MAMMOTH ENERGY SERVICES, INC.

Previous wording

We are an integrated, growth-oriented company focused on providing products and services to our customers primarily in the aviation, oil and natural gas and utility infrastructure industries. Our suite of services includes rental services, infrastructure services, natural sand proppant services, accommodation services and drilling services. Our rental services segment provides a wide range of equipment used in oilfield, construction and aviation activities. Our infrastructure services segment provides engineering, design and fiber optic services to the utility industry. Our natural sand proppant services segment mines, processes and sells natural sand proppant used for hydraulic fracturing. Our accommodation services provide housing, kitchen and dining, and recreational service facilities for workers located in remote areas away from readily available lodging. Our drilling services provide directional drilling to oilfield operators.

Current wording

We are a growth-oriented company centered on an expanding aviation leasing business. We also provide products and services to customers in the utility infrastructure and oil and natural gas industries. We operate through five reportable segments: rental services, infrastructure services, natural sand proppant services, accommodation services and drilling services. Our rental services segment comprises aviation leasing, aviation equipment sales and heavy equipment rentals for construction and oilfield activities. Our infrastructure services segment provides fiber optic services to utility customers. Our natural sand proppant services segment mines, processes and sells natural sand proppant used for hydraulic fracturing. Our accommodation services segment provides housing, kitchen and dining, and recreational service facilities for workers in remote areas away from readily available lodging. Our drilling services segment provides directional drilling services to oilfield operators. While the Company reports five reportable segments, management broadly evaluates performance across two business categories: Rentals, which includes aviation and equipment rental activities, and Services, which includes infrastructure, sand, accommodation and drilling operations. These broader categories are intended to assist investors in understanding the Company’s business mix and do not represent additional reportable segments. During the first nine months of 2026, management continued executing its strategy of investing in revenue-producing rental assets and increasing deployment across the aviation portfolio. These investments expanded the Company’s available leasing capacity and contributed to growth within the Rentals category. Improved profitability during the quarter was driven primarily by growth in aviation leasing activity, positive Adjusted EBITDA in the Sand segment and increased occupancy in the Accommodations segment, which contributed to higher consolidated Adjusted EBITDA and improved profitability compared with the second quarter of 2026.

Previous wording

To reflect how management evaluates the business after these divestitures, prior period segment information in our results of operations below has been recast to conform with our segment composition as of June 30, 2026. See Note 4. Discontinued Operations of the notes to our unaudited condensed consolidated financial statements for more information.

Current wording

To reflect how management evaluates the business after these divestitures, prior period segment information in our results of operations below has been recast to conform with our segment composition as of September 30, 2026. See Note 19. Segment Information, for additional information regarding the recast segment information and Note 4. Discontinued Operations of the notes to our unaudited condensed consolidated financial statements for more information regarding the divestitures.

Previous wording

Demand for aviation assets remained favorable during the quarter, supporting increased utilization and revenue in our aviation rental business. We continue to evaluate opportunities to expand our aviation fleet as market conditions warrant.

Current wording

Demand for aviation assets remained favorable during the quarter, supporting increased lease activity and revenue in our aviation rental business. We continue to evaluate opportunities to expand our aviation fleet as market conditions warrant.

Previous wording

Revenue increased 110%, to $26.1 million during the second quarter of 2026, driven primarily by aviation, accommodation and drilling activities. Operating income improved to $2.6 million compared to an operating loss of $37.1 million in the prior-year period, reflecting higher utilization and the absence of the impairment charges recorded in 2025. Adjusted EBITDA improved to $2.6 million from a loss of $3.5 million in the prior year period. See “Non-GAAP Financial Measures” for a reconciliation of net income (loss) from continuing operations to Adjusted EBITDA.

Current wording

Revenue increased 95%, to $21.3 million during the third quarter of 2026, driven primarily by aviation, natural sand proppant, and accommodation activities. Operating loss narrowed to $0.4 million compared to $9.4 million in the prior-year period, reflecting higher utilization. Adjusted EBITDA improved to $5.8 million from a loss of $4.8 million in the prior-year period. See “Non-GAAP Financial Measures” for a reconciliation of net income (loss) from continuing operations to Adjusted EBITDA.

Previous wording

We remain focused on increasing equipment utilization, expanding our aviation rental platform, developing our infrastructure services business and maintaining capital discipline. While uncertainty remains regarding commodity prices, tariffs and broader economic conditions, we believe our current liquidity position and operating platform will support continued execution of our business strategy during the remainder of 2026.

Current wording

We remain focused on increasing equipment utilization, expanding our aviation rental platform, developing our infrastructure services business and maintaining capital discipline. While uncertainty remains regarding commodity prices, tariffs and broader economic conditions, management believes recent operating results and placement of recently acquired aviation assets into service support its expectations for continued revenue growth and profitability improvement during the remainder of 2026.

Previous wording

Revenue. Revenue for the three months ended June 30, 2026 increased $13.7 million, or 110%, to $26.1 million compared to $12.4 million for the same period in 2025. The increase in total revenue is primarily attributable to increases in revenue for rental, natural sand proppant, accommodation and drilling services during the three months ended June 30, 2026, which was partially offset by a decrease in revenue for infrastructure services. Revenue by segment was as follows:

Current wording

Revenue. Revenue for the three months ended September 30, 2026 increased $10.4 million, or 95%, to $21.3 million compared to $10.9 million for the same period in 2025. The increase was primarily attributable to increases in revenue for rental, infrastructure, natural sand proppant, and accommodation services during the three months ended September 30, 2026, which was partially offset by a decrease in revenue for drilling services. Revenue by segment was as follows:

Previous wording

Rental Services and Aviation Sales. Rental services and aviation sales revenue increased $7.1 million, or 229%, to $10.2 million for the three months ended June 30, 2026 compared to $3.1 million for the same period in 2025. The increase reflected $5.7 million from aviation fleet expansion, higher aviation utilization and increased aviation sales activity. Aviation utilization improved from 34% during the prior-year period to 71% during the current-year period, while fleet capacity increased through aircraft acquisitions completed during 2025 and 2026. The increase in aviation revenue was partially driven by the sale of an airframe and landing gear for $2.0 million. Revenue also benefited from a 38% increase in the average number of pieces of equipment rented to customers to 407 for the three months ended June 30, 2026 compared to 296 for the same period in 2025.

Current wording

Rental Services and Aviation Sales. Rental services and aviation sales revenue increased $6.8 million, or 243%, to $9.6 million for the three months ended September 30, 2026 compared to $2.8 million for the same period in 2025. The increase was primarily attributable to $5.4 million from growth of the aviation leasing platform. Aviation fleet capacity increased from 15 in the prior-year period to 44 and revenue-producing assets increased from 11 in the prior-year period to 29. The increase also benefited from a 50% increase in the average number of pieces of equipment rented to customers to 430 for the three months ended September 30, 2026 compared to 286 for the same period in 2025.

Previous wording

Natural Sand Proppant Services. Natural sand proppant services revenue increased $2.6 million, or 48%, to $8.0 million for the three months ended June 30, 2026 compared to $5.4 million for the same period in 2025 primarily due to a $2.9 million increase in freight revenue. This was partially offset by a 5% decrease in tons of sand sold to 229,031 tons for the three months ended June 30, 2026 compared to 241,763 tons for the same period in 2025, combined with an immaterial decline in the average price per ton of sand sold to $21.36 per ton during the three months ended June 30, 2026 compared to $21.41 per ton for the same period in 2025. The average price per ton of sand sold decreased primarily due to a shift of grade mix to include more coarse sand.

Current wording

Natural Sand Proppant Services. Natural sand proppant services revenue increased $2.5 million, or 93%, to $5.2 million for the three months ended September 30, 2026 compared to $2.7 million for the same period in 2025. The increase in our natural sand proppant services revenue was primarily due to an 86% increase in tons of sand sold to 227,676 tons for the three months ended September 30, 2026 compared to 122,161 tons for the same period in 2025, combined with a 21% increase in the average price per ton of sand sold to $22.18 per ton during the three months ended September 30, 2026 compared to $18.26 per ton for the same period in 2025. The increase in average price per ton of sand sold was primarily due to a shift of grade mix to include more fine sand.

Previous wording

Accommodation Services. Accommodation services revenue increased $1.4 million, or 78%, to $3.2 million for the three months ended June 30, 2026 compared to $1.8 million for the same period in 2025. The increase reflected higher occupancy levels and improved utilization driven by increased customer activity. On average, 259 rooms were utilized during the three months ended June 30, 2026 as compared to 145 for the same period in 2025 for our accommodation services.

Current wording

Accommodation Services. Accommodation services revenue increased $1.1 million, or 48%, to $3.4 million for the three months ended September 30, 2026 compared to $2.3 million for the same period in 2025. The increase reflected higher occupancy levels and improved utilization driven by increased customer activity. On average, 270 rooms were utilized during the three months ended September 30, 2026 as compared to 185 for the same period in 2025 for our accommodation services.

Previous wording

Drilling Services. Drilling services revenue increased $3.1 million or 443% to $3.8 million for the three months ended June 30, 2026 compared to $0.7 million for the same period in 2025. The increase in our drilling services revenue was primarily attributable to increased utilization, which increased to 43% for the three months ended June 30, 2026 compared to 16% for the same period in 2025. This was coupled with proceeds of $0.3 million from the sale of equipment damaged or lost down-hole and higher average day rates for our drilling services for the three months ended June 30, 2026.

Current wording

Drilling Services. Drilling services revenue decreased $0.2 million or 9% to $2.1 million for the three months ended September 30, 2026 compared to $2.3 million for the same period in 2025. The decrease in revenue was primarily attributable to a 9% decrease in the average day rate and $0.3 million from the sale of equipment damaged or lost down-hole for the three months ended September 30, 2025 with no similar activity for the three months ended September 30, 2026. Utilization remained unchanged at 32% for both periods.

Previous wording

Cost of Revenue (exclusive of depreciation, depletion, amortization and accretion). Cost of revenue, exclusive of depreciation, depletion, amortization and accretion, increased $8.1 million to $19.2 million, or 74% of total revenue, for the three months ended June 30, 2026 compared to $11.1 million, or 90% of total revenue, for the same period in 2025. Cost of revenue by segment was as follows:

Current wording

Cost of Revenue (exclusive of depreciation, depletion, amortization and accretion). Cost of revenue, exclusive of depreciation, depletion, amortization and accretion, increased $0.5 million to $11.4 million, or 54% of total revenue, for the three months ended September 30, 2026 compared to $10.9 million, or 100% of total revenue, for the same period in 2025. Cost of revenue by segment was as follows:

Previous wording

Rental Services and Aviation Sales. Rental services and aviation sales cost of revenue, exclusive of depreciation and amortization, increased $3.1 million, or 194%, to $4.7 million for the three months ended June 30, 2026 compared to $1.6 million for the same period in 2025. The increase was primarily attributable to higher operating activity associated with the aviation fleet expansion, increased utilization and the sale of an airframe and landing gear with a cost basis of $2.0 million. As a percentage of revenue, our rental services cost of revenue, exclusive of depreciation and amortization of $3.5 million and $0.9 million for the three months ended June 30, 2026 and 2025, was 46% and 52%, respectively. Despite the increase in operating costs, segment margins benefited from higher aircraft utilization and improved absorption of fixed operating expenses.

Current wording

Rental Services and Aviation Sales. Rental services and aviation sales cost of revenue, exclusive of depreciation and amortization, increased $1.0 million, or 59%, to $2.7 million for the three months ended September 30, 2026 compared to $1.7 million for the same period in 2025. The increase was primarily attributable to higher operating activity associated with the deployment of newly acquired aircraft and equipment. As a percentage of revenue, our rental services cost of revenue, exclusive of depreciation and amortization of $4.4 million and $1.0 million for the three months ended September 30, 2026 and 2025, was 28% and 61%, respectively. Despite the increase in operating costs, segment margins benefited from greater aviation lease activity and improved absorption of fixed operating expenses.

Previous wording

Drilling Services. Drilling services cost of revenue, exclusive of depreciation, increased $3.0 million, or 250%, to $4.2 million for the six months ended June 30, 2026 compared to $1.2 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation of an immaterial amount and $0.1 million for the six months ended June 30, 2026 and 2025, was 81% and 133% for the six months ended June 30, 2026 and 2025, respectively. The decrease as a percentage of revenue is primarily due to an increase in utilization, resulting in a lower ratio of fixed costs to variable costs.

Current wording

Infrastructure Services. Infrastructure services cost of revenue, exclusive of depreciation, increased $0.1 million, or 6%, to $1.7 million for the three months ended September 30, 2026 compared to $1.6 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation of $0.4 million and $0.1 million for the three months ended September 30, 2026 and 2025, was 155% and 200% for the three months ended September 30, 2026 and 2025, respectively. The decrease as a percentage of revenue is primarily due to a decrease in contract labor coupled with an increase in activity, resulting in a lower ratio of fixed costs to variable costs.

Previous wording

Natural Sand Proppant Services. Natural sand proppant services cost of revenue, exclusive of depreciation, depletion and accretion, increased $2.4 million, or 45%, to $7.7 million for the three months ended June 30, 2026 compared to $5.3 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation, depletion and accretion of $0.7 million and $1.4 million for the three months ended June 30, 2026 and 2025, was 96% and 98% for the three months ended June 30, 2026 and 2025, respectively. The decrease in cost as a percentage of revenue is primarily due to an increase in freight revenue, which was offset by a 5% decrease in tons sold and a nominal decline in average sales price per ton.

Current wording

Natural Sand Proppant Services. Natural sand proppant services cost of revenue, exclusive of depreciation, depletion and accretion, decreased $1.1 million, or 27%, to $3.0 million for the three months ended September 30, 2026 compared to $4.1 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation, depletion and accretion of $1.4 million and $1.3 million for the three months ended September 30, 2026 and 2025, was 58% and 152% for the three months ended September 30, 2026 and 2025, respectively. The decrease in cost as a percentage of revenue is primarily due to an 86% increase in tons sold and a 21% increase in average sales price per ton.

Previous wording

Accommodation Services. Accommodation services cost of revenue, exclusive of depreciation and accretion, increased $0.9 million, or 75%, to $2.1 million for the three months ended June 30, 2026 compared to $1.2 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation and accretion of $0.3 million and $0.3 million for the three months ended June 30, 2026 and 2025, was 66% and 67% for the three months ended June 30, 2026 and 2025, respectively. Operating costs increased as utilization improved; however, segment margins benefited from greater absorption of fixed operating costs resulting from higher occupancy.

Current wording

Accommodation Services. Accommodation services cost of revenue, exclusive of depreciation and accretion, increased $0.6 million, or 43%, to $2.0 million for the three months ended September 30, 2026 compared to $1.4 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation and accretion of $0.3 million and $0.3 million for the three months ended September 30, 2026 and 2025, was 59% and 61% for the three months ended September 30, 2026 and 2025, respectively. The decrease in cost as a percentage of revenue is primarily due to a 46% increase in room utilization coupled with a modest increase in the average room rate.

Previous wording

Infrastructure Services. Infrastructure services cost of revenue, exclusive of depreciation, increased $0.1 million, or 7%, to $1.5 million for the three months ended June 30, 2026 compared to $1.4 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation of $0.1 million for the three months ended June 30, 2026 and 2025, was 167% and 100% for the three months ended June 30, 2026 and 2025, respectively. The increase as a percentage of revenue is primarily due to an increase in compensation and benefits and fuel expense coupled with a decrease in utilization, resulting in a higher ratio of fixed costs to variable costs.

Current wording

Drilling Services. Drilling services cost of revenue, exclusive of depreciation, increased $0.1 million, or 6%, to $1.9 million for the three months ended September 30, 2026 compared to $1.8 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation of $0.1 million and an immaterial amount for the three months ended September 30, 2026 and 2025, was 90% and 78% for the three months ended September 30, 2026 and 2025, respectively. The increase as a percentage of revenue is primarily due to a 9% decrease in the average day rate, coupled with flat utilization period over period.

Previous wording

Other Services. Other services cost of revenue, exclusive of depreciation, decreased $0.9 million to $0.5 million for the six months ended June 30, 2026 compared to $1.4 million for the same period in 2025. The decrease is primarily due to lower compensation and benefits expense and reduced insurance costs associated with non-operating legacy services.

Current wording

Other Services. Other services cost of revenue, exclusive of depreciation, remained flat at $0.2 million for the three months ended September 30, 2026 and 2025. The marginal decrease is primarily due to lower lease and rent expense and reduced insurance costs associated with non-operating legacy services.

Previous wording

Selling, General and Administrative. Selling, general and administrative expense decreased $0.8 million, or 16%, to $4.2 million for the three months ended June 30, 2026 compared to $5.0 million for the same period in 2025. The decrease was primarily attributable to lower corporate overhead and professional service costs. SG&A expense represented 16% of revenue during the three months ended June 30, 2026 compared to 40% during the prior-year period, reflecting improved operating leverage on higher revenue levels.

Current wording

Selling, General and Administrative. Selling, general and administrative expense decreased $0.6 million, or 13%, to $4.1 million for the three months ended September 30, 2026 compared to $4.7 million for the same period in 2025. The decrease was primarily attributable to lower corporate overhead and professional service costs. SG&A expense represented 19% of revenue during the three months ended September 30, 2026 compared to 43% during the prior-year period, reflecting improved operating leverage on higher revenue levels.

Previous wording

Depreciation, Depletion, Amortization and Accretion. Depreciation, depletion, amortization and accretion totaled $4.6 million for the three months ended June 30, 2026 compared to $2.8 million for the same period in 2025. The increase is primarily attributable to increased depreciation of property, plant and equipment resulting from aviation assets being placed into service.

Current wording

Depreciation, Depletion, Amortization and Accretion. Depreciation, depletion, amortization and accretion totaled $6.6 million for the three months ended September 30, 2026 compared to $2.8 million for the same period in 2025. The increase is primarily attributable to increased depreciation of property, plant and equipment resulting from aviation assets being placed into service.

Previous wording

Gain on Marketable Securities, Net. Net gain on marketable securities was $6.0 million for the six months ended June 30, 2026 compared to the prior‑year period in which no marketable securities were held.

Current wording

Gain on Marketable Securities, Net. Net gain on marketable securities was $1.2 million for the three months ended September 30, 2026 compared to $0.1 million for the prior‑year period.

Previous wording

Other Expense, Net. Other expense, net was $0.1 million for the three months ended June 30, 2026 compared to $0.6 million for the same period in 2025.

Current wording

Other Expense, Net. Other expense, net was $0.5 million for the three months ended September 30, 2026 compared to $1.9 million for the same period in 2025.

Previous wording

Provision (Benefit) for Income Taxes. We recorded income tax expense of $3.3 million on pre-tax income of $6.8 million for the six months ended June 30, 2026 compared to an income tax benefit of $0.1 million on pre-tax loss of $38.9 million for the same period in 2025. Our effective tax rates were 48.7% and 0.2% for the six months ended June 30, 2026 and 2025, respectively. The increase in the effective tax rate was primarily attributable to changes in valuation allowances, interest and penalties, withholding taxes and other foreign tax items, as well as the change from a pre-tax loss for the six months ended June 30, 2025 to pre-tax income for the six months ended June 30, 2026.

Current wording

Our effective tax rates were 31.6% and (20.4)% for the three months ended September 30, 2026 and 2025, respectively. The increase in the effective tax rate was primarily attributable to changes in valuation allowances, interest and penalties, withholding taxes and other foreign tax items, as well as the change from a pre-tax loss for the three months ended September 30, 2025 to pre-tax income for the three months ended September 30, 2026.

Previous wording

Discontinued Operations. We recorded net income from discontinued operations, net of income taxes totaling $0.4 million during the three months ended June 30, 2026 compared to $45.4 million for the same period in 2025. See Note 4 of the notes to our unaudited condensed consolidated financial statements for a breakout of the results of operations for our discontinued operations.

Current wording

Discontinued Operations. We recorded net loss from discontinued operations, net of income taxes totaling $0.2 million during the three months ended September 30, 2026 compared to net income from discontinued operations, net of income taxes of an immaterial amount for the same period in 2025. See Note 4 of the notes to our unaudited condensed consolidated financial statements for a breakout of the results of operations for our discontinued operations.

Previous wording

Revenue. Revenue for the six months ended June 30, 2026 increased $24.1 million, or 100%, to $48.1 million from $24.0 million for the same period in 2025. The increase in total revenue is primarily attributable to increases in rental, accommodation and drilling services, partially offset by decreases in infrastructure services and natural sand proppant services revenue. Revenue by segment was as follows:

Current wording

Revenue. Revenue for the nine months ended September 30, 2026 increased $34.6 million, or 99%, to $69.4 million from $34.8 million for the same period in 2025. The increase in total revenue is primarily attributable to increases in rental, natural sand proppant, accommodation and drilling services, partially offset by a decrease in infrastructure services revenue. Revenue by segment was as follows:

Previous wording

Rental Services and Aviation Sales. Rental services and aviation sales revenue increased $18.2 million, or 364%, to $23.2 million for the six months ended June 30, 2026 compared to $5.0 million for the same period in 2025. Revenue growth was driven by aviation fleet expansion, increased aircraft utilization and higher aviation sales activity. Aviation rental revenue increased $15.8 million and equipment rental revenue increased $2.4 million. The increase in aviation revenue was partially driven by the sale of an auxiliary power unit and an airframe and landing gear for $8.5 million. The increase in our equipment rental revenue was driven by a 51% increase in the average number of pieces of equipment rented to customers to 398 for the six months ended June 30, 2026 compared to 264 for the same period in 2025.

Current wording

Rental Services and Aviation Sales. Rental services and aviation sales revenue increased $25.0 million, or 321%, to $32.8 million for the nine months ended September 30, 2026 compared to $7.8 million for the same period in 2025. Revenue growth was driven by expansion of the Company’s aviation asset base and higher aviation sales activity. Aviation rental revenue increased $21.1 million and equipment rental revenue increased $3.9 million. The increase in aviation revenue was partially driven by the sale of an auxiliary power unit and an airframe and landing gear for $8.5 million. The increase in our equipment rental revenue was driven by a 51% increase in the average number of pieces of equipment rented to customers to 409 for the nine months ended September 30, 2026 compared to 271 for the same period in 2025.

Previous wording

Infrastructure Services. Infrastructure services revenue decreased $0.5 million, or 36%, to $0.9 million for the three months ended June 30, 2026 compared to $1.4 million for the same period in 2025. The decrease in revenue was primarily due to a decrease in fiber optic revenue related to a loss of a customer and decreased activity. Infrastructure results also reflected transition-related costs and underutilization associated with customer changes and the integration of recent acquisitions. Management expects utilization and operating performance to improve as these acquisitions are further integrated and customer activity expands.

Current wording

Infrastructure Services. Infrastructure services revenue decreased $0.6 million, or 21%, to $2.3 million for the nine months ended September 30, 2026 compared to $2.9 million for the same period in 2025. The decrease in revenue primarily reflected the loss of a customer and lower fiber optic activity. Infrastructure results also reflected transition-related costs and underutilization associated with customer changes and the integration of recent acquisitions. Management expects utilization and operating performance to improve as these acquisitions are further integrated and customer activity expands.

Previous wording

Natural Sand Proppant Services. Natural sand proppant services revenue decreased $0.3 million, or 2%, to $11.8 million for the six months ended June 30, 2026 compared to $12.1 million for the same period in 2025. The decrease in our natural sand proppant services revenue was primarily due to a 11% decrease in tons of sand sold to approximately 384,628 tons for the six months ended June 30, 2026 compared to approximately 430,783 tons for the same period in 2025, coupled with a 4% decrease in the average sales price per ton of sand sold to $20.60 per ton during the six months ended June 30, 2026 compared to $21.44 per ton for the same period in 2025. The average price per ton of sand sold decreased primarily due to a shift of grade mix to include more coarse sand.

Current wording

Natural Sand Proppant Services. Natural sand proppant services revenue increased $2.2 million, or 15%, to $17.0 million for the nine months ended September 30, 2026 compared to $14.8 million for the same period in 2025. The increase in our natural sand proppant services revenue was primarily due to an 11% increase in tons of sand sold to approximately 612,303 tons for the nine months ended September 30, 2026 compared to approximately 552,944 tons for the same period in 2025, combined with a 2% increase in the average sales price per ton of sand sold to $21.19 per ton during the nine months ended September 30, 2026 compared to $20.74 per ton for the same period in 2025. The increase in average price per ton primarily reflected a shift in product mix toward finer grades of sand.

Previous wording

Accommodation Services. Accommodation services revenue increased $2.9 million, or 76%, to $6.7 million for the six months ended June 30, 2026, compared to $3.8 million for the same period in 2025. Revenue growth reflected increased occupancy. On average, 267 rooms were utilized during the six months ended June 30, 2026 compared to 162 for the same period in 2025 for our accommodation services.

Current wording

Accommodation Services. Accommodation services revenue increased $4.0 million, or 66%, to $10.1 million for the nine months ended September 30, 2026, compared to $6.1 million for the same period in 2025. Revenue growth reflected increased occupancy. On average, 272 rooms were utilized during the nine months ended September 30, 2026 compared to 170 for the same period in 2025 for our accommodation services.

Previous wording

Drilling Services. Drilling services revenue increased $4.3 million, or 478%, to $5.2 million for the six months ended June 30, 2026, compared to $0.9 million for the same period in 2025. The increase in our drilling services revenue was primarily attributable to increased utilization, which increased to 32% for the six months ended June 30, 2026 compared to 15% for the same period in 2025. This was coupled with proceeds of $0.3 million from the sale of equipment damaged or lost down-hole and higher average day rates for our drilling services for the six months ended June 30, 2026.

Current wording

Drilling Services. Drilling services revenue increased $4.1 million, or 128%, to $7.3 million for the nine months ended September 30, 2026, compared to $3.2 million for the same period in 2025. The increase in our drilling services revenue was primarily attributable to higher utilization levels, which increased to 32% for the nine months ended September 30, 2026 compared to 17% for the same period in 2025. This was coupled with proceeds of $0.3 million from the sale of equipment damaged or lost down-hole and higher average day rates for our drilling services for the nine months ended September 30, 2026.

Previous wording

Cost of Revenue (exclusive of depreciation, depletion, amortization and accretion). Cost of revenue, exclusive of depreciation, depletion, amortization and accretion, increased $14.5 million to $35.7 million, or 74% of total revenue, for the six months ended June 30, 2026, compared to $21.2 million, or 88% of total revenue, for the same period in 2025. Cost of revenue by segment was as follows:

Current wording

Cost of Revenue (exclusive of depreciation, depletion, amortization and accretion). Cost of revenue, exclusive of depreciation, depletion, amortization and accretion, increased $15.0 million to $47.1 million, or 68% of total revenue, for the nine months ended September 30, 2026, compared to $32.1 million, or 92% of total revenue, for the same period in 2025. Cost of revenue by segment was as follows:

Previous wording

Rental Services and Aviation Sales. Rental services and aviation sales cost of revenue, exclusive of depreciation and amortization, increased $9.8 million, or 327%, to $12.8 million for the six months ended June 30, 2026 compared to $3.0 million for the same period in 2025. The increase reflected higher operating activity associated with aviation fleet expansion and increased utilization as well as the sale of an auxiliary power unit and an airframe and landing gear with an aggregate cost basis of $7.8 million. As a percentage of revenue, our rental services cost of revenue, exclusive of depreciation and amortization of $6.1 million and $1.1 million for the six months ended June 30, 2026 and 2025, respectively, was 55% and 60% for the six months ended June 30, 2026 and 2025, respectively. The decrease as a percentage of revenue is primarily due to an increase in utilization, combined with the investment in aviation assets, which produces a higher gross margin percentage.

Current wording

Rental Services and Aviation Sales. Rental services and aviation sales cost of revenue, exclusive of depreciation and amortization, increased $10.7 million, or 228%, to $15.4 million for the nine months ended September 30, 2026 compared to $4.7 million for the same period in 2025. The increase reflected higher operating activity associated with aircraft and equipment acquisitions and a higher percentage of assets on contract as well as the sale of an auxiliary power unit and an airframe and landing gear with an aggregate cost basis of $7.8 million. As a percentage of revenue, our rental services cost of revenue, exclusive of depreciation and amortization of $10.5 million and $2.1 million for the nine months ended September 30, 2026 and 2025, respectively, was 47% and 60% for the nine months ended September 30, 2026 and 2025, respectively. The decrease as a percentage of revenue is primarily due to an increase in utilization and a greater contribution from higher-margin aviation leasing activity.

Previous wording

Infrastructure Services. Infrastructure services cost of revenue, exclusive of depreciation, decreased $0.1 million, or 5%, to $2.1 million for the six months ended June 30, 2026 compared to $2.2 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation and amortization of $0.2 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively was 175% and 105% for the six months ended June 30, 2026 and 2025, respectively. The increase as a percentage of revenue is primarily due to an increase in compensation and benefits and fuel expense coupled with a decrease in utilization, resulting in a higher ratio of fixed costs to variable costs.

Current wording

Infrastructure Services. Infrastructure services cost of revenue, exclusive of depreciation, remained flat at $3.8 million for the nine months ended September 30, 2026 and 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation and amortization of $0.6 million and $0.2 million for the nine months ended September 30, 2026 and 2025, respectively was 165% and 131% for the nine months ended September 30, 2026 and 2025, respectively. The increase as a percentage of revenue is primarily due to an increase in compensation and benefits and fuel expense coupled with a decrease in utilization.

Previous wording

Natural Sand Proppant Services. Natural sand proppant services cost of revenue, exclusive of depreciation, depletion and accretion, increased $1.5 million, or 14%, to $12.2 million for the six months ended June 30, 2026 compared to $10.7 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation, depletion and accretion of $1.1 million and $2.3 million for the six months ended June 30, 2026 and 2025, respectively, was 103% and 88% for the six months ended June 30, 2026 and 2025, respectively. The increase in cost as a percentage of revenue is primarily due to an 11% decrease in tons sold and a 4% decrease in average sales price per ton.

Current wording

Natural Sand Proppant Services. Natural sand proppant services cost of revenue, exclusive of depreciation, depletion and accretion, increased $0.2 million, or 1%, to $15.1 million for the nine months ended September 30, 2026 compared to $14.9 million for the same period in 2025. As a percentage of revenue, cost of revenue, exclusive of depreciation, depletion and accretion of $2.5 million and $3.6 million for the nine months ended September 30, 2026 and 2025, respectively, was 89% and 100% for the nine months ended September 30, 2026 and 2025, respectively. The decrease in cost as a percentage of revenue is primarily due to an 11% increase in tons sold and a 2% increase in average sales price per ton.

Previous wording

Other Services. Other services cost of revenue, exclusive of depreciation, decreased $0.6 million to $0.3 million for the three months ended June 30, 2026 compared to $0.9 million for the same period in 2025. The decrease is primarily due to lower compensation and benefits expense and reduced insurance costs associated with non-operating legacy services.

Current wording

Other Services. Other services cost of revenue, exclusive of depreciation, decreased $0.9 million to $0.7 million for the nine months ended September 30, 2026 compared to $1.6 million for the same period in 2025. The decrease is primarily due to lower compensation and benefits expense and reduced insurance costs associated with non-operating legacy services.

Previous wording

Selling, General and Administrative. Selling, general and administrative expense decreased $1.3 million, or 14%, to $7.8 million for the six months ended June 30, 2026 compared to $9.1 million for the same period in 2025. The decrease was primarily attributable to reduced corporate and professional costs. SG&A expense represented 16% of revenue during the six months ended June 30, 2026 compared to 38% during the prior-year period, reflecting the Company’s ability to leverage its fixed overhead structure as revenue increased.

Current wording

Selling, General and Administrative. Selling, general and administrative expense decreased $1.8 million, or 13%, to $12.0 million for the nine months ended September 30, 2026 compared to $13.8 million for the same period in 2025. The decrease was primarily attributable to a decrease in compensation and benefits coupled with reduced corporate and professional costs. SG&A expense represented 17% of revenue during the nine months ended September 30, 2026 compared to 40% during the prior-year period, reflecting the Company’s ability to leverage its fixed overhead structure as revenue increased.

Previous wording

Depreciation, Depletion, Amortization and Accretion. Depreciation, depletion, amortization and accretion increased $3.2 million to $8.1 million for the six months ended June 30, 2026 from $4.9 million for the same period in 2025. The increase is primarily attributable to increased depreciation of property, plant and equipment resulting from aviation assets being placed into service during the six months ended June 30, 2026.

Current wording

Depreciation, Depletion, Amortization and Accretion. Depreciation, depletion, amortization and accretion increased $7.0 million to $14.7 million for the nine months ended September 30, 2026 from $7.7 million for the same period in 2025. The increase is primarily attributable to increased depreciation of property, plant and equipment resulting from aviation assets being placed into service during the nine months ended September 30, 2026.

Previous wording

Gains on Disposal of Assets, Net. Net gains on the disposal of assets, net were $4.6 million compared to $1.1 million for the three months ended June 30, 2026 and 2025, respectively. Gains on the disposal of assets is primarily related to the sale of drilling rigs for the three months ended June 30, 2026 and trucks and field equipment for the same period in 2025.

Current wording

Gains on Disposal of Assets, Net. Net gains on asset disposals were $5.6 million for the nine months ended September 30, 2026 compared with $2.7 million for the corresponding 2025 period. Net gains on asset disposals primarily related to the sale of drilling rigs and a building for the nine months ended September 30, 2026 and trucks and field equipment for the same period in 2025.

Previous wording

Impairment of Long-Lived Assets. During the three months ended June 30, 2025, the Company’s management made the decision to market assets related to its natural sand proppant operations at its Piranha Proppant LLC and Muskie Proppant LLC processing plants. As a result, the Company recognized impairment expense on these assets totaling $31.7 million during the three months ended June 30, 2025. There was no similar activity during the three months ended June 30, 2026.

Current wording

Impairment of Long-Lived Assets. During the nine months ended September 30, 2025, the Company’s management made the decision to market assets related to its natural sand proppant operations at its Piranha Proppant LLC and Muskie Proppant LLC processing plants. As a result, the Company recognized impairment expense on these assets totaling $31.7 million during the nine months ended September 30, 2025. There was no similar activity during the nine months ended September 30, 2026.

Previous wording

Operating Income (Loss). We reported operating income of $1.8 million for the six months ended June 30, 2026 compared to an operating loss of $38.3 million for the same period in 2025. The increase in operating income was primarily due to $31.7 million in impairment expense recognized during the six months ended June 30, 2025 with no similar activity during the six months ended June 30, 2026.

Current wording

Operating Income (Loss). We reported operating income of $1.3 million for the nine months ended September 30, 2026 compared to an operating loss of $47.7 million for the same period in 2025. The increase in operating income was primarily due to $31.7 million in impairment expense recognized during the nine months ended September 30, 2025 with no similar activity during the nine months ended September 30, 2026.

Previous wording

Interest (Expense) Income, Net. Interest expense, net of interest income was $0.3 million for the six months ended June 30, 2026 compared to interest income, net of interest expense of $0.4 million for the same period in 2025. The increase in interest expense is primarily due to a one time charge of $1.2 million of unamortized debt issuance costs during the six months ended June 30, 2026 in relation to the new credit agreement.

Current wording

Interest (Expense) Income, Net. Interest expense, net of interest income was $0.1 million for the nine months ended September 30, 2026 compared to interest income, net of interest expense of $1.1 million for the same period in 2025. The increase in interest expense is primarily due to a one-time charge of $1.2 million of unamortized debt issuance costs during the nine months ended September 30, 2026 in relation to the new credit agreement.