Kodiak Gas Services (NYSE: KGS) hikes 2026 guidance on DPS deal and record EBITDA
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Kodiak Gas Services reported strong first quarter 2026 growth and raised its full-year outlook. Total revenues were $345.8 million, up from $329.6 million a year earlier. Contract Services revenue reached a record $307.0 million, with contract services gross margin of 48.2% and adjusted gross margin of 70.6%, showing improved profitability.
Net income attributable to common shareholders was $17.8 million, or $0.20 per diluted share, after a $36.5 million loss on extinguishment of debt and $8.3 million of largely acquisition-related transaction costs. Adjusted net income was $52.0 million, or $0.59 per diluted share. Adjusted EBITDA hit a record $190.1 million, up 7.0% from first quarter 2025, while discretionary cash flow rose 9.0% to $126.5 million.
The company closed its acquisition of Distributed Power Solutions on April 1, 2026, issued $1 billion of senior unsecured notes, and reported total debt of $2.8 billion with a leverage ratio of 3.6x. Kodiak increased 2026 adjusted EBITDA guidance to $820 million–$860 million and now expects full-year discretionary cash flow of $520 million–$570 million. It has secured over 260 MW of additional power generation capacity, expects 300–500 MW of annual power growth through 2030, and targets power infrastructure revenue of $95 million–$125 million in 2026.
Positive
- Raised 2026 outlook with record profitability. Adjusted EBITDA reached a record $190.1 million in Q1 2026 (up 7.0% year over year), and full-year 2026 adjusted EBITDA guidance was increased to $820–$860 million, with discretionary cash flow of $520–$570 million.
- Strategic expansion into power infrastructure. The DPS acquisition and over 260 MW of procured power capacity support targeted Power Infrastructure revenue of $95–$125 million in 2026 and anticipated power capacity growth of 300–500 MW per year through 2030.
Negative
- Higher leverage and refinancing costs pressure net income. Total debt was $2.8 billion with a leverage ratio of 3.6x, and Q1 2026 net income included a $36.5 million loss on extinguishment of debt tied to refinancing senior notes.
Insights
Record profitability, higher 2026 guidance and new power growth point to an expanding platform.
Kodiak Gas Services delivered record adjusted EBITDA of $190.1 million and stronger margins in its core Contract Services business. Revenues grew across the platform, and fleet utilization reached 98.0%, indicating tight market conditions and strong demand for large-horsepower compression.
The company increased its full-year 2026 adjusted EBITDA outlook to $820–$860 million and projected discretionary cash flow of $520–$570 million. New segment guidance highlights Compression Infrastructure revenue of $1.25–$1.28 billion and Power Infrastructure revenue of $95–$125 million, reflecting the contribution from Distributed Power Solutions.
Kodiak issued $1 billion of senior unsecured notes, bringing total debt to $2.8 billion and a leverage ratio of 3.6x. Management expects to grow power generation capacity by 300–500 MW annually through 2030, with over 260 MW already procured and advanced discussions for long-term contracts. Actual benefits will depend on execution in the new power segment and integration of the DPS acquisition.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Total revenues Q1 2026: $345.8 million
Net income attributable to common: $17.8 million
Adjusted net income: $52.0 million
+5 more
8 metrics
Total revenues Q1 2026
$345.8 million
Three months ended March 31, 2026 vs $329.6 million in 2025
Net income attributable to common
$17.8 million
Q1 2026, $0.20 diluted EPS
Adjusted net income
$52.0 million
Q1 2026, $0.59 adjusted diluted EPS
Adjusted EBITDA
$190.1 million
Q1 2026, 7.0% increase vs Q1 2025
Total debt outstanding
$2.8 billion
As of March 31, 2026; leverage ratio 3.6x
2026 adjusted EBITDA guidance
$820–$860 million
Full-year 2026 outlook including DPS acquisition impact
Additional power capacity procured
260+ MW
New power generation capacity linked to DPS acquisition
Discretionary cash flow
$126.5 million
Q1 2026, up 9.0% vs Q1 2025
Key Terms
Adjusted EBITDA, discretionary cash flow, loss on extinguishment of debt, Power Infrastructure segment, +2 more
6 terms
Adjusted EBITDA financial
"Record adjusted EBITDA(1) of $190.1 million, a 7.0% increase compared to first quarter 2025"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
discretionary cash flow financial
"record discretionary cash flow(1) of $126.5 million, a 9.0% increase compared to first quarter 2025"
Discretionary cash flow is the amount of cash a company generates after covering its operating costs and mandatory capital needs, representing money management can choose how to use. Think of it as a household’s leftover pocket money after paying rent and groceries — investors watch it because it shows a firm’s ability to pay dividends, buy back shares, invest in growth, or reduce debt without needing outside financing.
loss on extinguishment of debt financial
"included a $36.5 million loss on extinguishment of debt related to the refinancing of the Company's senior notes due 2029"
Loss on extinguishment of debt is the accounting hit a company records when it retires or restructures a loan or bond for an amount that exceeds the debt’s recorded value—like paying more than the remaining balance to settle a loan early. It matters to investors because it reduces reported profit and can use cash, but may also cut future interest costs or signal financial stress; understanding it helps assess earnings quality and balance-sheet strength.
Power Infrastructure segment financial
"The Company intends to create a new Power Infrastructure segment that will include a significant majority of the assets, revenues and expenses acquired in the DPS acquisition"
fleet utilization financial
"Fleet utilization (4) | | 98.0 | % | | 97.7 | % | | 96.9 | %"
Fleet utilization measures how much of a company’s vehicles, ships, or aircraft are actively working and earning revenue compared with the total available capacity over a given time. It matters to investors because higher utilization usually means the company is turning expensive assets into income efficiently—like a taxi that’s on fares more often rather than sitting idle—while low utilization can signal wasted capital, higher unit costs, and weaker profit potential.
non-GAAP financial measures financial
"Adjusted gross margin percentage, adjusted net income, adjusted diluted earnings per share, adjusted EBITDA, and discretionary cash flow are non-GAAP financial measures."
Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.
Earnings Snapshot
Revenue: $345.8 million · Guidance included
Q1 2026
Revenue
$345.8 million
+$16.1 million vs Q1 2025
Net income attributable to common
$17.8 million
down vs $30.4 million Q1 2025
Adjusted EBITDA
$190.1 million
+7.0% vs Q1 2025
Guidance
For full-year 2026, Kodiak guides to adjusted EBITDA of $820–$860 million and discretionary cash flow of $520–$570 million, including three quarters of contribution from the Distributed Power Solutions acquisition.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 8-K
____________________
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 11, 2026
____________________
(Exact name of registrant as specified in its charter)
____________________
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
Registrant’s telephone number, including area code: (936 ) 539-3300
Not Applicable
(Former name or former address, if changed since last report.)
____________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
The NYSE Texas, Inc. | ||||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 2.02 Results of Operations and Financial Condition.
On May 11, 2026, Kodiak Gas Services, Inc. (the “Company”) issued a press release providing information on its results of operations and financial condition for the quarter ended March 31, 2026. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information under this Item 2.02 and in Exhibit 99.1 to this Current Report on Form 8-K are being furnished and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information under this Item 2.02 and in Exhibit 99.1 to this Current Report on Form 8-K shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
Item 9.01 Financial Statements and Exhibits.
d) Exhibits.
| No. | Description | ||||
| 99.1 | Kodiak Gas Services, Inc. press release dated May 11, 2026 | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Kodiak Gas Services, Inc. | ||||||||||||||
Date: May 11, 2026 | By: | /s/ Jennifer Howard | ||||||||||||
| Name: | Jennifer Howard | |||||||||||||
| Title: | Executive Vice President, General Counsel, | |||||||||||||
| Chief Compliance Officer and Corporate Secretary | ||||||||||||||
 | ||
| NEWS RELEASE | ||
Investor Contact Graham Sones, VP – Investor Relations ir@kodiakgas.com (936) 755-3529 | ||||||||
Kodiak Gas Services Reports First Quarter 2026 Financial Results, Increases Full Year 2026 Guidance to Include Distributed Power Business and Provides Power Generation Capacity Update and Growth Outlook
THE WOODLANDS, Texas — May 11, 2026 — Kodiak Gas Services, Inc. (NYSE: KGS) (“Kodiak” or the “Company”) today reported financial and operating results for the quarter ended March 31, 2026. The Company announced increased full-year 2026 guidance to incorporate the contribution from the recently-closed acquisition of Distributed Power Solutions, LLC (DPS). Kodiak also announced that it has procured over 260 megawatts (MWs) of additional power generation capacity and expects annual growth of 300 to 500 MWs per year through 2030.
First Quarter 2026 and Recent Highlights
•Record Contract Services segment revenues of $307.0 million
•Contract Services gross margin percentage of 48.2% and adjusted gross margin percentage(1) of 70.6%
•Net income of $17.8 million, or $0.20 per diluted share and adjusted net income(1) of $52.0 million, or $0.59 per adjusted diluted share(1)
•Record adjusted EBITDA(1) of $190.1 million, a 7.0% increase compared to first quarter 2025
•Quarterly net cash provided by operating activities of $71.2 million and record discretionary cash flow(1) of $126.5 million, a 9.0% increase compared to first quarter 2025
•Completed 20,700 horsepower purchase-leaseback transaction with a leading oil and gas producer in the Permian Basin
•Issued $1 billion of senior unsecured notes, reducing the Company's weighted average borrowing rate and bolstering liquidity
•Closed the acquisition of DPS on April 1, 2026 and procured over 260 MWs of additional power generation capacity; expect to take delivery of 61 MWs in 2026 with the balance to be delivered in 2027 through 2029
2026 Guidance Highlights
•Provided revised full year 2026 guidance to reflect continued strength in natural gas compression and to incorporate new power segment
•Increased 2026 Adjusted EBITDA guidance to a range of $820 million to $860 million
CEO Commentary
“Kodiak is off to a fantastic start in 2026, with record contract services revenue and adjusted gross margin percentage driving record quarterly adjusted EBITDA. Our contract compression business continues to outperform expectations, and our new power business has tremendous growth potential," said Mickey McKee, Kodiak's President and Chief Executive Officer. “Since closing the DPS acquisition, we have been actively engaged with numerous data center developers discussing the scope and scale of their distributed power needs. Given the overwhelming demand, we are actively working to scale our power offerings, including today's announcement of equipment orders that will significantly increase our power generation capacity to over 650 megawatts, and clear line of sight to
(1) Adjusted gross margin percentage, adjusted net income, adjusted diluted earnings per share, adjusted EBITDA, and discretionary cash flow are non-GAAP financial measures. Definitions and reconciliations to the most comparable GAAP financial measure are included herein.
over two gigawatts by the end of the decade. We are currently in advanced discussions with customers to deploy this capacity under long-term contracts.
“We remain constructive on the outlook for U.S. natural gas, with rising demand driving the need for incremental compression infrastructure. The market remains tight, with historically long lead times for new large horsepower compression, but Kodiak is well positioned to deliver on our growth targets in the coming years. We're also encouraged by the increasing adoption of distributed power as the preferred solution for data center and other large industrial power consumers' long-term power needs. We have a robust pipeline of commercial opportunities, and have made meaningful progress to secure the equipment to allow us to capture those opportunities and realize our long-term growth objectives."
Segment Information
Contract Services segment revenue was $307.0 million in the first quarter of 2026, a 6.2% increase compared to $289.0 million in the first quarter of 2025. Contract Services segment gross margin was $148.0 million in the first quarter of 2026, an 18.3% increase compared to $125.2 million in the first quarter of 2025 and adjusted gross margin was $216.7 million in the first quarter of 2026, a 10.7% increase compared to $195.7 million in the first quarter of 2025.
Other Services segment revenue was $38.8 million in the first quarter of 2026, a 4.7% decrease compared to $40.7 million in the first quarter of 2025. Other Services segment gross margin and adjusted gross margin were each $6.2 million in the first quarter of 2026, a 12.7% increase compared to $5.5 million for each measure in the first quarter of 2025.
Financial Results
Net income attributable to common shareholders of $17.8 million or $0.20 per share, in the first quarter of 2026 included a $36.5 million loss on extinguishment of debt related to the refinancing of the Company's senior notes due 2029, as well as $8.3 million of nonrecurring transaction expenses related primarily to the acquisition of DPS. Adjusting for these items and the associated tax effects, adjusted net income was $52.0 million or $0.59 per diluted share.
Long-Term Debt and Liquidity
Total debt outstanding was $2.8 billion as of March 31, 2026, and the Company had $1.5 billion available on its ABL Facility. Kodiak’s credit agreement leverage ratio was 3.6x for the first quarter of 2026.
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Summary Financial Data
| Three Months Ended | ||||||||||||||||||||
| (in thousands, excluding percentages) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Total revenues | $ | 345,759 | $ | 332,871 | $ | 329,642 | ||||||||||||||
| Net income attributable to common shareholders | $ | 17,805 | $ | 24,625 | $ | 30,411 | ||||||||||||||
Adjusted net income (1) | $ | 52,001 | $ | 35,261 | $ | 32,637 | ||||||||||||||
Adjusted EBITDA (1) | $ | 190,092 | $ | 184,451 | $ | 177,664 | ||||||||||||||
Adjusted EBITDA percentage (1) | 55.0 | % | 55.4 | % | 53.9 | % | ||||||||||||||
| Contract Services revenue | $ | 306,985 | $ | 301,810 | $ | 288,956 | ||||||||||||||
Contract Services adjusted gross margin (1) | $ | 216,726 | $ | 208,911 | $ | 195,721 | ||||||||||||||
Contract Services adjusted gross margin percentage (1) | 70.6 | % | 69.2 | % | 67.7 | % | ||||||||||||||
| Other Services revenue | $ | 38,774 | $ | 31,061 | $ | 40,686 | ||||||||||||||
Other Services adjusted gross margin (1) | $ | 6,155 | $ | 3,961 | $ | 5,460 | ||||||||||||||
Other Services adjusted gross margin percentage (1) | 15.9 | % | 12.8 | % | 13.4 | % | ||||||||||||||
| Maintenance capital expenditures | $ | 17,758 | $ | 22,265 | $ | 16,407 | ||||||||||||||
Growth capital expenditures (2) (3) | $ | 85,552 | $ | 25,253 | $ | 55,983 | ||||||||||||||
Other capital expenditures (4) | 7,458 | 11,895 | 22,258 | |||||||||||||||||
| Total Growth and Other capital expenditures | $ | 93,010 | $ | 37,148 | $ | 78,241 | ||||||||||||||
Discretionary cash flow (1) | $ | 126,505 | $ | 112,524 | $ | 116,084 | ||||||||||||||
Free cash flow (1) | $ | 36,962 | $ | 78,609 | $ | 47,219 | ||||||||||||||
(1)Adjusted net income, adjusted EBITDA, adjusted EBITDA percentage, adjusted gross margin, adjusted gross margin percentage, discretionary cash flow and free cash flow are non-GAAP financial measures. For definitions and reconciliations to the most directly comparable financial measures calculated and presented in accordance with GAAP, see “Non-GAAP Financial Measures” below.
(2)Growth capital expenditures for the three months ended March 31, 2026 include $18.0 million for additional power generation capacity.
(3)Growth capital expenditures made to (1) expand the operating capacity or operating income capacity of assets including, but not limited to, the acquisition of additional compression units, upgrades to existing equipment, expansion of supporting infrastructure, and implementation of new technologies, (2) maintain the operating capacity or operating income capacity of assets by acquisition of replacement compression units and their supporting infrastructure, and (3) expand the operating capacity or operating income capacity of existing assets..
(4)Other capital expenditures made on assets required to support our operations—such as rolling stock, leasehold improvements, technology hardware and software and related implementation expenditures, safety enhancements to equipment, and other general items that are typically capitalized and that have a useful life beyond one year.
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Summary Operating Data
(as of the dates indicated)
| March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||||||
Fleet horsepower (1) | 4,477,398 | 4,456,285 | 4,422,914 | |||||||||||||||||
Revenue-generating horsepower (2) | 4,389,412 | 4,354,724 | 4,284,103 | |||||||||||||||||
| Fleet compression units | 4,670 | 4,736 | 4,941 | |||||||||||||||||
| Revenue-generating compression units | 4,494 | 4,490 | 4,545 | |||||||||||||||||
Revenue-generating horsepower per revenue-generating compression unit (3) | 977 | 970 | 943 | |||||||||||||||||
Fleet utilization (4) | 98.0 | % | 97.7 | % | 96.9 | % | ||||||||||||||
(1)Fleet horsepower includes (x) revenue-generating horsepower and (y) idle horsepower, which is comprised of compression units that do not have a signed contract or are not subject to a firm commitment from our customer and therefore are not currently generating revenue.
(2)Revenue-generating horsepower includes compression units that are operating under contract and generating revenue and compression units which are available to be deployed and for which we have a signed contract or are subject to a firm commitment from our customer.
(3)Calculated as (i) revenue-generating horsepower divided by (ii) revenue-generating compression units at period end.
(4)Fleet utilization is calculated as (i) revenue-generating horsepower divided by (ii) fleet horsepower.
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Full-Year 2026 Guidance
Kodiak is providing revised guidance for the full year 2026. The full year 2026 guidance below incorporates three quarters of the financial impact of the DPS acquisition given the April 1, 2026 closing date.
Full-Year 2026 Guidance | ||||||||||||||
| (in thousands, excluding percentages) | Low | High | ||||||||||||
Adjusted EBITDA (1) | $ | 820,000 | $ | 860,000 | ||||||||||
Discretionary cash flow (1)(2) | $ | 520,000 | $ | 570,000 | ||||||||||
| Segment Information | ||||||||||||||
Compression Infrastructure (3) revenue | $ | 1,250,000 | $ | 1,280,000 | ||||||||||
Compression Infrastructure adjusted gross margin percentage (1) | 68.5 | % | 70.0 | % | ||||||||||
Power Infrastructure (3) revenue | $ | 95,000 | $ | 125,000 | ||||||||||
Power Infrastructure adjusted gross margin percentage (1) | 60.0 | % | 70.0 | % | ||||||||||
Other Services revenue | $ | 125,000 | $ | 160,000 | ||||||||||
Other Services adjusted gross margin percentage (1) | 13.0 | % | 16.0 | % | ||||||||||
| Capital Expenditures | ||||||||||||||
| Maintenance capital expenditures | $ | 80,000 | $ | 90,000 | ||||||||||
Growth capital expenditures: | ||||||||||||||
Compression Infrastructure (3) | $ | 245,000 | $ | 275,000 | ||||||||||
Power Infrastructure (3) | 400,000 | 500,000 | ||||||||||||
Total Growth capital expenditures | $ | 645,000 | $ | 775,000 | ||||||||||
| Other capital expenditures | $ | 45,000 | $ | 55,000 | ||||||||||
Total Growth and Other capital expenditures | $ | 690,000 | $ | 830,000 | ||||||||||
(1)The Company is unable to reconcile projected adjusted EBITDA to projected net income (loss) and discretionary cash flow to projected net cash provided by operating activities and projected adjusted gross margin percentage to projected gross margin percentage, the most comparable financial measures calculated in accordance with GAAP, respectively, without unreasonable efforts because components of the calculations are inherently unpredictable, such as changes to current assets and liabilities, unknown future events, and estimating certain future GAAP measures. The inability to project certain components of the calculation would significantly affect the accuracy of the reconciliations.
(2)Discretionary cash flow guidance assumes no change to Secured Overnight Financing Rate futures.
(3)The Company's Contract Services segment will be renamed Compression Infrastructure going forward. In addition, the Company intends to create a new Power Infrastructure segment that will include a significant majority of the assets, revenues and expenses acquired in the DPS acquisition, as well as similar assets, revenues and expenses, going forward. A portion of the revenues and expenses acquired in the DPS acquisition that are not recurring in nature, as well as similar revenues and expenses arising from the power business going forward, will be included in the Company's existing Other Services segment. To assist in comparisons to future segment results, the guidance above is provided using the Company's go-forward segment structure.
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Conference Call
Kodiak will conduct a conference call on Monday, May 11, 2026, at 11:00 a.m. Eastern Time (10:00 a.m. Central Time) to discuss financial and operating results for the quarter ended March 31, 2026. To listen to the call by phone, dial 877-407-4012 and ask for the Kodiak Gas Services call at least 10 minutes prior to the start time. To listen to the call via webcast, please visit the Investors tab of Kodiak’s website at www.kodiakgas.com.
About Kodiak
Kodiak is a leading contract compression, distributed power and energy infrastructure services provider in the United States. The Company serves as a critical link in the infrastructure chain that enables the safe, reliable and efficient production of energy. Headquartered in The Woodlands, Texas, Kodiak provides contract compression, distributed power and related services to oil and gas producers, midstream customers and digital infrastructure operators. Additional information is available on the Company's website at www.kodiakgas.com.
Non-GAAP Financial Measures
Adjusted net income and adjusted earnings per share are considered non-GAAP measures. Adjusted net income is defined as net income adjusted to exclude certain items, as applicable, such as (i) impairment of long-lived assets; (ii) severance expenses; (iii) transaction expenses; (iv) sales tax reserve; (v) loss on disposal of business; (vi) loss (gain) on derivatives; (vii) loss on extinguishment of debt; and (viii) the tax effects of the adjustments. Adjusted earnings per share is calculated by dividing adjusted net income by the weighted average diluted shares outstanding.
Adjusted EBITDA and adjusted EBITDA percentage are considered non-GAAP measures. Adjusted EBITDA is defined net income before interest expense; income tax expense; and depreciation and amortization; plus certain items, as applicable, such as (i) impairment of long-lived assets; (ii) loss (gain) on derivatives; (iii) equity compensation expense; (iv) severance expenses; (v) transaction expenses; (vi) sales tax reserve; (vii) loss (gain) on disposal of business; (viii) loss (gain) on sale of assets; and (ix) loss on extinguishment of debt. We define adjusted EBITDA percentage as adjusted EBITDA divided by total revenues.
Adjusted net income, adjusted diluted EPS, adjusted EBITDA and adjusted EBITDA percentage are used as supplemental financial measures by our management and external users of our financial statements, such as investors, commercial banks and other financial institutions, to assess: (i) the financial performance of our assets without regard to the impact of financing methods, capital structure or historical cost basis of our assets; (ii) the viability of capital expenditure projects and the overall rates of return on alternative investment opportunities; (iii) the ability of our assets to generate cash sufficient to make debt payments and pay dividends; and (iv) our operating performance as compared to those of other companies in our industry without regard to the impact of financing methods and capital structure. We believe adjusted net income, adjusted diluted EPS, adjusted EBITDA and adjusted EBITDA percentage provide useful information because, when viewed with our GAAP results and the accompanying reconciliation, they provide a more complete understanding of our performance than GAAP results alone. We also believe that external users of our financial statements benefit from having access to the same financial measures that management uses in evaluating the results of our business. Reconciliations of adjusted net income and adjusted EBITDA to net income and adjusted diluted EPS to GAAP diluted earnings per share, the most directly comparable GAAP financial measures are presented below.
Adjusted gross margin is defined as revenue less cost of operations, exclusive of depreciation and amortization expense. Adjusted gross margin percentage is defined as adjusted gross margin divided by total revenues. We believe adjusted gross margin and adjusted gross margin percentage are useful as supplemental measures to investors of our operating profitability. Reconciliations of adjusted gross margin to gross margin are presented below.
Discretionary cash flow is considered a non-GAAP measure. Discretionary cash flow is defined as net cash provided by operating activities less (i) maintenance capital expenditures; (ii) certain changes in operating assets and liabilities; and (iii) certain other expenses; plus certain items, as applicable, such as (w) severance expenses; (x) transaction expenses; and (y) sales tax reserve. We believe discretionary cash flow is a useful liquidity and performance measure and supplemental financial measure in assessing our ability to pay cash dividends to our stockholders, make growth capital expenditures and assess our operating performance. A reconciliation of discretionary cash flow to net cash provided by operating activities is presented below.
Free cash flow is considered a non-GAAP measure. Free cash flow is defined as net cash provided by operating activities less (i) maintenance capital expenditures; (ii) certain changes in operating assets and liabilities; (iii) certain other expenses; (iv) growth capital expenditures; and (v) other capital expenditures; plus certain items, as applicable, such as (w) severance expenses; (x) transaction expenses; (y) sales tax reserve; and (z) proceeds from sale of assets. We believe free cash flow is a liquidity measure and useful
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supplemental financial measure in assessing our ability to pursue business opportunities and investments to grow our business and to service our debt. A reconciliation of free cash flow to net cash provided by operating activities is presented below.
Cautionary Note Regarding Forward-Looking Statements
This news release contains, and our officers and representatives may from time to time make, “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding: (i) expected operating results, such as revenue growth and earnings, including the integration of acquired businesses and assets into our operations, and our ability to service our indebtedness; (ii) anticipated levels of capital expenditures and uses of capital; (iii) current or future volatility in the credit markets and future market conditions; (iv) potential or pending acquisition transactions or other strategic transactions, the timing thereof, the receipt of necessary approvals to close such acquisitions, our ability to finance such acquisitions, and our ability to achieve the intended operational, financial, and strategic benefits from any such transactions; (v) expectations of the effect on our financial condition of claims, litigation, environmental costs, contingent liabilities and governmental and regulatory investigations and proceedings; (vi) production and capacity forecasts for the natural gas and oil industry; (vii) strategy for customer retention, growth, fleet maintenance, market position and financial results; (viii) interest rate hedges; and (ix) strategy for risk management.
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements. Please refer to the factors discussed throughout the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission, which can be found at the SEC’s website www.sec.gov. The discussion of these factors is specifically incorporated by reference into this news release.
Any forward-looking statement made by us in this news release is based only on information currently available to us and speaks only as of the date on which it is made. Except as may be required by applicable law, we undertake no obligation to publicly update any forward-looking statement whether as a result of new information, future developments or otherwise.
7
KODIAK GAS SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
| Three Months Ended | ||||||||||||||||||||
| (in thousands, except per share data) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Revenues: | ||||||||||||||||||||
| Contract Services | $ | 306,985 | $ | 301,810 | $ | 288,956 | ||||||||||||||
| Other Services | 38,774 | 31,061 | 40,686 | |||||||||||||||||
| Total revenues | 345,759 | 332,871 | 329,642 | |||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Cost of operations (exclusive of depreciation and amortization shown below): | ||||||||||||||||||||
| Contract Services | 90,259 | 92,899 | 93,235 | |||||||||||||||||
| Other Services | 32,619 | 27,100 | 35,226 | |||||||||||||||||
| Depreciation and amortization | 68,681 | 73,192 | 70,529 | |||||||||||||||||
| Long-lived asset impairment | — | 6,344 | — | |||||||||||||||||
| Selling, general and administrative | 46,127 | 38,923 | 32,255 | |||||||||||||||||
| Loss on sale of assets | 1,261 | 7,519 | 9,211 | |||||||||||||||||
| Total operating expenses | 238,947 | 245,977 | 240,456 | |||||||||||||||||
| Income from operations | 106,812 | 86,894 | 89,186 | |||||||||||||||||
| Other income (expenses): | ||||||||||||||||||||
| Interest expense | (48,741) | (48,985) | (47,224) | |||||||||||||||||
| Loss on extinguishment of debt | (36,512) | — | — | |||||||||||||||||
| Other income (expense), net | (939) | 1,072 | (402) | |||||||||||||||||
| Total other expenses, net | (86,192) | (47,913) | (47,626) | |||||||||||||||||
| Income before income taxes | 20,620 | 38,981 | 41,560 | |||||||||||||||||
| Income tax expense | 2,760 | 14,216 | 10,524 | |||||||||||||||||
| Net income | 17,860 | 24,765 | 31,036 | |||||||||||||||||
| Less: Net income attributable to noncontrolling interests | 55 | 140 | 625 | |||||||||||||||||
| Net income attributable to common shareholders | $ | 17,805 | $ | 24,625 | $ | 30,411 | ||||||||||||||
| Earnings per share attributable to common shareholders: | ||||||||||||||||||||
| Basic | $ | 0.20 | $ | 0.28 | $ | 0.34 | ||||||||||||||
| Diluted | $ | 0.20 | $ | 0.28 | $ | 0.33 | ||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||
| Basic | 85,942 | 86,184 | 87,879 | |||||||||||||||||
| Diluted | 87,501 | 87,483 | 90,606 | |||||||||||||||||
8
KODIAK GAS SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
| (in thousands) | March 31, 2026 | December 31, 2025 | ||||||||||||
| Assets | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 94,363 | $ | 3,179 | ||||||||||
| Accounts receivable, net | 238,376 | 197,600 | ||||||||||||
| Inventories, net | 103,926 | 101,530 | ||||||||||||
| Contract assets | 7,725 | 5,190 | ||||||||||||
| Prepaid expenses and other current assets | 15,150 | 15,637 | ||||||||||||
| Total current assets | 459,540 | 323,136 | ||||||||||||
| Property, plant and equipment, net | 3,419,137 | 3,377,555 | ||||||||||||
| Operating lease right-of-use assets, net | 44,361 | 42,218 | ||||||||||||
| Finance lease right-of-use assets, net | 5,892 | 6,500 | ||||||||||||
| Goodwill | 408,681 | 408,681 | ||||||||||||
| Identifiable intangible assets, net | 149,514 | 154,474 | ||||||||||||
| Fair value of derivative instruments | 6,578 | 4,664 | ||||||||||||
| Other assets | 939 | 789 | ||||||||||||
| Total assets | $ | 4,494,642 | $ | 4,318,017 | ||||||||||
| Liabilities and Stockholders’ Equity | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 71,831 | $ | 72,974 | ||||||||||
| Accrued liabilities | 195,729 | 218,463 | ||||||||||||
| Contract liabilities | 92,413 | 94,505 | ||||||||||||
| Total current liabilities | 359,973 | 385,942 | ||||||||||||
| Long-term debt, net of unamortized debt issuance cost | 2,787,003 | 2,555,250 | ||||||||||||
| Operating lease liabilities | 42,122 | 39,391 | ||||||||||||
| Finance lease liabilities | 3,775 | 4,405 | ||||||||||||
| Deferred tax liabilities | 125,460 | 122,851 | ||||||||||||
| Other liabilities | 1,303 | 2,782 | ||||||||||||
| Total liabilities | $ | 3,319,636 | $ | 3,110,621 | ||||||||||
| Stockholders’ equity: | ||||||||||||||
| Preferred stock | 2 | 4 | ||||||||||||
| Common stock | 908 | 903 | ||||||||||||
| Additional paid-in capital | 1,326,985 | 1,334,333 | ||||||||||||
| Treasury stock, at cost | (143,968) | (143,968) | ||||||||||||
| Noncontrolling interest | 3,597 | 4,910 | ||||||||||||
| Accumulated other comprehensive loss | (99) | (1,586) | ||||||||||||
| (Accumulated deficit) Retained earnings | (12,419) | 12,800 | ||||||||||||
| Total stockholders’ equity | 1,175,006 | 1,207,396 | ||||||||||||
| Total liabilities and stockholders’ equity | $ | 4,494,642 | $ | 4,318,017 | ||||||||||
9
KODIAK GAS SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| Three Months Ended March 31, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 17,860 | $ | 31,036 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 68,681 | 70,529 | |||||||||
| Equity compensation expense | 5,890 | 6,978 | |||||||||
| Amortization of debt issuance costs | 2,963 | 3,133 | |||||||||
| Non-cash lease expense | 3,260 | 2,555 | |||||||||
| Provision for credit losses | 1,169 | — | |||||||||
| Inventory reserve | — | 123 | |||||||||
| Loss on sale of assets | 1,261 | 9,211 | |||||||||
| Amortization of interest rate swap | — | 2,426 | |||||||||
| Deferred tax provision | 2,709 | 7,016 | |||||||||
| Loss on extinguishment of debt | 36,512 | — | |||||||||
| Changes in operating assets and liabilities | |||||||||||
| Accounts receivable | (41,945) | (23) | |||||||||
| Inventories | (2,396) | 3,416 | |||||||||
| Contract assets | (2,535) | (12,313) | |||||||||
| Prepaid expenses and other current assets | 1,604 | (1,235) | |||||||||
| Accounts payable | (38) | 2,182 | |||||||||
| Accrued and other liabilities | (22,916) | (16,258) | |||||||||
| Contract liabilities | (2,092) | 5,913 | |||||||||
| Other assets | 1,195 | (361) | |||||||||
| Net cash provided by operating activities | 71,182 | 114,328 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchase of property, plant and equipment | (118,370) | (77,553) | |||||||||
| Proceeds from sale of assets | 3,467 | 9,376 | |||||||||
| Net cash used for investing activities | (114,903) | (68,177) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Borrowings on debt instruments | 1,353,857 | 347,491 | |||||||||
| Payments on debt instruments | (1,147,272) | (344,204) | |||||||||
| Principal payments on other borrowings | (395) | (1,950) | |||||||||
| Payment of debt issuance cost | (12,958) | — | |||||||||
| Principal payments on finance leases | (593) | (719) | |||||||||
| Dividends paid to stockholders | (42,604) | (36,445) | |||||||||
| Repurchase of common shares | — | (9,956) | |||||||||
| Cash paid for shares withheld to cover taxes | (14,979) | (2,827) | |||||||||
| Net effect on deferred taxes and taxes payable related to the vesting of restricted stock | — | 16 | |||||||||
| Distributions to noncontrolling interest | (151) | (357) | |||||||||
| Net cash provided by (used for) financing activities | 134,905 | (48,951) | |||||||||
| Net increase (decrease) in cash and cash equivalents | 91,184 | (2,800) | |||||||||
| Cash and cash equivalents - beginning of period | 3,179 | 4,750 | |||||||||
| Cash and cash equivalents - end of period | $ | 94,363 | $ | 1,950 | |||||||
10
KODIAK GAS SERVICES, INC.
RECONCILIATION OF NET INCOME AND DILUTED EARNINGS PER SHARE
TO ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE
(UNAUDITED)
| Three Months Ended | ||||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Net income | $ | 17,860 | $ | 24,765 | $ | 31,036 | ||||||||||||||
| Long-lived asset impairment | — | 6,344 | — | |||||||||||||||||
| Loss on extinguishment of debt | 36,512 | — | — | |||||||||||||||||
Severance expense | 72 | 2,121 | 376 | |||||||||||||||||
Transaction expenses (1) | 8,315 | 793 | 1,786 | |||||||||||||||||
Tax effect of adjustments (2) | (10,758) | 1,238 | (561) | |||||||||||||||||
| Adjusted net income | $ | 52,001 | $ | 35,261 | $ | 32,637 | ||||||||||||||
| Weighted-average common shares outstanding: | ||||||||||||||||||||
| Diluted | 87,501 | 87,483 | 90,606 | |||||||||||||||||
Diluted earnings per common share | $ | 0.20 | $ | 0.28 | $ | 0.33 | ||||||||||||||
| Long-lived asset impairment | — | 0.07 | — | |||||||||||||||||
| Loss on extinguishment of debt | 0.42 | — | — | |||||||||||||||||
Severance expense | — | 0.02 | 0.01 | |||||||||||||||||
Transaction expenses (1) | 0.10 | 0.01 | 0.02 | |||||||||||||||||
Tax effect of adjustments (2) | (0.13) | 0.02 | (0.01) | |||||||||||||||||
| Adjusted diluted earnings per common share | $ | 0.59 | $ | 0.40 | $ | 0.35 | ||||||||||||||
(1)Represents certain costs associated with non-recurring professional services and other costs, primarily primarily related to the acquisition of DPS and secondary offerings.
(2)Represents the estimated tax effect of adjustments calculated using the Company’s adjusted tax provision.
11
KODIAK GAS SERVICES, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(UNAUDITED)
| Three Months Ended | ||||||||||||||||||||
| (in thousands, excluding percentages) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Net income | $ | 17,860 | $ | 24,765 | $ | 31,036 | ||||||||||||||
| Interest expense | 48,741 | 48,985 | 47,224 | |||||||||||||||||
| Income tax expense | 2,760 | 14,216 | 10,524 | |||||||||||||||||
| Depreciation and amortization | 68,681 | 73,192 | 70,529 | |||||||||||||||||
| Long-lived asset impairment | — | 6,344 | — | |||||||||||||||||
| Loss on extinguishment of debt | 36,512 | — | — | |||||||||||||||||
| Equity compensation expense | 5,890 | 6,516 | 6,978 | |||||||||||||||||
Severance expense | 72 | 2,121 | 376 | |||||||||||||||||
Transaction expenses (1) | 8,315 | 793 | 1,786 | |||||||||||||||||
| Loss on sale of assets | 1,261 | 7,519 | 9,211 | |||||||||||||||||
| Adjusted EBITDA | $ | 190,092 | $ | 184,451 | $ | 177,664 | ||||||||||||||
| Net income percentage | 5.2% | 7.4% | 9.4% | |||||||||||||||||
| Adjusted EBITDA percentage | 55.0% | 55.4% | 53.9% | |||||||||||||||||
(1)Represents certain costs associated with non-recurring professional services and other costs, primarily primarily related to the acquisition of DPS and secondary offerings.
12
KODIAK GAS SERVICES, INC.
RECONCILIATION OF ADJUSTED GROSS MARGIN TO GROSS MARGIN
(UNAUDITED)
Contract Services
| Three Months Ended | ||||||||||||||||||||
| (in thousands, excluding percentages) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Total revenues | $ | 306,985 | $ | 301,810 | $ | 288,956 | ||||||||||||||
Cost of operations (excluding depreciation and amortization) | (90,259) | (92,899) | (93,235) | |||||||||||||||||
| Depreciation and amortization | (68,681) | (73,192) | (70,529) | |||||||||||||||||
| Gross margin | $ | 148,045 | $ | 135,719 | $ | 125,192 | ||||||||||||||
| Gross margin percentage | 48.2% | 45.0% | 43.3% | |||||||||||||||||
| Depreciation and amortization | 68,681 | 73,192 | 70,529 | |||||||||||||||||
| Adjusted gross margin | $ | 216,726 | $ | 208,911 | $ | 195,721 | ||||||||||||||
| Adjusted gross margin percentage | 70.6% | 69.2% | 67.7% | |||||||||||||||||
Other Services
| Three Months Ended | ||||||||||||||||||||
| (in thousands, excluding percentages) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Total revenues | $ | 38,774 | $ | 31,061 | $ | 40,686 | ||||||||||||||
Cost of operations (excluding depreciation and amortization) | (32,619) | (27,100) | (35,226) | |||||||||||||||||
| Depreciation and amortization | — | — | — | |||||||||||||||||
| Gross margin | $ | 6,155 | $ | 3,961 | $ | 5,460 | ||||||||||||||
| Gross margin percentage | 15.9% | 12.8% | 13.4% | |||||||||||||||||
| Depreciation and amortization | — | — | — | |||||||||||||||||
| Adjusted gross margin | $ | 6,155 | $ | 3,961 | $ | 5,460 | ||||||||||||||
| Adjusted gross margin percentage | 15.9% | 12.8% | 13.4% | |||||||||||||||||
13
KODIAK GAS SERVICES, INC.
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO DISCRETIONARY CASH FLOW AND FREE CASH FLOW
(UNAUDITED)
| Three Months Ended | ||||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Net cash provided by operating activities | $ | 71,182 | $ | 194,862 | $ | 114,328 | ||||||||||||||
| Maintenance capital expenditures | (17,758) | (22,265) | (16,407) | |||||||||||||||||
Severance expense | 72 | 2,121 | 376 | |||||||||||||||||
Transaction expenses (1) | 8,315 | 793 | 1,786 | |||||||||||||||||
| Change in operating assets and liabilities | 69,123 | (60,613) | 18,679 | |||||||||||||||||
Other (2) | (4,429) | (2,374) | (2,678) | |||||||||||||||||
| Discretionary cash flow | $ | 126,505 | $ | 112,524 | $ | 116,084 | ||||||||||||||
Growth capital expenditures (3)(4)(5) | (85,552) | (25,253) | (55,983) | |||||||||||||||||
Other capital expenditures (4) | (7,458) | (11,895) | (22,258) | |||||||||||||||||
| Proceeds from sale of assets | 3,467 | 3,233 | 9,376 | |||||||||||||||||
| Free cash flow | $ | 36,962 | $ | 78,609 | $ | 47,219 | ||||||||||||||
(1)Represents certain costs associated with non-recurring professional services and other costs, primarily related to the acquisition of DPS and secondary offerings.
(2)Includes non-cash lease expense, provision for credit losses and inventory reserve.
(3)Growth capital expenditures includes an $18.0 million investment in power generation infrastructure to support our recently acquired power distribution business for the three months ended March 31, 2026.
(4)For the three months ended March 31, 2026, December 31, 2025, and March 31, 2025, growth and other capital expenditures includes a $6.5 million decrease, a $6.5 million increase and a $14.1 million increase in accrued capital expenditures, respectively.
(5)For the three months ended March 31, 2026, December 31, 2025, and March 31, 2025, growth capital expenditures includes a $1.0 million increase, a $0.7 million increase and a $1.2 million increase, in a non-cash sales tax accrual on compression equipment purchases, respectively.
14
FAQ
How did Kodiak Gas Services (KGS) perform financially in Q1 2026?
Kodiak generated total Q1 2026 revenue of $345.8 million, up from $329.6 million a year earlier. Net income attributable to common shareholders was $17.8 million or $0.20 per diluted share, while adjusted net income reached $52.0 million or $0.59 per diluted share.
What was Kodiak Gas Services’ adjusted EBITDA in Q1 2026?
Adjusted EBITDA for Q1 2026 was $190.1 million, compared with $177.7 million in Q1 2025. This represents a 7.0% year-over-year increase, driven by record Contract Services segment revenue, higher adjusted gross margins, and strong fleet utilization across Kodiak’s compression operations.
Did Kodiak Gas Services change its 2026 guidance?
Kodiak raised its full-year 2026 outlook, guiding to adjusted EBITDA of $820–$860 million and discretionary cash flow of $520–$570 million. Guidance incorporates three quarters of financial impact from the Distributed Power Solutions acquisition and reflects continued strength in natural gas compression and new power operations.
What are Kodiak Gas Services’ plans for its distributed power business?
Kodiak closed the Distributed Power Solutions acquisition on April 1, 2026 and has procured over 260 MW of additional power capacity. It expects power infrastructure revenue of $95–$125 million in 2026 and forecasts annual capacity growth of 300–500 MW through 2030.
How leveraged is Kodiak Gas Services after recent debt activity?
As of March 31, 2026, Kodiak had total debt of $2.8 billion and a credit agreement leverage ratio of 3.6x. During Q1 2026 the company issued $1 billion of senior unsecured notes, incurring a $36.5 million loss on extinguishment of debt related to refinancing earlier notes.
What were Kodiak Gas Services’ capital expenditures and free cash flow in Q1 2026?
Q1 2026 maintenance capital expenditures were $17.8 million, while growth and other capital expenditures totaled $93.0 million. Discretionary cash flow was $126.5 million, and free cash flow reached $37.0 million, after factoring in growth, maintenance, and other capital spending and asset sale proceeds.