425: NCS Multistage Reports Q2 2026 Results Amidst Weatherford Merger

NCS Multistage Holdings, Inc. announced its second quarter 2026 financial results, showing a 5% year-over-year revenue increase to $38.4 million, but a net loss of $4.6 million.

Summary

• Total revenues for the second quarter of 2026 were $38.4 million, a 5% increase compared to $36.5 million in the second quarter of 2025.
• The company reported a net loss of $4.6 million, or $(1.71) per share, for the quarter, a significant shift from a net income of $0.9 million, or $0.34 per diluted share, in the prior year's quarter.
• Adjusted EBITDA was $1.9 million for the quarter, down from $2.2 million in the same quarter of 2025.
• As of June 30, 2026, the company had $31.3 million in cash and $7.5 million in total debt, consisting of finance lease obligations.
• The pending combination with Weatherford is expected to close in the second half of 2026.
• Revenue in the United States increased by $6.1 million, driven by Repeat Precision and tracer diagnostics, while Canadian revenue decreased due to project delays and consolidation.
• Services revenue increased due to the acquisition of ResMetrics, which contributed $2.3 million.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative sentiment due to the reported net loss, decreased profitability metrics (Adjusted EBITDA), and negative cash flow from operations, despite revenue growth. The upcoming merger provides a potential upside but does not negate the current financial performance concerns.

Positives

• Total revenues increased by 5% year-over-year to $38.4 million.
• Revenue in the United States saw a significant increase of $6.1 million, driven by Repeat Precision and tracer diagnostics.
• Services revenue grew due to the acquisition of ResMetrics, contributing $2.3 million.
• Gross margin remained stable at 34% year-over-year, with adjusted gross margin also stable at 36%.
• The company maintained a strong cash position of $31.3 million as of June 30, 2026.
• The pending merger with Weatherford has received written consent from holders of over 50% of outstanding common stock, eliminating the need for further stockholder approval.

Negatives

• The company reported a net loss of $4.6 million for the quarter, compared to a net income of $0.9 million in the prior year.
• Loss per share was $(1.71), a substantial decrease from diluted earnings per share of $0.34 in Q2 2025.
• Adjusted EBITDA decreased by $0.3 million to $1.9 million compared to the prior year's quarter.
• Adjusted EBITDA margin declined to 5% from 6% year-over-year.
• Cash flow from operating activities for the six months ended June 30, 2026, was a use of cash of $(0.6) million, compared to a source of cash of $1.9 million in the same period of 2025.
• Free cash flow less distributions to non-controlling interest was $(1.6) million for the six months ended June 30, 2026, compared to $0.5 million for the same period in 2025.
• Selling, general and administrative expenses increased by $4.3 million, primarily due to acquisition-related professional fees and ResMetrics expenses.

Risks

• The ability of NCS Multistage and Weatherford to satisfy closing conditions for the proposed merger and the risk that the merger may not be completed.
• Potential negative effects of the proposed merger on business, operations, and relationships with customers, suppliers, and employees.
• Risk of litigation and/or enforcement proceedings arising out of the proposed merger.
• Declines in oil and natural gas exploration and production activity in the U.S., Canada, and internationally.
• Fluctuations in oil and natural gas prices.
• Significant competition leading to pricing pressures, reduced sales, or market share loss.
• Inability to successfully implement strategies for increasing sales in U.S. and international markets.
• Loss of significant customers or inability to integrate and realize benefits from acquisitions.

Future Outlook

The company is progressing towards its pending combination with Weatherford, which is expected to close in the second half of 2026. The company's strategy focuses on delivering exceptional service and leveraging its portfolio of differentiated, technologically advanced products and services.

Management Comments

• "Our second quarter results reflect the continued execution of our strategy in a dynamic market environment, with revenue growth driven by our portfolio of differentiated, technologically advanced products and services, led by a strong performance from Repeat Precision and our U.S. tracer diagnostics offerings."
• "We remain focused on delivering exceptional service to our customers and supporting our employees and other stakeholders as we progress toward our pending combination with Weatherford."
• "The tremendous efforts, dedication and focus from our team at NCS has not wavered as we continue to bring world-class products and service to our customers and plan for the exciting opportunities ahead with Weatherford."
• "We thank our employees, customers, vendors, and shareholders for their continued trust and support."

Industry Context

StockSavvy.ai notes that NCS Multistage's results reflect the ongoing challenges and opportunities within the oil and gas services sector. While revenue growth is positive, the net loss and decreased Adjusted EBITDA highlight margin pressures and increased operational costs, potentially exacerbated by strategic transaction expenses. The pending merger with Weatherford is a significant event that could reshape the company's future market position.

Legal Proceedings

• The company periodically incurs legal costs associated with the assertion of, or defense of, intellectual property, which are excluded from Adjusted EBITDA unless settlement is expected prior to material legal spend.

Stakeholder Impact

• Shareholders: The net loss and decreased earnings per share may negatively impact shareholder value in the short term. The pending merger offers potential future value realization.
• Employees: Management expresses focus on supporting employees during the transition towards the Weatherford merger.
• Customers: Continued focus on delivering exceptional service is highlighted.
• Vendors: Management thanks vendors for their continued trust and support.

Next Steps

• Complete the merger with Weatherford, expected in the second half of 2026.
• Continue execution of strategy focused on differentiated products and services.
• Deliver exceptional service to customers.
• Support employees and stakeholders.

Key Dates

Recommendation

The company's performance metrics for the quarter are weaker than the prior year, with a net loss and reduced profitability. However, the pending merger with Weatherford introduces significant potential upside and a clear path forward. Given the mixed financial results and the transformative nature of the merger, a 'hold' recommendation is appropriate, allowing investors to await further developments on the merger's closing and integration.

Keywords

Oil and Gas Services, Well Completions, Hydraulic Fracturing, Repeat Precision, Tracer Diagnostics, Merger, Weatherford, EBITDA