ProPetro Holding Corp. Q4 FY2025 earnings call

• 2025 was defined by energy market uncertainty with Permian completions activity down. ProPetro delivered operationally and financially, generating strong free cash flow, especially in Q4. • Legacy completions business generates sustainable free cash flow to fuel PROPWR growth. • PROPWR made progress in 2025, with committed capacity and equipment orders, and expects to grow to 750 megawatts by 2028 and 1 gigawatt or more by 2030. • 2026 focus includes streamlining costs, PROPWR derisking deployments and establishing foundation, and completions CapEx program with refurbishment, automation, and direct drive investments. • Completions business had resilient margins and strong free cash flow despite market challenges. • PROPWR has a unique execution strategy, capitalizing on speed-to-market and operational execution, with growing demand in Permian and beyond.

In the fourth quarter, ProPetro generated total revenue of $290 million, a 1% decrease from the third quarter. Net income was $1 million or $0.01 per diluted share, compared to a net loss of $2 million or $0.02 per diluted share in the third quarter. Adjusted EBITDA was $51 million, 18% of revenue, and increased 45% from the third quarter. The legacy completions business generated sustainable free cash flow. PROPWR had significant progress, with total committed capacity now approximately 240 megawatts, and orders for an additional 190 megawatts, increasing total delivered or on order capacity to approximately 550 megawatts, with the portfolio split approximately 70% and 30% between high-efficiency natural gas reciprocating engine generators and low emission modular turbines respectively.

• Expect market challenges to persist into 2026. • Anticipate approximately 11 active frac fleets in Q1, but winter weather impacted activity. • 2026 full year capital expenditures expected to be between $390 million and $435 million, with completions business accounting for $140 million to $160 million, including lease buyouts for FORCE electric fleet and refurbishment, automation, and direct drive investments. • PROPWR capital expenditures expected to be $250 million to $275 million in 2026. • Reaffirm 5-year growth outlook for PROPWR to deliver at least 750 megawatts by year-end 2028 and 1 gigawatt or more by year-end 2030. • First half of 2026 focus on derisking PROPWR deployments and establishing operational foundation, with PROPWR expected to contribute meaningfully to earnings in the second half of 2026.

Q: Expanding on PROPWR contracting cadence and mix, A: Sam Sledge said it's a portfolio approach, aiming for annual contracted equipment to reach 1 gigawatt by 2030, with non-oil and gas projects potentially changing the mix.

Q: On completion side and frac attrition, A: Sam Sledge said it's a major stretch to get back to 90-100 fleets in Permian, but ProPetro is well-positioned with diverse fleet portfolio.

Q: On mix between finance CapEx and cash CapEx, A: Caleb Weatherl said they prioritize using cash on hand, flexible debt facilities, and lease financing facility.

Q: On DGB fleet upgrades, A: Sam Sledge said they have a good portfolio, with plans to rebuild Tier 4s, invest in direct drive and automation.

Q: On power demand mix and e-frac cost, A: Sam Sledge said no concern about e-frac power cost, Travis Simmering said both oil and gas and data center demands are growing.

Q: On contract duration and data center returns, A: Travis Simmering said it's a balancing act, weighing different variables.

Q: On power equipment cost for data centers, A: Travis Simmering said evaluating mix, but return metrics same.

Q: On transitioning customers from Tier 2 to Tier IV DGB, A: Sam Sledge said it's less of a game now due to market stability.

Q: On wireline and cementing, A: Sam Sledge said wireline is stable with market share gains, cementing impacted by low rig count but has good bones.