What factors drove the changes in Archrock's revenue and profit?

What is Archrock's latest dividend and current dividend yield?

What is Archrock's gross profit margin?

What guidance did Archrock's management provide for the next earnings period?

What is the revenue and EPS growth rate for Archrock year over year?

Did Archrock beat or miss consensus estimates last quarter?

What does Archrock do and what are its main business segments?

What were the key takeaways from Archrock's earnings call?

- **Exceptional 2025 Growth**: Adjusted EPS +68%, EBITDA +51%, with 70%+ contract margins and 95.5% fleet utilization.
- **2026 Outlook**: $890M EBITDA midpoint, 85% contracted backlog, and $250-275M growth CapEx for 170,000 hp deliveries.
- **Strategic Focus**: Large horsepower, EMD (20-30% of 2026 orders), and LNG-driven Permian gas growth.
- **Financial Strength**: 2.7x leverage, $800M 6% bond issuance, and $0.22 dividend (16% YoY increase).
- **Supply Chain Challenges**: 110-120 week lead times, but 2026 demand fully booked with 85% contracts.

**【CEO Summary Section】**
- **Record Performance in 2025**: Adjusted EPS grew 68% YoY, and adjusted EBITDA increased 51% YoY, driven by strong pricing, efficiency, and cost discipline. Contract operations achieved 70%+ adjusted gross margins for five consecutive quarters.
- **Strategic Fleet Optimization**: Sold 325,000 horsepower for $192 million, redeploying proceeds into high-return new builds. Operating horsepower grew 8% YoY to 4.6 million, with 95.5% utilization.
- **2026 Outlook**: 85% of 2026 backlog is contracted, with $250-275 million in growth CapEx. Focus on large horsepower and electric motor drive (EMD) compression, supported by U.S. LNG exports and Permian gas growth.
- **Customer粘性**: Average time on location for large horsepower units (≥1,500 hp) reached 97 months, up 61% since 2021.

**【CFO Financial Commentary】**
- **Q4 2025 Results**: Adjusted EBITDA of $269 million, net income of $117 million. Full-year adjusted EBITDA of $901 million, exceeding guidance midpoint. Fourth-quarter gross margin of 78% benefited from $23 million in prior-period tax settlements.
- **2026 Guidance**: Adjusted EBITDA of $865-915 million (midpoint $890 million). Growth CapEx of $250-275 million, with $125-135 million for maintenance and $25-35 million for vehicles. Dividend increased 5% QoQ to $0.22 per share, with $117.7 million remaining under share repurchase program.
- **Balance Sheet Strength**: Year-end leverage of 2.7x, below long-term target range of 3.0-3.5x. Issued $800 million 8-year bond at 6%, lowest rate in compression sector history.

**【Q&A Highlights】**
- **Growth CapEx and Lead Times**: 2026 growth CapEx of $250-275 million will deliver 170,000 hp, with 60% of deliveries in H1. Lead times for large horsepower equipment (e.g., Caterpillar engines) extended to 110-120 weeks, but 2026 backlog is 85% contracted.
- **M&A Strategy**: Open to accretive acquisitions, particularly in large horsepower and EMD segments. Recent transactions (e.g., TOPS, NGCS) demonstrate ability to integrate accretively.
- **Aftermarket Services**: 2025 gross margin of 24%, with focus on high-quality, high-margin work. Growth constrained by labor availability and selective customer targeting.
- **Electric Motor Drive (EMD) Adoption**: 20-30% of 2026 orders for EMD, driven by power demand and decarbonization trends. Archrock leads industry with EMD expertise.
- **Geographic Focus**: Permian Basin dominates growth, but net horsepower additions in 6 basins in 2025, including dry gas plays reactivating due to gas/oil price dynamics.

Archrock, Inc.(AROC)-20260225-2025 Q4 Earnings call transcript

- **Record Financial Performance**: Q3 2025 adjusted EPS of $0.42 (50% YoY growth) and EBITDA of $221 million (46% YoY increase) reflect strong execution in contract ops and AMS.
- **Leverage and Share Returns**: 3.1x leverage ratio and $159M returned to shareholders (71% YoY increase) highlight financial discipline and shareholder focus.
- **Long-Term Growth Drivers**: 17 Bcf/day LNG export growth by 2030 and 10-25 Bcf/day AI-driven power demand create sustained compression demand.
- **Operational Strength**: 96% utilization, 6+ year average unit tenure, and 70.4% contract ops gross margin underscore market leadership.
- **CapEx and Pricing**: $345-355M 2025 CapEx guidance reflects confidence in multiyear contracts, while 60-65% annual repricing opportunities support margin resilience.

**【CEO Summary Section】**
- Archrock reported third-quarter 2025 adjusted EPS of $0.42, up 50% year-over-year, and adjusted EBITDA of $221 million, a 46% increase from Q3 2024. Contract operations and Aftermarket Services (AMS) segments drove strong revenue and gross margins due to robust activity and pricing.
- The company maintained a sector-leading leverage ratio of 3.1x and returned $159 million to shareholders through dividends and share buybacks in the first nine months of 2025, up 71% year-over-year.
- Management highlighted long-term growth drivers, including U.S. LNG exports (expected to grow by 17 Bcf/day by 2030) and AI-driven power demand, which could add 10-25 Bcf/day of natural gas demand by 2030.
- The fleet utilization rate remained at 96%, with units staying on location for an average of over 6 years, reflecting strong customer retention and multiyear contracts.

**【CFO Financial Commentary】**
- Third-quarter net income was $71 million, with adjusted EBITDA of $221 million. Contract operations revenue rose 2% sequentially to $326 million, driven by pricing and horsepower growth. AMS revenue was $56 million, up 20% year-over-year.
- Adjusted gross margin for contract operations was 70.4%, up slightly from Q2 2025, with a $9.9 million cash tax credit boosting the overall gross margin to 73%. 
- The company narrowed its 2025 growth CapEx guidance to $345-355 million, reflecting confidence in customer demand and multiyear contracts. Free cash flow after dividends is expected to remain positive.
- Archrock repurchased 1.1 million shares in Q3 at an average price of $23.18 and increased its share buyback authorization by $100 million, leaving $130 million available.

**【Q&A Highlights】**
- **Capital Allocation**: CEO Brad Childers emphasized investing in growth (priority), followed by dividend increases and share buybacks. The company plans to maintain a 3.0-3.5x leverage target while generating free cash flow.
- **Margins and Pricing**: CFO Doug Aron noted that 60-65% of contracts are repriced annually, with pricing driven by high utilization (96%) and limited available capacity. Gross margins remain resilient despite cost inflation (low single digits).
- **Demand Trends**: LNG exports and AI-driven power demand are key growth drivers. The company expects 2026 compression market activity to match 2025 levels, with $250 million+ CapEx required to meet demand.
- **Supply Chain Constraints**: Lead times for Caterpillar engines are 60 weeks, up from 42 weeks six months ago, but Archrock is able to source some units faster through the secondary market.
- **Asset Sales**: The company generated $114 million in non-strategic asset sales year-to-date and expects to continue monetizing older, smaller units to refresh its fleet.

Archrock, Inc. (AROC) Q3 2025 Earnings Call Transcript

- **Record Financials**: Q2 2025 adjusted EPS up 70% YoY to $0.39, EBITDA $213M (+60% YoY). Fleet utilization at 96%.
- **Dividend & Buybacks**: 11% QoQ dividend increase to $0.21/share, $29M buybacks in Q2.
- **2026 Growth**: CapEx guidance ≥$250M, 55% order book in Permian, 6+ year unit stay times.
- **Margin Resilience**: 70%+ contract ops gross margin for 3Q in a row, stable amid macro volatility.
- **Strategic Position**: Largest compression provider in key basins, 2.6Mhp in Permian with 30%+ gas production growth outlook.


**【CEO Opening Remarks】**
- Q2 2025: Record adjusted EPS of $0.39 (+70% YoY), adjusted EBITDA of $213M (+60% YoY). Fleet utilization at 96%, up 368,000hp QoQ due to NGCS acquisition and organic growth.
- Financial strength: Leverage ratio 3.3x, dividend coverage 3.4x. Q2 dividend increased 11% QoQ to $0.21/share, buybacks of $29M (total $51M since April 2023).
- Growth outlook: 2026 CapEx guidance of $250M+ driven by strong order book, with 55% of 2026 order book in Permian.

**【CFO Financial Review】**
- Q2 2025: Contract ops revenue $318M (+6% QoQ, +41% YoY), AMS revenue $65M (highest since 2018). Adjusted gross margin 70% for contract ops, 23% for AMS.
- Updated 2025 guidance: Adjusted EBITDA $810M-$850M (up from $790M-$830M), CapEx narrowed to $340M-$360M.
- Liquidity: $675M post-ABL upsize, $102M+ in asset sales YTD.

**【Q&A Highlights】**
1. **2026 Growth**: CEO expects CapEx ≥$250M, driven by 55% Permian order book and midstream infrastructure demand. Average unit stay time >6 years, up 52% since 2021.
2. **Pricing Trends**: Mid-single-digit inflation-based pricing growth, stable margins due to fleet modernization (70%+ gross margin for 3Q in a row).
3. **Competitive Position**: Largest contract compression provider in Eagle Ford, Haynesville, and Permian. 2.6Mhp in Permian, 30%+ gas production growth vs. 15% oil growth by 2030.
4. **Capital Allocation**: Buybacks ($59M remaining) and dividend growth (27% YoY) prioritized, with 3.3x leverage target.
5. **Tariff Impact**: Minimal (domestic supply chain), no material 2025 impact.
6. **Electric vs. Gas Drives**: Mix shifting to 20-25% electric (down from 30+%), driven by power availability constraints.


Archrock, Inc. (AROC) Q2 2025 Earnings Call Transcript

- **Revenue Growth**: Q1 2025 adjusted EBITDA up 50% YoY, driven by 70,000+ new horsepower additions. 
- **Shareholder Value**: 15% dividend increase, $23M in buybacks, and $50M added to share repurchase capacity. 
- **Market Resilience**: 96% fleet utilization, no spare equipment, and customers maintaining 2025 capital programs despite OPEC volatility. 
- **Acquisition Impact**: NGCS acquisition adds $50M to buyback capacity and boosts 2025 EBITDA guidance by $40M. 
- **Electric Compression Growth**: 30% of newbuild CapEx allocated to electric units, reflecting long-term demand for low-emission solutions. 


**【CEO Summary Section】**
- **Record Financial Performance**: Q1 2025 saw adjusted EPS up 60% YoY and adjusted EBITDA up 50%, driven by 70,000+ new horsepower additions. 
- **Utilization Strength**: Fleet utilization remained at 96%, with no spare equipment in the market. 
- **Shareholder Returns**: Dividend increased 15% YoY, coverage at 3.9x, and $23M in share buybacks (977,000 shares) completed. 
- **Acquisition Strategy**: NGCS acquisition added $50M to share buyback capacity, with 8-month contribution to 2025 guidance. 
- **Market Resilience**: Despite OPEC volatility, customers maintain 2025 capital programs; stop activity at record lows. 

**【CFO Financial Commentary】**
- **Q1 Financials**: GAAP net income $71M, adjusted EBITDA $198M. Contract ops revenue $300M (+35% YoY), aftermarket services $47M (+17% YoY). 
- **Profitability**: Adjusted gross margin 70% (contract ops), 25% (aftermarket). Leverage ratio 3.2x, lowest in company history. 
- **2025 Guidance Update**: EBITDA raised to $790-830M (prev $750-790M), reflecting NGCS contribution. 
- **Capital Allocation**: Growth CapEx $330-370M, 1st-half weighted; maintenance CapEx $110-120M. 

**【Q&A Key Themes】**
- **Macro Volatility**: Customers not delaying 2025 starts; 2026 bookings pace unchanged. 
- **Tariff Impact**: <10% cost increase in 2025, locked-in pricing for 2025/2026 equipment. 
- **Electric Compression**: 30% of newbuild CapEx, demand tied to power availability. 
- **Utilization Stability**: Mid-90s utilization expected, driven by multi-year contracts. 
- **Synergy Potential**: NGCS transaction immediately accretive; no synergies modeled in guidance. 


Archrock (AROC)-6 May 25-2025 Q1 Earnings call transcript

- **2024 Record Year**: 69% EPS growth, 30% EBITDA rise, 70% gross margin, and 96% fleet utilization. 
- **2025 Ambitious Plan**: $330-370M capex for new build units, 15% dividend hike, and 30% EBITDA growth. 
- **Market Dominance**: Permian-focused growth with 2026 backlog, EMD expansion, and 70% gross margin target. 
- **Financial Strength**: 3.3x leverage, $118M cash flow, and 3.5x dividend coverage. 
- **Risks & Opportunities**: Tariff monitoring, dry gas reactivation, and AI data center infrastructure growth. 


**【CEO Summary Section】**
- **Record Financial Performance**: 2024 saw 69% increase in adjusted EPS and 30% rise in adjusted EBITDA, driven by organic growth and the TPS acquisition. Fleet utilization peaked at 96%, with 716,000 HP added (excluding non-core sales). 
- **Profitability Leap**: Adjusted gross margin dollars reached $657M (+155% YoY), with Q4 gross margin hitting 70%. 
- **2025 Growth Strategy**: $330-370M capital spend on new build units, focusing on Permian and electric motor drive (EMD) compression. Dividend increased 15% YoY to $0.70 annualized. 
- **Market Outlook**: EIA forecasts 2-3% oil/gas production growth in 2025, supporting demand for compression in LNG, exports, and AI data centers. Backlog extends into 2026. 

**【CFO Financial Commentary】**
- **Q4 2024 Results**: Net income $60M, adjusted EBITDA $184M. Contract ops revenue up 17% QoQ to $286M, AMS revenue $40M (seasonally soft). 
- **2025 Guidance**: Adjusted EBITDA $750-790M (+30% YoY). Contract ops revenue +24% YoY, gross margin 68-71%. AMS revenue $190-210M with 22-24% margin. 
- **Balance Sheet**: Year-end debt $2.2B, leverage 3.3x. 2025 capex $470-535M, funded by operations and asset sales. Dividend coverage 3.5x. 

**【Key Q&A Highlights】**
- **Margin Sustainability**: 70% gross margin achievable with pricing strength and cost control. 2025 capex split: 80% gas drive, 20% EMD. 
- **Market Diversification**: 60-70% capex for Permian, but growing activity in Haynesville, Bakken, and Northeast. 
- **Tariff Risks**: Minimal near-term impact, but monitoring steel tariffs. 
- **Aftermarket Growth**: High customer utilization drives service demand, with 2025 AMS revenue up 10-15%. 
- **Dividend Policy**: Focus on covered, growing dividend aligned with profitability. 


Actual										-0.41	-0.2	0.12	0.03	0.03	0.06	0.06	0.04	0.01	0.11	0.1	0.07	0.1	0.16	0.2	0.21	0.26	0.22	0.22	0.34	0.4	0.36	0.4	0.67
Forecast										0.13	0.125	0.1014	0.0775	0.079	0.0608	0.0701	0.02	0.06	0.12	0.04	0.07	0.1067	0.1433	0.1867	0.2133	0.2233	0.2464	0.2679	0.31	0.3823	0.3775	0.3916	0.3882
Surprise	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	-415.38%	-260.00%	+18.34%	-61.29%	-62.03%	-1.32%	-14.41%	+100.00%	-83.33%	-8.33%	+150.00%	0.00%	-6.28%	+11.65%	+7.12%	-1.55%	+16.44%	-10.71%	-17.88%	+9.68%	+4.63%	-4.64%	+2.15%	+72.59%

AROC

AROC fundamentals

AROC Q4 2025 Earnings

Earnings Call

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AROC

AROC fundamentals

AROC Q4 2025 Earnings

Earnings Call

AROC Earnings Call Summary for Q4/20258:30 AM on Feb 25, 2026

AROC Earnings Call Summary for Q3/20258:30 AM on Oct 29, 2025

AROC Earnings Call Summary for Q2/202511:30 AM on Aug 5, 2025

AROC Earnings Call Summary for Q1/202510:30 AM on May 6, 2025

AROC Earnings Call Summary for Q4/20249:00 AM on Feb 25, 2025

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