USA Compression Partners, LP

Three months ended March 31, 2026, compared to the three months ended March 31, 2025

The following table summarizes our results of operations for the periods presented (dollars in thousands):

*Not meaningful

Contract operations revenue. The $68.5 million increase in contract operations revenue for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to a $60.3 million increase due to the J-W Power Acquisition with the remaining increase attributable to (i) an increase in average revenue per revenue-generating horsepower per month, which resulted from higher market-based rates on newly deployed and redeployed compression units and CPI-based and other market-based price increases on existing customer contracts that occur as market conditions permit and (ii) an increase in average revenue-generating horsepower as a result of increased demand for our services, consistent with an overall increase in natural gas produced within the U.S.

Average revenue per revenue-generating horsepower per month associated with our compression services provided on a month-to-month basis did not differ significantly from the average revenue per revenue-generating horsepower per month associated with our compression services provided under contracts in their primary term during the period.

Parts and service revenue. The $16.8 million increase in parts and service revenue for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was due to the additional revenue generated by the J-W Power Acquisition, including $11.7 million attributable to parts and service revenue earned on maintenance work performed on customer-owned equipment and $8.1 million attributable to manufacturing sales.

Related-party revenue. Related-party revenue was earned through related-party transactions that occur in the ordinary course of business with various affiliated entities of Energy Transfer. Related-party revenue for the three months ended March 31, 2026 was consistent with the three months ended March 31, 2025.

Cost of operations, exclusive of depreciation and amortization. The $36.3 million increase in cost of operations, exclusive of depreciation and amortization, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to (i) a $40.1 million increase attributable to the J-W Power Acquisition, partially offset by (ii) a $1.4 million decrease in fluids expense and (iii) a $2.4 million decrease in part consumption.

Depreciation and amortization expense. The $16.8 million increase in depreciation and amortization expense for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to (i) a $13.5 million increase resulting from the J-W Power Acquisition, and (ii) overhauls and major improvements to compression units.

Selling, general, and administrative expense. The $16.5 million increase in selling, general, and administrative expense for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to (i) a $10.4 million increase related to the J-W Power Acquisition, (ii) a $3.8 million increase in transaction expenses related to the J-W Power Acquisition, and (iii) a $2.1 million increase in outside services and professional fees.

Impairment of assets. The $4 thousand and $3.6 million impairment of assets for the three months ended March 31, 2026 and 2025, respectively, primarily resulted from our evaluation of the future deployment of our idle fleet under current market conditions. The primary circumstances supporting this impairment were: (i) unmarketability of certain compression units into the foreseeable future, (ii) excessive maintenance costs associated with certain fleet assets, and (iii) prohibitive retrofitting costs that likely would prevent certain compression units from securing customer acceptance. These compression units were written down to their estimated salvage values, if any.

As a result of our evaluation during the three months ended March 31, 2026 and 2025, we retired one and 17 compression units, respectively, with approximately 335 and 10,200 of aggregate horsepower, respectively, that were previously used to provide compression services in our business.

Interest expense, net. The $2 million increase in interest expense, net for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to higher aggregate borrowings, offset by lower weighted-average interest rates under the Credit Agreement and our senior notes.

Income tax expense. The $2.6 million increase in income tax expense for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was related to additional taxes attributable to the J-W Power Acquisition. For additional information on income tax expense, see Note 7 to our unaudited condensed consolidated financial statements in Part I, Item 1 “Financial Statements” of this report for additional information.

Other Financial Data

The following table summarizes other financial data for the periods presented (dollars in thousands):

(1)Adjusted gross margin, Adjusted EBITDA, Distributable Cash Flow (“DCF”), and DCF Coverage Ratio are all non-GAAP financial measures. Definitions of each measure, as well as reconciliations of each measure to its most directly comparable financial measure(s) calculated and presented in accordance with GAAP, can be found below under the caption “Non-GAAP Financial Measures”.

(2)Adjusted gross margin percentage and Adjusted EBITDA percentage are calculated as a percentage of revenue.

Gross margin. The $33.0 million increase in gross margin for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was due to (i) an $86.0 million increase in revenues, partially offset by (ii) a $36.3 million increase in cost of operations, exclusive of depreciation and amortization, and (iii) a $16.8 million increase in depreciation and amortization.

Adjusted gross margin. The $49.8 million increase in Adjusted gross margin for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was due to an $86.0 million increase in revenues offset by a $36.3 million increase in cost of operations, exclusive of depreciation and amortization.

Adjusted EBITDA. The $39.1 million increase in Adjusted EBITDA for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to a $49.8 million increase in Adjusted gross margin, offset by a $12.7 million increase in selling, general, and administrative expenses, excluding unit-based compensation expense, transaction expenses, amortization of capitalized SaaS implementation costs, and severance charges and other employee costs.

DCF. The $42.1 million increase in DCF for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily was due to (i) a $39.1 million increase in Adjusted EBITDA, (ii) a $4.4 million decrease in distributions on Preferred Units due to the conversion of the remaining Preferred Units into common units, and (iii) a $1.6 million decrease in maintenance capital expenditures, offset by (iv) a $2.0 million increase in cash interest expense, net.

DCF Coverage Ratio. The increase in DCF Coverage Ratio for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was due to the increase in DCF for the period offset by increased common unitholder distributions primarily due to (i) the conversion of the remaining Preferred Units into common units and (ii) the issuance of 18,175,323 common units pursuant to the J-W Power Acquisition.