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EXPRO GROUP HOLDINGS N.V. (XPRO)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 revenue was $411.4M, adjusted EBITDA was $94.0M (22.8% margin), and adjusted EPS was $0.24; adjusted free cash flow reached $46.1M (11% margin), the highest quarterly adjusted FCF in company history .
  • Versus Street: revenue missed ($422.2M* consensus vs $411.4M actual), adjusted EPS slightly beat ($0.239* vs $0.24 actual); S&P’s EBITDA consensus was $87.4M* vs $79.7M* actual (note definition differences vs company’s adjusted EBITDA of $94.0M) .
  • Guidance updated for FY 2025: revenue lowered to $1.60–$1.65B (from $1.7B), adjusted EBITDA raised to $350–$360M (from “>$350M”), capex reduced to $110–$120M ($120M prior), and adjusted FCF raised to $110–$120M (~$110M prior) .
  • Operational catalysts: strong $2.3B backlog, technology wins (QPulse, ELITE Composition, Velonix), and $25M buybacks in Q3 (achieved $40M YTD) .

What Went Well and What Went Wrong

What Went Well

  • Record adjusted FCF: “Adjusted free cash flow was $46 million, or 11% of the quarter’s revenue… highest recorded by the company to date” .
  • Margin expansion: Q3 adjusted EBITDA margin of 22.8% (up ~50 bps q/q and ~270 bps y/y per management’s commentary) with ongoing Drive25 efficiency and mix benefits .
  • Technology and awards: OTC Brasil Spotlight awards (QPulse™, ELITE Composition™), Gulf Energy Awards win for VIGILANCE™ HSE solution; offshore world record for heaviest casing string deployment with Blackhawk® Gen III + SKYHOOK® .
  • Contract momentum and backlog: $2.3B total backlog; NLA strength (Chevron subsea extension; ConocoPhillips Alaska well testing) and MENA wins (ADNOC/Petronas zero-flaring well test/multiphase pump) .

What Went Wrong

  • Revenue softness: Q3 revenue declined sequentially ($411.4M vs $422.7M Q2) and missed consensus, driven by declines in ESSA (-5% q/q) and APAC (-14% q/q) and lower activity/mix in MENA .
  • APAC margin pressure: APAC segment EBITDA margin fell to 21% (down ~500 bps q/q) due to lower activity and less favorable mix, especially in Australia and Malaysia .
  • Guidance trim on top line: Full-year revenue guidance lowered to $1.60–$1.65B (from ~$1.7B) amid a softer macro backdrop and cautious customer spending early in 2026 .

Financial Results

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Revenue ($USD Millions)$422.8 $390.9 $422.7 $411.4
GAAP Diluted EPS ($USD)$0.14 $0.12 $0.16 $0.12
Adjusted EPS ($USD)$0.23 $0.25 $0.30 $0.24
Net Income Margin (%)4% 4% 4% 3%
Adjusted EBITDA ($USD Millions)$85.0 $76.2 $94.5 $94.0
Adjusted EBITDA Margin (%)20% 20% 22% 23%
Gross Margin (%)12% 10% 13% 13%
Contribution Margin (%)39% 40% 41% 41%

Segment breakdown

SegmentQ3 2024 Revenue ($MM)Q2 2025 Revenue ($MM)Q3 2025 Revenue ($MM)Q3 2024 EBITDA ($MM; %)Q2 2025 EBITDA ($MM; %)Q3 2025 EBITDA ($MM; %)
NLA$139.4 $142.6 $150.9 $33.1; 24% $33.9; 24% $36.8; 24%
ESSA$131.5 $132.4 $125.8 $32.2; 24% $39.6; 30% $40.5; 32%
MENA$86.7 $91.0 $86.1 $30.0; 35% $32.6; 36% $29.9; 35%
APAC$65.2 $56.8 $48.6 $16.2; 25% $14.8; 26% $10.0; 21%

Revenue by capabilities

CapabilityQ3 2024 ($MM; %)Q2 2025 ($MM; %)Q3 2025 ($MM; %)
Well Construction$159.3; 38% $141.6; 34% $150.3; 37%
Well Management (WFM/SWA/WII)$263.6; 62% $281.1; 66% $261.0; 63%

KPIs and cash metrics

KPIQ1 2025Q2 2025Q3 2025
Cash from Operations ($MM)$41.5 $48.4 $63.2
Capital Expenditure ($MM)$33.1 $21.2 $24.2
Free Cash Flow ($MM; %)$8.4; 2% $27.2; 6% $39.0; 9%
Adjusted Free Cash Flow ($MM; %)$16.2; 4% $36.2; 9% $46.1; 11%
Backlog ($B)~$2.2 $2.3 $2.3
Liquidity ($MM)$316 $343 $532
Share Repurchases ($MM)$10.0 $5.0 $25.0

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2025~$1.7B $1.60–$1.65B Lowered
Adjusted EBITDAFY 2025“≥$350M” $350–$360M Raised
CapexFY 2025~$120M $110–$120M Reduced
Adjusted Free Cash FlowFY 20257% of revenue ($110M) $110–$120M Raised
Share RepurchasesFY 2025one-third of adj. FCF ($40M) Achieved $40M YTD; $36M authorization remaining Achieved target (maintain framework)

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Previous Mentions (Q2 2025)Current Period (Q3 2025)Trend
AI/Technology initiativesCENTRI-FI™, Generation-X™, QPulse pilot in Saudi RCIS automation; Brute® Armor packer; remote cement ops QPulse™, ELITE Composition™, Velonix™ deployment; safety/efficiency gains Scaling commercialization; margin accretive
Tariffs/MacroTariff/OPEC+ uncertainty; long-cycle resilience Volatile commodities; cautious short-cycle activity Softer backdrop; 2026 H1 cautious, H2 improving Near-term caution; medium-term constructive
Product performanceMENA strength; OWIRS; NLA TRS leadership Record orders ($595M) and backlog; regional execution Record adjusted FCF; margin expansion; backlog supports visibility Mix-driven margin gains
Regional trendsLATAM strong; APAC Australia soft; MENA stable ESSA mix up; MENA solid; APAC mix improved APAC laggard; NLA up q/q; MENA steady; ESSA margin up APAC lagging; Middle East strong
Regulatory/Safety——NOPSEMA ALARP recognition; Gulf Energy HSE award Strengthening safety credentials
Cost programDrive25 launched; $25M run-rate target Drive25 ≥50% capture in 2025; target raised to $30M Drive25 full-year effect in 2026 to expand margins Efficiency benefits maturing

Management Commentary

  • “Adjusted free cash flow was $46 million, or 11% of the quarter’s revenue… highest recorded by the company to date.” – CEO Mike Jardon .
  • “Third quarter Adjusted EBITDA margin of 22.8% represents a continuous improvement in our goal of driving at least 25% margins.” – CEO Mike Jardon .
  • “We now expect our adjusted EBITDA to be between $350 million and $360 million… lowering our CapEx guidance… and increasing our free cash flow guidance to $110 million to $120 million.” – CFO Sergio Maiworm .
  • “Expro’s $2.3 billion backlog provides solid revenue visibility… strong offshore and international positioning.” – CEO Mike Jardon .
  • “Our capital allocation framework targets the return of at least one-third of free cash flow to shareholders annually, primarily through share repurchases.” – CFO Sergio Maiworm .
  • “APAC is likely to be a laggard in 2026… expect H2 pickup in West Africa and Gulf of America.” – CEO Mike Jardon .

Q&A Highlights

  • Margin expansion in 2026 even on flat-to-slightly lower revenue driven by full-year Drive25, internationalizing M&A (Coretrax), and higher-margin technology rollout .
  • Activity cadence: softer H1 2026 (seasonality, NOCs), improving H2; APAC remains soft; strength expected in Golden Triangle (West Africa, Gulf of America) and improving sentiment in Saudi .
  • Buybacks: Achieved $40M target ahead of schedule; management will evaluate further repurchases consistent with framework and free cash flow trajectory .
  • Production Solutions: transition from capital consumer to annuity-like cash generator as projects move to operations/maintenance phase, stacking recurring cash flows .
  • RCIS scalability: hands-free clamp installation improves safety/efficiency; broader uptake in 2026 and ramp into 2027 expected .

Estimates Context

Metric (Q3 2025)ConsensusActualSurprise
Revenue ($USD Millions)$422.2*$411.4 Miss
Primary EPS ($USD)$0.239*$0.24 (Adjusted EPS) Beat
EBITDA ($USD Millions, S&P definition)$87.4*$79.7*Miss
  • Note: Company-reported adjusted EBITDA was $94.0M with a 22.8% margin, differing from S&P’s EBITDA definition .
  • Primary EPS here aligns with adjusted diluted EPS per company reconciliation .
  • Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Mixed print vs Street: revenue missed while adjusted EPS slightly beat; definitional differences on EBITDA versus company’s adjusted EBITDA matter for comparisons .
  • Quality of earnings improved: adjusted EBITDA margin rose to 22.8% and adjusted FCF margin to 11% on disciplined capex and working capital execution .
  • Guidance mix is sensible: lower top line but higher EBITDA/FCF and reduced capex, signaling focus on margin/FCF over growth amid softer macro .
  • Regional/mix watch: APAC softness and MENA moderation offset NLA strength; ESSA margins improved despite lower revenue—monitor mix-driven margin durability .
  • Technology differentiation: QPulse, ELITE Composition, RCIS, and Blackhawk Gen III underpin margin accretion and HSE leadership—drivers of wallet share expansion .
  • Capital returns: buyback framework (~one-third of FCF) intact with $40M already executed YTD and $36M authorization remaining—potential ongoing support .
  • Setup into 2026: H1 cautious, H2 improving; expect continued margin expansion from Drive25, mix, and production solutions maturation—positioning for stronger FCF conversion .

vs Prior Quarter/Year and Why

  • Sequential revenue decline (Q3 vs Q2) reflected lower activity/mix in ESSA, MENA, and APAC; NLA offset with Gulf of America strength .
  • Year-over-year margin gains driven by mix, cost efficiency (Drive25), and technology-led wallet share expansion; adjusted EBITDA margin up to 23% vs 20% y/y .
  • Free cash flow conversion sharply higher on disciplined capital spending and improved working capital, enabling record adjusted FCF .

Additional Relevant Press Releases (Q3 period)

  • Remote Clamp Installation System (RCIS) first full deployments in North Sea—hands-free installation, ~50% time reduction per clamp, and safety improvements .
  • Offshore world record casing string deployment—Blackhawk® Gen III Wireless Cement Head with SKYHOOK®; 2.849M lb hook load on Deepwater Titan, setting new benchmark .

Earnings Schedule

  • Q3 2025 earnings release/call on October 23, 2025; access details and replay posted to investor relations site .