Achieved record performance in 2025 by leveraging a multiyear transformation focused on large horsepower and electric motor drive compression, which align with high-growth midstream applications.

Maintained fleet utilization at or above 95% for 11 consecutive quarters, driven by steady increases in natural gas production and the high reliability of standardized operations.

Successfully high-graded the fleet through the sale of 325,000 horsepower of older or non-strategic assets, redeploying $192 million in proceeds into higher-return new build investments.

Observed a significant increase in asset 'stickiness,' with the average time a compressor remains on location rising to 73 months, a 61% increase since 2021.

Attributed margin expansion to disciplined pricing strategies and the deployment of digital tools, including machine learning and remote monitoring, to optimize maintenance and reduce unplanned downtime.

Benefited from a strategic weighting toward the Permian Basin, where associated gas volumes continue to grow despite relatively flat oil production, creating sustained compression demand.

2026 adjusted EBITDA guidance of $865 million to $915 million assumes continued horsepower growth and the full-year impact of 2025 rate increases, though new price hikes are expected to be more modest.

Growth CapEx is targeted at $250 million to $275 million, primarily supporting 170,000 horsepower of new deliveries that are already 85% contracted for 2026.

Management anticipates a long-term demand runway driven by 14 Bcf/d of additional LNG export capacity expected to come online through 2030 and emerging AI-driven power generation needs.

The company expects to operate with a leverage ratio below 3.0x in the near term, providing flexibility for further organic growth or accretive M&A opportunities.

Supply chain lead times for large horsepower equipment have extended to 110-120 weeks, prompting the company to already begin booking units for 2027 delivery.

Fourth quarter 2025 results included a $23 million one-time benefit from prior period sales and use tax audit settlements and credits.

Asset sales in 2025 generated $47 million in net gains but will result in an estimated $18 million reduction in 2026 adjusted EBITDA due to the removal of those units from the fleet.

Successfully pre-funded the redemption of 2028 notes through an $800 million bond issuance at 6%, effectively extending the nearest bond maturity to 2032.

Maintenance CapEx is forecasted to increase to $125 million to $135 million in 2026 due to a planned increase in overhaul activity across the fleet.

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Management has not yet seen significant price hikes from Caterpillar but noted that the extended 120-week lead times increase the value of their existing installed base.

Any future inflationary costs from packagers or engine manufacturers will be priced into forward contracts to maintain target returns.

While peers have entered the power market, Archrock remains focused on compression M&A where they see more available asset packages that fit their long-term infrastructure criteria.

The company is open to power market opportunities if they offer comparable long-term infrastructure stability and returns.

EMD demand remains steady but has moderated to 20-30% of the order book as power availability becomes a gating item for customers.

Management views EMD as a highly profitable segment but acknowledges it is 'lumpy' based on localized grid infrastructure.

Archrock is using AI to filter telemetry noise and identify actionable maintenance items, as well as deploying AI tools to help field mechanics access technical information faster.

These initiatives are aimed at driving continuous improvement in uptime rather than a one-time margin step-change.

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