10-Q · May 5, 2026
Innovex International, Inc. reported Q1 2026 revenue of $239.0 million, exceeding estimates of $227.0 million and showing a slight decrease of 1% year-over-year. The company turned a loss of $16.7 million, equating to a…
Earnings analysis · 10-Q
INVX earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Innovex delivered a solid Q2 operating result: revenue rose 9.2% year over year to $244.896 million, gross margin expanded to 34.2%, operating margin improved to 13.8%, and diluted EPS reached $0.36. Both NAM and…
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Innovex delivered a solid Q2 operating result: revenue rose 9.2% year over year to $244.896 million, gross margin expanded to 34.2%, operating margin improved to 13.8%, and diluted EPS reached $0.36. Both NAM and International & Offshore markets grew, supported by market-share gains, Latin America, and acquired operations. The outlook is tempered by a $51.607 million year-to-date Impulse Litigation accrual and a 42% decline in six-month free cash flow to $44.400 million, although liquidity remains strong with $222.1 million of cash and no revolver borrowings.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
Reported figures
- Earnings per share
- $0.36
What stood out
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Revenue rose 9.2% and beat consensus
Q2 revenue was $244.896 million, up $20.662 million (9.2%) from $224.234 million a year earlier. This also exceeded the supplied consensus estimate of $240.872 million by $4.024 million.
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Gross and operating margins expanded
Gross margin expanded to 34.2% from 32.0% a year ago, as revenue increased $20.662 million while cost of revenue rose only $8.733 million. Operating margin improved to 13.8% from 10.1% on operating income of $33.782 million versus $22.695 million.
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EPS beat and earnings increased
Diluted EPS was $0.36, versus the supplied consensus estimate of $0.30 and prior-year quarterly EPS of $0.22. Q2 net income increased $9.686 million to $25.031 million year over year.
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Both end markets delivered growth
Both operating markets grew in Q2: NAM revenue was $131.4 million, up $11.5 million, and International and Offshore revenue was $113.5 million, up $9.2 million. Management attributed NAM growth to market-share gains and Citadel, and international growth to Latin America and DIS.
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Strong liquidity and no revolver debt
Liquidity was substantial at June 30, with $222.1 million of cash and restricted cash, $156.5 million of revolver availability, and $25.1 million of total indebtedness including finance leases. There were no borrowings outstanding under the $200.0 million revolver.
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Cash generation remained positive
Six-month operating cash flow was $56.868 million and free cash flow was $44.400 million after $12.468 million of capex. Capex represented 2.6% of six-month revenue, consistent with management's modest-capex model.
What to watch
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Impulse litigation remains a material overhang
The company recorded a $51.607 million six-month provision related to the Impulse Litigation, including $2.804 million in Q2. This contributed to six-month operating income falling $32.595 million to $11.950 million and net income falling $21.742 million to $8.360 million.
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Year-to-date cash flow declined materially
Six-month operating cash flow fell 37% to $56.868 million and free cash flow declined 42% to $44.400 million, versus $90.300 million and $75.947 million, respectively, a year earlier.
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TCO acquisition adds integration exposure
TCO Group was acquired after quarter-end for approximately $95 million, consisting of approximately $65 million cash and 1,060,713 shares valued at approximately $30 million. Management notes that acquisition results, purchase accounting, integration spending, and potential debt can reduce comparability and affect future results.
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Near-term upstream spending outlook is softer
Management cited Rystad Energy's expectation that global upstream spending will decline approximately 1% in 2026, while the company remains exposed to volatile commodity prices, drilling activity, OPEC+ actions, and geopolitical instability.
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No formal risk-factor updates in the 10-Q
Item 1A states there were no material changes in risk factors from the 2025 Annual Report. Accordingly, the filing introduces no newly identified or revised risk factor, despite the $51.607 million litigation provision disclosed elsewhere in the report.
Management's outlook
The 10-Q does not provide quantitative revenue, EPS, or EBITDA guidance. Management cited Rystad Energy's expectation that global upstream energy spending will decline approximately 1% in 2026 before increasing approximately 6% in 2027.
Earlier filings 1
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.