NCS Multistage Holdings Reports 8.7% Revenue Decline and 60.9% Drop in Net Income for Q1 2026

NCS Multistage Holdings, Inc. reported a decline in financial performance for the first quarter of 2026, with total revenues of $45.6 million, down 8.7% from $50.0 million in the same period last year. The decrease was primarily driven by a significant drop in revenues from Canada, attributed to reduced market activity and delays in planned customer projects. Product sales fell to $32.6 million from $35.1 million, while service revenues decreased to $13.1 million from $14.9 million. The company noted that U.S. revenues increased, bolstered by successful field trials and new product introductions, including contributions from the recently acquired ResMetrics, which added $1.8 million in revenue.

The company's net income for the quarter was $1.7 million, a 60.9% decrease from $4.5 million in the prior year. This decline was accompanied by a net loss attributable to NCS Multistage Holdings of $371,000, compared to a profit of $4.1 million in the same quarter of 2025. The effective tax rate rose to 32.4% from 13.1%, reflecting changes in the company's tax position and the reversal of valuation allowances against deferred tax assets. The overall gross margin also contracted to 38.1% from 42.3%, influenced by a less favorable product mix and lower fixed cost absorption due to decreased revenues.

Operationally, NCS Multistage made strategic moves, including the acquisition of Reservoir Metrics, LLC, which was finalized in July 2025 for $7.1 million. This acquisition is expected to enhance the company's tracer diagnostics capabilities. The company also reported a decrease in employee headcount, with total current liabilities dropping significantly to $21.9 million from $28.5 million, reflecting improved cash management and operational efficiencies. Cash and cash equivalents at the end of the quarter stood at $34.5 million, down from $36.7 million at the end of 2025.

Looking ahead, NCS Multistage anticipates stable drilling and completion activity levels in North America for the remainder of 2026, despite ongoing geopolitical tensions that could impact commodity prices. The company expects to maintain its focus on capital discipline and return-focused spending strategies. However, it also faces challenges from competitive pressures and rising costs due to tariffs and inflation, which may affect its ability to recover costs through price increases. The company plans to invest between $2.2 million and $2.8 million in capital expenditures throughout 2026 to enhance its manufacturing capabilities and support product development initiatives.