targets.

• ERP system transition challenges in U.S. MRC Global operations are impacting revenue and customer service, with targeted actions to resolve them.

• Strategic focus on customer service, operational excellence, and leveraging combined strengths for growth.

Financial highlights

• Full-year 2025 revenue reached $2.82 billion, up 19% year-over-year; Q4 revenue was $959 million, up 51% sequentially, with $388 million from MRC Global.

• Adjusted EBITDA was $209 million (7.4% of revenue) for the year and $61 million (6.4% of revenue) for Q4.

• Net loss attributable to the company was $89 million for the year and $147 million for Q4, mainly due to transaction charges; adjusted net income was $104 million for the year and $23 million for Q4.

• Adjusted gross profit was $651 million (23.1% margin) for the year; Q4 adjusted gross profit was $217 million (22.6% margin).

• Cash provided by operating activities was $155 million for the year; liquidity at year-end was $588 million, including $411 million in cash and $164 million in cash equivalents.

Outlook and guidance

• Guidance for 2026 is delayed due to ongoing ERP challenges and integration phase; will be reinstated when operational stability improves.

• Cost synergies from the MRC Global merger are expected to approach $23 million in the first year, a 35% improvement over initial goals.

• Expecting flat to modest organic revenue growth in 2026, with upside from cost and revenue synergies.

• Working capital as a percentage of revenue expected to approach 25% in 2026; effective tax rate projected at 26%-27%.

• Free cash flow for 2026 anticipated in the $100-$200 million range.