Cactus Inc (NYSE: WHD) adds $291.5M from Baker Hughes JV
Cactus Inc. reported higher results for Q2 2026 as it consolidated the Cactus International acquisition, with total revenue of $449.528 million versus $273.575 million a year earlier and operating income of $83.582 million.
For the first six months of 2026, revenue was $837.877 million and net income attributable to Cactus Inc. was $81.902 million. Accretion of redeemable non‑controlling interest of $81.507 million reduced six‑month basic earnings per share to $0.01 despite underlying profitability.
The Baker Hughes surface pressure control business, acquired for estimated consideration of $362.031 million, added $291.5 million of revenue and $0.5 million of net income through June 30 and created $84.222 million of goodwill and $241.121 million of mezzanine equity. Operating cash flow was $232.835 million, funding a $301.011 million business acquisition, while the company ended the quarter with $365.821 million of cash and no bank debt, and subsequently arranged a $75.0 million secured UAE credit facility.
Positive
- None.
Negative
- None.
Filing Explained
The acquisition is complete, but the redeemable remaining interest creates future purchase obligations and reduces earnings available to common shareholders.
The Form 10-Q updates Cactus’s unaudited quarterly financial statements and reports that the Cactus International acquisition closed on
The remaining interest can be sold or purchased after the second anniversary at a valuation based on six times trailing-twelve-month adjusted EBITDA, subject to a
The purchase-price allocation remains preliminary: the company recorded a
Separately, on
Key Figures
Q2 2026 Revenue: $449.528 million
Six‑Month 2026 Revenue: $837.877 million
Q2 2026 Net Income attributable to Cactus Inc.: $48.996 million
+5 more
8 metrics
Q2 2026 Revenue
$449.528 million
Total revenues for the three months ended June 30, 2026
Six‑Month 2026 Revenue
$837.877 million
Total revenues for the six months ended June 30, 2026
Q2 2026 Net Income attributable to Cactus Inc.
$48.996 million
Net income attributable to Cactus Inc. for the quarter ended June 30, 2026
Operating Cash Flow
$232.835 million
Net cash provided by operating activities for the six months ended June 30, 2026
Cactus International Purchase Price
$362.031 million
Estimated fair value of consideration for the Baker Hughes surface pressure control business
Goodwill Balance
$287.250 million
Total goodwill as of June 30, 2026 after adding $84.222 million from Cactus International
Mezzanine Equity
$241.121 million
Redeemable non‑controlling interest related to the Cactus International joint venture at June 30, 2026
Tax Receivable Agreement Liability
$267.0 million
Total TRA liability, including $21.314 million current, as of June 30, 2026
Key Terms
Mezzanine Equity, Tax Receivable Agreement, Adjusted EBITDA, Term Loan Facility, +2 more
6 terms
Mezzanine Equity financial
"the fair value of the option and the redeemable noncontrolling interest are classified within Mezzanine Equity"
Mezzanine equity is a layer of financing that sits between bank loans and full ownership, combining elements of borrowed money and equity. It often gives lenders higher potential returns in exchange for taking more risk, sometimes with the option to convert into ownership or receive extra payments; think of it as a middle seat that pays more because it’s less secure than front-row debt. Investors watch it because it affects a company’s debt risk, potential dilution of ownership, and expected returns.
Tax Receivable Agreement financial
"In connection with our initial public offering we entered into the TRA which generally provides for payment"
A contract in which a company agrees to pay a specified party (often former owners after a spinoff or IPO) a share of future tax savings the company realizes. Think of it like agreeing to share a future tax refund with someone who helped create the conditions for that refund. For investors it matters because those payments reduce the cash the company can use for dividends, buybacks, or reinvestment, and therefore affect valuation and returns.
Adjusted EBITDA financial
"value of the Joint Venture using a multiple of six times its trailing twelve month ("TTM") Adjusted EBITDA"
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.
Term Loan Facility financial
"The amendment established a delayed‑draw term loan facility (the "Term Loan Facility")"
A term loan facility is a type of loan provided by a lender that is repaid over a set period of time, usually with fixed payments. It functions like a large, upfront loan that a borrower agrees to pay back gradually, often used to fund major investments or projects. For investors, understanding a company's use of such loans helps assess its financial stability and risk level.
Section 232 tariffs financial
"new Section 232 tariffs of 50% on imports of steel and certain products made from steel"
A U.S. law authority that lets the government impose import duties if certain goods are judged to threaten national security, commonly used for metals like steel or aluminum. For investors, these tariffs act like a sudden price hike or import tax on a company's raw materials or foreign competitors, which can raise costs, change profit margins, shift supply chains, and alter competitive advantage across affected industries.
Pillar Two financial
"OECD has introduced a framework ("Pillar Two") that provides for a new, global minimum tax"
Pillar Two is an international tax framework that sets a global minimum tax rate for large multinational companies and requires extra payments when profits booked in low-tax locations fall below that floor. For investors, it matters because it raises the likely tax bill, reduces after-tax earnings and cash available for dividends or reinvestment, and can change company valuations—think of it as a tax “price floor” that limits how much a firm can lower its effective tax rate.
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FAQ
What were Cactus Inc. (WHD) revenue and earnings in Q2 2026?
Cactus generated $449.528 million in Q2 2026 revenue and $61.380 million in net income, with $48.996 million attributable to Cactus Inc. Basic and diluted earnings per Class A share were both $0.70 for the quarter.
How did the Cactus International acquisition impact WHD’s 2026 results?
From January 1 through June 30, 2026, Cactus International contributed $291.5 million of revenue and $0.5 million of net income. The transaction added $84.222 million of goodwill and created $241.121 million of mezzanine equity tied to redeemable non‑controlling interests.
Why is Cactus Inc. (WHD) six‑month EPS so low despite solid net income?
Six‑month net income attributable to Cactus Inc. was $81.902 million, but accretion of redeemable non‑controlling interest to redemption value of $81.507 million reduced net income available to common shareholders to $0.395 million, resulting in basic earnings per share of $0.01.
What is Cactus Inc. (WHD)’s debt and liquidity position as of June 30, 2026?
Cactus reported no bank debt outstanding and held $365.821 million in cash and cash equivalents. It had access to a $225.0 million U.S. asset‑based revolving facility and an undrawn term loan, plus a subsequent $75.0 million secured UAE credit facility.
How are Cactus Inc. (WHD)’s business segments performing?
In Q2 2026, Pressure Control generated $343.995 million of revenue and segment profit of $59.154 million, while Spoolable Technologies delivered $105.533 million of revenue and $32.168 million of segment profit, reflecting significant contribution from the acquired Cactus International operations.
What major obligations does Cactus Inc. (WHD) have from its Tax Receivable Agreement?
As of June 30, 2026, Cactus carried a Tax Receivable Agreement liability of $267.0 million, with $21.314 million classified as current. Payments equal 85% of certain tax savings realized, and obligations can accelerate upon early termination or change‑of‑control events.
What new financing did Cactus Inc. (WHD) secure after quarter‑end?
On July 24, 2026, a 65%-owned UAE subsidiary entered a Facilities Agreement providing a $75.0 million secured credit facility. It includes $40.0 million for revolving borrowings and $35.0 million for guarantees and letters of credit, guaranteed by Cactus Companies.
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________________________________________________________
FORM 10-Q
______________________________________________________________________________
(MARK ONE)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended June 30, 2026
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from _____ to _____
Commission File Number: 001-38390
______________________________________________________________________________
(Exact name of registrant as specified in its charter)
______________________________________________________________________________
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
| (Zip Code) | ||||||||
| (Address of principal executive offices) | ||||||||
(713 ) 626-8800
(Registrant’s telephone number, including area code)
______________________________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☑ | Accelerated filer | ☐ | |||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
| 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. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
As of July 29, 2026, the registrant had 69,733,168 shares of Class A common stock, $0.01 par value per share, and 10,446,249 shares of Class B common stock, $0.01 par value per share, outstanding.
Table of Contents
TABLE OF CONTENTS
Cautionary Note Regarding Forward-Looking Statements | i | |||||||
PART I - FINANCIAL INFORMATION | ||||||||
Item 1. | Financial Statements | 1 | ||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 25 | ||||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 32 | ||||||
Item 4. | Controls and Procedures | 32 | ||||||
PART II - OTHER INFORMATION | ||||||||
Item 1. | Legal Proceedings | 33 | ||||||
Item 1A. | Risk Factors | 33 | ||||||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 34 | ||||||
Item 5. | Other Information | 34 | ||||||
Item 6. | Exhibits | 35 | ||||||
Signatures | 36 | |||||||
Table of Contents
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). When used in this Quarterly Report, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on our current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. We caution you that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. When considering forward‑looking statements, you should keep in mind the risk factors and other cautionary statements described under “Part I, Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 (our “2025 Annual Report”), and under “Part II, Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 and this Quarterly Report and other cautionary statements contained herein and in our Exchange Act filings. Forward‑looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events. Should one or more of the risks or uncertainties described in our 2025 Annual Report or other Exchange Act filings occur, or should underlying assumptions prove incorrect, our actual results could differ materially from those expressed in any forward-looking statements.
All forward-looking statements, expressed or implied, included in this Quarterly Report are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report.
i
Table of Contents
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
CACTUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
| (in thousands, except per share data) | June 30, 2026 | December 31, 2025 | |||||||||
| Assets | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Restricted cash | |||||||||||
Accounts receivable, net of allowance of $ | |||||||||||
| Inventories | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Property and equipment, net | |||||||||||
| Operating lease right-of-use assets, net | |||||||||||
| Intangible assets, net | |||||||||||
| Goodwill | |||||||||||
| Deferred tax asset, net | |||||||||||
| Investment in unconsolidated affiliates | |||||||||||
| Other noncurrent assets | |||||||||||
| Total assets | $ | $ | |||||||||
Liabilities, Mezzanine Equity and Stockholders' Equity | |||||||||||
| Current liabilities | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses and other current liabilities | |||||||||||
Contract liabilities | |||||||||||
| Current portion of liability related to tax receivable agreement | |||||||||||
| Finance lease obligations, current portion | |||||||||||
| Operating lease liabilities, current portion | |||||||||||
| Total current liabilities | |||||||||||
| Deferred tax liability, net | |||||||||||
| Liability related to tax receivable agreement, net of current portion | |||||||||||
| Finance lease obligations, net of current portion | |||||||||||
| Operating lease liabilities, net of current portion | |||||||||||
| Other noncurrent liabilities | |||||||||||
| Total liabilities | |||||||||||
| Commitments and contingencies | |||||||||||
Mezzanine equity | |||||||||||
Redeemable non-controlling interest | |||||||||||
| Stockholders’ equity | |||||||||||
Preferred stock, $ | |||||||||||
Class A common stock, $ | |||||||||||
Class B common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Total stockholders’ equity attributable to Cactus Inc. | |||||||||||
| Non-controlling interest | |||||||||||
| Total stockholders’ equity | |||||||||||
Total liabilities, mezzanine equity and stockholders' equity | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
1
Table of Contents
CACTUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in thousands, except per share data) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
Revenues | |||||||||||||||||||||||
Product revenue | $ | $ | $ | $ | |||||||||||||||||||
Rental revenue | |||||||||||||||||||||||
Field service and other revenue | |||||||||||||||||||||||
Total revenues | |||||||||||||||||||||||
Costs and expenses | |||||||||||||||||||||||
Cost of product revenue | |||||||||||||||||||||||
Cost of rental revenue | |||||||||||||||||||||||
Cost of field service and other revenue | |||||||||||||||||||||||
Selling, general and administrative expenses | |||||||||||||||||||||||
Total costs and expenses | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
Interest income, net | |||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||
| Income tax expense | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Less: net income attributable to non-controlling interest | |||||||||||||||||||||||
Net income attributable to Cactus Inc. | $ | $ | $ | $ | |||||||||||||||||||
| Net income attributable to Cactus Inc. | $ | $ | $ | $ | |||||||||||||||||||
Less: Accretion of redeemable non-controlling interest to redemption value | |||||||||||||||||||||||
| Net income attributable to Cactus Inc. including accretion of redeemable non-controlling interest to redemption value | $ | $ | $ | $ | |||||||||||||||||||
| Earnings per Class A share—basic | $ | $ | $ | $ | |||||||||||||||||||
| Earnings per Class A share—diluted | $ | $ | $ | $ | |||||||||||||||||||
Weighted average Class A shares outstanding - basic | |||||||||||||||||||||||
Weighted average Class A shares outstanding - diluted | |||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
2
Table of Contents
CACTUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Foreign currency translation adjustments | |||||||||||||||||||||||
Comprehensive income | $ | $ | $ | $ | |||||||||||||||||||
Less: comprehensive income attributable to non-controlling interest | |||||||||||||||||||||||
Comprehensive income attributable to Cactus Inc. | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
CACTUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND MEZZANINE EQUITY
(unaudited)
Stockholders' Equity | Mezzanine Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A | Class B | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interest | Total Equity | Redeemable Non-Controlling Interest | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock | Common Stock | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Member distributions | — | — | — | — | — | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Effect of CC Unit redemptions | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of equity transactions | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity award vestings | — | — | ( | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Share repurchases | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | — | — | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition of non-controlling interest | — | — | — | — | — | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Member distributions | — | — | — | — | — | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Effect of CC Unit redemptions | — | ( | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of equity transactions | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity award vestings | — | — | ( | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share repurchases | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | — | — | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
CACTUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND MEZZANINE EQUITY
(unaudited)
Stockholders' Equity | Mezzanine Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A | Class B | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interest | Total Equity | Redeemable Non-Controlling Interest | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock | Common Stock | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
Redeemable non-controlling interest | — | — | — | — | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Member distributions | — | — | — | — | — | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Effect of CC Unit redemptions | ( | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of equity transactions | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity award vestings | — | — | ( | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | — | — | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition of non-controlling interest | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Member distributions | — | — | — | — | — | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Effect of CC Unit redemptions | — | ( | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of equity transactions | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity award vestings | — | — | ( | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share repurchases | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | — | — | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
CACTUS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
| Six Months Ended June 30, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
Cash flows from operating activities | |||||||||||
Net income | $ | $ | |||||||||
Reconciliation of net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | |||||||||||
Deferred financing cost amortization | |||||||||||
Stock-based compensation | |||||||||||
Provision for expected credit losses | |||||||||||
Inventory obsolescence | |||||||||||
| Gain on disposal of assets | ( | ( | |||||||||
Deferred income taxes | |||||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | ( | ( | |||||||||
Inventories | ( | ( | |||||||||
Prepaid expenses and other assets | ( | ( | |||||||||
Accounts payable | |||||||||||
Accrued expenses and other liabilities | ( | ||||||||||
Contract liabilities | |||||||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities | |||||||||||
Acquisition of a business, net of cash and cash equivalents acquired | ( | ||||||||||
Investment in unconsolidated affiliate | ( | ||||||||||
Capital expenditures and other | ( | ( | |||||||||
| Proceeds from sales of assets | |||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Cash flows from financing activities | |||||||||||
| Payments of deferred financing costs | ( | ||||||||||
Payments on finance leases | ( | ( | |||||||||
Dividends paid to Class A common stock shareholders | ( | ( | |||||||||
Distributions to members | ( | ( | |||||||||
Repurchases of shares | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash and cash equivalents | |||||||||||
| Net (decrease) increase in cash and cash equivalents | ( | ||||||||||
Cash, cash equivalents, and restricted cash | |||||||||||
| Beginning of period | |||||||||||
| End of period | $ | $ | |||||||||
| Supplemental disclosure of cash flow information | |||||||||||
| Net cash paid for income taxes | $ | $ | |||||||||
| Cash paid for interest | $ | $ | |||||||||
Non-cash investing and financing activities: | |||||||||||
| Right-of-use assets obtained in exchange for new lease obligations | $ | $ | |||||||||
| Property and equipment in accounts payable | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
CACTUS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(in thousands, except per share data, or as otherwise indicated)
1.Preparation of Interim Financial Statements and Other Items
Basis of Presentation
The financial statements presented in this report represent the consolidation of Cactus, Inc. (“Cactus Inc.”) and its subsidiaries (the “Company”), including Cactus Companies, LLC (“Cactus Companies”). Cactus Inc. is a holding company whose only material asset is an equity interest consisting of units representing limited liability company interests in Cactus Companies (“CC Units”). Cactus Inc. is the sole managing member of Cactus Companies and operates and controls all of the business and affairs of Cactus Companies and conducts its business through Cactus Companies and its subsidiaries. As a result, Cactus Inc. consolidates the financial results of Cactus Companies and its subsidiaries and reports a non-controlling interest related to the portion of CC Units not owned by Cactus Inc., which reduces net income attributable to holders of Cactus Inc.’s Class A common stock, par value $0.01 per share (“Class A common stock”). Except as otherwise indicated or required by the context, all references to “Cactus,” “we,” “us” and “our” refer to Cactus Inc. and its consolidated subsidiaries.
On February 28, 2023, Cactus Inc. through one of its subsidiaries, completed the acquisition of the FlexSteel business through a merger (the “Merger”) with HighRidge Resources, Inc. and its subsidiaries (“HighRidge”). On February 27, 2023, in order to facilitate the Merger with HighRidge, an internal reorganization was completed in which Cactus Companies acquired all of the outstanding units representing ownership interests in Cactus Wellhead, LLC (“Cactus LLC”), the operating subsidiary of Cactus Inc. (the “CC Reorganization”). The purpose of the Merger was to effect the acquisition of the operations of FlexSteel Holdings, Inc. and its subsidiaries. FlexSteel Holdings, Inc. was a wholly-owned subsidiary of HighRidge prior to the Merger and was converted into a limited liability company, contributed from HighRidge to Cactus Companies as part of the CC Reorganization and is now named FlexSteel Holdings, LLC (“FlexSteel”).
Cactus International Joint Venture with Baker Hughes
On January 1, 2026 (the “Closing Date”), Baker Hughes Holdings LLC ("Baker Hughes Holdings") and certain of its affiliates sold 65 % of the limited liability company membership interests ("Membership Interests") in Baker Hughes Pressure Control LLC (the "Joint Venture" or "Cactus International"), which holds Baker Hughes Company's former surface pressure control business (the "Acquired Business") to Cactus UK Holding Limited (the “Cactus Member”), a subsidiary of Cactus Companies, for a cash purchase price of $344.5 million, subject to certain working capital, cash, debt, capital expenditure and other customary adjustments (the "Baker Hughes Transaction").
For so long as Baker Hughes Pressure Control Holdings LLC (the "Baker Member") continues to hold Membership Interests, the Cactus Member shall cause the Joint Venture to operate its business generally in the ordinary course. Certain actions of the Board of Directors of the Joint Venture require the affirmative vote of at least one director appointed by the Baker Member. Baker Hughes Company ("Baker Hughes Company") and the Company have specific non-compete restrictions with respect to surface pressure control applications in certain countries, and the members of the Joint Venture are subject to certain transfer restrictions with respect to the Membership Interests.
From and after the second anniversary of the Closing Date, the Baker Member has the right to sell to either the Joint Venture or the Cactus Member, and the Cactus Member has the right to purchase or cause the Joint Venture to purchase, all of the Membership Interests held directly or indirectly by Baker Hughes Company. The purchase price will be based on a value of the Joint Venture using a multiple of six times its trailing twelve month ("TTM") Adjusted EBITDA (as defined and calculated pursuant to the Amended and Restated Limited Liability Company Agreement of the Joint Venture, entered into on the Closing Date by the Joint Venture, the Cactus Member, the Baker Member, Cactus Inc. and Baker Hughes Company (the "Joint Venture LLC Agreement")), subject to a maximum valuation of $660.0 million, and if the Cactus Member elects to purchase or cause the Joint Venture to purchase the Membership Interests, a minimum valuation of $530.0 million applies. In connection with the Baker Hughes Transaction, Cactus Companies is obligated to pay Baker Hughes Holdings $10.0 million subject to contractual adjustments on the first anniversary of the Closing Date and $14.5 million at such time as Baker Hughes Company ceases to be a member of the Joint Venture.
Following the transactions described above, the Company currently operates in two business segments: Pressure Control, which includes the legacy Cactus Wellhead business and the Cactus International business, and Spoolable Technologies, which includes the FlexSteel business.
7
The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, these consolidated financial statements do not include all information or notes required by generally accepted accounting principles for annual financial statements and should be read together with our Annual Report on Form 10-K for the year ended December 31, 2025.
The consolidated financial statements include all adjustments, which are of a normal recurring nature, unless otherwise disclosed, necessary for a fair statement of the consolidated financial statements for the interim periods. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year.
Investments in Unconsolidated Affiliates
In November 2023, the Company entered into an agreement to invest in a Vietnam forging manufacturing facility for an ownership percentage of 40 %. In January 2025, the Company provided an initial capital contribution of $6.0 million. In late 2025 the parties decided not to proceed with the development of the facility and are in the process of liquidating the assets and returning the capital to the respective parties. The investment in a company in which Cactus does not have a controlling financial interest, but over which it has significant influence, is accounted for using the equity method. The Company's share of the after-tax earnings of the equity method investment was recorded in field service and other revenue in the consolidated statements of income.
Restricted Cash
Restricted cash represents amounts that are not available for general corporate use because they are subject to contractual or legal restrictions. Consistent with U.S. GAAP, the Company presents restricted cash separately from cash and cash equivalents on the consolidated balance sheets and includes restricted cash in the reconciliation of beginning and ending cash, cash equivalents, and restricted cash in the consolidated statements of cash flows.
As of December 31, 2025, the Company had $371.0 million of restricted cash held in an escrow account in connection with the then-pending acquisition of Baker Hughes Pressure Control LP. Under the terms of the purchase agreement, these funds were required to be placed in escrow and were restricted from use for any purpose other than funding the acquisition consideration at closing. The escrowed funds were released on January 1, 2026, the acquisition closing date, at which point the restriction lapsed and the cash was released to certain affiliates of Baker Hughes Company.
The restricted cash balance is classified as a current asset, as the restriction was scheduled to be released within one year of the balance sheet date.
The following table provides a reconciliation of the amounts presented in the consolidated balance sheets to the total amounts shown in the consolidated statements of cash flows:
| December 31, | ||||||||
| 2025 | ||||||||
Cash and cash equivalents | $ | |||||||
Restricted cash | ||||||||
Total cash, cash equivalents and restricted cash | $ | |||||||
Use of Estimates
In preparing our consolidated financial statements in conformity with GAAP, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with a high degree of precision from available data, or is not otherwise capable of being readily calculated based on accepted methodologies. In some cases, these estimates are particularly difficult to determine, and we must exercise significant judgment. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our consolidated financial statements.
8
Recent Accounting Pronouncements
Standards Not Yet Adopted
In November 2024, the FASB issued ASU 2024-03, Income Statement- Reporting Comprehensive Income- Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The new standard would require public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-Use Software. This standard update modernizes the capitalization criteria for internal-use software, eliminating references to project stages and instead requiring that projects meet completion probability criteria before costs can be capitalized. This guidance is effective for annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of these amendments but does not anticipate that adoption will have a material impact on the Company's results of operations or financial position.
2. Cactus International Acquisition
On June 2, 2025, Cactus Companies, a subsidiary of Cactus, Inc., entered into a Framework Agreement (the “Framework Agreement”) with Baker Hughes Holdings and Baker Hughes Pressure Control LLC, each of which at such time was an indirect subsidiary of Baker Hughes Company, pursuant to which the Company agreed to acquire Baker Hughes Company’s surface pressure control business.
Prior to the Closing Date, Baker Hughes Holdings effected certain restructuring transactions on the terms and subject to the conditions set forth in the Framework Agreement (the “Restructuring Transactions”), as a result the Joint Venture and certain of its subsidiaries came to own the Business Assets and Business Liabilities (each as defined in the Framework Agreement). As part of the Restructuring Transactions, the Joint Venture converted from a Texas limited partnership to a Delaware limited liability company.
On the Closing Date, Baker Hughes Holdings and certain of its affiliates sold 65 % of the Membership Interests to the Cactus Member, a subsidiary of Cactus Companies, for a cash purchase price of $344.5 million (on a debt-free, and, except as noted below, cash-free basis), subject to certain working capital, cash, debt, capital expenditure and other customary adjustments after the Closing Date (the “Purchase Price”). The Joint Venture was to retain minimum cash of $70.0 million (the “Minimum Cash Amount”). In order to compensate Baker Hughes Holdings for the Minimum Cash Amount, Cactus Companies (i) paid Baker Hughes Holdings 65 % of the Minimum Cash Amount, or $45.5 million, on the Closing Date, and (ii) will pay Baker Hughes Holdings 35 % of the Minimum Cash Amount, or $24.5 million, as follows: $10.0 million, subject to contractual adjustments on the first anniversary of the Closing Date, and $14.5 million at such time as Baker Hughes Company ceases to be a member, directly or indirectly, of the Joint Venture.
The acquisition was completed to expand the Company’s surface pressure control operational capabilities and broaden its geographic footprint. The acquired business complements the Company’s existing pressure control offerings through additional product capabilities, manufacturing capacity, geographic markets and customer relationships.
The acquisition is being accounted for using the acquisition method of accounting, with Cactus being treated as the accounting acquirer. Under the acquisition method of accounting, the assets and liabilities were recorded at their respective fair values as of the date of the completion of the acquisition. The transaction was treated as a purchase of partnership units for United States federal income tax purposes. In connection with the acquisition, we incurred approximately $6.1 million of transaction costs for the six months ended June 30, 2026 required to effect the transaction and incurred an additional $1.0 million in costs related to the reporting of and accounting for the transaction. These fees primarily related to legal, accounting and consulting fees and are included in selling, general and administrative (“SG&A”) expenses in the statements of income.
9
Purchase Price Consideration
The estimated purchase price consideration is $362.0 million and is summarized as follows:
| Purchase Price Consideration | ||||||||
Initial cash payment (1)(2) | $ | |||||||
Minimum cash amount at closing | ||||||||
Working capital and other | ( | |||||||
Deferred Payment (3) | ||||||||
| Fair value of consideration | $ | |||||||
(1) The cash consideration was funded utilizing cash on hand.
(2) The total cash consideration transferred is subject to potential working capital and capital expenditure adjustments.
(3) Represents the estimated fair value of our deferred consideration payment of $10.0 million, subject to contractual adjustments, discounted at present value and payable to the Seller on the first anniversary of the Transaction Date.
Preliminary Purchase Price Allocation
The following table summarizes the preliminary allocation of the purchase price to the identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, after measurement period adjustments:
| Cash and cash equivalents | $ | |||||||
| Receivables | ||||||||
| Inventories | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Property and equipment | ||||||||
| Operating lease right-of-use assets | ||||||||
| Identifiable intangible assets | ||||||||
| Other noncurrent assets | ||||||||
Total assets acquired (A) | ||||||||
| Accounts payable | ||||||||
| Accrued expenses and other current liabilities | ||||||||
| Finance lease obligations | ||||||||
| Operating lease liabilities | ||||||||
| Deferred tax liabilities | ||||||||
Other non-current liabilities | ||||||||
Total liabilities assumed (B) | ||||||||
Net identifiable assets acquired (C) = (A)-(B) | $ | |||||||
Fair value of the mezzanine classified non-controlling interest (D) | ||||||||
Fair value of the other non-controlling interest (E) | ||||||||
Goodwill (F) | ||||||||
Total consideration to be transferred (G) = (C) - (D) - (E) + (F) | $ | |||||||
Assets acquired and liabilities assumed in connection with the acquisition were recorded at their estimated fair values. Estimated fair values were determined by management, based in part on an independent valuation performed by third-party valuation specialists. The valuation methods used to determine the estimated fair value of intangible assets included the excess earnings approach for customer relationships, which values the relationships on a standalone basis by estimating the excess earnings that are driven by owning the customer relationship via a framework that deducts direct and indirect costs. Backlog is a representation of what a buyer would pay to assume the open customer orders on hand. Several significant assumptions and estimates were involved in the application of these valuation methods, including revenues from equipment sales and services, costs to produce, tax rates, capital spending, discount rates, attrition rates and working capital changes. The cash flow forecasts are based solely on facts and circumstances that existed or were reasonably knowable as of the acquisition date. Identifiable intangible assets with finite lives are subject to amortization over their estimated useful lives.
10
The fair values determined for accounts receivable, accounts payable and most other current assets and liabilities, other than inventory, were approximately equivalent to the carrying value due to their short-term nature. The gross contractual amounts receivable acquired totaled $242.9 million, of which management estimates $2.6 million will be uncollectible. Acquired inventories are comprised of raw materials, work-in-progress and finished goods. The preliminary fair value of finished goods was calculated as the estimated selling price, less costs of the selling effort and a reasonable profit allowance relating to the selling effort. The preliminary fair value of work-in-progress was calculated as the estimated selling price, less costs to complete, less costs of the selling effort and a reasonable profit allowance on completion and selling costs. The preliminary fair value of raw materials was determined based on replacement cost which approximates historical carrying value. The preliminary fair value of identifiable fixed assets was calculated using a combination of valuation approaches, but primarily consisted of the cost approach which adjusts estimates of replacement cost for the age, condition and utility of the associated assets. The acquisition includes a deferred payment component and a put option and call option for the remaining equity interest. The net put/call was valued at $146.7 million using a Monte Carlo simulation in a risk-neutral framework. The fair value of the remaining noncontrolling interest of 35 % after the acquisition was determined using the implied enterprise value based on the purchase price. Due to the redeemable nature of the arrangement, both the fair value of the option and the redeemable noncontrolling interest are classified within Mezzanine Equity.
Other noncontrolling interests acquired were valued at $19.6 million using the noncontrolling interest of the acquired subsidiary’s fair value measured using discounted cash flows under the income approach.
Goodwill is calculated as the excess of the purchase price over the estimated fair value of net assets acquired and liabilities assumed, and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Among the factors that contributed to a purchase price in excess of the estimated fair value of the net tangible and intangible assets acquired were the acquisition of an assembled workforce, market expansion opportunities and other benefits that we believe will result from the combined operations. Goodwill was further increased by the deferred tax liability associated with the fair market value in excess of the tax basis acquired. The goodwill associated with this transaction has been allocated to our Pressure Control segment.
Due to the timing of the completion of the acquisition, the purchase price and related allocation are preliminary and could be revised as a result of adjustments made to the purchase price, additional information obtained regarding assets acquired and liabilities assumed, and revisions of preliminary estimates of fair values including, but not limited to, certain tangible assets acquired and liabilities assumed, contractual relationships, intangible assets, certain working capital items, deferred income taxes and residual goodwill. These changes to the purchase price allocation could be significant. The purchase price allocation will be finalized within the measurement period of up to one year from the acquisition date.
From the Closing Date through June 30, 2026, Cactus International contributed revenue of $291.5 million and a net income of $0.5 million to the Company's unaudited condensed consolidated results of operations.
Intangible assets acquired consist of customer relationships, developed technologies and backlog. The Company amortizes finite-lived intangible assets on a straight-line basis over their respective useful lives. The following table presents the details of identifiable intangible assets acquired and the respective estimated useful lives:
(in thousands) | Estimated useful life | Amount | ||||||||||||
Customer relationships | $ | |||||||||||||
Developed technology | ||||||||||||||
Backlog | ||||||||||||||
Total identifiable intangible assets | $ | |||||||||||||
11
Pro forma financial information
The pro forma financial information below represents the combined results of operations for the three and six months ended June 30, 2025, as if the acquisition had occurred as of January 1, 2025. There is no pro forma information included for the three and six months ended June 30, 2026, because the Company’s actual financial results for such period fully reflect the acquisition. The unaudited pro forma combined financial information includes, where applicable, adjustments for additional amortization expense related to the fair value step-up of intangible assets, additional inventory fair value step-up expense, additional depreciation expense associated with adjusting property and equipment to fair value, changes to align accounting policies and associated tax-related impacts of adjustments. These pro forma adjustments are based on available information as of the date hereof and upon assumptions that we believe are reasonable to reflect the impact of the acquisition on our historical financial information on a supplemental pro forma basis. The unaudited pro forma financial information is presented for informational purposes only and is neither indicative of the results of operations that would have occurred if the acquisition had taken place at the beginning of the period presented nor indicative of future operating results.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
| 2025 | 2025 | ||||||||||
| Revenues | $ | $ | |||||||||
| Net Income attributable to Cactus, Inc. | |||||||||||
Subsequent measurement of Mezzanine Equity
Although the noncontrolling interest in the Joint Venture classified as Mezzanine Equity is not currently redeemable, redemption is considered probable; therefore, the Company elected Method 2 under ASC 480 and remeasures the Mezzanine Equity to its estimated redemption value each reporting period, with subsequent changes reflected directly in retained earnings. The redemption price is determined in accordance with the terms of the agreement and is calculated by applying a specified multiple to EBITDA. For additional information, see “Note 14 – Earnings per Share”.
Measurement Period Adjustments
During the second quarter of 2026, management recorded certain measurement period adjustments to the preliminary purchase price allocation, which were the result of additional analysis performed, and information identified based on facts and circumstances that existed as of the acquisition date. The most significant of these adjustments are described below.
The Company has recorded a measurement period adjustment to increase the warranty liability previously recorded by $44.4 million as an increase to accrued liabilities. The warranty liability adjustment is based on management's conclusion that a liability for warranty-related costs should have been recognized prior to the acquisition date in accordance with ASC 450, Contingencies. In addition, the Company recorded income tax-related adjustments of $18.9 million related to a decrease in the deferred tax liability and an increase to tax indemnity receivable of $11.4 million in the opening balance sheet as of the acquisition date, with a corresponding net increase to goodwill. The deferred tax liability and tax indemnification receivable adjustments are based on further information becoming available during the measurement period and the impacts of pretax accounting changes. Both adjustments result from facts and circumstances that existed at the acquisition date and were subsequently identified by management within the measurement period. The Company also recorded adjustments to the fair values of property, plant, and equipment and inventories assumed, based on additional analysis performed in the measurement period.
These adjustments represent a revision of the preliminary purchase price allocation and were recorded as if the accounting had been completed at the acquisition date. As such, the adjustments did not result in a material impact to the Company’s previously reported results of operations.
As noted above, the cash purchase price of the Baker Hughes Transaction is subject to certain working capital, cash, debt, capital expenditure and other customary adjustments, which could mitigate potential future impacts on the Company’s cash flow associated with these measurement period adjustments.
Management will continue to evaluate warranty and tax-related information obtained subsequent to the acquisition; however, any changes in estimates related to post-acquisition events or circumstances will be recognized in the period incurred in accordance with the Company’s accounting policies for warranty obligations and deferred taxes. No amortizable tax goodwill was created in the acquisition.
12
3.Accounts Receivable and Allowance for Credit Losses
We extend credit to customers in the normal course of business. Our customers are predominantly oil and gas exploration and production companies located in the U.S. and the Middle East. Our receivables are short-term in nature and typically due in 30 to 60 days after the billing for the product that has been delivered or the services that have been provided to the customer. We typically do not accrue interest on delinquent receivables. Accounts receivable includes both amounts billed and currently due from customers, as well as unbilled amounts resulting from accrued revenue associated with products delivered and services performed for which billings have not yet been submitted to the customers. Total unbilled revenue included in accounts receivable as of June 30, 2026 and December 31, 2025 was $156.5 million and $39.4 million, respectively.
We maintain an allowance for credit losses to provide for the amount of billed receivables we believe to be at risk of loss. In our determination of the allowance for credit losses, we pool receivables with similar risk characteristics based on customer size, credit ratings, payment history, bankruptcy status and other factors known to us, and then apply an expected credit loss percentage. The expected credit loss percentage is determined using historical loss data, adjusted for current conditions and forecasts of future economic conditions. Accounts deemed uncollectible are applied against the allowance for credit losses. The following is a roll-forward of our allowance for credit losses.
| Balance at Beginning of Period | Expense | Write off | Other | Balance at End of Period | |||||||||||||||||||||||||
| Six Months Ended June 30, 2026 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||
| Six Months Ended June 30, 2025 | ( | ||||||||||||||||||||||||||||
4.Inventories
Inventories are stated at the lower of cost or net realizable value. Cost is generally determined using standard cost, which approximates average cost. Costs include an application of related material, direct labor, duties, tariffs, freight and overhead costs. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Reserves are made for excess and obsolete items based on a range of factors, including age, usage and technological or market changes that may impact demand for those products. Inventories consist of the following:
| June 30, 2026 | December 31, 2025 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work-in-progress | |||||||||||
| Finished goods | |||||||||||
| $ | $ | ||||||||||
13
5.Property and Equipment, net
Property and equipment are stated at cost. We manufacture or construct most of our Pressure Control rental equipment assets. During the manufacture of these assets, they are reflected as construction in progress until complete. Property and equipment consists of the following:
| June 30, 2026 | December 31, 2025 | ||||||||||
Land | $ | $ | |||||||||
Buildings and improvements | |||||||||||
Machinery and equipment | |||||||||||
| Reels and skids | |||||||||||
| Vehicles | |||||||||||
| Rental equipment | |||||||||||
Furniture and fixtures | |||||||||||
Computers and software | |||||||||||
Gross property and equipment | |||||||||||
Less: Accumulated depreciation | ( | ( | |||||||||
Net property and equipment | |||||||||||
Construction in progress | |||||||||||
Total property and equipment, net | $ | $ | |||||||||
6.Goodwill and Other Intangible Assets
Goodwill represents the excess of purchase price paid over the fair value of the net assets of acquired businesses. Goodwill is not amortized, but we perform an annual goodwill impairment test on December 31, and more frequently if events and circumstances indicate that the asset might be impaired. The change in carrying value of goodwill allocated to our reportable segments during the three months ended June 30, 2026 was as follows:
Pressure Control | Spoolable Technologies | Total | |||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ||||||||||||||
Cactus International | |||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | ||||||||||||||
The following table presents the detail of acquired intangible assets:
| June 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||||||||||||
| Gross Cost | Accumulated Amortization | Net Cost | Gross Cost | Accumulated Amortization | Net Cost | |||||||||||||||||||||||||||||||||
| Customer relationships | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||
| Developed technology | ( | ( | ||||||||||||||||||||||||||||||||||||
Trade name | ( | ( | ||||||||||||||||||||||||||||||||||||
| Backlog | ( | ( | ||||||||||||||||||||||||||||||||||||
| Total | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||
14
All intangible assets are amortized over their estimated useful lives. The weighted average amortization period for identifiable intangible assets acquired as of June 30, 2026 is 9.4 years. Amortization expense recognized during three and six months ended June 30, 2026 was $14.6 million and $27.1 million, respectively, and was recorded in selling, general and administrative expenses in the consolidated statements of income. Estimated future amortization expense is as follows:
| Remainder of 2026 | $ | |||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| 2030 | ||||||||
| 2031 | ||||||||
| Thereafter | ||||||||
| Total | $ | |||||||
7.Debt
We had no 14.4 million in letters of credit outstanding, $1.3 million of which reduced the borrowing capacity under our Amended and Restated Credit Agreement. The Amended and Restated Credit Agreement was originally entered into on February 28, 2023, by and among Cactus Companies, as borrower, certain subsidiaries of Cactus Companies from time to time party thereto, as guarantors, the lenders party thereto and JPMorgan Chase Bank, N.A., as lender, administrative agent, issuing bank and swingline lender (as amended from time to time, the “Amended ABL Credit Facility”. We were in compliance with all covenants under the Amended ABL Credit Facility as of June 30, 2026.
The Amended ABL Credit Facility was amended in December 2025. The amendment established a delayed‑draw term loan facility (the “Term Loan Facility”) and extended the maturity of the revolving credit facility. The amendment provided for a Term Loan Facility of up to the lesser of $100.0 million and 85 % of the appraised value of eligible machinery and equipment, which could be drawn in up to two advances during the six months following December 1, 2025. In June 2026, the Company further amended the Amended ABL Credit facility to extend the maturity of the Term Loan Facility, with limitations on the scope of use of funds, to December 31, 2026. The Term Loan Facility was undrawn as of June 30, 2026 and December 31, 2025. Any amounts drawn will mature three years from the initial funding date and bear interest, at the borrower’s option, at ABR or SOFR‑based rates plus applicable margins. The unused portion of the Term Loan Facility is subject to a 0.05 % monthly unused line fee.
The December 2025 amendment also extended the maturity of the revolving credit facility to December 1, 2030. The Amended ABL Credit Facility requires compliance with a maximum leverage ratio of 2.50 to 1.00 for so long as the Term Loan Facility is outstanding or available. Until the Term Loan Facility is repaid or terminated without being drawn, the collateral for the ABL Credit Facility was expanded to include certain equipment and intellectual property of Cactus Companies and its subsidiaries that are guarantors.
The Amended ABL Credit Facility provides up to $225.0 million in revolving commitments, of which $100.0 million is available for the issuance of letters of credit. Subject to certain terms and conditions set forth in the Amended ABL Credit Facility, Cactus Companies may request additional revolving commitments in an amount not to exceed $50.0 million, for a total of up to $275.0 million in revolving commitments. The maximum amount that Cactus Companies may borrow under the Amended ABL Credit Facility is subject to a borrowing base, which is based on a percentage of eligible accounts receivable and eligible inventory, subject to reserves and other adjustments.
Borrowings under the Amended ABL Credit Facility bear interest at Cactus Companies’ option at either (i) the Alternate Base Rate (as defined therein) (“ABR”), or (ii) the Adjusted Term SOFR Rate (as defined therein) (“Term Benchmark”), plus, in each case, an applicable margin. Letters of credit issued under the Amended ABL Credit Facility accrue fees at a rate equal to the applicable margin for Term Benchmark borrowings, plus a fronting fee. The applicable margin for revolving loan borrowings ranges from 0.0 % to 0.5 % per annum for revolving loan ABR borrowings and 1.25 % to 1.75 % per annum for revolving loan Term Benchmark borrowings and, in each case, is based on the average quarterly availability of the revolving loan commitment under the Amended ABL Credit Facility for the immediately preceding fiscal quarter. The unused portion of revolving commitment under the Amended ABL Credit Facility is subject to a commitment fee of 0.25 % per annum. At June 30, 2026 and December 31, 2025, although there were no 1.00 %, plus the base rate of one, three or six month SOFR plus 0.10
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8.Revenue
The majority of our revenues are derived from contracts for fixed consideration, or in the case of rentals, generally for a fixed charge per day while the equipment is in use by the customer, plus repair costs. Product sales generally do not include right of return or other significant post-delivery obligations. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Revenues are recognized when we satisfy a performance obligation by transferring control of the promised goods or providing services to our customers at a point in time, in an amount specified in the contract with our customer which reflects the consideration to which we expect to be entitled in exchange for those goods or services. The majority of our contracts with customers contain a single performance obligation to provide agreed upon products or services. For contracts with multiple performance obligations, we allocate revenue to each performance obligation based on its relative standalone selling price. We do not assess whether promised goods or services are performance obligations if they are immaterial in the context of the contract with the customer. We typically do not incur any material costs of obtaining contracts.
We do not adjust the amount of consideration per the contract for the effects of a significant financing component when we expect, at contract inception, that the period between the transfer of a promised good or service to a customer and when the customer pays for that good or service will generally be one year or less, which is in substantially all cases. Payment terms and conditions vary, although terms generally include a requirement of payment within 30 to 60 days of invoicing. Revenues are recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. We treat shipping and handling associated with outbound freight as a fulfillment cost instead of as a separate performance obligation. We recognize the cost for the associated shipping and handling when incurred as an expense in cost of sales.
We disaggregate revenue into three categories: product revenues, rental revenues and field service and other revenues. Upon completing the Acquisition, we have worldwide sales, with the majority of our revenues being generated in the U.S. and Middle East, with smaller contributions to sales being generated in Australia, Canada, and other international markets. The following table presents our revenues disaggregated by category:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||||||||||||||
Product revenue | $ | % | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||||||||||||
Rental revenue | % | % | % | % | |||||||||||||||||||||||||||||||||||||||||||
Field service and other revenue | % | % | % | % | |||||||||||||||||||||||||||||||||||||||||||
| Total revenues | $ | % | $ | % | $ | % | $ | % | |||||||||||||||||||||||||||||||||||||||
Remaining Performance Obligations
9.Tax Receivable Agreement (“TRA”)
In connection with our initial public offering (“IPO”) in February 2018, we entered into the TRA which generally provides for payment by Cactus Inc. to certain direct and indirect owners of Cactus LLC (after the CC Reorganization, Cactus Companies) of 85 % of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax that Cactus Inc. actually realizes, or is deemed to realize in certain circumstances. Cactus Inc. retains the benefit of the remaining 15 % of these net cash savings.
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The TRA liability is calculated by determining the tax basis subject to the TRA (“tax basis”) and applying a blended tax rate to the basis differences and calculating the resulting iterative impact. The blended tax rate consists of the U.S. federal income tax rate and an assumed combined state and local income tax rate driven by the apportionment factors applicable to each state. Subsequent changes to the measurement of the TRA liability are recognized in the statements of income as a component of other expense, net. As of June 30, 2026, the total liability from the TRA was $267.0 million with $21.3 million reflected in current liabilities based on the expected timing of our next payments. The payments under the TRA will not be conditional on a holder of rights under the TRA having a continued ownership interest in either Cactus Companies or Cactus Inc.
The term of the TRA commenced upon completion of our IPO and will continue until all tax benefits that are subject to the TRA have been utilized or expired, unless we exercise our right to terminate the TRA. If we elect to terminate the TRA early (or it is terminated early due to certain mergers, asset sales, other forms of business combinations or other changes of control), our obligations under the TRA would accelerate and we would be required to make an immediate payment equal to the present value of the anticipated future payments to be made by us under the TRA, and such payment is expected to be substantial. The calculation of anticipated future payments is based upon certain assumptions and deemed events set forth in the TRA, including the assumptions that (i) we have sufficient taxable income to fully utilize the tax benefits covered by the TRA and (ii) any CC Units (other than those held by Cactus Inc.) outstanding on the termination date are deemed to be redeemed on the termination date. Any early termination payment may be made significantly in advance of the actual realization, if any, of the future tax benefits to which the termination payment relates.
10.Equity
As of June 30, 2026, Cactus Inc. owned 86.8 % of Cactus Companies as compared to 86.3 % of Cactus Companies as of December 31, 2025. As of June 30, 2026, Cactus Inc. had outstanding 69.6 million shares of Class A common stock (representing 86.8 % of the total voting power) and 10.5 million shares of Class B common stock (representing 13.2 % of the total voting power).
Redemptions of CC Units
As part of the CC Reorganization in connection with the acquisition of FlexSteel, Cactus Companies acquired all of the outstanding units representing limited liability company interests of Cactus LLC (“CW Units”) in exchange for an equal number of CC Units issued to each of the previous owners of CW Units other than Cactus Inc. In connection with the CC Reorganization, Cactus Inc. and the owners of CC Units entered into the Amended and Restated Limited Liability Company Operating Agreement of Cactus Companies (the “Cactus Companies LLC Agreement”). Pursuant to the Cactus Companies LLC Agreement, holders of CC Units are entitled to redeem their CC Units, which results in additional Class A common stock outstanding. Since our IPO in February 2018, an aggregate of 50.0 million CC Units (including CW Units prior to the CC Reorganization) and a corresponding number of shares of Class B common stock have been redeemed in exchange for shares of Class A common stock.
During the six months ended June 30, 2026 and 2025, 0.4 million and 0.2 million CC Units, respectively together with a corresponding number of shares of Class B common stock, were redeemed in exchange for Class A common stock in accordance with the Cactus Companies LLC Agreement.
Dividends
Aggregate cash dividends of $0.28 and $0.26 per share of Class A common stock were declared during the six months ended June 30, 2026 and 2025, totaling $19.8 million and $18.1 million, respectively. Cash dividends paid during the six months ended June 30, 2026 and 2025 totaled $20.0 million and $18.2 million, respectively. Dividends accrue on unvested equity-based awards on the date of record and are paid upon vesting. Dividends are not paid to our Class B common stockholders; however, a corresponding distribution up to the same amount per share as our Class A common stockholders is paid to the owners of CC Units other than Cactus Inc. for any dividends declared on our Class A common stock. See further discussion of the distributions below under “Member Distributions.”
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Share Repurchase Program
On June 6, 2023, our board of directors authorized the Company to repurchase shares of its Class A common stock for an aggregate purchase price of up to $150 million. Under our share repurchase program, shares may be repurchased from time to time in open market transactions or block trades, in privately negotiated transactions or any other method permitted under U.S. securities laws, rules and regulations. The repurchase program does not obligate the Company to purchase any particular amount of shares, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion. During the six months ended June 30, 2026, the Company did not repurchase shares of Class A common stock under the share repurchase program. As of June 30, 2026, $146.3 million remained authorized for future repurchases of Class A common stock under the program.
Member Distributions
Distributions made by Cactus Companies are generally required to be made pro rata among all its members. For the six months ended June 30, 2026, Cactus Companies distributed $27.7 million to Cactus Inc. to fund its dividend payment and made pro rata distributions to the other members totaling $4.2 million over the same period. During the six months ended June 30, 2025, Cactus Companies distributed $52.5 million to Cactus Inc. to fund its dividend and estimated tax payments and made pro rata distributions to the other members totaling $8.7 million.
Limitation of Members’ Liability
Under the terms of the Cactus Companies LLC Agreement, the members of Cactus Companies are not obligated for debt, liabilities, contracts or other obligations of Cactus Companies. Profits and losses are allocated to members as defined in the Cactus Companies LLC Agreement.
11.Commitments and Contingencies
Due to the nature of our business, we are, from time to time, involved in routine litigation or subject to disputes or claims related to our business activities, including workers’ compensation claims and employment related disputes.
A range of total possible losses for all litigation matters cannot be reasonably estimated. Based on our consideration of all relevant facts and circumstances, we do not expect the ultimate outcome of currently pending lawsuits or claims against us, other than as discussed below, will have a material adverse effect on our financial position, results of operations or cash flows, however, there can be no assurance as to the ultimate outcome of these matters. With respect to the litigation described below, if there was an adverse outcome, there could be a material impact on our business, financial condition and results of operations. Litigation is subject to inherent uncertainties and management's view may change in the future. Therefore, there can be no assurance as to the ultimate outcome of any dispute or claim.
On August 20, 2021, Cactus filed a complaint against Cameron International Corporation (“Cameron”) in the U.S. District Court for the Southern District of Texas, Civil Action No.: 4:21-cv-02720-ASH, seeking a declaratory judgment that Cactus frac operations do not infringe certain Cameron patents and that such patents are invalid. In response to that action, Cameron has asserted infringement of certain of those patents by Cactus’ SafeLink® frac flow system and is seeking past royalties and other damages related to the alleged infringement. The parties have been unable to reach an amicable settlement. The jury trial, originally scheduled on June 9, 2025, was delayed, and no new trial date has been set. At this time, we are not able to predict the outcome of these claims.
12.Fair Value Measurements
Authoritative guidance on fair value measurements provides a framework for measuring fair value and establishes a fair value hierarchy that prioritizes the inputs used to measure fair value, giving the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 inputs), observable inputs other than quoted prices in active markets (Level 2 inputs) and the lowest priority to unobservable inputs (Level 3 inputs).
The carrying value of cash and cash equivalents, receivables, accounts payable and accrued expenses approximates fair value based on the short-term nature of these accounts.
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13.Segment Reporting
We operate in two
Our reporting segments are:
•Pressure Control – engaged in the design, manufacture, sale, installation, service and associated rental of wellhead and pressure control equipment utilized during the drilling, completion and production phases of oil and gas wells.
•Spoolable Technologies – engaged in the design, manufacture, sale, installation, service and associated rental of onshore spoolable pipe technologies utilized for production, gathering and takeaway transportation of oil, gas or other liquids.
Financial information by business segment for the three and six months ended June 30, 2026 and 2025 is summarized below.
| Three Months Ended June 30, | |||||||||||||||||
| 2026 | |||||||||||||||||
Pressure Control | Spoolable Technologies | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Intersegment revenue | |||||||||||||||||
| Total revenues | |||||||||||||||||
| Reconciliation of revenue | |||||||||||||||||
| Elimination of intersegment revenue | |||||||||||||||||
| Total consolidated revenues | |||||||||||||||||
Less:(1) | |||||||||||||||||
| Cost of revenue from external customers | $ | $ | $ | ||||||||||||||
| Intersegment cost of revenue | |||||||||||||||||
| Total cost of revenues | |||||||||||||||||
| Reconciliation of cost of revenue | |||||||||||||||||
| Elimination of intersegment cost of revenue | ( | ||||||||||||||||
| Total consolidated cost of revenue | |||||||||||||||||
Selling, general, administrative expenses and other (2) | |||||||||||||||||
| Segment profit | $ | $ | $ | ||||||||||||||
| Reconciliation of segment profit | |||||||||||||||||
| Elimination of intersegment profit | |||||||||||||||||
| Total consolidated segment profit | $ | ||||||||||||||||
Corporate expenses (3) | ( | ||||||||||||||||
| Total operating income | $ | ||||||||||||||||
| Interest income, net | |||||||||||||||||
| Income before income taxes | $ | ||||||||||||||||
(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker.
(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.
(3) Comprised primarily of expenses not allocated to our operating segments.
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| Three Months Ended June 30, | |||||||||||||||||
| 2025 | |||||||||||||||||
Pressure Control | Spoolable Technologies | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Intersegment revenue | |||||||||||||||||
| Total revenues | |||||||||||||||||
| Reconciliation of revenue | |||||||||||||||||
| Elimination of intersegment revenue | ( | ||||||||||||||||
| Total consolidated revenues | |||||||||||||||||
Less:(1) | |||||||||||||||||
| Cost of revenue from external customers | $ | $ | $ | ||||||||||||||
| Intersegment cost of revenue | |||||||||||||||||
| Total cost of revenues | |||||||||||||||||
| Reconciliation of cost of revenue | |||||||||||||||||
| Elimination of intersegment cost of revenue | ( | ||||||||||||||||
| Total consolidated cost of revenue | |||||||||||||||||
Selling, general, administrative expenses and other (2) | |||||||||||||||||
| Segment profit | $ | $ | $ | ||||||||||||||
| Reconciliation of segment profit | |||||||||||||||||
| Elimination of intersegment profit | ( | ||||||||||||||||
| Total consolidated segment profit | $ | ||||||||||||||||
Corporate expenses (3) | ( | ||||||||||||||||
| Total operating income | $ | ||||||||||||||||
| Interest income, net | |||||||||||||||||
| Income before income taxes | $ | ||||||||||||||||
(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker.
(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.
(3) Comprised primarily of expenses not allocated to our operating segments.
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| Six Months Ended June 30, | |||||||||||||||||
| 2026 | |||||||||||||||||
Pressure Control | Spoolable Technologies | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Intersegment revenue | |||||||||||||||||
| Total revenues | |||||||||||||||||
| Reconciliation of revenue | |||||||||||||||||
| Elimination of intersegment revenue | ( | ||||||||||||||||
| Total consolidated revenues | |||||||||||||||||
Less:(1) | |||||||||||||||||
| Cost of revenue from external customers | $ | $ | $ | ||||||||||||||
| Intersegment cost of revenue | |||||||||||||||||
| Total cost of revenues | |||||||||||||||||
| Reconciliation of cost of revenue | |||||||||||||||||
| Elimination of intersegment cost of revenue | ( | ||||||||||||||||
| Total consolidated cost of revenue | |||||||||||||||||
Selling, general, administrative expenses and other (2) | |||||||||||||||||
| Segment profit | $ | $ | $ | ||||||||||||||
| Reconciliation of segment profit | |||||||||||||||||
| Elimination of intersegment profit | |||||||||||||||||
| Total consolidated segment profit | $ | ||||||||||||||||
Corporate expenses (3) | ( | ||||||||||||||||
| Total operating income | $ | ||||||||||||||||
| Interest income, net | |||||||||||||||||
| Income before income taxes | $ | ||||||||||||||||
(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker.
(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.
(3) Comprised primarily of expenses not allocated to our operating segments.
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| Six Months Ended June 30, | |||||||||||||||||
| 2025 | |||||||||||||||||
Pressure Control | Spoolable Technologies | Total | |||||||||||||||
| Revenues from external customers | $ | $ | $ | ||||||||||||||
| Intersegment revenue | |||||||||||||||||
| Total revenues | |||||||||||||||||
| Reconciliation of revenue | |||||||||||||||||
| Elimination of intersegment revenue | ( | ||||||||||||||||
| Total consolidated revenues | |||||||||||||||||
Less:(1) | |||||||||||||||||
| Cost of revenue from external customers | $ | $ | $ | ||||||||||||||
| Intersegment cost of revenue | |||||||||||||||||
| Total cost of revenues | |||||||||||||||||
| Reconciliation of cost of revenue | |||||||||||||||||
| Elimination of intersegment cost of revenue | ( | ||||||||||||||||
| Total consolidated cost of revenue | |||||||||||||||||
Selling, general, administrative expenses and other (2) | |||||||||||||||||
| Segment profit | $ | $ | $ | ||||||||||||||
| Reconciliation of segment profit | |||||||||||||||||
| Elimination of intersegment profit | ( | ||||||||||||||||
| Total consolidated segment profit | $ | ||||||||||||||||
Corporate expenses (3) | ( | ||||||||||||||||
| Total operating income | $ | ||||||||||||||||
| Interest income, net | |||||||||||||||||
| Income before income taxes | $ | ||||||||||||||||
(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker.
(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.
(3) Comprised primarily of expenses not allocated to our operating segments.
Assets are not reported to the CODM on a segment basis as it is not a meaningful measure used to run the business.
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14.Earnings per Share
Basic earnings per share of Class A common stock is calculated by dividing the net income attributable to Cactus Inc. during the period by the weighted average number of shares of Class A common stock outstanding during the same period. Diluted earnings per share of Class A common stock is calculated by dividing the net income attributable to Cactus Inc. during that period by the weighted average number of common shares outstanding, assuming all potentially dilutive shares were issued.
We use the if-converted method to determine the potential dilutive effect of outstanding CC Units and corresponding shares of outstanding Class B common stock. We use the treasury stock method to determine the potential dilutive effect of unvested stock-based compensation awards assuming that the proceeds will be used to purchase shares of Class A common stock. For our unvested performance stock units, we first apply the criteria for contingently issuable shares before determining the potential dilutive effect using the treasury stock method.
The following table summarizes the basic and diluted earnings per share calculations:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Numerator: | |||||||||||||||||||||||
Net income attributable to Cactus Inc. | $ | $ | $ | $ | |||||||||||||||||||
Less: Accretion of redeemable non-controlling interest to redemption value | |||||||||||||||||||||||
Net income attributable to Cactus Inc. including accretion of redeemable non-controlling interest to redemption value —basic(1) | $ | $ | $ | $ | |||||||||||||||||||
Denominator: | |||||||||||||||||||||||
Weighted average Class A shares outstanding—basic | |||||||||||||||||||||||
Effect of dilutive shares (2) | |||||||||||||||||||||||
Weighted average Class A shares outstanding—diluted (2) | |||||||||||||||||||||||
| Earnings per Class A share—basic | $ | $ | $ | $ | |||||||||||||||||||
Earnings per Class A share—diluted (1)(2) | $ | $ | $ | $ | |||||||||||||||||||
(1)Diluted earnings per share does not reflect any incremental shares related to redeemable equity, as such instruments are not participating securities and do not give rise to potentially dilutive common shares. However, the accretion of redeemable equity to its redemption value is treated as a deemed dividend and reduces net income available to common shareholders in the calculation of both basic and diluted earnings per share. Accordingly, the impact of redeemable equity on earnings per share is limited to this income allocation adjustment, with no effect on the weighted-average shares outstanding.
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15.Contract Liabilities
Contract liabilities include deferred income primarily on long-term contracts to construct technically complex equipment, long-term product maintenance or extended warranty arrangements and progress collections, which reflects billings in excess of revenue. Contract liabilities consist of the following:
| June 30, 2026 | December 31, 2025 | ||||||||||
Deferred income | $ | $ | |||||||||
Progress collections | |||||||||||
Contract liabilities | $ | $ | |||||||||
16.Subsequent Events
On July 24, 2026, Cactus Companies, and Baker Hughes Oilfield Equipment Manufacturing – Sole Proprietorship L.L.C., a 65 % owned indirect subsidiary of Cactus Companies that is organized in the UAE (“Cactus UAE”), entered into a Facilities Agreement (the “Facilities Agreement”) with Commercial Bank of Dubai PSC, as lender (“CBD”), Cactus UAE as borrower, and Cactus Companies as guarantor.
The Facilities Agreement provides Cactus UAE with a $75.0 million secured credit facility, with sublimits of (x) $40.0 million for revolving credit borrowings, (y) $35.0 million for bank guarantees, bid bonds, performance bonds and similar obligations, and (z) $10.0 million for letters of credit (with a $35.0 million aggregate limit on the amount of bank guarantees, bid bonds, performance bonds, similar obligations and letters of credit). The credit facility established by the Facilities Agreement is scheduled to terminate on February 28, 2027, but CBD may elect to extend the facility for successive 12-month periods in its sole discretion. The obligations of Cactus UAE under the Facilities Agreement are guaranteed by Cactus Companies and secured by a lien on the accounts receivable and certain other personal property assets of Cactus UAE. The Facility Agreement will be used for working capital and general corporate purposes of Cactus International LLC and its subsidiaries (including Cactus UAE), a group of 65 % owned subsidiaries of the Company that hold Baker Hughes Company’s former surface pressure control business.
Revolving credit borrowings under the Facility Agreement will accrue interest at the applicable reference rate set forth in the Facilities Agreement plus 1.85 % per annum. Cactus UAE will pay fees to CBD in the amount of (x) 0.75 % per annum for letters of credit issued under the Facility Agreement, (y) 0.75 % per annum for bank guarantees, bid bonds, performance bonds and similar obligations issued under the Facility Agreement to beneficiaries located in the UAE, and (z) 1.00 % per annum for bank guarantees, bid bonds, performance bonds and similar obligations issued under the Facility Agreement to beneficiaries located outside the UAE.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Except as otherwise indicated or required by the context, all references in this Quarterly Report to the “Company,” “Cactus,” “we,” “us” and “our” refer to Cactus, Inc. (“Cactus Inc.”) and its consolidated subsidiaries. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related notes. The following discussion contains “forward-looking statements” that reflect our plans, estimates, beliefs and expected performance. Our actual results may differ materially from those anticipated as discussed in these forward-looking statements as a result of a variety of risks and uncertainties, which are difficult to predict, including those described above in “Cautionary Note Regarding Forward-Looking Statements,” and in the risk factors included in “Part II, Item 1A. Risk Factors” in this Quarterly Report. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We assume no obligation to update any of these forward-looking statements except as otherwise required by law.
Executive Summary
Cactus is an equipment solutions provider primarily for onshore oil and gas markets. Cactus was founded in 2011 by a management group that previously operated two of the largest wellhead providers at the time. Since its formation, Cactus has rapidly grown to be a leading provider of wellhead solutions to the U.S. onshore market. With the acquisition of Cactus International, Cactus is now a global wellhead supplier.
On February 28, 2023, Cactus acquired FlexSteel, which grew from its founding in 2003 to its current status as a leading provider of spoolable pipe technologies, primarily to the U.S. onshore market. We believe this acquisition enhanced our position as a premier manufacturer and provider of highly engineered equipment primarily to the exploration and production ("E&P") industry and has provided opportunities for meaningful growth. FlexSteel’s spoolable technology products complement Cactus’s pressure control equipment, and the combined business allows for exposure to customers operations from production trees to transportation of oil, gas and other liquids, as well as to additional customers operating in the midstream area.
On January 1, 2026, Cactus completed the acquisition of Cactus International, a global provider of wellhead and pressure control equipment and services with operations across key international oil and gas markets. The acquisition significantly expands the Company's geographic footprint, diversifies its customer base, manufacturing, service and operational capabilities, and enhances its ability to serve customers globally. As a result of the acquisition, Cactus is now a global wellhead supplier with meaningful exposure to both U.S. and international drilling and production activity.
Demand for our products and services depends primarily upon oil and gas industry activity levels, including the number of active drilling rigs, the number of wells being drilled, the number of wells being completed, and the volume of newly producing wells, among other factors.
Revenues
Our revenues are derived from three sources: products, rentals, and field service and other. Product revenues are derived from the sale of wellhead systems, production trees and spoolable pipe and fittings. Rental revenues are derived from the rental of equipment used during the completion process, the repair of such equipment, and the rental of equipment or tools used to install wellhead equipment or spoolable pipe. Field service and other revenues are earned when we provide installation and other field services for both product sales and equipment rental.
During the six months ended June 30, 2026, we derived 77% of total revenues from the sale of our products, 4% of total revenues from rental and 19% of total revenues from field service and other. During the six months ended June 30, 2025, we derived 75% of total revenues from the sale of our products, 9% of total revenues from rental and 16% of total revenues from field service and other. We have worldwide operations, including the U.S., Saudi Arabia, UAE, and China, with more limited operations in Australia and Canada, as well as sales in other international markets.
We operate in two business segments consisting of the Pressure Control segment and the Spoolable Technologies segment.
Pressure Control
The Pressure Control segment designs, manufactures, sells and rents a range of wellhead and pressure control equipment under the Cactus Wellhead brand and, following the acquisition of Cactus International on January 1, 2026, includes a broader portfolio of surface pressure control products and services serving customers in key international oil and gas markets. Products are
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sold and rented principally for onshore conventional and unconventional oil and gas wells and are utilized during the drilling, completion and production phases of our customers' wells. In addition, we provide field services for our products and rental equipment to assist with the installation, maintenance and handling of the equipment.
We operate through service centers in the United States that are strategically located in key oil and gas producing regions. These service centers support our field services and provide equipment assembly and repair services. Through our legacy operations and Cactus International, we also maintain service, rental and operational capabilities across numerous international markets, including the Kingdom of Saudi Arabia and Australia. Pressure Control manufacturing and production facilities are located in Bossier City, Louisiana; Suzhou, China; Saudi Arabia; Abu Dhabi; and Hai Duong, Vietnam, supporting both domestic and international customer demand.
Demand for our Pressure Control product sales is driven primarily by the number of new wells drilled, as each new well requires a wellhead and, following the completion phase, a production tree. Demand for our rental equipment is driven primarily by well completions, as we rent frac trees to oil and gas operators to support hydraulic fracturing activities. Rental demand is also driven, to a lesser extent, by drilling activity through the rental of tools used in wellhead installation. Field service and other revenues are closely correlated with product sales and rental activity, as equipment sold or rented generally requires an associated service component.
Spoolable Technologies
The Spoolable Technologies segment designs, manufactures, and sells spoolable pipe and associated end fittings under the FlexSteel brand. Our customers use these products primarily as production, gathering, and takeaway pipelines to transport oil, gas or other liquids. In addition, we also provide field services and rental items to assist our customers with the installation of these products. We support our field service operations through service centers and pipe yards located in oil and gas regions throughout the United States and Western Canada. Our manufacturing facility is located in Baytown, Texas.
Demand for our product sales in the Spoolable Technologies segment is driven primarily by the number of wells being placed into production after the completions phase, as customers use our spoolable pipe and associated fittings to bring wells more rapidly onto production. Rental and field service and other revenues are closely correlated with revenues from product sales, as items sold usually have an associated rental and service component.
Recent Developments and Trends
Oil and Natural Gas Prices
The following table summarizes average oil and natural gas prices over the indicated periods, as well as industry activity levels as reflected by the average number of active onshore drilling rigs during the same periods.
| Three Months Ended | |||||||||||||||||||||||
| June 30, 2026 | March 31, 2026 | June 30, 2025 | |||||||||||||||||||||
Brent Oil Price ($/bbl) (1) | $ | 102.63 | $ | 80.72 | $ | 68.07 | |||||||||||||||||
WTI Oil Price ($/bbl) (2) | $ | 95.65 | $ | 72.74 | $ | 64.57 | |||||||||||||||||
Natural Gas Price ($/MMBtu) (3) | $ | 2.95 | $ | 4.71 | $ | 3.19 | |||||||||||||||||
U.S. Land Drilling Rigs (4) | 538 | 530 | 556 | ||||||||||||||||||||
International Land Drilling Rigs (4) | 814 | 841 | 835 | ||||||||||||||||||||
(1) EIA Europe Brent spot price.
(2) EIA Cushing, OK West Texas Intermediate ("WTI") spot price.
(3) EIA Henry Hub Natural Gas spot price per million British Thermal Unit (“MMBtu”).
(4) Based on data made publicly available by Baker Hughes Company.
The Company’s operating results continue to be impacted by conditions in the oil and gas industry, which are primarily driven by global commodity prices, drilling and completion activity levels, and supply and demand dynamics.
Average WTI and Brent oil prices increased approximately 31% and 27%, respectively, in the second quarter of 2026 compared to the first quarter of 2026, as the war in Iran and associated supply disruption led to elevated commodity prices. Oil
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price levels have been highly volatile as geopolitical tensions remain high in the Middle East, and the ability to export of oil through the Strait of Hormuz and the Red Sea remain uncertain. Average natural gas prices decreased approximately 37% in the second quarter of 2026 compared to the first quarter of 2026. Prices were elevated in the first quarter due to winter storms and seasonality and have since moderated, as storage levels remained above five-year historical average through the second quarter.
In the second quarter of 2026, average U.S. land drilling activity levels were up 2% compared to the first quarter of 2026, as our customers generally continued stable drilling programs despite stronger commodity prices, reflecting E&P capital discipline. International land drilling levels decreased approximately 3% from the first quarter of 2026, led by reduced activity in the Middle East, offset by increases in Africa.
U.S. Trade Policies
Over the course of 2025 and 2026, the Trump administration implemented and announced a number of new tariffs, including new Section 232 tariffs of 50% on imports of steel and certain products made from steel from most countries outside of the U.S. Threats and actual implementation of tariffs continue to cause market and geopolitical uncertainty. Tariff announcements and implementation have caused global equity, bond, and currency markets to experience heightened levels of volatility as market participants incorporate potential effects of supply chain disruption, inflation, and consumer demand into pricing models. In February 2026, the United States Supreme Court ruled that certain tariffs were unlawful, resulting in the implementation of alternative tariffs under Section 122 and further market uncertainty. The Section 122 tariffs are anticipated to expire in July 2026 and be replaced by subsequent tariffs with similar cost impacts. As a result of the Supreme Court ruling, we filed claims for and have received certain tariff refunds and continue to monitor the situation closely, but there is no guarantee that any future refund claim will be honored. The refunds received and being pursued represent a limited component of the overall tariff impact incurred by the Company as the most material tariffs incurred by the Company under Section 232 and 301 remain unchanged.
We are incurring, and expect to continue to incur, elevated tariff expenses on our goods imported from Vietnam and China, and experience generally higher steel input costs at our Bossier City and Baytown manufacturing facilities primarily as a result of the broad Section 232 tariffs. Both tariffs and higher steel input costs have impacted profitability, although the impact has been partially mitigated by cost reduction and tariff recovery efforts.
Conflict in Iran
The ongoing war involving the United State, Isreal, and Iran continues to disrupt global oil supplies, maintaining upward pressure on energy prices and contributing to volatility in international markets Our operations in the region have been adversely impacted, and we continue to prioritize the safety of personnel in the region. We have experienced and expect to continue to experience disruptions to our operations, our customers’ drilling activities, and our supply chain along with increased freight and logistics costs due to the conflict, and particularly the impediment of traffic through the Strait of Hormuz. Continued war in the region may lead to reduced revenues and profits and increased costs for our business in the region.
Pillar Two Framework
The Organization for Economic Cooperation and Development (“OECD”) has introduced a framework (“Pillar Two”) that provides for a new, global minimum tax of at least 15% on the income of large multinational corporations arising in each jurisdiction in which they operate. Pillar Two is being implemented on a country-by-country basis, and many countries have adopted rules in this regard. The United States had raised concerns regarding Pillar Two and had proposed a “side-by-side” solution under which U.S. parented groups (such as the Company) would be exempted from certain minimum taxes under Pillar Two in recognition of the existing U.S. minimum tax rules to which they are subject. On January 5, 2026, the OECD/G20 Inclusive Framework formally released a side-by-side package implementing this understanding, together with related simplifications and safe harbors. The side-by-side solution only takes legal effect in a given jurisdiction once that jurisdiction enacts implementing legislation or guidance. The Company continues to evaluate the impact of Pillar Two, and the associated adoption of that legislation by local jurisdictions, across the jurisdictions in which it operates, and estimates the impacts to income tax expense to be immaterial
Critical Accounting Policies and Estimates
A discussion of our critical accounting policies and estimates is contained in our 2025 Annual Report on Form 10-K. There have not been any changes in our critical accounting policies since December 31, 2025.
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Consolidated Results of Operations
The following discussions relating to significant line items from our condensed consolidated statements of income are based on available information and represent our analysis of significant changes or events that impact the comparability of reported amounts. Where appropriate, we have identified specific events and changes that affect comparability or trends and, where reasonably practicable, have quantified the impact of such items.
We have two operating segments consisting of the Pressure Control segment and the Spoolable Technologies segment. Our results of operations are evaluated by the Chief Executive Officer on a consolidated basis as well as at the segment level. The performance of our operating segments is primarily evaluated based on segment operating income (in addition to other measures), which is defined as income before taxes and before interest income (expense), net, other income (expense), net and corporate and other expenses not allocated to the operating segments.
Three Months Ended June 30, 2026 Compared to Three Months Ended March 31, 2026
The following table presents a summary of the segment consolidated operating results for the periods indicated:
| Three Months Ended | |||||||||||||||||||||||
| June 30, 2026 | March 31, 2026 | $ Change | % Change | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||
| Pressure Control | $ | 343,995 | $ | 300,172 | $ | 43,823 | 14.6 | % | |||||||||||||||
| Spoolable Technologies | 105,533 | 89,900 | 15,633 | 17.4 | |||||||||||||||||||
| Corporate and other | — | (1,723) | 1,723 | 100.0 | |||||||||||||||||||
| Total revenues | 449,528 | 388,349 | 61,179 | 15.8 | |||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Pressure Control | 59,154 | 38,605 | 20,549 | 53.2 | |||||||||||||||||||
| Spoolable Technologies | 32,168 | 23,567 | 8,601 | 36.5 | |||||||||||||||||||
| Total segment operating income | 91,322 | 62,172 | 29,150 | 46.9 | |||||||||||||||||||
| Corporate and other expenses | (7,740) | (12,668) | 4,928 | 38.9 | |||||||||||||||||||
| Total operating income | 83,582 | 49,504 | 34,078 | 68.8 | |||||||||||||||||||
| Interest income, net | 949 | 220 | 729 | nm | |||||||||||||||||||
| Income before income taxes | 84,531 | 49,724 | 34,807 | 70.0 | |||||||||||||||||||
| Income tax expense | 23,151 | 9,503 | 13,648 | nm | |||||||||||||||||||
| Net income | 61,380 | 40,221 | 21,159 | 52.6 | |||||||||||||||||||
| Less: net income attributable to non-controlling interest | 12,384 | 7,315 | 5,069 | 69.3 | |||||||||||||||||||
| Net income attributable to Cactus Inc. | $ | 48,996 | $ | 32,906 | $ | 16,090 | 48.9 | % | |||||||||||||||
| nm = not meaningful | |||||||||||||||||||||||
Pressure Control. Pressure Control revenue for the second quarter of 2026 was $344.0 million, an increase of $43.8 million, or 14.6%, from the first quarter of 2026 primarily due to increased revenues in the Middle East. Pressure Control operating income of $59.2 million for the second quarter of 2026 increased $20.5 million, or 53.2% from the first quarter of 2026, as segment operating income improved due to the higher volume and operating leverage, combined with the positive impact of tariff cost recovery, including the receipt of refunds of $10.3 million.
Spoolable Technologies. Spoolable Technologies revenue for the second quarter of 2026 was $105.5 million, an increase of $15.6 million, or 17.4% from the first quarter of 2026 primarily due to higher domestic customer activity levels. Total operating income for Spoolable Technologies for the second quarter of 2026 was $32.2 million, compared to operating income of $23.6 million for the first quarter of 2026, an increase of $8.6 million, or 36.5%, from the first quarter of 2026. The increase in operating income was primarily due to improved operating leverage and better sales mix.
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Corporate and other. Corporate and other revenue represents the elimination of inter-segment sales from our Pressure Control segment to our Spoolable Technologies segment. Corporate and other expenses include costs associated with executive management and other administrative functions not directly attributable to our reporting segments. Corporate and other expenses for the second quarter of 2026 was $7.7 million, a decrease of $4.9 million, or 38.9% from the first quarter of 2026 primarily due to lower transaction and integration expenses associated with the Baker Hughes Transaction.
Interest income, net. Interest income, net was $0.9 million for the second quarter of 2026 compared to $0.2 million for the first quarter of 2026, with the improvement resulting from higher levels of cash invested during the second quarter following the completion of the Acquisition. The interest income, net is primarily comprised of interest income earned on the invested cash balance.
Income tax expense. Income tax expense for the second quarter of 2026 was $23.2 million compared to $9.5 million for the first quarter of 2026. Cactus Inc. is only subject to federal and state income tax on its share of income from Cactus Companies. Income allocated to the non-controlling interest is only taxable to the non-controlling interest.
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
The following table presents a summary of the segment consolidated operating results for the periods indicated:
| Six Months Ended June 30, | |||||||||||||||||||||||
| 2026 | 2025 | $ Change | % Change | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||
| Pressure Control | $ | 644,167 | $ | 370,049 | $ | 274,118 | 74.1 | % | |||||||||||||||
| Spoolable Technologies | 195,433 | 188,803 | 6,630 | 3.5 | |||||||||||||||||||
| Corporate and other | (1,723) | (4,958) | 3,235 | 65.2 | |||||||||||||||||||
| Total revenues | 837,877 | 553,894 | 283,983 | 51.3 | |||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Pressure Control | 97,759 | 96,666 | 1,093 | 1.1 | |||||||||||||||||||
| Spoolable Technologies | 55,735 | 51,929 | 3,806 | 7.3 | |||||||||||||||||||
| Total segment operating income | 153,494 | 148,595 | 4,899 | 3.3 | |||||||||||||||||||
| Corporate and other expenses | (20,408) | (19,178) | (1,230) | (6.4) | |||||||||||||||||||
| Total operating income | 133,086 | 129,417 | 3,669 | 2.8 | |||||||||||||||||||
Interest income, net | 1,169 | 4,843 | (3,674) | (75.9) | |||||||||||||||||||
| Income before income taxes | 134,255 | 134,260 | (5) | — | |||||||||||||||||||
| Income tax expense | 32,654 | 31,108 | 1,546 | 5.0 | |||||||||||||||||||
| Net income | 101,601 | 103,152 | (1,551) | (1.5) | |||||||||||||||||||
| Less: net income attributable to non-controlling interest | 19,699 | 18,600 | 1,099 | 5.9 | |||||||||||||||||||
| Net income attributable to Cactus Inc. | $ | 81,902 | $ | 84,552 | $ | (2,650) | (3.1) | % | |||||||||||||||
| nm = not meaningful | |||||||||||||||||||||||
Pressure Control. Pressure Control revenue was $644.2 million for the first six months of 2026, an increase of $274.1 million, or 74.1%, from the first six months of 2025, primarily driven by international contributions from the newly acquired Cactus International joint venture. Operating income of $97.8 million in the first six months of 2026 increased $1.1 million, or 1.1%, from the first six months of 2025. The increase was primarily driven by higher operating income from Cactus International and tariff cost recovery, including the receipt of refunds of $10.3 million, which was more than offset by the impacts of purchase accounting and ongoing Section 232 and Section 301 tariff-related costs affecting product margins compared to prior year.
Spoolable Technologies. Spoolable Technologies revenue for the first six months of 2026 was $195.4 million, an increase of $6.6 million, or 3.5%, from the first six months of 2025, primarily due to higher customer activity levels in the international markets. Total operating income was $55.7 million in the first six months of 2026, an increase of $3.8 million, or 7.3%, compared
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to operating income of $51.9 million in the first six months of 2025. The increase was driven in part by improved operating leverage and lower selling, general and administrative expenses.
Corporate and other. Corporate and other revenue represents the elimination of inter-segment sales from our Pressure Control segment to our Spoolable Technologies segment. Corporate and other expenses include costs associated with executive management and other administrative functions not directly attributable to our reporting segments. Corporate and other expenses for the first six months of 2026 was $20.4 million, an increase of $1.2 million, or 6.4% from the first six months of 2025. The increase was largely attributable to professional fees and integration expenses associated with the Baker Hughes Transaction.
Interest income, net. Interest income, net for the first six months of 2026 was $1.2 million, compared to $4.8 million for the first six months of 2025. The decrease was due to lower interest income earned on lower amounts of cash invested during the first six months of 2026 as a result of the utilization of cash to fund the Baker Hughes Transaction.
Income tax expense. Income tax expense for the first six months of 2026 was $32.7 million compared to $31.1 million for the first six months of 2025. The increase in income tax expense from the first six months of 2025 was primarily due increase taxes associated with foreign operations.
Liquidity and Capital Resources
At June 30, 2026, we had $365.8 million of cash and cash equivalents, including $92.5 million of cash held for certain restructuring activities related to the Cactus International acquisition. Our primary sources of liquidity and capital resources are cash on hand, cash flows generated by operating activities, and borrowings under our Amended ABL Credit Facility (as defined in Note 7 in the notes to the unaudited condensed consolidated financial statements). Depending upon market conditions and other factors, we may also have the ability to issue additional equity and debt if needed. As of June 30, 2026, we had $223.7 million of available borrowing capacity under our Amended ABL Credit Facility with no outstanding borrowings, in addition to $100.0 million available under our Term Loan Facility (as defined in Note 7 in the notes to the unaudited condensed consolidated financial statements) and $14.4 million in letters of credit outstanding. We were in compliance with the covenants of the Amended ABL Credit Facility as of June 30, 2026. Additionally, we have indemnified Baker Hughes for $14.1 million of contingent liabilities associated with letters of credit in support of Cactus International operations, which do not reduce the borrowing capacity under our Amended ABL Credit Facility.
In June 2023, our board of directors authorized the Company to repurchase shares of its Class A common stock for an aggregate purchase price of up to $150 million. Under our share repurchase program, shares may be repurchased from time to time in open market transactions or block trades, in privately negotiated transactions, or any other method permitted under U.S. securities laws, rules and regulations. The repurchase program does not obligate the Company to purchase any particular amount of shares, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion. As of June 30, 2026, $146.3 million remained authorized for future repurchases of Class A common stock under the program.
We expect that our existing cash on hand, cash generated from operations and available borrowings under our Amended ABL Credit Facility and Term Loan Facility will be sufficient for the next 12 months to meet our material cash requirements, including working capital requirements, debt service obligations, anticipated capital expenditures, lease obligations, repurchases of shares of our Class A common stock, expected TRA liability payments, anticipated tax liabilities and dividends to holders of our Class A common stock as well as pro rata cash distributions to holders of CC Units other than Cactus Inc.
For the full year 2026, the Company is increasing its net capital expenditure guidance from $40 to $50 million to $55 to $65 million. The higher range is due primarily to initial capacity investments in the Baytown Spoolable Technologies manufacturing facility to meet increased global demand. The Company is additionally evaluating capex related to the Spoolable Technologies business in the Eastern hemisphere. In the Pressure Control segment, capital expenditures are primarily related to U.S. service center enhancements, rental fleet investments, and international expansion, and less material investments in low-cost supply chain.
Our ability to satisfy our long-term liquidity requirements, including cash requirements to fund income tax liabilities and the TRA liability at Cactus Inc., along with associated distributions to holders of CC Units relating to their ownership of Cactus Companies, depends on our future operating performance, which is affected by, and subject to, prevailing economic conditions, market conditions in the E&P industry, availability and cost of raw materials, and financial, business and other factors, many of which are beyond our control. We will not be able to predict or control many of these factors, such as economic conditions in the markets where we operate, and competitive pressures. If necessary, we would likely choose to reduce and delay or defer our spending on capital expenditures and operating expenses to ensure we operate within the cash flow generated from our operations.
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Cash Flows
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
The following table summarizes our cash flows for the periods indicated:
| Six Months Ended June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| (in thousands) | |||||||||||
| Net cash provided by operating activities | $ | 232,835 | $ | 124,380 | |||||||
| Net cash used in investing activities | (325,585) | (26,507) | |||||||||
Net cash used in financing activities | (36,258) | (36,546) | |||||||||
Net cash provided by operating activities was $232.8 million and $124.4 million for the six months ended June 30, 2026 and 2025, respectively. Operating cash flows for the six months ended June 30, 2026 increased primarily due to changes in working capital, largely driven by our recent acquisition of Cactus International.
Net cash used in investing activities was $325.6 million and $26.5 million for the six months ended June 30, 2026 and 2025, respectively. The increase for the six months ended June 30, 2026 was primarily due to cash paid to acquire Cactus International for $371.0 million, less $70.0 million in cash acquired from the acquisition.
Net cash used in financing activities was $36.3 million for the six months ended June 30, 2026 compared to $36.5 million for the six months ended June 30, 2025. The decrease in net cash used in financing activities for the six months ended June 30, 2026 was primarily related to a decrease in distributions to members of Cactus Companies of approximately $4.5 million. This decrease was partially offset by an increase in share repurchases of $2.3 million as well as an increase in the payment of Class A share dividends of $1.8 million.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
For quantitative and qualitative disclosures about market risk, see Part II, Item 7A., “Quantitative and Qualitative Disclosures about Market Risk,” in our 2025 Annual Report. Our exposure to market risk has not changed materially since December 31, 2025.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
In accordance with Exchange Act Rules 13a-15 and 15d-15, we have evaluated, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission ("SEC"). Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of June 30, 2026 at the reasonable assurance level.
As disclosed in Note 2 to the unaudited condensed consolidated financial statements, we acquired Cactus International on January 1, 2026 and accounted for this acquisition as a business combination. Cactus International’s total revenues constituted approximately 35% of our total consolidated revenues for the six months ended June 30, 2026. Cactus International’s total assets constituted approximately 37% of our total consolidated assets as of June 30, 2026. We excluded Cactus International’s disclosure controls and procedures that are subsumed by its internal control over financial reporting from the scope of management's assessment of the effectiveness of our disclosure controls and procedures. This exclusion is in accordance with the SEC staff’s general guidance that an assessment of a recently acquired business may be omitted from the scope of management’s assessment of internal controls over financial reporting for one year following the acquisition. We are in the process of implementing financial reporting controls and procedures at Cactus International as part of our ongoing integration activities.
Changes in Internal Control over Financial Reporting
Except as described above, there were no changes in our internal control over financial reporting that occurred during the second quarter of 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Due to the nature of our business, we are, from time to time, involved in routine litigation or subject to disputes or claims related to our business activities, including workers’ compensation claims and employment related disputes. For information concerning existing legal proceedings as of June 30, 2026, see Note 11 to our condensed consolidated financial statements.
Item 1A. Risk Factors.
In addition to the information set forth in this Quarterly Report, you should carefully consider the risk factors and other cautionary statements described under the heading “Item 1A. Risk Factors” included in our 2025 Annual Report, and under the heading "Part II Item 1A Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 and in our other filings with the SEC, which could materially affect our business, results of operations, financial condition or cash flows. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, results of operations, financial condition or cash flows. There have been no material changes in our risk factors from those described in our 2025 Annual Report, our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 and our other SEC filings, except as follows:
Ongoing conflict between the United States, Iran and other countries in the Middle East could continue to adversely impact our operations in the Middle East.
Cactus International, a 65% owned subsidiary of the Company, has plants in the UAE and Saudi Arabia. Both Cactus Wellhead and Cactus International, as well as our Spoolable Technologies segment, maintain significant operations in the Middle East. As long as the conflict between or among the United States, Iran and other countries in the Middle East continues, (i) those plants and operations are subject to interruptions, (ii) customer operations may be disrupted resulting in fewer orders, (iii) traffic through the Strait of Hormuz will likely negatively impact our supply chain in the region, (iv) there may be increased safety concerns for our employees and (v) our integration plan for Cactus International may be delayed. There is no way to predict when this conflict will be resolved and when operations can be restored to the conditions that existed before the conflict began. Until such conditions are restored, we expect that our operations in the Middle East and our financial results will be adversely impacted.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Issuer Purchases of Equity Securities
The following sets forth information with respect to our repurchases of Class A common stock during the three months ended June 30, 2026 (in whole shares).
| Period | Total number of shares purchased (1) | Weighted-average price paid per share (2) | Total number of shares purchased as part of publicly announced plans or programs (3) | Maximum dollar value of shares that may yet be purchased under the plans or program (3) | ||||||||||||||||||||||||||||||||||
| April 1-30, 2026 | 1,247 | $ | 52.76 | — | $ | 146,302,153 | ||||||||||||||||||||||||||||||||
| May 1-31, 2026 | 178 | $ | 62.26 | — | $ | 146,302,153 | ||||||||||||||||||||||||||||||||
| June 1-30, 2026 | 864 | $ | 58.80 | — | $ | 146,302,153 | ||||||||||||||||||||||||||||||||
| Total | 2,289 | $ | 55.78 | — | $ | 146,302,153 | ||||||||||||||||||||||||||||||||
(1)Consists of shares of Class A common stock repurchased from employees to satisfy tax withholding obligations related to restricted stock units that vested during the period.
(2)Average price paid for Class A common stock purchased from employees to satisfy tax withholding obligations related to restricted stock units that vested during the period.
(3)In June 2023, our board of directors authorized the Company to repurchase shares of its Class A common stock for an aggregate purchase price of up to $150 million.
Item 5. Other Information.
During the three months ended June 30, 2026, no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of Cactus, Inc. adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,”
On July 24, 2026, Cactus Companies and Cactus UAE entered into the Facilities Agreement with Commercial Bank of Dubai PSC, as lender, Cactus UAE as borrower, and Cactus Companies as guarantor. See Footnote 16 in Item1. Financial Statements for further information regarding the Facilities Agreement.
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
The board of directors (“Board”) of Cactus, Inc. (the “Company”) approved an increase in the number of directors on the Board from eight to nine and appointed Joseph Elkhoury to fill the newly created vacancy resulting from the increase in the number of directors, effective as of August 1, 2026. Mr. Elkhoury was appointed as a Class III director, with an initial term expiring at the 2027 annual meeting of stockholders. The increase in the size of the Board and the election of Mr. Elkhoury to fill the newly created vacancy on the Board were based upon the recommendation of the Company’s nominating and governance committee.
In connection with his appointment, the Board reviewed the independence of Mr. Elkhoury using the independence standards of the New York Stock Exchange (“NYSE”) and the Securities and Exchange Commission and, based on this review, determined that Mr. Elkhoury is independent within the meaning of the applicable NYSE listing standards currently in effect and within the meaning of Section 10A-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Joseph Elkhoury—Director Candidate. Mr. Elkhoury served as the Chief Executive Officer of KCA Deutag from July 1, 2019 until January 16, 2025. Prior to that time, Mr. Elkhoury was an Operating Partner, focusing on investment opportunities in the energy technology sector at Apollo Global Management, one of the world’s largest alternative investment managers. He was also Chairman of the Board of Express Energy Services, one of Apollo’s portfolio companies from July 10, 2018 to December 1, 2020. Mr. Elkhoury was previously Chief Operating Officer and Senior Vice President at Tetra Technologies from June 16, 2014 until June 1, 2017. Prior to that, Mr. Elkhoury spent 21 years with Schlumberger, originally joining the group in 1994 as a Wireline Field Engineer in Abu Dhabi. During his time there he held a number of senior positions and had responsibility for several of Schlumberger’s businesses including Microseismic Services, Production Services, Information Solutions and Global Supply Chain. Mr. Elkhoury has a degree in electrical engineering from the American University of Beirut. The Company
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believes Mr. Elkhoury’s qualifications to serve on the board include his executive leadership, his 33 years of experience in a wide variety of operational and leadership roles in the oilfield services industry and his experience in the Middle East.
The Company has entered into its standard form of indemnification agreement with Mr. Elkhoury. The form indemnification agreement was previously filed as Exhibit 10.6 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018, as filed with the Securities and Exchange Commission on March 15, 2019 and is incorporated by reference herein.
Mr. Elkhoury was not appointed pursuant to any arrangement or understanding with any other person and there are no family relationships between Mr. Elkhoury and the other directors or executives of the Company. There are no transactions in which Mr. Elkhoury has an interest requiring disclosure on the part of the Company under Item 404(a) of Regulation S-K promulgated under the Exchange Act.
As a non-employee director, Mr. Elkhoury will be entitled to receive an annual cash retainer of $94,000 per year, payable quarterly in arrears, as well as annual equity-based compensation with an aggregate grant date value of $141,000. On August 1, 2026, in connection with his appointment to the Board, Mr. Elkhoury will receive an award of restricted stock units with a grant date value of $70,500.
Item 6. Exhibits.
The following exhibits are required by Item 601 of Regulation S-K and are filed as part of this report.
| Exhibit No. | Description | |||||||
| 3.1 | Restated Certificate of Incorporation of Cactus, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 20, 2024) | |||||||
| 3.2 | Amended and Restated Bylaws of Cactus, Inc. (incorporated by reference to Exhibit 3.6 to the Registrant's Form 10-Q filed with the Securities and Exchange Commission on August 1, 2024) | |||||||
| 10.1* | First Amendment, dated March 10, 2026 to the Amended and Restated Limited Liability Company Operating Agreement of Cactus Companies, LLC | |||||||
| 10.2 | Fourth Amendment, dated May 29, 2026, to the Amended and Restated Credit Agreement among Cactus Companies, LLC, as borrower, certain subsidiaries of Cactus Companies, LLC, as guarantors, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities Exchange Commission on June 2, 2026) | |||||||
| 31.1* | CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||||
| 31.2* | CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||||
| 32.1** | CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||||
| 32.2** | CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||||
| 101.INS* | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document | |||||||
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |||||||
| 101.CAL* | Inline XBRL Taxonomy Calculation Linkbase Document | |||||||
| 101.LAB* | Inline XBRL Taxonomy Label Linkbase Document | |||||||
| 101.PRE* | Inline XBRL Taxonomy Presentation Linkbase Document | |||||||
| 101.DEF* | Inline XBRL Taxonomy Definition Document | |||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
* Filed herewith.
** Furnished herewith.
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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, thereunto duly authorized.
| Cactus, Inc. | |||||||||||
| July 30, 2026 | By: | /s/ Scott Bender | |||||||||
| Date | Scott Bender Chief Executive Officer, Chairman of the Board and Director (Principal Executive Officer) | ||||||||||
| July 30, 2026 | By: | /s/ Jay A. Nutt | |||||||||
| Date | Jay A. Nutt Executive Vice President and Chief Financial Officer (Principal Financial Officer) | ||||||||||
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