DNOW Turns a Profit After a Second-Quarter Loss

The Tip Desk · November 7, 2026 · 2 min read

Adjusted EBITDA reached $76 million, or 5.7% of revenue, as the energy distributor posted $1,337 million of third-quarter sales.

DNOW Inc. (DNOW), the energy and industrial solutions provider, reported net income attributable to the company of $26 million, or $0.14 a share, for the third quarter ended September 30, 2026, reversing a $21 million net loss, or ($0.11) a share, in the second quarter.

Adjusted net income attributable to DNOW Inc. was $34 million, or $0.18 a share.

Revenue was $1,337 million, up from $1,307 million in the second quarter after a 10% sequential increase in that prior period. Adjusted EBITDA rose to $76 million, or 5.7% of revenue, from $60 million, or 4.6% of revenue, in the second quarter after a 54% sequential increase there. President and CEO David Cherechinsky said third-quarter Adjusted EBITDA was nearly double first-quarter results.

Gross profit was $265 million, or 19.8% of revenue. Adjusted gross profit was $283 million, or 21.2% of revenue.

United States revenue was $1,125 million, up from $1,109 million in the second quarter after a 13% sequential increase in that period. International revenue was $156 million and Canada revenue was $56 million. The company said sales increased sequentially in all three geographic segments, with solid growth in the downstream, industrial and midstream businesses, and the gas utilities business achieving its highest quarterly revenue in three years.

Cash flow from operating activities was $120 million, down from a record $133 million in the second quarter. Cherechinsky attributed the third-quarter cash generation to substantial improvements in working capital velocity. Free cash flow was $106 million after $14 million of purchases of property, plant and equipment.

Cash and cash equivalents was $112 million and total long-term debt was $377 million at September 30, 2026, resulting in net debt of $265 million and a net debt leverage ratio of 1.1 times, compared with net debt of $360 million and a leverage ratio of 1.7 times at June 30, 2026. Trailing twelve-month Adjusted EBITDA was $236 million.

The company repurchased $17 million of common stock in the third quarter and $92 million year-to-date under its $160 million share repurchase program, after $25 million in the second quarter and $75 million year-to-date at that point. Cherechinsky said year-to-date repurchases through September exceeded the combined amount returned through share repurchases over the prior eleven quarters by 24 percent.

Cherechinsky said the company remained disciplined in capital allocation and, with an even stronger balance sheet, improving end-market fundamentals and a positive outlook across the business, believed it was well positioned to continue gaining share, expanding profitability and creating long-term value.