Drilling Tools International Corp. Reports 2025 Second Quarter Results
Company maintains full year 2025 outlook
HOUSTON, Aug. 13, 2025 /PRNewswire/ -- Drilling Tools International Corp. (NASDAQ:DTI) ("DTI" or the "Company"), a global oilfield services company that designs, engineers, manufactures and provides a differentiated, rental-focused offering of tools for use in onshore and offshore horizontal and directional drilling operations, as well as other cutting-edge solutions across the well life cycle, today reported its results for the three months ended June 30, 2025.
DTI generated total consolidated revenue of $39.4 million in the second quarter of 2025. Second quarter Tool Rental revenue was $32.8 million, and Product Sales revenue totaled $6.7 million. Net Loss and Adjusted Net Loss(1) for the second quarter were approximately $2.4 million and $725,000, respectively. Diluted EPS and Adjusted Diluted EPS(1) for the second quarter were a loss of $0.07 per share and a loss of $0.02 per share, respectively. Second quarter Adjusted EBITDA(1) was $9.3 million and Adjusted Free Cash Flow(1)(2) was $1.8 million. As of June 30, 2025, DTI had approximately $1.1 million of cash and cash equivalents and Net Debt(1) of $55.8 million.
Wayne Prejean, President and Chief Executive Officer of DTI, stated, "The second quarter played out largely as we expected with lower commodity prices resulting in reductions in rig count and customer activity, particularly on US land. As a result, our Western Hemisphere business was down from Q1. However, our performance in Q2 remained solid despite the continued activity decline. This enabled us to deliver financial results that exceeded our internal forecasts, which included our first positive Adjusted Free Cash Flow for any second quarter since becoming public. Historically, the second quarter is weaker due to the impacts of spring break-up in Canada and other seasonality. I'm pleased with the continued strong performance of our organization as our efforts thus far have helped DTI efficiently navigate the evolving energy landscape to deliver resilient financial results.
"We also continue to benefit from our recent acquisitions with a more diversified geographic footprint and customer base as the rental tool business gains traction in the Eastern Hemisphere. Quarter over quarter, our Eastern Hemisphere segment grew revenue by 46% and contributed approximately 14% of our total revenue in the current quarter. This momentum has allowed us to grow consolidated Revenue and Adjusted EBITDA compared to the second quarter of 2024 by 5% and 4%, respectively, despite the market softness.
"Looking forward, commodity prices have somewhat stabilized in recent weeks after a period of volatility, however, average rig count and activity levels have continued to trend downward. In the past, current oil prices would typically support higher drilling and completions activity than we are seeing today, but our customers have remained cautious as uncertainty persists. While the market works to find its footing, we expect uncertainty to continue causing disruptions through both pricing pressure and utilization. In anticipation of these disruptions, last quarter we implemented a program to cut expenses by approximately $6 million this year to align our spending with the activity levels of our customers. We are pleased to report that we are on track to meet or exceed this goal. Should the market deteriorate further, we have contingency plans to cut additional costs. We remain committed to identifying cost reduction opportunities and maintaining operational flexibility to quickly respond to the current challenging environment.
"While the activity declines to date have not been quite as severe as we initially anticipated, we have begun to experience pricing pressures, and continue to expect these to compress margins in the back half of this year. As such, we are maintaining our previously disclosed guidance ranges as follows:
2025 Full Year Outlook
Revenue
$145 million
—
$165 million
Adjusted EBITDA(1)
$32 million
—
$42 million
Adjusted EBITDA Margin(1)
22 %
—
25 %
Adjusted Free Cash Flow(1)(2)
$14 million
—
$19 million
(1)
Adjusted Net Income (Loss), Adjusted Diluted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Net Debt, and Adjusted Free Cash Flow are non-GAAP financial measures. See "Non-GAAP Financial Measures" at the end of this release for a discussion of reconciliations to the most directly comparable financial measures calculated and presented in accordance with U.S. generally accepted accounting principles ("GAAP").
(2)
Adjusted Free Cash Flow defined as Adjusted EBITDA less Gross Capital Expenditures.
2025 Second Quarter Conference Call Information
DTI's 2025 second quarter conference call can be accessed live via dial-in or webcast on Thursday, August 14, 2025 at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) by dialing 201-389-0869 and asking for the DTI call at least 10 minutes prior to the start time, or via live webcast by logging onto the webcast at this URL address: https://investors.drillingtools.com/news-events/events. An audio replay will be available through August 21, 2025 by dialing 201-612-7415 and using passcode 13754878#. Also, an archive of the webcast will be available shortly after the call at https://investors.drillingtools.com/news-events/events for 90 days. Please submit any questions for management prior to the call via email to
About Drilling Tools International Corp.
DTI is a Houston, Texas based leading oilfield services company that manufactures and rents downhole drilling tools used in horizontal and directional drilling of oil and natural gas wells. With roots dating back to 1984, DTI operates from 15 service and support centers across North America and maintains 11 international service and support centers across the EMEA and APAC regions. To learn more about DTI, please visit: www.drillingtools.com.
Contact:
DTI Investor RelationsKen Dennard / Rick
Forward-Looking Statements
This press release may include, and oral statements made from time to time by representatives of the Company may include, "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements other than statements of historical fact included in this press release are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "will," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward looking. These forward-looking statements include, but are not limited to, statements regarding DTI and its management team's expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward looking statements in this press release may include, for example, statements about: (1) the demand for DTI's products and services, which is influenced by the general level activity in the oil and gas industry; (2) DTI's ability to retain its customers, particularly those that contribute to a large portion of its revenue; (3) DTI's ability to employ and retain a sufficient number of skilled and qualified workers, including its key personnel; (4) DTI's ability to source tools and raw materials at a reasonable cost; (5) DTI's ability to market its services in a competitive industry; (6) DTI's ability to execute, integrate and realize the benefits of acquisitions, and manage the resulting growth of its business; (7) potential liability for claims arising from damage or harm caused by the operation of DTI's tools, or otherwise arising from the dangerous activities that are inherent in the oil and gas industry; (8) DTI's ability to obtain additional capital; (9) potential political, regulatory, economic and social disruptions in the countries in which DTI conducts business, including changes in tax laws or tax rates; (11) DTI's dependence on its information technology systems, in particular Customer Order Management Portal and Support System, for the efficient operation of DTI's business; (11) DTI's ability to comply with applicable laws, regulations and rules, including those related to the environment, greenhouse gases and climate change; (12) DTI's ability to maintain an effective system of disclosure controls and internal control over financial reporting; (13) the potential for volatility in the market price of DTI's common stock; (14) the impact of increased legal, accounting, administrative and other costs incurred as a public company, including the impact of possible shareholder litigation; (15) the potential for issuance of additional shares of DTI's common stock or other equity securities; (16) DTI's ability to maintain the listing of its common stock on Nasdaq; and (17) other risks and uncertainties separately provided to you and indicated from time to time described in in DTI's most recent Forms 10-K, 10-Q and 8-K filed with or furnished to the Securities and Exchange Commission (the "SEC"). You should carefully consider the risks and uncertainties including those described in Part I, Item 1A, "Risk Factors" of our Annual Report on Form 10-K filed on March 14, 2025 and in comparable "Risk Factor" sections of our Quarterly Reports on Form 10-Q filed after such Form 10-K. Such forward-looking statements are based on the beliefs of management of DTI, as well as assumptions made by, and information currently available to DTI's management and are subject to numerous conditions, many of which are beyond the control of DTI. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in DTI's most recent Forms 10-K, 10-Q and 8-K filed with or furnished to the SEC. All subsequent written or oral forward-looking statements attributable to the Company or persons acting on its behalf are qualified in their entirety by this paragraph. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Drilling Tools International Corp.
Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
(In thousands of U.S. dollars and rounded)
Three Months Ended June 30,
2025
2024
Revenue, net:
Tool rental
$ 32,756
$ 28,328
Product sale
6,665
9,205
Total revenue, net
39,421
37,533
Costs and other deductions:
Cost of tool rental revenue
7,402
6,998
Cost of product sale revenue
2,494
3,000
Selling, general, and administrative expense
21,023
19,619
Depreciation and amortization expense
6,830
5,681
Interest expense, net
1,336
811
Loss (gain) on asset disposal
85
(51)
Loss (gain) on remeasurement of previously held equity interest
—
(480)
Goodwill impairment
—
—
Other operating and non-operating expense, net
1,912
1,672
Total costs and other deductions
41,082
37,250
Income (loss) before income tax expense
(1,661)
283
Income tax benefit (expense)
(746)
82
Net income (loss)
$ (2,407)
$ 365
Basic earnings (loss) per share
$ (0.07)
$ 0.01
Diluted earnings (loss) per share
$ (0.07)
$ 0.01
Basic weighted-average common shares outstanding
35,573,749
29,816,202
Diluted weighted-average common shares outstanding
35,573,749
30,873,436
Comprehensive income (loss):
Net income (loss)
$ (2,407)
$ 365
Foreign currency translation adjustment, net of tax
2,199
102
Net comprehensive income (loss)
$ (208)
$ 467
Drilling Tools International Corp.
Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
(In thousands of U.S. dollars and rounded)
Six months ended June 30,
2025
2024
Revenue, net:
Tool rental
$ 67,289
$ 58,294
Product sale
15,012
16,213
Total revenue, net
82,301
74,507
Costs and other deductions:
Cost of tool rental revenue
15,090
13,482
Cost of product sale revenue
6,051
5,053
Selling, general, and administrative expense
42,633
37,560
Depreciation and amortization expense
13,552
11,047
Interest expense, net
2,645
992
Loss (gain) on asset disposal
72
(42)
Loss (gain) on remeasurement of previously held equity interest
—
(729)
Goodwill impairment
1,901
—
Other operating and non-operating expense, net
3,846
2,798
Total costs and other deductions
85,790
70,161
Income (loss) before income tax expense
(3,489)
4,346
Income tax benefit (expense)
(587)
(854)
Net income (loss)
$ (4,076)
$ 3,492
Basic earnings (loss) per share
$ (0.11)
$ 0.12
Diluted earnings (loss) per share
$ (0.11)
$ 0.12
Basic weighted-average common shares outstanding
35,583,139
29,792,385
Diluted weighted-average common shares outstanding
35,583,139
30,321,002
Comprehensive income (loss):
