DNOW Reports Fourth Quarter and Full-Year 2025 Results
MWN-AI** Summary
DNOW Inc. (NYSE: DNOW) has reported its fourth quarter and full-year results for 2025, highlighting significant developments following its merger with MRC Global Inc. finalized on November 6, 2025. The merger is expected to yield annual cost synergies of $23 million in the first year, exceeding initial targets by 35%, contributing to DNOW's commitment of $70 million in synergies over three years.
For the full year 2025, DNOW achieved revenues of $2.82 billion, with a gross profit margin of 17% (totaling $478 million) and adjusted gross profit at $651 million, reflecting 23.1% of revenues. However, the company recorded a net loss of $89 million, translating to $(0.76) per diluted share, primarily attributable to transaction costs related to the acquisition. Adjusted net income stood at $104 million or $0.86 per diluted share, with adjusted EBITDA at $209 million, making up 7.4% of total revenue.
In Q4 2025, DNOW reported revenues of $959 million, with a gross profit of $68 million (7.1% of revenue) and adjusted gross profit of $217 million (22.6%). The net loss for the quarter was $147 million, or $(0.95) per diluted share, with adjusted net income of $23 million, or $0.15 per diluted share. Cash flow from operating activities reached $83 million in the fourth quarter, with $155 million for the year. The company also repurchased $37 million of common stock over the year.
CEO David Cherechinsky emphasized the strong financial performance for 2025, marking sustained revenue growth and a successful merger integration, proposing a focus on addressing challenges associated with the transition of the U.S. MRC Global ERP system as they look toward 2026.
MWN-AI** Analysis
DNOW Inc. (NYSE: DNOW) has reported its fourth quarter and full-year results for 2025, revealing a complex financial landscape following its merger with MRC Global. While the company recorded total revenues of $2.82 billion for the year—a 19% increase from 2024—it also faced challenges, notably a net loss of $89 million, primarily attributed to transaction-related charges. Adjusted figures, however, show an adjusted net income of $104 million, representing the company’s operational strength beyond merger costs.
The merger, completed in November 2025, is projected to yield $23 million in annual synergies, exceeding initial targets by 35%. This suggests strong integration efforts, which can drive cost efficiencies and bolster DNOW's competitive positioning in the energy and industrial sectors. Operating cash flow remained robust at $155 million, indicative of the company’s ongoing ability to generate liquidity.
Investors should note that despite a reported net loss of $147 million in Q4, adjusted EBITDA improved to $61 million (6.4% of revenue), demonstrating operational resilience. However, the challenges surrounding the ERP transition pose near-term risks that might affect performance. Analysts should closely monitor DNOW's execution on integration initiatives and ERP stabilization as these will be critical to future profitability.
Given the current valuation and potential growth from the merger, investors may find DNOW shares attractive, especially considering the long-term outlook touted by management. Consequently, it is advisable to adopt a cautious but optimistic stance—buying into shares during this transitional period could capitalize on future gains as operational efficiencies are achieved and market conditions improve. However, it's essential to remain attentive to developments regarding the ERP transition and the broader economic environment affecting the energy sector.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
Earnings Conference Call
February 20, 2026
8:00 a.m. CT
1 (888) 660-6431 (within North America)
1 (929) 203-2118 (outside of North America)
Access Code: 7372055
Webcast: ir.dnow.com
DNOW Inc. (NYSE: DNOW) announced results for the fourth quarter and year ended December 31, 2025.
Completed Merger with MRC Global Inc.
- On November 6, 2025, DNOW completed its acquisition of MRC Global in an all-stock transaction
- Annual merger cost synergies are ahead of plan, with first-year savings now projected at $23 million, or 35% above target, while maintaining our $70 million three-year synergy commitment
Full-Year 2025 Highlights
- Revenue was $2,820 million
- Gross profit was $478 million, or 17.0% of revenue, and adjusted gross profit was $651 million, or 23.1% of revenue
- Net loss attributable to DNOW Inc. was $89 million, or $(0.76) per diluted share, primarily due to transaction charges, and adjusted net income attributable to DNOW Inc. was $104 million, or $0.86 per diluted share
- Adjusted EBITDA was $209 million, or 7.4% of revenue
- Cash provided by operating activities was $155 million
- Repurchased $37 million of common stock
- Cash and cash equivalents was $164 million and long-term debt was $411 million at December 31, 2025 with total liquidity of approximately $588 million
Fourth Quarter 2025 Highlights
- Revenue was $959 million
- Gross profit was $68 million, or 7.1% of revenue, and adjusted gross profit was $217 million, or 22.6% of revenue
- Net loss attributable to DNOW Inc. was $147 million, or $(0.95) per diluted share, primarily due to transaction charges, and adjusted net income attributable to DNOW Inc. was $23 million, or $0.15 per diluted share
- Adjusted EBITDA was $61 million, or 6.4% of revenue
- Cash provided by operating activities was $83 million
- Repurchased $10 million of common stock
David Cherechinsky, President and CEO of DNOW, added, “DNOW delivered strong financial results in 2025 generating $2.8 billion in revenue, with Adjusted EBITDA totaling 7.4% of revenues. Excluding the contribution from MRC Global in the fourth quarter, 2025 marked DNOW’s fifth consecutive year of revenue growth and its highest Adjusted EBITDA year ever.
The merger with MRC Global expands DNOW's growth opportunities and strategically positions the Company for long-term success. I am encouraged by the strong start to our integration efforts and the early progress of our synergy realization initiatives, which we expect will create meaningful value for our combined business over time.
As we move into 2026, we have taken targeted actions to address persistent challenges related to the U.S. MRC Global ERP system transition, which went live in the third quarter of 2025. While these complexities have created near-term obstacles, we are actively addressing them and remain focused on positioning the business for long-term growth.
I am humbled to represent the talented women and men of DNOW who work hard every day to serve our customers and compete in the market. Their dedication gives me confidence in our future as we lay the groundwork for 2026 and beyond.”
Prior to the earnings conference call a presentation titled “DNOW Fourth Quarter and Full-Year 2025 Earnings Presentation” will be available on the Company’s Investor Relations website.
About DNOW
DNOW is a premier energy and industrial solutions provider with a legacy of over 160 years as a leading distributor of pipe, valves, fittings (PVF), gas products, pumps and fabricated equipment. Headquartered in Houston, Texas, with approximately 5,300 employees and a global network of distribution and engineering locations; we provide a broad mix of quality products our customers require to build and maintain essential infrastructure across the upstream, midstream, gas utilities, downstream, energy transition and industrial markets. We deliver a comprehensive range of value-added supply chain solutions and technical product expertise, supported by advanced digital offerings. Our products and resources enable our customers to run their operations more efficiently and effectively, helping them to meet and exceed their business goals.
Statements made in this press release that are forward-looking in nature are intended to be "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 and may involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to documents filed by DNOW Inc. with the U.S. Securities and Exchange Commission, which identify significant risk factors which could cause actual results to differ from those contained in the forward-looking statements.
DNOW INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In millions, except share and per share data) | ||||||||
December 31, | ||||||||
2025 | 2024 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 164 | $ | 256 | ||||
Receivables, net | 874 | 388 | ||||||
Inventories, net | 1,192 | 352 | ||||||
Prepaid and other current assets | 48 | 32 | ||||||
Total current assets | 2,278 | 1,028 | ||||||
Property, plant and equipment, net | 264 | 157 | ||||||
Operating right-of-use assets | 160 | 40 | ||||||
Deferred income taxes | 11 | 93 | ||||||
Goodwill | 617 | 230 | ||||||
Intangibles, net | 565 | 65 | ||||||
Other assets | 29 | 8 | ||||||
Total assets | $ | 3,924 | $ | 1,621 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 653 | $ | 300 | ||||
Accrued liabilities | 300 | 130 | ||||||
Other current liabilities | 21 | 12 | ||||||
Total current liabilities | 974 | 442 | ||||||
Long-term debt | 411 | — | ||||||
Long-term operating lease liabilities | 129 | 29 | ||||||
Deferred income taxes | 99 | — | ||||||
Other long-term liabilities | 73 | 22 | ||||||
Total liabilities | 1,686 | 493 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity: | ||||||||
Common stock - par value $0.01; 330 million shares authorized; | 2 | 1 | ||||||
Additional paid-in capital | 3,193 | 2,023 | ||||||
Accumulated deficit | (836 | ) | (747 | ) | ||||
Accumulated other comprehensive loss | (126 | ) | (153 | ) | ||||
DNOW Inc. stockholders' equity | 2,233 | 1,124 | ||||||
Noncontrolling interest | 5 | 4 | ||||||
Total stockholders' equity | 2,238 | 1,128 | ||||||
Total liabilities and stockholders' equity | $ | 3,924 | $ | 1,621 |
DNOW INC. CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (In millions, except per share data) | |||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||
December 31, | September 30, | December 31, | |||||||||||||||||
2025 | 2024 | 2025 | 2025 | 2024 | |||||||||||||||
Revenue | $ | 959 | $ | 571 | $ | 634 | $ | 2,820 | $ | 2,373 | |||||||||
Cost of products | 891 | 438 | 491 | 2,342 | 1,842 | ||||||||||||||
Gross profit | 68 | 133 | 143 | 478 | 531 | ||||||||||||||
Selling, general and administrative expenses | 226 | 103 | 112 | 559 | 416 | ||||||||||||||
Impairment and other charges | 12 | 1 | — | 12 | 6 | ||||||||||||||
Operating (loss) profit | (170 | ) | 29 | 31 | (93 | ) | 109 | ||||||||||||
Other (expense) income | (6 | ) | 1 | (1 | ) | (7 | ) | 1 | |||||||||||
(Loss) income before income taxes | (176 | ) | 30 | 30 | (100 | ) | 110 | ||||||||||||
Income tax (benefit) provision | (29 | ) | 7 | 7 | (12 | ) | 31 | ||||||||||||
Net (loss) income | (147 | ) | 23 | 23 | (88 | ) | 79 | ||||||||||||
Net income attributable to noncontrolling interest | — | — | — | 1 | 1 | ||||||||||||||
Net (loss) income attributable to DNOW Inc. | $ | (147 | ) | $ | 23 | $ | 23 | $ | (89 | ) | $ | 78 | |||||||
(Loss) earnings per share attributable to DNOW Inc. stockholders: | |||||||||||||||||||
Basic | $ | (0.95 | ) | $ | 0.22 | $ | 0.21 | $ | (0.76 | ) | $ | 0.72 | |||||||
Diluted | $ | (0.95 | ) | $ | 0.21 | $ | 0.21 | $ | (0.76 | ) | $ | 0.71 | |||||||
Weighted-average common shares outstanding, basic | 155 | 106 | 105 | 118 | 106 | ||||||||||||||
Weighted-average common shares outstanding, diluted | 155 | 107 | 106 | 118 | 107 |
DNOW INC. SUPPLEMENTAL INFORMATION
(In millions) | |||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||
December 31, | September 30, | December 31, | |||||||||||||||||
2025 | 2024 | 2025 | 2025 | 2024 | |||||||||||||||
Revenue: | |||||||||||||||||||
United States | $ | 765 | $ | 451 | $ | 527 | $ | 2,294 | $ | 1,880 | |||||||||
Canada | 51 | 66 | 53 | 214 | 253 | ||||||||||||||
International | 143 | 54 | 54 | 312 | 240 | ||||||||||||||
Total revenue | $ | 959 | $ | 571 | $ | 634 | $ | 2,820 | $ | 2,373 |
U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) TO NON-GAAP RECONCILIATIONS
In an effort to provide investors with additional information regarding our results as determined by GAAP, we disclose various non-GAAP financial measures in our quarterly earnings press releases and other public disclosures. The non-GAAP financial measures include: (i) adjusted gross profit, (ii) adjusted gross profit as a percentage of revenue, (iii) adjusted earnings before interest, taxes, depreciation and amortization and excluding other costs (Adjusted EBITDA), (iv) Adjusted EBITDA as a percentage of revenue, (v) adjusted net (loss) income attributable to DNOW Inc., (vi) adjusted diluted earnings per share attributable to DNOW Inc. stockholders, (vii) net debt and (viii) net debt leverage ratio. We use these non-GAAP financial measures to evaluate and manage the Company’s operations because we believe they provide useful supplemental information regarding the financial performance of our business. These non-GAAP financial measures are not intended to replace the GAAP financial measures. The Company defines Adjusted Gross profit as revenue, less cost of products, plus amortization of intangibles, plus inventory-related charges incremental to normal operations, plus transaction costs associated with acquisitions, such as inventory fair value step-up or write-downs and plus or minus the impact of our LIFO inventory costing methodology. We define Adjusted EBITDA as net (loss) income plus interest, taxes, depreciation and amortization and excluding other costs, such as stock-based compensation, restructuring and exit costs, transaction related charges, long-lived asset impairments (including goodwill and intangible assets), inventory-related charges incremental to normal operations and plus or minus the impact of our LIFO inventory costing methodology. Transaction-related charges include transaction costs, inventory fair value step-up, retention bonus accruals and integration expenses associated with acquisitions. We define Net Debt as total long-term debt, including current portion, minus cash. We define our net debt leverage ratio as Net Debt divided by trailing twelve months Adjusted EBITDA. The Company believes Net Debt is an indicator of the extent to which the Company’s outstanding debt obligations could be satisfied by cash on hand and a useful metric for investors to evaluate the Company’s leverage position. We believe the net debt leverage ratio is a commonly used metric that management and investors use to assess the borrowing capacity of the Company. A reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure is included in the schedules herein. Totals in the schedules herein may not foot due to rounding.
GROSS PROFIT TO ADJUSTED GROSS PROFIT RECONCILIATION (UNAUDITED) (In millions) | |||||||||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||||||||
December 31, | September 30, | December 31, | |||||||||||||||||||||||||
2025 | As a % of revenue | 2024 | As a % of revenue | 2025 | As a % of revenue | 2025 | As a % of revenue | 2024 | As a % of revenue | ||||||||||||||||||
Gross profit, as reported | $ | 68 | 7.1 | % | $ | 133 | 23.3 | % | $ | 143 | 22.6 | % | $ | 478 | 17.0 | % | $ | 531 | 22.4 | % | |||||||
Amortization of intangibles | 5 | 2 | 2 | 11 | 7 | ||||||||||||||||||||||
Increase in LIFO reserve | 9 | — | 2 | 27 | 4 | ||||||||||||||||||||||
Inventory-related transaction charges | 135 | 1 | — | 135 | 7 | ||||||||||||||||||||||
Adjusted Gross Profit | $ | 217 | 22.6 | % | $ | 136 | 23.8 | % | $ | 147 | 23.2 | % | $ | 651 | 23.1 | % | $ | 549 | 23.1 | % |
NET (LOSS) INCOME ATTRIBUTABLE TO DNOW INC. TO ADJUSTED EBITDA RECONCILIATION (UNAUDITED) (In millions) | |||||||||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||||||||
December 31, | September 30, | December 31, | |||||||||||||||||||||||||
2025 | As a % of revenue | 2024 (1) | As a % of revenue | 2025 (1) | As a % of revenue | 2025 | As a % of revenue | 2024 (1) | As a % of revenue | ||||||||||||||||||
Net (loss) income attributable to DNOW Inc. | $ | (147 | ) | (15.3 | )% | $ | 23 | 4.0 | % | $ | 23 | 3.6 | % | $ | (89 | ) | (3.2 | )% | $ | 78 | 3.3 | % | |||||
Net income attributable to noncontrolling interest | — | — | — | 1 | 1 | ||||||||||||||||||||||
Interest expense (income), net | 4 | (2 | ) | — | 2 | (6 | ) | ||||||||||||||||||||
Income tax (benefit) provision | (29 | ) | 7 | 7 | (12 | ) | 31 | ||||||||||||||||||||
Depreciation and amortization | 20 | 10 | 11 | 52 | 34 | ||||||||||||||||||||||
Increase in LIFO reserve | 9 | — | 2 | 27 | 4 | ||||||||||||||||||||||
Stock-based compensation (2) | 4 | 4 | 4 | 15 | 13 | ||||||||||||||||||||||
Transaction-related charges (3) | 51 | 2 | 4 | 62 | 6 | ||||||||||||||||||||||
Impairment and other charges (4) | 12 | 1 | — | 12 | 6 | ||||||||||||||||||||||
Inventory-related transaction charges (5) | 135 | 1 | — | 135 | 7 | ||||||||||||||||||||||
Restructuring and exit costs (3) | — | — | — | 2 | 2 | ||||||||||||||||||||||
Other (6) | 2 | (1 | ) | — | 2 | — | |||||||||||||||||||||
Adjusted EBITDA | $ | 61 | 6.4 | % | $ | 45 | 7.9 | % | $ | 51 | 8.0 | % | $ | 209 | 7.4 | % | $ | 176 | 7.4 | % |
(1) | The year ended December 31, 2024 includes a change in accounting principle adjustment decreasing the previously reported net income attributable to DNOW Inc. by $3 million. The three months ended September 30, 2025 includes a change in accounting principle adjustment decreasing the previously reported net income attributable to DNOW Inc. by $2 million. |
(2) | For the three months and year ended December 31, 2025, stock-based compensation excludes $13 million and $14 million, respectively, as such amounts were reported in transaction-related charges. For the three months ended September 30, 2025, stock-based compensation excludes less than $1 million, as such amounts were reported in transaction-related charges. |
(3) | Transaction-related charges and restructuring and exit costs are included in selling, general and administrative expenses. |
(4) | For the three months and year ended December 31, 2025, impairment and other charges included $12 million of foreign currency translation losses as a result of substantially completing the liquidation of certain foreign subsidiaries in the International segment. For the three months and year ended December 31, 2024, impairment and other charges included $1 million and $6 million, respectively, of International restructuring charges for foreign currency translation losses. |
(5) | Inventory-related transaction charges are included in cost of products. For the three months and year ended December 31, 2025, inventory-related transaction charges included $135 million of charges related to inventory step-up. For the year ended December 31, 2024, inventory-related transaction charges included $5 million of transaction-related charges, coupled with $2 million of inventory write-downs. |
(6) | For the three months and year ended December 31, 2025, other costs included $2 million related to foreign currency losses. |
NET (LOSS) INCOME ATTRIBUTABLE TO DNOW INC. STOCKHOLDERS TO ADJUSTED NET INCOME ATTRIBUTABLE TO DNOW INC. STOCKHOLDERS RECONCILIATION (UNAUDITED) (In millions) | |||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||
December 31, | September 30, | December 31, | |||||||||||||||||
2025 | 2024 (1) | 2025 (1) | 2025 | 2024 (1) | |||||||||||||||
Net (loss) income attributable to DNOW Inc. | $ | (147 | ) | $ | 23 | $ | 23 | $ | (89 | ) | $ | 78 | |||||||
Increase in LIFO reserve | 9 | — | 2 | 27 | 4 | ||||||||||||||
Transaction-related charges | 51 | 2 | 4 | 62 | 6 | ||||||||||||||
Impairment and other charges | 12 | 1 | — | 12 | 6 | ||||||||||||||
Inventory-related transaction charges | 135 | 1 | — | 135 | 7 | ||||||||||||||
Restructuring and exit costs | — | — | — | 2 | 2 | ||||||||||||||
Tax benefit (2) | (37 | ) | — | (1 | ) | (45 | ) | (3 | ) | ||||||||||
Adjusted net income attributable to DNOW Inc. | $ | 23 | $ | 27 | $ | 28 | $ | 104 | $ | 100 |
(1) | The year ended December 31, 2024 and the three months ended September 30, 2025 include a change in accounting principle adjustment decreasing the previously reported net income attributable to DNOW Inc. by $3 million and $2 million, respectively. |
(2) | The tax effect of non-GAAP reconciling items is calculated based on the nature of the item and/or the tax jurisdiction in which the reconciling item has been incurred and applying the specific tax rate or tax treatment to each item. |
DILUTED (LOSS) EARNINGS PER SHARE ATTRIBUTABLE TO DNOW INC. STOCKHOLDERS TO ADJUSTED DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO DNOW INC. STOCKHOLDERS RECONCILIATION (UNAUDITED)
Three Months Ended | Year Ended | ||||||||||||||||||
December 31, | September 30, | December 31, | |||||||||||||||||
2025 | 2024 | 2025 (1) | 2025 | 2024 (1) | |||||||||||||||
Diluted (loss) earnings per share attributable to DNOW Inc. stockholders | $ | (0.95 | ) | $ | 0.21 | $ | 0.21 | $ | (0.76 | ) | $ | 0.71 | |||||||
Increase in LIFO reserve | 0.06 | — | 0.02 | 0.22 | 0.04 | ||||||||||||||
Transaction-related charges | 0.33 | 0.02 | 0.04 | 0.53 | 0.06 | ||||||||||||||
Impairment and other charges | 0.08 | 0.01 | — | 0.10 | 0.05 | ||||||||||||||
Inventory-related transaction charges | 0.87 | 0.01 | — | 1.14 | 0.06 | ||||||||||||||
Restructuring and exit costs | — | — | 0.01 | 0.01 | 0.02 | ||||||||||||||
Tax benefit (2) | (0.24 | ) | — | (0.02 | ) | (0.38 | ) | (0.03 | ) | ||||||||||
Adjusted diluted earnings per share attributable to DNOW Inc. stockholders | $ | 0.15 | $ | 0.25 | $ | 0.26 | $ | 0.86 | $ | 0.91 |
(1) | The year ended December 31, 2024 and the three months ended September 30, 2025 include a change in accounting principle adjustment decreasing the previously reported diluted earnings per share attributable to DNOW Inc. stockholders by $0.03 and $0.02, respectively. |
(2) | The tax effect of non-GAAP reconciling items is calculated based on the nature of the item and/or the tax jurisdiction in which the reconciling item has been incurred and applying the specific tax rate or tax treatment to each item. |
LONG-TERM DEBT TO NET DEBT AND NET DEBT LEVERAGE RATIO CALCULATION (UNAUDITED) (In millions) | ||||
December 31, | ||||
2025 | ||||
Long-term debt | $ | 411 | ||
Plus: current portion of debt obligations | — | |||
Total debt | 411 | |||
Less: cash | 164 | |||
Net Debt | $ | 247 | ||
Net Debt | $ | 247 | ||
Adjusted EBITDA | 209 | |||
Net Debt Leverage Ratio | 1.2x |
View source version on businesswire.com: https://www.businesswire.com/news/home/20260220721495/en/
Mark Johnson
Senior Vice President and Chief Financial Officer
(281) 823-4754
FAQ**
How does DNOW Inc. DNOW plan to further leverage the $23 million in annual merger cost synergies from the integration with MRC Global to improve its financial performance in 2026 and beyond?
Considering DNOW Inc. DNOW reported a net loss of $89 million in 2025, what specific measures will the company implement to enhance profitability and overall financial health moving forward?
With revenue growth continuing for DNOW Inc. DNOW, how does management foresee navigating the complexities introduced by the new ERP system to optimize operations and meet long-term growth targets?
Given DNOW Inc. DNOW's substantial increase in inventories and receivables in 2025, what strategies will the company adopt to manage cash flow efficiently and mitigate risks associated with working capital?
**MWN-AI FAQ is based on asking OpenAI questions about DNOW Inc. (NYSE: DNOW).
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