Drilling Tools International (DTI) Q4 2025 earnings summary

Executive summary

• Delivered strong Q4 and full-year results in 2025, achieving or exceeding guidance despite a 7% global rig count decline and muted U.S. activity.

• Achieved record adjusted free cash flow and annual growth since going public in 2023.

• Expanded global footprint, especially in the Eastern Hemisphere, with revenue up 78% year-over-year and now 14% of total revenue.

• Focused on execution, innovation, and strategic acquisitions to diversify product lines and strengthen the foundation.

• Maintained operational continuity and minimal disruption in the Middle East despite regional conflict.

Financial highlights

• FY2025 revenue reached $159.6M (rental: $129.6M, product sales: $30.1M), up 3% year-over-year.

• Adjusted EBITDA for 2025 was $39.3M; adjusted free cash flow was $19.2M, up 11% year-over-year.

• Adjusted net income for 2025 was $3.4M ($0.10 per diluted share); net loss was $(3.8)M.

• Q4 2025 revenue was $38.5M; Q4 adjusted EBITDA was $10.1M; Q4 adjusted free cash flow was $6.1M.

• Net debt reduced to $42.2M; net leverage ratio at 1.1x at year-end 2025.

Outlook and guidance

• 2026 revenue guidance: $155M–$170M; adjusted EBITDA: $35M–$45M; adjusted free cash flow: $17M–$22M.

• Capex guidance for 2026: $18M–$23M.

• Assumes flat activity in H1 2026, with improvement in H2; Eastern Hemisphere expected to contribute a growing share.

• Guidance constructed before recent Middle East conflict; potential upside from rig reactivations and new tenders not included.