Flowco (NYSE:FLOC) reported record quarterly adjusted EBITDA of approximately $104 million for the third quarter of 2026, helped by growth in both operating segments and accelerated rental revenue from equipment returned early by a customer.
Revenue rose 10% from the second quarter to $259 million, while adjusted EBITDA increased 11%. Revenue was up 46% from a year earlier, President and CEO Joe Bob Edwards said. The company generated $72 million in free cash flow, or 70% of adjusted EBITDA.
For the fourth quarter, Flowco expects adjusted EBITDA of $93 million to $99 million. The outlook reflects seasonal trends across both segments and includes a full quarter of contributions from Lifting Solutions, which Flowco acquired in early October.
Early Equipment Returns Boost Results
Production Solutions revenue rose 5% sequentially to $179 million, and adjusted segment EBITDA climbed approximately 10% to $78 million. CFO Jon Byers said the segment benefited from consistent rental fleet performance and approximately $9 million in accelerated revenue associated with notices to release surface equipment systems.
Edwards said a major oil company returned some high-pressure gas lift units after reaching its targeted Permian production rate. The customer continues to have other units under contract, he said.
Flowco’s take-or-pay contracts allowed it to recognize the remaining contract value when the units were released. Byers said the company pulled forward about a year of revenue and expects the fourth-quarter impact from the returns to be in the $1 million to $3 million range. Edwards said the associated cash flow will be received in the fourth quarter.
Flowco has identified customers for the returned units, including private operators, but expects redeployment to take several quarters after the equipment is prepared for use. Byers said the company expects to return to current stacked surface equipment system levels by mid-2027.
In Natural Gas Technologies, revenue increased 23% sequentially to approximately $80 million, while adjusted segment EBITDA rose 11% to roughly $31 million. Byers attributed the performance to growth in vapor recovery rentals and a strong quarter for natural gas systems. The segment’s adjusted EBITDA margin declined as lower-margin natural gas systems contributed a larger share of revenue.
Acquisition Extends International Reach
Flowco completed its acquisition of Edmonton-based artificial lift provider Lifting Solutions on October 2 for $112 million, excluding potential contingent consideration. Byers said Flowco expects the business to contribute approximately $23 million in adjusted EBITDA in 2027.
The acquisition adds continuous rod and progressing cavity pump technologies and gives Flowco a larger presence in Canada and other international markets. Edwards said Canada immediately becomes Flowco’s second-largest geographic market after the United States. The company expects approximately 10% of its revenue to come from outside the U.S. following the transaction.
Flowco expects to deliver 20 electric submersible pump systems in Venezuela during the fourth quarter and has secured orders for gas lift equipment and digital gauges there. Through Lifting Solutions, it expects to deliver roughly 250 progressing cavity pumps in Venezuela during 2026, including more than 100 on order for fourth-quarter delivery.
Edwards also said Flowco secured orders for 20 electric submersible pump systems from a major multinational operator with a presence in Iraq. He described international procurement, particularly in the Middle East, as often involving multiyear supply commitments, while calling the situation in Venezuela more fluid.
In the U.S., Edwards said Flowco recently won a significant electric submersible pump contract with a large independent operator by drawing on relationships across its existing businesses and the expertise of acquired provider Valiant. The customer could become one of Flowco’s largest in that product line over time, he said.
Cash Flow and Capital Allocation
Flowco generated approximately $103 million in operating cash flow during the third quarter and spent $31 million on growth and maintenance capital expenditures. Byers said fourth-quarter capital spending should be in line with the third quarter, while 2027 spending is currently expected to be similar to or slightly below 2026 levels.
Byers said he expects free cash flow conversion from adjusted EBITDA to remain in the “50% neighborhood.” He noted that the third quarter was stronger than normal, helped in part by working capital and the timing of capital spending.
As of October 30, Flowco had approximately $356 million drawn under its credit facility and about $365 million of available capacity. Leverage remained below one times trailing 12-month EBITDA after the Lifting Solutions acquisition, Byers said.
Edwards said the board increased the company’s share repurchase authorization to $200 million, giving Flowco more flexibility to buy stock when it is attractive relative to other uses of capital. He said the company does not plan to provide a programmatic repurchase guide in the intermediate term.
About Flowco (NYSE:FLOC)
Flowco Holdings Inc is an energy services company that provides production optimization and emissions-reduction solutions to oil and gas producers. Its services are designed to help customers improve well performance, maintain production and manage emissions throughout the life of a well.
The company’s offerings include artificial-lift systems and related equipment, production-monitoring and optimization technologies, and solutions for managing methane and other emissions. Flowco supports producers with a combination of engineered products, field services and ongoing technical assistance.
Flowco primarily serves the U.S.
