Good morning, ladies and gentlemen, and welcome to the Q2 2026 Nine Energy Service earnings conference call. At this time, all lines are in listen-only mode, and following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, August 7, 2026. I would now like to turn the conference call over to Mr. Josh Riley, Senior Vice President, Corporate Finance and Investor Relations. Please go ahead. Thank you. Good morning, everyone, and welcome to the Nine Energy Service Earnings conference call to discuss our results for the second quarter of 2026. With me today are Ann Fox, President and Chief Executive Officer, and Heather Schmidt, Chief Financial Officer. We appreciate your participation. Some of our comments today may include forward-looking statements reflecting Nine's views about future events. Forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. These risks and uncertainties can cause actual results to differ materially from our current expectations. We advise listeners to review our earnings release and the risk factors discussed in our filings with the SEC. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. Our comments today also include non-GAAP financial measures. Additional details and the reconciliation of these measures to the most directly comparable GAAP financial measures are also included in our second quarter press release and can be found in the investor relations section of our website. I will now turn the call over to Ann. Thank you, Josh, and good morning, everyone. Thank you for joining us today to discuss our second quarter results for 2026. Revenue for the quarter was $141.8 million, which was within the range of our original guidance. However, adjusted EBITDA was $8.6 million, which was below our original guidance. While industry activity improved modestly during the second quarter, rising from 543 rigs at the end of Q1 to 573 rigs at the end of Q2, our profitability was negatively impacted by significant margin compression within our Coiled Tubing business. During the quarter, two of our large diameter Coiled Tubing units, representing approximately 17% of our large diameter fleet, were taken out of service due to maintenance related issues. This is a unique situation, we have not previously experienced this percentage of our active fleet unexpectedly taken out of service. One of the affected Coiled Tubing units returned to service early in the third quarter, while the second unit remains under repair and is currently expected to return near year-end. As a result, we anticipate our Coiled Tubing operations will remain constrained until that unit is restored to service. Coiled Tubing also experienced meaningful inflationary pressures across several cost categories, including consumables, labor and repairs, and maintenance, which on average increased by approximately 12% quarter-over-quarter. Although we implemented incremental price increases during the quarter, these increases did not fully offset the inflationary cost pressures. In addition, there is typically a delay between when cost increases are incurred and when pricing adjustments can be negotiated and reflected in customer work, which contributed to the margin compression in the quarter. While the EBITDA shortfall is disappointing, we do not believe it reflects the underlying momentum of the broader business. Our Completion Tools business delivered a strong quarter, supported by increased domestic sales and continued growth in international markets, where revenue increased 17% in the first six months of 2026 versus the same period last year. We also continue to make meaningful progress commercializing our new technologies and demand for our dissolvable solutions is increasing as operators extend lateral length. These trends reinforce our confidence in the long-term growth opportunities across our product offerings. Cementing remained a steady contributor. However, this business also experienced inflationary cost pressures during Q2 related to materials and labor, negatively impacting margins. In wireline, we are making steady progress executing our expansion in the Haynesville Basin. I would now like to turn the call over to Heather to walk through detailed financial information. Thank you, Ann. As of June 30, 2026, Nine's cash and cash equivalents were $16.8 million, with $30 million of availability under our credit facility, resulting in a total liquidity position of $46.8 million. At June 30, the company had $97.3 million in outstanding borrowings under our credit facility. During the second quarter, revenue totaled $141.8 million, with adjusted gross profit of $19.9 million. During the second quarter, we completed 1,155 Cementing jobs, an increase of approximately 13% as compared to the first quarter of 2026. The average blended revenue per job decreased by approximately 8%, primarily due to job mix versus pricing. Cementing revenue for the quarter was $55.3 million, an increase of approximately 3% from the first quarter of this year. During the second quarter, we completed 6,414 wireline stages, a decrease of approximately 7% quarter-over-quarter. The average blended revenue per stage was up by approximately 3%. Wireline revenue for the quarter was $23 million, a decrease of approximately 4%. For Completion Tools, we completed 28,256 stages, an increase of approximately 45%. Completion tool revenue was $37.1 million, an increase of approximately 44% from the prior quarter. During the second quarter, our coiled tubing days worked increased by approximately 16%, while the average blended day rate decreased by approximately 15%, driven primarily by job mix and increased white space between jobs. Coiled tubing revenue declined approximately 2% to $26.4 million. During the second quarter, the company reported general and administrative expense of $15.6 million. Depreciation and amortization expense was $7.2 million. The company's tax provision was approximately $0.4 million year to date, primarily attributed to state and non-U.S. jurisdictions. For the second quarter, the company reported net cash used in operating activities of $2.3 million. The average DSO for Q2 was 59 days. CapEx spend during Q2 was $4.8 million, bringing total CapEx spend year to date to $10.4 million. Today, we anticipate full year CapEx will range between $20 million-$30 million. I will now turn it back to Ann. Thank you, Heather. The macro backdrop remains uncertain, particularly given recent geopolitical events and the continued focus by operators on capital discipline. With what we know today, we expect the average U.S. rig count during the third quarter to be relatively flat to slightly up compared to the second quarter, with any incremental activity likely to be measured and dependent on the sustainability of commodity prices. In the near term, we will continue to navigate a dynamic market environment. As mentioned, we are facing inflationary cost pressure across our service lines, and we often see lags between price increases and cost inflation that results in margin compression. One of our large diameter coiled tubing units that was out of service during the second quarter remains under repair and is expected to be inactive for potentially the remainder of the year. With the sustained revenue loss from this unit, combined with cost inflation that continues to outpace pricing adjustments, we expect third quarter revenue and adjusted EBITDA to be flat to modestly down compared to the second quarter. We are currently projecting third quarter revenue in the range of $133 million-$143 million. We remain focused on disciplined execution, cost control, and the continued development of our technology portfolio. Our operations are diversified across service lines, basins, commodities, and domestic and international markets, which remains an important differentiator for Nine. Longer term, the fundamentals supporting U.S. shale, the need for efficient completion services, and the potential growth in natural gas demand remain constructive for Nine. We believe our strengthened financial position, combined with our asset light operating model, provides flexibility to execute through market volatility and continue pursuing profitable growth. We will now open up the call for Q&A. Thank you. Ladies and gentlemen, we'll now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touch-tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment please, for your first question. Your first question comes from John Daniel from Daniel Energy. Please go ahead. Ann, my first question relates to the CT units, that current nickel on the revenue decline would be suggestive that there's no slack in the system. I'm just curious if you could elaborate on that, given the rise in demand and, you know, therefore the implications. You know, often when we write and others write, we talk about oilfield, you know, attrition in the oilfield, and we tend to associate that with just the frac market. It would seem to extend beyond frac, and just if you could also pontificate on that as well. Sure. No, it's a great question, John. Thank you, and good morning. You know, it's interesting you mention that because we lost a significant percentage of our fleet. On an absolute basis, it's two, but if you said to anybody across the space, "Hey, you're gonna take down nearly 20% of your fleet of anything," it's significant. Typically, you'd pull something off the fence, right? Because there would be that slack, there would be that excess. In this case, for most of the OFS period, there's not lots of excess equipment sitting on the fence line that's ready to go and/or, is actually geared for the wells today. You know, if you look at kind of end of 2019, let's just say pre-COVID, you're probably down almost 40% the number of Coiled Tubing units available in the U.S. That's extraordinarily significant. It's also, you know, important to note that the investment in new units is also down considerably. You can't see that as well because, you know, a lot of the public, do not play in the Coiled space. There's not much slack. I think, you know, depending on where the rig count goes, you know, obviously pricing will have to follow that because there's just not availability. Although very challenging to lose these units now, we're definitely excited about the coil space and for what's to come, and we see this absolutely as very temporary. Okay, fair enough. A quick follow-up just on your rolling out the wireline operations in the Haynesville. Can you just update us on how that's going and then what the opportunities are for pull-through of other services? Yes. It's another great question. We love the Haynesville because it's very complicated to complete wells there, right? Extremely high temperatures, very high pressures. We've really decided to reposition assets out of the Permian and face the gas markets as we're seeing and most of the folks on the phone understand that this natural gas demand could be very real and very significant as we see the proliferation of data centers and the use of AI. That was, you know, the rationale behind moving assets there. We're looking forward to, you know, strong incremental plug use there. We've got cement services there. This will be a really nice offering and a great basin for us moving forward. So far going quite well, John. Okay. Thank you. I'll turn it back over. Thank you. Your next question comes from Steve Ferazani from Sidoti. Please go ahead. Great. Thanks, Ann. Thanks, Heather, for the detail on the call. I do want to dig in a little bit on if you can quantify in some way the impact of the lost Coiled Tubing units, timing of when they went down, because your revenue was quite healthy, as you noted. I'm just trying to figure out if those were late in the quarter or if you were running ahead of your guidance prior to those going down. Then did we see costs in that number, that would have pressured margins, or that was just simply you still were absorbing costs when you weren't getting revenue from two units? Thanks for the question, Steve. Yes. To answer the second part of the question first, yes, there were significant costs moving upward throughout the quarter. When we have these inflationary environments in OFS, we typically see a lag in the timeframe for which we can reprice the customers and then actually realize that new pricing. You're obviously finishing the well pad that you're on for them, you're negotiating that price, and then you're waiting for that new work to start. If you look at our guidance moving forward, you'll see the midpoint to Q3 dropped a good significant chunk without giving up too much competitive information. A good significant chunk... Yeah ...of that revenue is from that unit. Keep in mind, we've got a very small fleet. We've got 12 deep-reach units, these units are very specialized to go very deep into the wells. We're using a lot of these units in the Permian, they're huge revenue generators for us. You're also not sheltering your costs by getting rid of the collection of workforce that relates to that unit. That's a really important point to note, and separate that from inflationary pressures due to geopolitical events and kind of the cost of crews. That's important because those guys are extraordinarily skilled at what they do, and they've been trained over years. They've got implicit communication in those crews, and we are absolutely going to hang on to them and drag margin until these units can get back up into service. That makes sense. It is very helpful. You said there is somewhat extraordinary events. Is there any concern among the remaining Coiled Tubing units you could see similar issues? No. We have a very good eye on maintenance and one of these units, just to be specific, to give you an idea, if you drive a pickup truck, you might have a gross weight somewhere a little over 10,000 pounds. Our Coiled Tubing units are getting up over 300,000 pounds of gross weight. If we are going out to location and one sinks in the sand, it is not your average tow truck that is pulling that thing out. When you retrieve it, once it is sunk, you can do very significant damage. That is exactly what happened. It is not like we have got some fleet that is not well-maintained and not ready for action. Because of the size and the weight of these units and the depth that they have to reach to, oftentimes it is pretty challenging to get them to where they need to be if they get stuck. That is what happened in the case of one unit. Then we had a very unusual maintenance failure in one of them that we have not previously seen, that resulted in a reel dropping down onto the pavement and becoming damaged. In the time that we have had Coiled Tubing, which has been since 2017, we have never seen this percentage of the fleet drop, and we have always been able to maneuver. Again, these fleets are highly utilized, critically important to that revenue and margin. It is temporary. It is painful in the meantime, but it is absolutely temporary, and I am absolutely hanging on to that workforce. Absolutely. Okay. That is helpful. Turning to the other side with Completion Tools, it had been trending down in line with activity, probably revenue was down a little bit faster than activity. This quarter, activity was up, revenue outpaced what we would think the activity growth is. Is there something you have turned around in Completion Tools after trending down? I would say there's two pieces to that question. The outpacing of market activity was due to international sales. We had very strong international sales. We're seeing lots of demand for dissolvable plugs in the international space. Our products have been very well received there. That gave rise to that outpacing that you mentioned. We're also doing a darn good job of getting domestic market share. Completion tools is certainly firing on all fronts. We're very excited about that. Excellent. Very helpful. In terms of your general view on pricing across product and service lines, it sounds like you're at least offsetting with a lag. How much activity growth do you think we need to see before you can actually get some pricing power, and how much does it vary by your product and service lines? Big question. I'll let you answer it. If you want, just answer parts of it. Sure. It's another great question. When you look at your more differentiated service lines, obviously easier to ask for price in those service lines. Those are your bigger margin contributors. Kind of at the top of that is your tools and your cement. closely followed by coil and then wireline. I think we certainly have been able to offset, as you said, chunks of the inflationary pressure with price increases. The times of these are pretty significant. The other nuance to this is you've got certain customers that are big volume customers. They have a big impact on your P&L. They're not necessarily the first ones you're going after a price for. Typically those relationships are long dated. They're also very good customers, which is why you have the volume. The other thing that's been happening in this volatile environment is you'll reprice a customer. They'll accept it. Three weeks later you get hit with another inflationary cost. You're not necessarily walking back into that customer's office and repricing again. Lots of bumpiness in that. Think about it just as kind of temporary turbulence in the air. These things do settle out. It's a very dynamic market. I think we would love to be able to predict how this goes going forward. I think there's been fits and starts. Obviously, the commodity price is jumping all around based on peace deals in Iran. We certainly can't predict where that goes. We can say based on our drillers, that we do see incremental rigs coming into the market, which will help. Once you get towards that 600 rig count, you really start to take the slack out of the service sector, and the service sector starts to get a lot more leverage and pricing power. Excellent. Very helpful. If I can get one last one in in terms of your comfort level with the balance sheet as we end the quarter. Obviously you ran into some of the issues which we've talked about on the call. How are you thinking about cash conversion CapEx into the second half, and what are you comfortable with in terms of the balance sheet? Sure, I can take that. I'll start with CapEx. We're always evaluating CapEx with the market, whether it's good or bad. We guided to 20-30, which we reaffirmed today. We originally had talked about that being in the higher end of that range. I think that's probably going to be in the middle to lower end of that range now as we see what we've done thus far in the year. I think you'll see cash flow neutrality through the second half of the year. I think we feel relatively comfortable with the balance sheet. We have a 7% interest rate, we have the ABL. We're watching that very closely, we always are. I think we feel pretty comfortable today, and we're looking at that CapEx on a regular basis. Great. Thanks, Ann. Thanks, Heather. Thank you. Thank you. Your last question comes from Dave Storms from Stonegate. Please go ahead. Morning, appreciate you- Good morning ...taking the questions here. I wanted to circle back to some of the margin compression. You mentioned a whole lot of factors on inflation. I guess broad strokes, where are you seeing the stronger headwinds between the labor and the consumables repairs? Maybe is there any way you're starting to see that ease up? Yeah. We did do some pretty strong wage increases. That was just necessary. I would say that doesn't continue and that doesn't continue to surprise you. Those are typically one-time inflection points for which we already took that. Very necessary, very happy to give those to the workforce. The other, I would say biggest chunk was on our consumables. That's perfect. I appreciate that. You mentioned in your prepared remarks that dissolvable offerings really gain a lot of momentum. Thinking beyond them, what other downhole tech are you really focused on, or is the dissolvable really the prime focus right now? Yeah. I would say again, we've been super pleased with that dissolvable offering. Our barrier valves have been great. We're very excited about that. We're also really looking forward to increased market share through better composite sales. That's perfect. Thank you. Maybe just one more on the macro side. Given the conversations that you're having with people in the industry, you made a comment to this earlier around the jumping around of commodity prices. Is the market still just waiting for commodity prices to settle, or are you seeing people start to get ahead of this new volatility in the market? Just maybe any high level macro commentary that you're seeing. Yeah, well, you're seeing rig count move. That's good. That's healthy. I think we had one of our customers come out today, or this week, I should say, announce to the street increased production and increased CapEx. That was really received with very mixed results. I think our operators are being very careful and cautious about raising their capital plans. It sure is nice to see the privates coming in with increased rig count, which the drillers have said is going to continue. Whether that number is 10 or 15, we shall see, but that matters because those are very impactful for the market. I do think regardless of what happens now with the geopolitical situation, it has definitely put an increased focus on the lack of risk coming out of North American shale. I think it's put another lens on just how incredibly important this region of the world is. We're definitely excited about that and very excited to kind of get all of this turbulence behind us with inflationary pressures and price movement, which I suspect stabilizes by Q4. That is very dependent on something going on with Iran, right? This could all start again if for some reason the conflict starts and we see crude prices move significantly. I do think we've got optimism around the rising rig count environment, that's very exciting. Again, this temporary issue with coil is just that, it's temporary. That's great commentary. Thank you. Thank you. There are no further questions at this time. You may please proceed with your conference. Thank you for your participation in the call today, and I want to thank our employees, our E&P partners, and our investors. Thank you. Ladies and gentlemen, this does conclude your conference call for today. We thank you very much for your participation, and you may now disconnect. Have a great day, everyone.