National Energy Services Reunited Posts Record Quarter as Margins Expand
National Energy Services Reunited (NESR) reported revenue of $520.8 million in the second quarter, up 59.1% from a year earlier and up 28.7% from the first quarter.
National Energy Services Reunited (NESR) reported second-quarter revenue of $520.8 million, up 59.1% year over year and 28.7% sequentially, a sharp acceleration from the 33.5% annual growth and nearly flat sequential pace it posted in the first quarter. The oilfield-services provider's sequential revenue path over the past three quarters has been uneven rather than a steady climb: up 34.9% in the fourth quarter of 2025, up just 1.6% in the first quarter of 2026, then up 28.7% in the second quarter, a pattern that points to lumpiness in contract mobilization timing rather than a smooth ramp.
Net income nearly tripled from a year earlier to $44.0 million, up 189.6% year over year and 84.7% sequentially, extending a recovery that began after net income fell to a depressed $7.8 million in the fourth quarter of 2025 and rebuilt to $23.8 million in the first quarter of 2026. Diluted earnings rose to $0.43 a share from $0.23 a share in the first quarter and $0.08 a share in the fourth quarter of 2025, an increase of 168.8% from a year earlier and 85.8% from the prior quarter. Adjusted EBITDA reached a record $106.2 million, up 50.5% year over year and 38.5% sequentially, reversing a 9.2% sequential dip to $76.7 million in the first quarter that had followed $84.4 million in the fourth quarter of 2025.
Gross margin expanded to 15.6% from 13.4% a year earlier, with gross profit rising to $81.3 million on the higher revenue base from $43.9 million on $327.4 million a year ago, a gain resulting from operating leverage from higher hydraulic fracturing, well testing and wireline logging activity. Adjusted net income rose 125.9% year over year and 70.1% sequentially to $45.5 million, outpacing the erratic quarter-to-quarter pattern of late 2025 and early 2026, when adjusted net income surged 106.6% sequentially in the fourth quarter before falling 16.1% in the first. Total charges and credits affecting adjusted earnings fell to $1.5 million from $2.9 million in the first quarter and $4.9 million a year earlier, a smaller drag from one-off adjustments on reported results.
Operating cash flow surged to $174.0 million, up 466.6% year over year and 76.7% sequentially, recovering from a weak $30.7 million in the first quarter linked to Ramadan-related working capital build. Free cash flow turned positive at $99.9 million, up $105.2 million sequentially and $31.2 million from a year earlier, reversing negative free cash flow of $5.3 million in the first quarter. The stronger cash generation came even as capital expenditures for the first half of 2026 nearly doubled to $110.1 million from $59.9 million in the first half of 2025, as the company continued investing behind growth.
Total debt fell to $274.6 million as of June 30, 2026 from $310.1 million at the end of 2025, and net debt nearly halved to $99.6 million from $185.3 million, driven by stronger cash collections. Cash and cash equivalents rose to $175.0 million from $124.8 million at year-end and $131.8 million a year earlier.
The combination of record adjusted EBITDA, positive free cash flow and a shrinking net debt balance marks a reversal from the working-capital strain and margin softness that weighed on results in the fourth quarter of 2025 and early 2026.