DNOW 2025 Q2 Earnings Mixed Results as Net Income Remains Flat

DNOW Inc. (NYSE: DNOW) reported its Q2 2025 earnings on August 7, 2025. The company posted a slight revenue decline but delivered higher-than-expected earnings per share (EPS), though net income remained flat year-over-year. The results reflect mixed performance, with no formal guidance provided for future periods.

Revenue
DNOW’s Q2 2025 total revenue fell slightly by 0.8% to $628 million compared to $633 million in the prior-year quarter. Domestic operations were the primary revenue driver, with the U.S. segment contributing $528 million, while the Canadian segment reported $48 million and the international segment added $52 million.

Earnings/Net Income
Earnings per share rose 14.3% year-over-year to $0.24, reflecting solid progress in profitability. However, net income for the quarter remained unchanged at $25 million compared to the same period in 2024. Despite the EPS increase, the flat net income suggests that cost pressures or margin constraints may have limited broader gains.

Price Action
DNOW’s stock price edged up 2.48% on the latest trading day but fell 4.43% during the previous full trading week, with a 5.09% gain reported month-to-date.

Post Earnings Price Action Review
Following the earnings report, a strategy of purchasing DNOW stock after earnings beats and holding for 30 days yielded a 72.61% return. However, this underperformed the benchmark, which returned 85.36%, resulting in an excess return of -12.75%. The strategy showed a Sharpe ratio of 0.75, indicating reasonable risk-adjusted returns, albeit with 15.81% volatility and a maximum drawdown of 0%. While the strategy minimized downside exposure, it failed to fully capitalize on the benchmark’s performance.

CEO Commentary
CEO David Cherechinsky highlighted the company’s strong EBITDA performance in the prior year, driven by gross margin expansion and cost controls. He expressed confidence in DNOW’s cash generation and long-term earnings potential, pointing to the recent $160 million share repurchase authorization as a signal of this conviction. Cherechinsky also emphasized the role of strategic acquisitions, like the Trojan Rentals deal, and share buybacks in enhancing shareholder value. Looking ahead, he expressed optimism about 2025, crediting the team’s dedication and a clear path toward sustained growth.

Guidance
DNOW did not provide explicit forward-looking guidance in the report, though management expressed confidence in continued cash flow generation and strategic growth initiatives.

Additional News
On May 7, 2025, DNOW announced its first-quarter 2025 results, revealing continued capital allocation activity. The company repurchased $8 million of common stock in Q1 2025, bringing year-to-date buybacks to $16 million. While no earnings metrics were disclosed in the Form 8-K filing, the continued focus on share repurchases underscores DNOW’s commitment to returning value to shareholders and optimizing its capital structure.