Archrock Lowers EBITDA Guidance as Aftermarket Sales Decline
The company tightened its full-year 2026 adjusted EBITDA guidance to a range of $865 million to $885 million.
Archrock (AROC), the natural gas compression services provider, reported second-quarter revenue of $371.2 million. The result represented a decrease from the $383.2 million the company recorded in the second quarter of 2024.
The decline in top-line performance was driven largely by a contraction in the company's aftermarket services segment. Revenue for that unit fell to $42.0 million from $64.8 million a year earlier, due to reduced demand for major maintenance and lower parts sales.
Growth in the contract operations segment partially offset the aftermarket slump. Revenue for the segment rose 3% to $329.3 million. The company also saw a slight expansion in the contract operations adjusted gross margin, which reached 71% compared to 70% in the prior-year period.
Operational capacity shifted as Archrock sold approximately 165,000 non-strategic operating horsepower. Total operating horsepower ended the quarter at 4.5 million, down from 4.7 million at the end of the second quarter of 2024. Spot fleet utilization also declined to 94.4% from 96.0%.
Archrock tightened its full-year 2025 adjusted EBITDA guidance to a range of $865 million to $885 million, lowering the upper end from a previous estimate of $915 million. The company also introduced a new multi-year growth capital expenditure target, projecting cumulative spending between $1.4 billion and $1.6 billion from 2027 through 2030.
The company improved its leverage ratio to 2.6x as of June 30, 2025, down from 3.3x a year prior. This followed the April 1 repurchase of its 2028 Notes for $800 million in principal and approximately $25 million in interest, which generated a debt extinguishment gain of $0.7 million in the second quarter.
Archrock increased its quarterly dividend to $0.23 a share, a rise of approximately 10% from the $0.21 a share paid in the second quarter of 2024.