NPK Raises Profit Outlook as Product Sales Accelerate
Second-quarter revenue rose 20% to $81.6 million as product demand strengthened.
NPK International (NPKI), an energy-services equipment and rental provider, raised its 2026 adjusted EBITDA outlook after second-quarter profit growth accelerated and margins widened.
The quarter extended a four-quarter margin recovery while shifting growth toward product sales. Adjusted EBITDA margin reached 31.5%, up from 29.9% in the first quarter and 22.3% in the third quarter of 2025.
Revenue growth accelerated from 16% in the first quarter, while diluted continuing-operations earnings rose to $0.14 a share from $0.10 a year earlier. Operating income increased to $16.1 million from $11.6 million, and operating margin expanded to 19.7% from 17.0%.
Product revenue rose 28% from a year earlier to $28.0 million, its highest quarterly level in two years, and increased from $23.1 million in the first quarter. Rental revenue climbed 16% to a quarterly record of $37.2 million, while service revenue was nearly unchanged sequentially at $16.3 million.
Adjusted EBITDA rose 37% to $25.7 million, accelerating from 14% growth in the prior quarter. Gross margin held nearly steady at 37.0%, while selling, general and administrative expenses declined to 17.4% of revenue despite a new $0.9 million accelerated-compensation charge.
NPK now expects 2026 adjusted EBITDA of $97 million to $103 million, compared with its initial range of $88 million to $100 million. The company narrowed its revenue forecast to $313 million to $323 million from $305 million to $325 million, raising the midpoint by $3 million.
Free cash flow increased to $5.9 million from $4.9 million in the first quarter but fell from $11.2 million a year earlier as capital expenditures rose. NPK reduced its 2026 capital-spending plan to $65 million to $80 million after some manufacturing-expansion spending shifted in timing. The Carencro project remains scheduled to add about 50% capacity and begin additional production by mid-2027.