Drilling Tools International Corp. (NASDAQ: DTI) reported fourth‑quarter and full‑year 2025 results on March 5, 2026, delivering consolidated revenue of $159.6 million and adjusted EBITDA of $39.3 million. Adjusted net income of $3.4 million translated to an adjusted diluted EPS of $0.10, while adjusted free cash flow reached $19.2 million. The company’s tool‑rental segment generated $129.6 million in revenue, with product sales contributing $30.1 million. Net debt stood at $42.2 million as of December 31, 2025, and the company paid down more than $11 million of debt in the second half of the year and repurchased approximately $660,000 of common shares, bringing the trailing‑12‑month adjusted EBITDA multiple to 1.1×.
In the fourth quarter, DTI generated $38.5 million in revenue, a 3.4% year‑over‑year decline from $39.8 million in Q4 2024. The quarter’s revenue beat the consensus estimate of $37.63 million by $0.87 million. Segment‑level data show tool‑rental revenue of $30.4 million and product‑sales revenue of $8.1 million. Adjusted diluted EPS of $0.10 surpassed the consensus estimate of –$0.02, a $0.12 beat, while adjusted EBITDA for the quarter was $10.1 million, up from $9.5 million in Q4 2024.
GAAP results for the year reflected a net loss of $3.8 million, compared with a GAAP net income of $3.0 million in 2024. The company’s debt‑paydown of $11 million in the second half of 2025 and share repurchase of $660,000 helped reduce net debt to $42.2 million. The adjusted EBITDA multiple of 1.1× indicates a strong valuation relative to earnings.
For 2026, DTI guided revenue of $155 million to $170 million, adjusted EBITDA of $35 million to $45 million, and adjusted free cash flow of $17 million to $22 million. Management highlighted continued momentum in the Eastern Hemisphere, which now accounts for 14% of total revenue, and emphasized cost discipline and capital allocation as key drivers of the outlook.
CEO Wayne Prejean said, “Our strong fourth quarter results demonstrate our ability to consistently deliver favorable returns in the face of muted industry‑wide activity levels.” He added, “Our use of funds as they flow will be debt service, M&A, some buybacks, but mostly, throughout 2025, we focused on integration and gaining efficiencies from what we acquired.” CFO Johnson noted, “Our 2026 capital expenditure guidance assumes ‘activity will remain relatively flat in 2026… The Eastern Hemisphere segment has continued to perform well, reflecting significant demand for our tools along with consistent execution and Drilling Tools International Corp.’s growing market presence. Western Hemisphere operations were impacted by soft North American drilling and completions activity in 2025 but managed to see only a low single‑digit revenue decline when compared to 2024.”
Investors responded favorably to the results, citing the earnings beat, strong guidance, and continued debt reduction. The company’s focus on free‑cash‑flow generation and the growth of its Eastern Hemisphere operations were highlighted as key positives.
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