Smart Sand, Inc. — Second Quarter 2026 Earnings Summary

Financial Performance

• Second quarter 2026 revenue was $115.1 million, up from $93.1 million in the first quarter of 2026 and $85.8 million in the second quarter of 2025.
• Net income for the second quarter of 2026 was $10.2 million ($0.26 per basic and diluted share), compared to a net loss of $3.9 million ($0.10 per share) in the first quarter of 2026 and net income of $21.4 million ($0.55 per share) in the second quarter of 2025.
• Tons sold totaled approximately 1,864,000 in the second quarter of 2026, a 25% sequential increase and a 31% year-over-year increase compared to 1,424,000 tons.
• Contribution margin was $27.1 million ($14.54 per ton), compared to $13.2 million ($8.84 per ton) in the first quarter of 2026 and $15.8 million ($11.08 per ton) in the second quarter of 2025.
• Adjusted EBITDA was $18.7 million, up from $3.8 million in the first quarter of 2026 and $7.8 million in the second quarter of 2025.
• Free cash flow was $(1.4) million, compared to $0.8 million in the first quarter of 2026 and $(7.8) million in the second quarter of 2025.
• Net cash provided by operating activities was $3.4 million.
• Capital expenditures were $4.8 million in the second quarter of 2026; year-to-date capital expenditures through June 30, 2026, were approximately $7.0 million.
• Gross profit was $19.8 million, compared to $6.1 million in the first quarter of 2026 and $9.0 million in the second quarter of 2025.
• Operating expenses were $9.8 million, down from $11.0 million in the first quarter of 2026 and up from $9.0 million in the second quarter of 2025.
• Total interest expense was $0.3 million, consistent with the first quarter of 2026 and second quarter of 2025.
• As of June 30, 2026, cash on hand was $10.2 million with $30.0 million in undrawn availability under the FCB ABL Credit Facility.
• Deferred revenue was $1.6 million as of June 30, 2026, down from $9.8 million as of December 31, 2025.
• Total debt consisted of $6.1 million in current portion of long-term debt and $8.6 million in long-term debt as of June 30, 2026.

Guidance and Future Outlook

• The Company expects 2026 sales volumes to increase by 10% to 20% compared with 2025 sales volumes.
• The Company expects to generate positive free cash flow in 2026.
• Full year 2026 capital expenditures are projected to range between $15.0 million and $20.0 million, excluding acquisitions and potential investments in new terminals.
• Management expects activity levels to remain strong through the third quarter and potentially into the fourth quarter.
• Long-term growth is supported by expected increases in North American natural gas demand driven by expanding LNG export capacity and increased gas-fired power generation for AI data centers.

Business Segments and Product Lines

• Industrial Product Solution sales volumes grew sequentially.
• The redesigned SmartSystems fleet continued to perform well in the quarter.
• SmartSystems revenue was $1.2 million in the second quarter of 2026, compared to $0.6 million in the first quarter of 2026 and $1.2 million in the second quarter of 2025.

Market and Competitive Landscape

• Strong demand was observed across key operating basins, particularly the Appalachian Basin in the Northeast United States and Canadian shale basins.
• Higher sales volumes through Smart Sand controlled terminals resulted in more cost-efficient logistics costs per ton sold compared to third-party terminals.

Risks and Challenges

• Forward-looking statements are subject to risks including fluctuations in product demand, delays in expansion projects, regulatory changes, adverse weather, increased fuel prices, higher transportation costs, access to capital, increased competition, and changes in economic or political conditions.

Management Commentary and Tone

• CEO Charles Young described the second quarter as "one of the best quarters in Smart Sand's history," citing record quarterly sales volumes, revenues, contribution margin, and Adjusted EBITDA.
• Management noted that while delivering record performance, the company maintained a strong cash position and low leverage levels.
• Young attributed the performance to employee dedication and the value of the Northern White sand franchise.

Other Key Points

• The Company returned approximately $12.1 million to shareholders year-to-date in 2026 through share repurchases and dividends, including a dividend to be paid on August 12, 2026.
• In the second quarter of 2026, the Company repurchased 470,088 shares for $2.5 million under its share repurchase program.
• A new share repurchase program was approved on February 23, 2026, authorizing up to $20.0 million of repurchases, effective April 3, 2026, and continuing through April 2, 2028.
• A special dividend of $0.10 per share was declared on July 16, 2026, to be paid on August 12, 2026, returning approximately $4.2 million to shareholders.
• A prior special dividend of $0.10 per share was declared on April 9, 2026, and paid on May 5, 2026, distributing approximately $3.9 million.
• The Company announced a leadership transition where James Young will succeed Lee Beckelman as Chief Financial Officer effective January 1, 2027; Lee Beckelman will remain as an advisor.
• Stephen Brill will be promoted to General Counsel effective January 1, 2027.