RPC Q1 Earnings Lag Estimates, Revenues Fall Y/Y on Sluggish Demand

RPC Inc. RES reported first-quarter 2025 adjusted earnings of 6 cents per share, which missed the Zacks Consensus Estimate of 7 cents. The bottom line declined from the year-ago figure of 13 cents. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Total quarterly revenues were $332.9 million, down from the year-ago quarter’s $377.8 million. The top line, however, beat the Zacks Consensus Estimate of $332 million.

The weak quarterly earnings were primarily due to flat pressure pumping revenues and slightly declining performance across other service lines.

RPC, Inc. Price, Consensus and EPS Surprise

RPC, Inc. price-consensus-eps-surprise-chart | RPC, Inc. Quote

Segmental Performance

Operating profit in the Technical Services segment totaled $14 million, significantly lower than the year-ago quarter’s $31.9 million. The results were primarily affected by pressure pumping pricing, which remained highly competitive.

Operating profit in the Support Services segment amounted to $2.7 million, lower than the year-ago level of $3.6 million.

Total operating profit in the quarter was $12.4 million, down from $32.3 million in the year-ago quarter. The average domestic rig count was 588, down 5.6% year over year.

The average oil price in the quarter was $71.93 per barrel, down 7.1% year over year. The average price of natural gas was $4.14 per thousand cubic feet, up 92.6% from the figure recorded in the corresponding period of 2024.

Costs & Expenses

In the first quarter, the cost of revenues decreased to $243.9 million from $250.2 million in the prior-year period. Selling, general and administrative expenses amounted to $42.5 million, higher than the year-ago quarter’s $41.2 million.

Financials

RPC’s total capital expenditure was $32.3 million.

As of March 31, the company had cash and cash equivalents of $326.7 million and maintained a debt-free balance sheet.

RES’ Zacks Rank and Key Picks

RES currently carries a Zacks Rank #3 (Hold).

Investors interested in the energy sector may look at some better-ranked stocks like Archrock Inc. AROC, Kinder Morgan, Inc. KMI and Enterprise Products Partners L.P. EPD. While Archrock presently sports a Zacks Rank #1 (Strong Buy), Kinder Morgan and Enterprise Products carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Archrock is an energy infrastructure company based in the United States with a focus on midstream natural gas compression. AROC provides natural gas contract compression services and generates stable fee-based revenues.

Archrock’s earnings beat estimates in three of the trailing four quarters and met once, delivering an average surprise of 8.81%.

Kinder Morgan is a leading midstream player in North America with a stable and resilient business model, largely driven by take-or-pay contracts, which ensure consistent earnings and facilitate reliable capital returns to shareholders. KMI operates one of the largest natural gas pipeline networks, positioning it to benefit from the projected increase in U.S. natural gas demand by 2030. 

Kinder Morgan’s earnings missed estimates in three of the trailing four quarters and met once, delivering an average negative surprise of 3.33%.

Enterprise generates stable fee-based revenues from its vast network of oil and gas pipelines spanning 50,000 miles, connecting prolific U.S. shale plays. Notably, the acquisition of Pinon Midstream, which aims to provide services in the prolific Permian Basin, is expected to drive the partnership’s cash flows. This move enhances its NGL value chain and addresses regional infrastructure constraints, with strong customer demand expected to boost revenues.

EPD’s earnings beat estimates in two of the trailing four quarters and missed in the other two, delivering an average surprise of 1.83%.

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This article originally published on Zacks Investment Research (zacks.com).

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