Good day and thank you for standing by. Welcome to the Cactus Q2 2025 earnings call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answe r session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Alan Boyd, Director of Corporate Development and Investor Relations. Please go ahead. Thank you and good morning. We appreciate you joining us on today's call. Our speakers will be Scott Bender, our Chairman and Chief Executive Officer, and Jay Nutt, our Chief Financial Officer. Also joining us today are Joel Bender, President, Steven Bender, Chief Operating Officer, Steve Tadlock, CEO of Flexsteel, and Will Marsh, our General Counsel. Please note that any comments we make on today's call regarding projections or expectations for future events are forward-looking statements covered by the Private Securities Litigation Reform Act. 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. Any forward- looking statements we make today are only as of today's date and we undertake no obligation to publicly update or review any forward- looking statements. In addition, during today's call we will reference certain non-GAAP financial measures. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in our earnings release. With that, I'll turn the call over to Scott. Thanks Alan and good morning to everyone. We generated substantial F ree cash flow during the second quarter despite the exigencies caused by tariffs and commodity market weakness. We also announced a transformative acquisition of a controlling interest in Baker Hughes' Surface pressure control business. Our Spoolable Technologies business outperformed profit expectations in the quarter and our Pressure Control product sales remained strong relative to declining activity levels. I'd like to thank our Cactus associates for another quarter in which we remain focused on safety and execution for our customers despite the challenging business climate. Some second-quarter total company financial highlights include revenue of $274 million, adjusted EBITDA of $87 million, adjusted EBITDA margins of 31.7%. We increased our cash balance to $405 million and yesterday we announced that our board approved an 8% increase in our quarterly dividend to $0.14 per share. I'll now turn the call over to Jay Nutt, our CFO, who will review our financial results and following his remarks, I'll provide some thoughts on our outlook for the near term before opening the lines for Q&A. Jay. Thank you, Scott. As Scott Bender just mentioned, total Q2 revenues were $274 million, a sequential 2.4% decline, and total adjusted EBITDA was $87 million, down 7.6% sequentially. For our Pressure Control segment, revenues of $180 million were down 5.5% sequentially, driven primarily by lower revenue in our rental business, where pricing often weakens disproportionately when overall demand softens. As we've demonstrated in the past, we will continue to selectively deploy rental equipment when returns may meet our threshold. A less favorable product mix compared to the first quarter resulted in slightly lower product revenues in the period, though our product sales decreased less than the decline in the average U.S. Land Rig Count, a testament to our strong market position. Operating income declined $12 million, or 22.1%, sequentially with operating margins compressing 510 basis points, and adjusted segment EBITDA was $11.7 million, or 18% lower sequentially with margins decreasing by 450 basis points. The operating margin decline was primarily due to the lower operating leverage, higher product costs due to tariffs, which particularly impacted our results in June, and the lower revenue contribution from our higher margin rental business. In addition, we recorded $5.1 million of legal expenses and reserves in connection with litigation claims, which represented an increase of approximately $2 million from the first quarter. For our Spoolable Technologies segment, revenues of $96 million were up 3.9% sequentially on higher domestic customer activity. In the seasonally stronger second quarter, operating income increased $4.2 million, or 17.5% sequentially, with operating margins expanding 340 basis points due to the improved operating leverage and increased manufacturing efficiencies following our investments in the same. Adjusted segment EBITDA increased $4.4 million, or 13.2% sequentially, while margins expanded by 320 basis points. Corporate and other expenses were flat sequentially at $9.6 million in Q2, which included $3.5 million of professional fees associated with the announced plan to acquire a majority interest in the Surface Pressure Control business of Baker Hughes. Adjusted corporate EBITDA was flat at $4.4 million of expense compared to Q1. On a total company basis, second quarter adjusted EBITDA was $87 million, down 7.6% from $94 million in the first quarter. Adjusted EBITDA margin for the second quarter was 31.7% compared to 33.5% for the first quarter. Adjustments to total company EBITDA during the second quarter of 2025 include noncash charges of $6.3 million in stock-based compensation, $3.5 million for transaction-related professional fees, and $177,000 for the initial phase of severance. Actions were taken in June to right-size the organization to reflect lower activity levels. A fuller picture of the actions taken to restructure the business will be evident in our results as we progress through the year. Depreciation and amortization expense for the second quarter was $16 million, which includes an ongoing $4 million of amortization related to the intangible assets resulting from the Flexsteel acquisition. During the second quarter, the public or Class A ownership of the company averaged and ended the period at 86%. GAAP income was $49 million in the second quarter versus $54 million during the first quarter. The decrease was largely driven by lower operating income. Book tax expense during the second quarter was $14 million, resulting in an effective tax rate of 23%. Adjusted net income and earnings per share were $53 million and $0.66 per share, respectively, during the second quarter compared to $59 million and $0.73 per share in the first quarter. Adjusted net income for the second quarter was net of a 25% tax rate applied to our adjusted premium pretax income. During the quarter, we paid a quarterly dividend of $0.13 per share, resulting in a cash outflow of approximately $10 million, including related distributions to members. Positive movements in both inventory and accounts payable, combined with lower net CapEx, led to a much stronger quarter of Free cash flow. We ended the quarter with a cash balance of $405 million, a sequential increase of approximately $58 million. Net CapEx was approximately $11.1 million during the second quarter of 2025. In a moment, Scott will give you our third-quarter operational outlook. Some additional financial considerations when looking ahead to the third quarter include an effective tax rate of 22% and an estimated tax rate for adjusted EPS of approximately 25%. Total depreciation and amortization expense during the third quarter is expected to be approximately $16 million, with $7 million associated with our Pressure Control segment and $9 million in Spoolable Technologies. We are reducing our full-year 2025 CapEx outlook to be in a range of $40 million- $45 million, including the $6 million equity investment made into Vietnam in the first quarter. We are continuing to evaluate our capital spending program, considering the trend of domestic activity while maintaining investments to support Vietnam production growth and to strengthen manufacturing efficiencies in Baytown. Additionally, we expect to pay an annual TRA payment and distributions related to 2024 taxes late in the third quarter, which will be approximately $24 million. Finally, the board has approved an 8% increase in the quarterly dividend of $0.14 per share, which will be paid in September. We're pleased that the durability of cash flows in our structurally capital light business has allowed us to consistently increase our dividend over the past several years. That covers the financial review and I'll now turn the call back over to Scott. Thanks, Jay. I'd like to take a few moments to discuss our latest understanding of the tariff impact on our business and the corresponding weaker-than-anticipated Pressure Control margin performance in the second quarter. On June 4, the Section 232 tariff rate on steel and certain steel derivatives was unexpectedly doubled from 25%- 50%. This resulted in an increased in the tariff rate applied to goods imported from our Chinese manufacturing facility from the minimum 45% incremental rate discussed on last quarter's call and reflected in our guidance affirmed on June 4th to what is now an incremental 70%. As a result of the general tax tariff uncertainty and this change, we broadened our supply chain to other higher cost jurisdictions, including the U.S., to ensure certainty of delivery for our customers. These higher cost materials turned through our inventory faster than we had anticipated, resulting in depressed margins as we exited the quarter. In light of recent announcements, we must now modify the statement we made last quarter regarding our expectations that sourcing from Vietnam going forward would put us back into the same tariff position we had been operating under for the past several years. Considering the recent doubling of the Section 232 tariffs, we now believe that the rate applied to most imports from Vietnam could remain at 50% despite the recently published rate of 20%, an absolute increase of 25% over the Section 301 rate that applied to our imports from China since 2018. This increased rate has not changed our planning to heavily utilize Vietnam for our U.S. imports. Given the challenges of scaling U.S. manufacturing and the cost competitiveness of Vietnam, we continue to work with our vendors and our customers to neutralize the impact of these increased tariff base rates going forward. I'll now touch on our expectations for the third quarter of 2025 by reporting segment. During the third quarter, we expect Pressure Control revenue to be down mid to high single digits versus the $180 million reported in the second quarter. The decline is primarily due to the anticipated decrease in the average rig count in the third quarter. Further deterioration in our Frac Rental business is also contributing to the decrease as we elect to sideline equipment rather than irresponsibly deploy it into a shrinking market where we believe current Frac crew counts are more than 10% below second quarter average levels. Last Friday, the Baker Hughes U.S. Land Rig Count was 526, 5% below the second quarter average level, and we anticipate that modest softening will continue into the fourth quarter. Our customers have recently suggested that the majority of the declines for 2025 are behind us, provided commodity prices remain near recent levels. Adjusted EBITDA margins in our Pressure Control segment are expected to stay relatively stable at 28%- 30% for the third quarter despite lower operating leverage. This adjusted EBITDA guidance includes the partial benefits arising from our cost reduction and recovery efforts offsetting increased average tariff costs and excludes approximately $3 million of stock-based compensation expense within the segment. Considering the increasing pace of shipments from our Vietnam facility and the support of our customer base, we believe that the second and third quarters will represent the trough of our Pressure Control segment profit margin in this cycle. Barring further changes in tariff rates or a greater than anticipated decline in industry activity levels regarding our Spoolable Technologies segment, we expect third quarter revenue to be down high single digits from the second quarter as the progression of domestic activity levels impacts customer spending. That said, we remain pleased with recent international bookings. We expect adjusted EBITDA margins to be approximately 35%- 37% for Q3, which excludes $1 million of stock-based comp in the segment, moderating from the second quarter levels on lower volume and relatively stable input costs. Adjusted corporate EBITDA is expected to be a charge of approximately $4 million in Q3, which excludes $2 million of stock-based comp. We remain extremely excited about our recently announced plan to acquire a majority interest in the Surface Pressure Control business of Baker Hughes, which we believe is continuing to perform well. The recent activity trends in North American markets combined with tariff impacts to our base business further demonstrate the strategic rationale for diversifying our footprint. With a business heavily focused on the Middle East, integration planning work is progressing well. We expect closing of the transaction in late 2025 or early 2026 as we work through administrative filings in select global jurisdictions. We look forward to welcoming SPC associates to Cactus in the near future. In conclusion, the second quarter was busy for our team as we announced a transformative acquisition and faced supply chain and tariff uncertainty. Despite these distractions, we remained execution focused for our customers and generated solid Free cash flow in the quarter. Our confidence in the Cash flow durability of our structurally variable, cost-driven and capital-light business is reflected in the board's recent approval to increase our dividend by 8%. We believe the sharpest domestic activity declines for 2025 are behind us and look forward to beginning 2026 with a substantially broader geographic footprint and customer base from our announced acquisition plan. With that, I'll turn it back over to the operator and we can begin Q& A. Operator. Thank you. At this time, we will conduct the question and answer session. As a reminder, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q A roster. Our first question comes from Stephen Gengaro from Stifel. The floor is yours. Hi, Steven. Thanks. Good morning, everybody. I think two things for me. First, you mentioned. It sounds. Like June kind of felt the brunt of the tariffs, but you still guided Pressure Control margins pretty flat in the second quarter. Can you just maybe provide a little bit more color around how that's achieved sequentially? Because I'm just thinking June was probably worse than the average in the quarter you just reported. You would be correct. I'd tell you there really were a couple of factors, Stephen. The first one was this unexpected doubling of Section 232 for which the administration gave absolutely no notice. When we prepared our guide for June, we didn't anticipate the 232 was going to ratchet up by 25% absolute points. That impacted both inbound goods from Vietnam and inbound goods from China. That was clearly not anticipated. I think the second point is that we had begun to. Look. For alternate supply chain sources, and that was primarily in the U.S. and the U.S. Supply Chain, as you know, is higher cost than our imported supply chain. We still believed it was below what the fully tariffed amount would have been. The last was we had anticipated pushing through some cost recovery initiatives only to see oil prices implode in April and May, which actually caused our customers to request price relief rather than entertain cost recovery requests. We had to put that on pause for a bit. Those are the three contributing factors. Thank you. The other question I had is sort of bigger picture. Like when we look at the world. Oil prices are relatively high. I mean, I know the strips may be a little lower than the spot price, but when you think about it, you talk to your customers about the next several quarters, what do you think they're looking for to lead to some confidence to ramp activity? I feel like the oil price backdrop is not that bad. Rig count just kind of keeps shrinking. Yes, Stephen, I'm not really sure that our customers are as responsive today as they were five years ago to more robust crude prices. Because you're entirely right. I think that that range of $65- $70 is certainly providing very reasonable returns. They're so focused right now on capital discipline and returning cash to shareholders that nobody wants to be the first to announce CapEx expansion. Having said that, it's undeniable that the gas market is expanding. I think our gas rig count is up 50% since January, which is of course diametrically at odds with our oil rig count. Unfortunately for us and maybe the rest of the industry, with some exceptions, gas still makes up a much lower percentage of our total rig count. I guess the short answer is, yes, we're going to see some expansion with gas, but it's starting at a much lower base and I don't think we're going to see significant response to oil prices. Great. Thank you for all the details. Thank you for your question. One moment, please. Our next question comes from David Anderson of Barclays. The floor is yours. Hey, David, how are you? Good morning. I'm doing great, Scott. How are things? Good. Your product lines in the U.S. are leveraged across Drilling, Completions, and Production. It sounds like Completions was the weakest for you this quarter as rentals really kind of taking a hit. I was wondering, could you just kind of walk me through your views on the second half about how those three components are trending? I mean, should we expect production to hold up stronger? Do you think completions might be a Little bit stronger than drilling? You're indicating maybe the drilling, maybe the rig count declines are kind of behind us. Can you just walk me through kind of how those three things are kind of driving the second half? First, I would probably expand on your conclusion that it was Completions or Frac activity that mostly impacted our results. I'd be remiss if I didn't mention that our production business was also beginning to soften, not as significantly as our Frac-related business. In answer to your question about the rest of the year, I think our team believes that Completion activity or Frac-related activity is going to decline more significantly than Drilling activity. As I mentioned, we're already, as of today, 12% below in terms of Frac crews. I said at least 10%, but the number is actually 12% today below the Frac crew count in the second quarter of this year. I really don't see that situation improving very much. Unfortunately, as Frac activity wanes, so does the subsequent production activity, because if we don't frack a well, we can't put a production tree on there. I think we've got quite a few locations that may have been fracked and don't have production trees, so production activity I don't think will suffer to the same degree as Frac-related activity. All right, let's shift to much more positive things. Middle East acquisition I really. Love to know a little bit about. Now you've kind of been in here a little bit and I'm curious how you're going to approach this. We've watched you grow Pressure Control business in U.S. land essentially from scratch to a dominant share position. Clearly you've done a great job whipping Spoolable Technologies into shape. This business in the Middle East is a different story. By all accounts, it's been essentially orphaned under the prior owner. I was wondering if you could walk us through turning something like this around. Where do you start? What's the process on something like this? How are you sort of thinking about it right now? Really appreciate that, thank you. Wow, David, sorry to maybe offer my opinion about how Baker has run the company. Let me first say that Baker has done a significant job in improving the results of their international business over the last two years. Kudos to them. They made some very, very difficult decisions in terms of closing down the less productive manufacturing facilities. I'm looking at my General Counsel here to make sure you're trying to. You're not kicking me, are you? Kudos to them. I think that in general, we operate with a much flatter organization. I mean, that's undeniable. You can imagine we operate with a much flatter organization than any of our large competitors. Baker is no exception, nor is FMC or Schlumberger Cameron. I think that the culture is going to be significantly different. The next area of emphasis will clearly be on our supply chain philosophy, which again, Baker Hughes has done a remarkable job in improving their cost structure for their products. I still believe that we do a much better job, particularly in an environment that's not plagued with tariffs. You could look for supply chain. You can look for organization and cultural changes. Frankly, I'm excited about the opportunity to enhance that business. I also think you're going to see the same degree of focus that we brought to the U.S. market on the international market, where that has not been the case. Expect nothing less. Thank you very much, Scott. Thank you. Thank you for your question. Our next question comes from Arun Jayaram from J.P. Morgan Securities. The floor is yours. Yeah, good morning. Good morning. Good morning, team. Is it fair to say when you guys came out with your early June kind of update to the market on Pressure Control margins in that 33%- 35% range that it didn't factor in maybe two things? One is the increase in Section 232 tariffs as well as some of the legal costs that Jay mentioned in his opening remarks. Is that fair? It is fair, but I'd say there's more than just that. There's the Section 232, which was significant, but there also is our cost recovery efforts were paused because of the implosion in crude prices. Got it. That makes sense. Maybe just as a follow up, I don't want to spend too much time on this, but maybe you could just talk a little bit about the legal or the legal charge that you took. It looks like something in the queue. Around. An ongoing situation with Cameron. Maybe you could just describe, provide an update on that, and thoughts on do you expect any more cost to put in the model as we think about the back half of the year? You know, Will, what can I say on that? I think we can start by letting him know the trial was delayed. We'll have some further disclosure on that in the 10-Q. A lot of those expenses were gearing up for trial, which was delayed at the last minute. There will be some more expenses in the back half of the year, but it's just hard to predict how the litigation may go. Okay, what is the nature of the dispute? It's as we disclosed in the queue. It's an IP disclosure around the SafeLink or IP dispute around the SafeLink product. Okay, got it. Got it. Thanks a lot, gentlemen. Thank you. Thank you for your question. Our next question comes from Scott Gruber of Citigroup. The floor is yours. Hey, Scott. Yes, good morning, gentlemen. Doing well. Thanks for letting me in here. It's good to hear, Scott. That P C margin should be troughing. I think that means you expect maybe some improvement into 2026 even in a soft drilling market. Is that fair? That's fair. Okay. Some color on, you know, we. Don't normally give guidance that far out, but all things being equal, that's very fair. No, I know, but you can appreciate there's a lot of moving pieces right now, and obviously we just see the margins. If we just assume drilling is kind of, you know, flat, with the normal seasonality across 4Q and 1Q, can you just provide a little more detail on what could drive kind of grind higher in the margins? Is it tariff surcharges being passed along? Is it Vietnam ramping up? Just some more color on what could drive some improvement. You're paying excellent attention. It is, it's more expansive cost recovery benefits. It is the migration to Vietnam. Even though Vietnam currently is 50% incremental, it's still below the absolute 95% coming out of China. That certainly is a tailwind for us. I think it also has to do with, and we haven't disclosed the impact of that, but if you followed us from the very beginning, you know we're pretty aggressive in terms of right sizing and you'll begin to see the benefits of that right sizing as they flow through our P&L. It'll be pretty significant. Gotcha. If I could sneak one more, when do you think Vietnam is in a position to fully take on the former Chinese load? We believe that will be the coming summer. Okay, very good. I appreciate it. Thank you. Thank you for your question. This concludes the question and answer session. I would now like to turn it back to Scott Bender, Chairman and CEO, for closing remarks. I thank you all first for joining us. It's been a pretty active Q2, as you know, both in terms of navigating this macro environment and the tariff environment, as well as, of course, the announcement of this Baker deal. I think if we've learned anything, and I hope you have as well, it's the importance of this international diversification. While international won't be immune to some of these oil price swings, it's going to be far more stable and certainly long term, a much more resilient market than the domestic market. Although honestly, I am pretty optimistic about the U.S. Our market position is strong. Anyway, thank you very much, everybody. Have a good day. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.