Flowco (NYSE: FLOC) reported Q2 2026 revenue of $235.9 million, up 22.1% year over year, while diluted EPS increased to $0.28 from $0.21. Adjusted EBITDA rose 22.7% to $93.9 million, and the company generated $49.8 million of free cash flow. Production Solutions accounted for essentially all of the revenue increase, although higher Surface Equipment costs pressured its margin sequentially.
Core Earnings Data
Revenue increased by $42.6 million year over year, with rental revenue rising 29.9% to $132.7 million and sales revenue growing 13.3% to $103.2 million. Operating income grew more slowly than revenue and adjusted EBITDA, partly reflecting a 48.9% increase in depreciation and amortization to $49.4 million.
Consolidated net income was $30.9 million, but $18.4 million was attributable to redeemable non-controlling interests. Net income attributable to Flowco Holdings was $12.5 million, compared with $5.5 million a year earlier. Diluted EPS grew more slowly because the diluted weighted-average share count increased to 44.0 million from 26.2 million.
| Metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Revenue | $235.9 million | $193.2 million | +22.1% |
| Operating income / margin | $41.2 million / approximately 17.5% | $37.1 million / approximately 19.2% | +11.0%; margin down approximately 1.7 points |
| Net income | $30.9 million | $27.4 million | +13.1% |
| Net income attributable to Flowco | $12.5 million | $5.5 million | +128.8% |
| Diluted EPS | $0.28 | $0.21 | +33.3% |
| Adjusted EBITDA / margin | $93.9 million / 39.8% | $76.5 million / 39.6% | +22.7%; margin up 0.2 points |
| Operating cash flow | $95.2 million | Not provided | — |
| Free cash flow | $49.8 million | Not provided | — |
Adjusted net income was $34.3 million, up 3.8% from $33.0 million. The measure excludes transaction expenses, share-based compensation, equipment-sale losses and certain non-recurring charges.
Business and Segment Performance
Production Solutions generated nearly all of Flowco’s year-over-year revenue growth. Natural Gas Technologies remained broadly unchanged from the prior year, while lower vapor recovery system sales caused a sequential decline from Q1.
| Segment metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Production Solutions revenue | $170.9 million | $128.2 million | +33.2% |
| Production Solutions adjusted EBITDA | $71.0 million | $53.3 million | +33.1% |
| Production Solutions adjusted EBITDA margin | 41.6% | 41.6% | Flat |
| Natural Gas Technologies revenue | $65.0 million | $65.0 million | Approximately flat |
| Natural Gas Technologies adjusted EBITDA | $27.8 million | $27.4 million | +1.3% |
| Natural Gas Technologies adjusted EBITDA margin | 42.7% | 42.2% | +0.5 points |
Corporate adjusted EBITDA was negative $4.9 million, compared with negative $4.3 million a year earlier. Sequentially, the corporate expense improved from negative $5.6 million because of lower professional-services fees.
Valiant lifts Production Solutions while equipment costs limit margin expansion
Production Solutions revenue increased 21.9% from Q1, and adjusted segment EBITDA rose 15.5%. Flowco attributed the improvement to higher Downhole Components activity, including two additional months of earnings from Valiant, which added electric submersible pump capabilities when it was acquired in March 2026.
The segment’s adjusted EBITDA margin nevertheless fell 229 basis points from Q1 to 41.6%. Higher maintenance and operating costs at Surface Equipment were the main cause. At the consolidated level, this contributed to adjusted EBITDA margin declining from 40.8% in Q1 to 39.8% in Q2, even though the margin remained slightly above the prior-year quarter.
Profitability, Cash Flow and the Balance Sheet
Flowco converted its quarterly earnings into $95.2 million of operating cash flow and $49.8 million of free cash flow. For the first six months of 2026, operating cash flow was $173.9 million, up approximately 39.5% from $124.7 million in the comparable 2025 period. These are year-to-date figures and should not be compared directly with the quarterly cash-flow amounts.
During the first half, Flowco used $161.8 million of cash for the Valiant acquisition and $71.9 million for property and equipment additions. Cash and equivalents ended June at $19.2 million, up from $4.5 million at the end of 2025, while net long-term debt on the balance sheet increased to $298.4 million from $167.8 million.
Accounts receivable increased to $145.5 million from $100.5 million at year-end, and inventory rose to $186.3 million from $149.6 million. As of August 7, Flowco had $274.1 million of revolving-credit borrowings and $446.4 million of remaining availability under its $721.8 million borrowing base.
The board declared a regular quarterly dividend of $0.09 per Class A share, payable August 26, and a special dividend of $0.14 per Class A share, payable August 31. The special dividend applies only to Class A common stockholders.
Management Perspective
CEO Joe Bob Edwards said customer demand remained consistent in North America as operators focused on increasing output and efficiency from existing assets. Management also said Valiant had performed above its expectations and identified cross-selling, technology integration and deeper customer relationships as potential benefits of the acquisition.
Management emphasized that demand and operating discipline helped offset the quarter’s cost headwinds. However, it did not quantify Valiant’s standalone revenue or EBITDA contribution, making it difficult to separate acquired growth from the rest of Production Solutions.
Recent Insider Transactions
The supplied transaction history shows no reported insider purchases during the six months through August 10, 2026. Jonathan B. Fairbanks, identified as a director and beneficial owner, reported four indirect sales in March at $21.18 per share; the records do not support conclusions about the reason for those transactions.
| Date | Insider | Action | Price per share | Reported transaction value | Ownership |
|---|---|---|---|---|---|
| March 26, 2026 | Jonathan B. Fairbanks | Sale | $21.18 | $24.8 million | Indirect |
| March 26, 2026 | Jonathan B. Fairbanks | Sale | $21.18 | $165.2 million | Indirect |
| March 26, 2026 | Jonathan B. Fairbanks | Sale | $21.18 | $24.8 million | Indirect |
| March 23, 2026 | Jonathan B. Fairbanks | Sale | $21.18 | $165.2 million | Indirect |
Risks Investors Need to Watch
- Production Solutions cost pressure: Higher Surface Equipment maintenance and operating expenses reduced the segment’s margin by 229 basis points sequentially. Continued cost pressure could limit the profit contribution from revenue growth.
- Dependence on Valiant-related growth: Two additional months of Valiant earnings helped drive the sequential increase in Production Solutions, but Flowco did not disclose the acquisition’s standalone contribution. That limits visibility into underlying growth outside the acquired business.
- Natural Gas Technologies sales volatility: Lower vapor recovery system sales caused segment revenue and adjusted EBITDA to decline 6.3% and 6.4%, respectively, from Q1.
- Higher debt and working capital: Net long-term debt, accounts receivable and inventory all increased from year-end. Flowco retains substantial revolver availability, but these balance-sheet changes and declared dividends increase the importance of maintaining cash generation.
Summary
Flowco’s Q2 2026 growth was concentrated in Production Solutions, supported sequentially by Downhole Components and the Valiant acquisition. Adjusted EBITDA kept pace with revenue year over year, and free cash flow provided support for the balance sheet and dividends, but rising depreciation, Surface Equipment costs and higher debt limited the quality of some of that growth. Future results will depend on whether Flowco can convert Valiant-related expansion into sustained gains while stabilizing segment margins and managing working capital.
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