RPC Q3 2026 Earnings: Pintail Impairment Drives GAAP Loss

RPC, Inc. (NYSE: RES) reported Q3 2026 revenue of $467.7 million, up 4.6% from $447.1 million a year earlier, while GAAP diluted EPS swung to a loss of $0.20 from earnings of $0.06. A $74.5 million non-cash impairment tied to Pintail drove the GAAP loss, but adjusted net income rose 35.5% to $22.8 million and adjusted EBITDA increased 5.5% to $71.5 million.

Core Financial Results

Revenue increased 1% sequentially as higher activity in coiled tubing, nitrogen, snubbing, and rental tools outweighed lower Pintail wireline revenue. Adjusted profitability also improved, with adjusted EBITDA margin rising to 15.3% from 14.3% in Q2 2026 and 15.2% a year earlier.

The GAAP results moved in the opposite direction because RPC recorded the Pintail impairment and $7.3 million of acquisition-related employment costs. Dollar figures below are in millions except EPS and margins.

Adjusted net income margin increased to 4.9% from 3.8% a year earlier, showing that the underlying earnings improvement was stronger than the modest revenue growth.

Business and Segment Performance

Technical Services generated most of RPC’s revenue growth. Segment revenue increased 5.2% year over year and 1.4% sequentially, while operating income rose 18.1% year over year and 4.7% sequentially. Coiled tubing, nitrogen, and snubbing each recorded double-digit sequential revenue growth, partially offset by weaker Pintail wireline revenue.

Support Services improved from Q2, with revenue rising 3% and operating income increasing 56% sequentially. Management attributed that improvement to higher Patterson Rental Tools activity and the fixed-cost structure of the service line, although both revenue and operating income remained below the prior-year quarter.

Technical Services operating income excludes the $74.5 million impairment, which RPC recorded separately but attributed entirely to that segment.

Pintail Impairment Obscured Better Adjusted Profitability

RPC determined that Pintail’s carrying value was not fully recoverable because of persistent pricing weakness, lower activity, and cost pressure. The resulting $74.5 million non-cash charge included $58.3 million for intangible assets and $16.2 million for property, plant, and equipment.

After including the impairment, RPC reported a $53.8 million operating loss and a $41.9 million net loss. Excluding the impairment and acquisition-related employment costs, adjusted operating income was $28.0 million, up approximately 11% year over year, while adjusted net income reached $22.8 million.

The charge did not directly consume cash, but it reflects weaker economics in the acquired wireline operation. RPC also identified continued Pintail pricing weakness, lower activity, cost pressure, and the possibility of further impairments as ongoing risks.

Profitability, Cash Flow, and Balance Sheet

Cash flow figures in the release cover the nine months ended September 30 rather than Q3 alone. Nine-month operating cash flow decreased 17.0% to $115.7 million, while free cash flow fell to $5.0 million from $21.7 million after $110.7 million of capital expenditures.

Working capital used $68.0 million of cash, compared with $43.7 million a year earlier. Accounts receivable rose to $387.1 million from $327.7 million at the end of 2025 because of increased customer activity and collection timing, while inventories increased to $140.5 million from $119.0 million partly because of strategic purchases of components in short supply.

Cash and cash equivalents declined $32.9 million year to date to $177.1 million. RPC repaid $20.0 million of note principal during Q2, leaving $30.0 million of notes payable at quarter-end, and had no borrowings under its $100 million revolving credit facility.

RPC paid $26.6 million in dividends and used $3.5 million for share purchases related to restricted-stock tax withholding during the first nine months. The board also declared a regular quarterly dividend of $0.04 per share, payable December 10, 2026, to shareholders of record on November 10.

Risks Investors Need to Watch

• Continued Pintail weakness: Persistent pricing pressure, lower wireline activity, and rising costs could weigh on Technical Services and may lead to additional impairment charges.
• Competitive and inflationary pressure: Management described the oilfield services market as highly competitive and identified labor, trucking, and fuel as continuing sources of cost inflation.
• Weak cash conversion: Higher receivables, strategic inventory purchases, and substantial capital spending reduced nine-month free cash flow to $5.0 million despite positive operating cash flow.
• Dependence on customer activity and commodity prices: RPC benefited from improved drilling and completion activity, but customer demand remains sensitive to oil and natural gas prices. The average oil price declined 10.8% sequentially in Q3, even though it remained 30.7% above the prior-year level.

Summary

RPC’s Q3 2026 results combined moderate revenue growth and improving adjusted profitability with a sizable GAAP loss caused by the Pintail impairment. Technical Services led year-over-year growth, and Support Services improved sequentially, but Pintail’s operating challenges and weak nine-month free cash flow remain important areas to monitor. Future results will depend on wireline pricing and activity, cost control, and the company’s ability to convert higher customer activity into cash flow.