ProPetro Holding Corp. announced a second-quarter 2025 adjusted loss of 7 cents per share. This was worse than the expected profit of 3 cents, mainly due to weak pricing and reduced activity. Last year’s loss was 3 cents. Revenues reached $326.2 million, just below the $327 million forecast. The decrease stemmed from lower service revenues in the Cementing segment, down 3% to $32.4 million. This contributed to an overall 8.6% drop from last year’s $357 million. Adjusted EBITDA fell to $49.6 million, a 31.8% decline from $72.7 million in the previous quarter and also below expectations. ProPetro signed a 10-year deal to provide 80 megawatts of PROPWR service, with over half of its hydraulic horsepower tied to long-term contracts. Since starting a $200 million share repurchase program, ProPetro has bought back 13 million shares. This program has been extended until December 2026, but no shares were repurchased this quarter. The Pressure Pumping segment accounted for all total revenues, even though service revenues dropped 8.6% to $326.2 million. Total costs and expenses reached $329.3 million, a 7.9% decrease from the previous year but higher than the anticipated $322.2 million. As of June 30, 2025, ProPetro had $74.8 million in cash and $45 million in borrowings. Capital spending was $73 million, with $37 million already paid. Some spending on PROPWR equipment was financed with a partner. The company generated $54 million in net cash from operations and plans capital expenditures of $270 million to $310 million for 2025. With recent tariff-related oil price drops, ProPetro expects to operate 10 to 11 hydraulic fracturing fleets in the third quarter. Valero Energy, Halliburton, and Equinor also reported quarterly results, showing mixed performances. Valero exceeded expectations with earnings of $2.28 per share, Halliburton met expectations, and Equinor fell short. Other companies in the sector also had varied results. With the earnings miss and lowered outlook, we predict a bearish trend for ProPetro in the upcoming weeks. The company’s forecast to operate fewer hydraulic fracturing fleets hints at lower expected revenue. We should consider preparing for a potential drop in the stock price, possibly through put options for September or October 2025. This downturn is occurring in a tough market. Recent data shows WTI crude prices have decreased from over $85 in May to around $72 in late July 2025, mainly due to new trade tariff announcements raising concerns about an economic slowdown. Looking back at the 2018-2019 period, we saw similar trade disputes causing considerable volatility and downward pressure on oil prices, which may offer insight into current trends. Industry statistics support this decline, showing that the U.S. frac spread count has dropped by 5% in the past month. The most significant reductions are in the Permian Basin, where ProPetro operates heavily. This indicates that service providers will likely face weak pricing power through the third quarter. With the stock’s implied volatility expected to rise following this news, buying puts outright might be costly. A more thoughtful strategy would be to implement bear put spreads, which can reduce entry costs while still allowing for profit from a downward or sideways movement. This method helps manage the impact of high volatility premiums. Even with the short-term concerns, we must recognize the company’s long-term contracts and the new PROPWR agreement. These factors provide revenue stability and could hint at a recovery in 2026. For traders willing to take on risk, the drop in price might be a chance to buy long-dated call options, like those expiring in January 2026, as a bet on future improvement. We’ll keep a close eye on ProPetro’s cash flow and capital spending. While generating $54 million from operations is encouraging, the planned capital expenditures are substantial. A lengthy period of low activity could pressure their balance sheet, making cash and debt levels essential metrics to watch in the next earnings report.

here to set up a live account on VT Markets now