USA Compression Posts Record Q3 Revenue as Horsepower Reaches 4.48 Million

USA Compression Partners (NYSE: USAC) reported record third-quarter 2026 revenue and adjusted EBITDA as its revenue-generating fleet expanded and pricing reached a new high. Average revenue-generating horsepower rose 26% year over year to 4.48 million, while revenue per revenue-generating horsepower increased 8% to $23.14.

Revenue climbed 43% from a year earlier to $357.2 million. Adjusted EBITDA, a non-GAAP measure, increased 23% to a record $197.3 million, while net income rose to $47.3 million from $34.5 million in the third quarter of 2025.

The year-over-year comparison includes the impact of the J-W Power acquisition. USA Compression said J-W Power’s operating results following the January 12, 2026 acquisition date are included in its results for the nine months ended September 30.

Fleet Growth and Pricing Support Results

Total fleet utilization was 92% at quarter-end, with utilization for units of at least 1,000 horsepower reaching 96%. The partnership said pricing remained at record levels, supporting an increase in quarterly adjusted gross margin to $222.2 million from $173.3 million a year earlier. GAAP gross margin rose to $133.1 million from $102.1 million.

Distributable cash flow increased to $127.1 million from $103.8 million in the prior-year quarter. Distributable cash flow coverage was 1.67 times, compared with 1.61 times a year earlier, based on $76.1 million of distributions for the quarter. Excluding approximately 18.2 million common units issued for the J-W acquisition, the presentation indicated coverage would have been 1.55 times.

Net cash provided by operating activities totaled $117.7 million, up from $75.9 million in the third quarter of 2025. Maintenance capital expenditures were $18.5 million, compared with $9 million a year earlier.

2026 Guidance and Capital Structure

USA Compression’s presentation showed full-year 2026 guidance of $770 million to $780 million for adjusted EBITDA and $495 million to $505 million for distributable cash flow. Expansion capital expenditures are expected to total $230 million to $250 million, while maintenance capital spending is projected at $60 million to $70 million. The expansion spending range includes about $38 million for vehicles, tools, information technology infrastructure and other business-support investments.

The partnership reported a leverage ratio of 3.78 times for the third quarter, down from 4.0 times in 2025 and approaching its near-term target of 3.75 times. Management said the expected benefits from the J-W acquisition support that target, though it is not formal guidance and remains subject to change.

USA Compression issued senior notes due in 2035 during September and subsequently increased capacity under its asset-based lending facility to more than $1 billion. The partnership said the financing extended its debt maturity profile and increased its flexibility to consider value-accretive transactions.

Demand Outlook and Risks

Management expects U.S. natural gas production to grow by more than 20 billion cubic feet per day by 2030, driven by liquefied natural gas exports and power demand. The presentation identified the Permian, Haynesville and Marcellus basins as key growth areas and estimated that more than 10 million incremental horsepower could be needed as shale development increasingly relies on artificial lift and wellhead compression. The production and horsepower figures are based partly on third-party forecasts and management estimates and have not been independently verified by the partnership.

The outlook remains subject to economic and energy-market uncertainty, including inflation, supply-chain disruptions, tariffs, changes in crude oil and natural gas supply and demand, and geopolitical conflicts. Other identified risks include integrating J-W Power’s assets and realizing the anticipated acquisition benefits, competition for employees, changes in interest rates and access to capital, customer contract renegotiations, and actions by customers, competitors and third-party operators.

Adjusted EBITDA, adjusted gross margin, distributable cash flow and distribution coverage are non-GAAP measures and may not be comparable with similarly named measures reported by other companies.