DNOW Inc. Reports 2.2% Revenue Increase but Significant Decline in Net Income for Fiscal Year 2024

DNOW Inc. reported a modest increase in revenue for the fiscal year ended December 31, 2024, generating $2.373 billion, a rise of $52 million or 2.2% compared to the previous year. However, net income attributable to the company saw a significant decline, dropping by $166 million to $81 million, or $0.74 per diluted share. The operating profit also decreased to $113 million from $140 million in 2023. The increase in revenue was primarily driven by acquisitions, while the decline in profitability was attributed to rising expenses related to these acquisitions and restructuring efforts in the International segment.

The company's performance varied across its three reportable segments. In the United States, revenue increased by $131 million to $1.88 billion, reflecting a 7.5% growth, despite a decrease in rig counts. Conversely, the Canadian segment experienced a 10.3% decline in revenue to $253 million, impacted by lower project activity and unfavorable foreign exchange rates. The International segment saw a more pronounced drop, with revenue falling by 17.2% to $240 million, primarily due to weaker project activity and restructuring costs.

Strategically, DNOW has focused on expanding its market presence through acquisitions, completing significant purchases in 2024, including Whitco Supply, LLC and Trojan Rentals, LLC, which together accounted for approximately 12.5% of the company's consolidated revenues. The company operates approximately 165 locations globally and employs around 2,575 individuals, with a strong emphasis on leveraging technology through its DigitalNOW® platform to enhance customer service and operational efficiency.

Operationally, DNOW's customer base remains concentrated in the oil and gas sector, with a notable reliance on drilling and production activities. The company reported a decrease in the U.S. rig count from 621 to 589 over the year, reflecting broader market conditions. Despite these challenges, DNOW anticipates continued demand for its products and services, particularly in the evolving energy transition markets, which include greenhouse gas reduction and renewable energy initiatives. The company aims to capitalize on these trends while managing its operations in response to fluctuating commodity prices and market dynamics.

Looking ahead, DNOW's outlook remains closely tied to oil and gas prices, drilling activity, and overall market conditions. The company plans to continue supporting its customers while optimizing operations and expanding its product offerings to meet the changing demands of the energy sector. The strategic focus on energy transition investments presents opportunities for growth, as DNOW seeks to align its services with the evolving needs of its customer base in both traditional and new energy markets.