Ranger Energy (RNGR) Q3 2026 Earnings Call Transcript

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DATE

Tuesday, Nov. 10, 2026

CALL PARTICIPANTS

• Vice President of Finance - Joe Mease
• Chief Executive Officer - Stuart Bodden
• Executive Vice President and Chief Financial Officer - Melissa Cougle

TAKEAWAYS

• Revenue -- $162.8 million, representing a 7.8% decrease from $176.5 million in the second quarter due to lower activity across all three segments.
• Adjusted EBITDA -- $20.1 million, down 29.7% from $28.6 million in the second quarter, primarily due to activity declines and cost inflation.
• Net Income -- $2.5 million, or $0.10 per diluted share, compared to $6.9 million or $0.29 per diluted share in the second quarter.
• Free Cash Flow -- $20 million, supported by strong cash generation that allowed the company to fully repay revolver borrowings from the American Well Services acquisition.
• High Specification Rigs Revenue -- $110.5 million, decreasing 2.6% from $113.4 million in the second quarter as customers managed budgets more closely.
• Average Hourly Rig Rate -- $770, remaining essentially flat compared to $772 in the second quarter while increasing 6% from $727 year over year.
• Rig Hours -- 143,500 hours, a 2% sequential decrease from 146,800 hours as budget exhaustion led to incremental white space across the fleet.
• STEP U.S. Acquisition Price -- $27.5 million, a targeted investment that positions the company as the second largest coiled tubing provider in the Lower 48.
• STEP 2027 EBITDA Guidance -- Over $10 million, with significant further upside anticipated in 2028 as the assets integrate into the multi-basin platform.
• ECHO Rig Fleet Target -- 24 rigs, representing a committed expansion through the end of 2027 following four additional rig contracts from Chevron.
• Employee Medical Costs -- $1.5 million, an incremental expense compared to the second quarter that served as the largest single contributor to cost inflation.
• AWS Cost Synergies -- $5.2 million, surpassing the company's initial annualized target of $5 million one year after closing the transaction.
• Processing Solutions and Ancillary Services Revenue -- $40 million, a 10% decrease from $44.5 million in the second quarter driven by lower activity in transportation and tubing inspection.
• Wireline Services Revenue -- $12.3 million, a 34% sequential decline resulting from expected gaps in customer well completion programs.
• Quarterly Share Repurchases -- $2.2 million, consisting of 142,100 shares at an average price of $15.74 per share.
• Year-to-Date Shareholder Returns -- $11.7 million, representing 64% of year-to-date free cash flow through a combination of dividends and share repurchases.
• Liquidity -- $76.2 million, comprising $70.2 million in revolver availability and $6 million in cash on hand as of Sept. 30.
• 24-Hour Rig Activity -- 6% increase, reflecting a sequential rise as operators continued to transition production work to around-the-clock operations.
• Capital Expenditures -- $10.5 million for the quarter, with $16.8 million year to date specifically allocated to ECHO rig construction payments.
• Cost of Services -- 85% of revenue, up from 81% in the prior quarter due to negative operating leverage and higher labor and fuel expenses.

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RISKS

• Bodden stated, "smaller competitors lowered price to win back work, and we absorbed cost inflation across several cost categories, the largest being an incremental $1.5 million in employee medical costs compared to the second quarter," identifying pricing pressure and inflation as specific margin headwinds.
• Bodden warned that "we do think that we are seeing the labor market tighten, and we expect it to continue into next year," signaling potential future constraints on workforce availability and costs.
• Bodden noted that "a rig idle for a week still carries its crew and equipment costs, so even modest gaps in the schedule weighed disproportionately on margins," highlighting the sensitivity of the business to intermittent activity breaks.

SUMMARY

Ranger Energy Services, Inc. (NYSE:RNGR) reported third-quarter results that reflected a transition toward higher-specification assets and technological differentiation despite navigating a period of customer budget exhaustion and competitive pricing pressures. Management stated that the company successfully eliminated all net debt associated with its prior acquisition of American Well Services while simultaneously funding the $27.5 million acquisition of STEP U.S. coiled tubing assets. This acquisition expands the company's operational footprint from a single-basin business into a multi-basin provider with specialized technology for long-lateral wells. While sequential revenue and margins were compressed by inflationary costs and activity gaps, the company maintained its pricing discipline and continued to build its hybrid electric fleet. Management confirmed that it remains focused on achieving a target of $100 million in annualized adjusted EBITDA supported by the integration of new assets and the continued delivery of contracted workover rigs through 2027.

• Management reported that the STEP acquisition provides COIL+ Extended Reach Technology, which has successfully reached total depth on more than 60 wells exceeding 30,000 feet.
• CEO Bodden stated, "Repeat orders from an operator of this caliber are the strongest validation of this technology we could possibly ask for," regarding Chevron's commitment to 24 total ECHO hybrid electric workover rigs.
• The company reported that its ECHO build program is running ahead of schedule, with five rigs delivered through the third quarter and the remainder slated for completion by the third quarter of 2027.
• Management noted that they made a deliberate decision not to follow smaller competitors in lowering prices, as CEO Bodden stated, "our experience has been if you do that, it is almost impossible to get it back."
• The company reorganization of ancillary service lines, specifically transportation and tubing inspection, is underway to improve accountability and utilization following underperformance in the third quarter.
• Management indicated that wireline activity began to improve in October as new work programs commenced, with an expectation of returning to mid-single-digit margins in the fourth quarter.
• The company reported that plugging and abandonment service lines reached their highest margin levels in several quarters, supported by consistent work from the Texas Railroad Commission.

INDUSTRY GLOSSARY

• AWS: American Well Services, a high-specification well service rig provider acquired by Ranger in late 2025.
• Bakken: A major oil-producing rock formation located primarily in North Dakota, representing one of the basins where Ranger's coiled tubing units operate.
• Coiled Tubing: A long, continuous metal pipe spooled on a large reel used for interventions in oil and gas wells, such as cleaning or drill-outs.
• ECHO: Ranger's proprietary line of hybrid electric workover rigs designed to improve fuel efficiency and safety through automation and battery technology.
• High Specification Rigs: Advanced well service rigs capable of handling the heavy loads and complex requirements of modern horizontal wells.
• P&A (Plugging and Abandonment): The process of permanently closing a well that is no longer productive to prevent fluid migration and ensure environmental safety.
• Permian Basin: A large sedimentary basin in the southwestern United States, one of the most prolific oil and natural gas-producing regions in the world.
• STEP: Referring to the U.S. coiled tubing assets acquired from STEP Energy Services, which added 13 units to Ranger's fleet.
• Torrent: A service line within Ranger's Processing Solutions segment that provides modular natural gas processing and mechanical refrigeration units.
• Wireline Services: The use of electrical cables to lower tools into a well for data gathering, reservoir evaluation, or mechanical interventions.

Full Conference Call Transcript

Operator: Good morning, and welcome to the Ranger Energy Services' Third Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Joe Mease, Vice President of Finance. Please go ahead.

Joe Mease: Good morning, and thank you for joining Ranger Energy Services' Third Quarter 2026 Results Conference Call. Before we begin, Ranger has issued a press release outlining our operational and financial performance for the quarter ended September 30, 2026. This press release, along with our most recent investor presentation, is available in the Investor Relations section of our website at www.rangerenergy.com. Today's discussion may contain forward-looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in our periodic reports filed with the Securities and Exchange Commission. Except as required by law, we undertake no obligation to update our forward-looking statements.

Factors that could cause actual results to differ include, but are not limited to, changes in crude oil and natural gas prices, customer activity levels, operating risks, competitive pressures, weather conditions, integration risks related to acquisitions and other risks as described in our filings with the Securities and Exchange Commission. We will also reference certain non-GAAP financial measures during today's call, including adjusted EBITDA and free cash flow. Reconciliations of these measures to the most directly comparable GAAP financial measures are included in our earnings release. Joining me on the call today are Stuart Bodden, our Chief Executive Officer; and Melissa Cougle, our Executive Vice President and Chief Financial Officer.

Stuart will begin with an overview of the quarter and our strategic progress, including the completion of the STEP coiled tubing acquisition and the continued build-out of our ECHO rig fleet. Melissa will then walk through our third quarter financial results in more detail. Following their remarks, we'll open the call for questions. With that, I'll turn it over to Stuart.

Stuart Bodden: Thank you, Joe, and good morning, everyone. We appreciate you joining us today. Consistent execution and steady progress define Ranger. And this quarter, we continued to deliver against our strategic goals. Most notably, we completed the acquisition of the STEP U.S. coiled tubing assets, making Ranger the second largest coiled tubing provider in the Lower 48. In addition to this transaction, Chevron committed to 4 additional ECHO hybrid electric workover rigs, which will take our contracted ECHO rig fleet to 24 rigs by the end of 2027.

Finally, strong cash generation allowed us to fully repay the revolver borrowings from our American Well Services acquisition, allowing us to exit the quarter with 0 net debt less than a year after closing that transaction. This progress was a result of intentional and consistent effort from the organization that continues to strengthen Ranger as we approach 2027. I firmly believe Ranger has more ways to grow today than at any point in our history. First, a few words about the quarter itself. Ranger generated revenue of $162.8 million and adjusted EBITDA of $20.1 million in the third quarter, results that were softer than we expected.

Customers managed their budgets more closely, smaller competitors lowered price to win back work, and we absorbed cost inflation across several cost categories, the largest being an incremental $1.5 million in employee medical costs compared to the second quarter. Considerable time has been spent recently with our operating teams, evaluating ways to improve utilization and margins, and many of those efforts are already in flight. Melissa will walk through some additional color in the segment detail. Cash generation, however, remains strong. Ranger produced $20 million of free cash flow in the third quarter, which allowed us to fully repay our revolver borrowings while continuing to return capital to shareholders and giving us capacity to complete the STEP acquisition.

Now let me turn to the STEP asset acquisition, which we closed on October 8. I want to first welcome our new professionals to Ranger. The STEP team has earned a strong reputation for technical execution, service quality and solving customers' most challenging drill-out applications safely and reliably, and they are a tremendous addition to our organization. This transaction does 3 important things for Ranger. First, it gives our coiled tubing business scale. We have long been proud of our coiled tubing operation in the North, but it was a single-basin business. And in coiled tubing, scale drives utilization and returns.

STEP adds 13 coiled tubing units operating from the Bakken through South Texas with its largest presence in the Permian Basin, right alongside our high-spec rig fleet. We are now a multi-basin coiled tubing provider in the U.S. coiled tubing market estimated at $1.5 billion annually. Second, it gives us differentiated technology. The COIL+ Extended Reach Technology has helped operators successfully reach total depth on more than 60 long lateral wells with its deepest well exceeding 30,000 feet.

As laterals get longer, that capability lets us compete for the most demanding work in our basins, and it gives customers real flexibility in their drill-out programs because Ranger can now offer either a coiled tubing unit or a high-spec rig for the job. Third, it creates pull-through. The overlap between STEP's customers and our own is significant and a larger coiled tubing business lets us provide more services and equipment to those customers across more of their wells. We acquired these assets for approximately $27.5 million, and we expect STEP's coiled tubing assets to contribute more than $10 million of adjusted EBITDA in 2027 with significant further upside expected in 2028.

That is a compelling valuation for a business of this quality and exactly the kind of targeted M&A that continues to set Ranger apart. We are adding shareholder value at attractive prices in businesses we know well. Turning to ECHO. During the quarter, we were awarded contracts for 4 additional ECHO rigs. This represents additional expansion of our ECHO relationship with Chevron this year following the rigs committed to earlier in the year, and it will bring our total contracted fleet to 24 rigs by the end of 2027. Repeat orders from an operator of this caliber are the strongest validation of this technology we could possibly ask for. The ECHO Build program is also running slightly ahead of schedule.

5 ECHO rigs have been delivered through the third quarter with the balance of the fleet scheduled for delivery through the third quarter of 2027. Customer feedback has been positive, reinforcing both the efficiency of operations and the enhanced safety ECHO brings to location, and our current customer conversations point to additional rig commitments in the future. We are beginning to track safety and operational performance on these rigs and feel over time, their value proposition will become increasingly evident in the data, driving further demand. Importantly, ECHO represents growth where our customers are investing alongside Ranger. Our agreements include upfront customer payments or day rate premiums that support returns on the capital we invest.

And as ECHO's efficiency gains are solidified, we expect the fleet to help push down overall service costs for our customers. That is a powerful combination in a market where operators are looking to do more with less. We have also now passed the 1-year mark since closing AWS. We have realized approximately $5.2 million of annualized cost synergies ahead of the $5 million we targeted, and we have fully repaid the borrowings used to fund the transaction. The acquired high-specification rigs have largely tracked our expectations. While some of the ancillary service lines, particularly transportation, mixing plants and tubing inspection underperformed during the third quarter.

We have taken several operational steps to reorganize those operations to improve accountability, utilization and profitability. In high-specification rigs, customers managed their spending more closely in the third quarter, creating incremental white space across our fleet. At the same time, as Ranger has gained share through operator consolidation, smaller displaced competitors have offered price reductions to regain work and some budget-constrained customers took advantage of those savings. We have held our pricing discipline, which allows us to maintain our standards for safety and service quality, and we expect that decision to pay off as the market normalizes and budgets reset next year.

Elsewhere, our legacy rentals and plugging and abandonment service lines continue to perform well, with P&A supported by an expanding and steady base of work from the Texas Railroad Commission. Our Wireline segment performed as we expected with the breaks in customer well programs. The team managed the activity decline with timely cost reductions, demonstrating the progress made in creating a more responsive cost structure. New work programs began in October, and we believe that the fourth quarter will provide improvement from this quarter. Stepping back, crude prices moved sharply higher during the third quarter and U.S. production and land drilling activity continued to grow.

Although commodity prices have recently retreated somewhat, we believe Ranger's production-focused services, which deliver the fastest and lowest cost incremental barrels from existing wells are well positioned as our customers' budgets reset. As we head into 2027, we have a fast-growing ECHO fleet and expanded coiled tubing platform, reorganized ancillary service lines and a wireline segment that has shown its resilience. The moat is deeper now than it has ever been, and we remain focused on our goal of achieving $100 million of annualized adjusted EBITDA supported by these initiatives. With that, I'll turn the call over to Melissa.

Melissa Cougle: Thank you, Stuart, and good morning, everyone. I'll walk through our third quarter results in more detail with a particular focus on drivers and then cover cash flow, the balance sheet and capital allocation. Revenue for the third quarter was $162.8 million, a decrease of $13.7 million or 7.8% from $176.5 million in the second quarter and an increase of $33.9 million or 26.3% from $128.9 million in the third quarter of 2025. The sequential decrease reflects lower activity across our 3 segments, while the year-over-year increase reflects the contribution of the AWS business.

Net income was $2.5 million or $0.10 per diluted share compared to $6.9 million or $0.29 per diluted share in the second quarter and $1.2 million or $0.05 per diluted share in the third quarter of last year. Operating income in the quarter included a $3 million noncash benefit from a reduction in the contingent consideration related to the AWS acquisition. Adjusted EBITDA was $20.1 million, a 12.3% margin compared to $28.6 million and a 16.2% margin in the second quarter and a $16.8 million and a 13% margin in the third quarter of 2025.

Cost of services rose to 85% of revenue from approximately 81% of revenue in the second quarter, driven by 2 forces: lower activity, which created negative operating leverage against the cost base staffed for a busier quarter and higher costs, most significantly employee-related costs and fuel. The single largest contributor was employee medical costs across segments, which was $1.5 million higher than in the second quarter. General and administrative expense was $7.7 million, essentially flat with the second quarter, with both quarters including expenses related to the AWS integration and the STEP acquisition. Turning to High Specification Rigs.

Segment revenue was $110.5 million, a decrease of $2.9 million or 2.6% from $113.4 million in the second quarter and an increase of $29.6 million or 36.6% from $80.9 million a year ago. Rig hours were 143,500 hours, down 2% sequentially from 146,800 hours in the second quarter and up 29% year-over-year from 111,200 hours in the third quarter of 2025. Our average hourly rig rate was $770, essentially flat with $772 in the second quarter and up 6% from $727 a year ago, largely reflecting the pass-through of fuel surcharges and changes in asset and regional mix.

Segment adjusted EBITDA was $18.4 million compared to $20.6 million in the second quarter, and segment margins were 16.7%, down from 18.2% in the second quarter. With margins down roughly 150 basis points, I want to walk through a few drivers. The first was white space. Customers manage their spending more closely and operators laid down rigs for intermittent periods. A rig idle for a week still carries its crew and equipment costs, so even modest gaps in the schedule weighed disproportionately on margins. These were rig breaks that were not anticipated given the macro backdrop, but reflect budget exhaustion early in the year given the strong activity in the second quarter.

It is worth noting that our 24-hour rig activity increased about 6% sequentially as operators continued converting production work to around-the-clock operations, but that growth was more than offset by white space and rig releases, which brings me to our second driver. During the quarter, we contended with a couple of smaller new market entrants offering price reductions to win back lost share the past couple of years, particularly in the Permian Basin. A couple of key operators who are now budget constrained took advantage of those lower prices, which displaced a number of our daylight rigs. We made a deliberate decision not to follow pricing down.

That kept our rates stable, but it did cost us some activity in the quarter. The third was cost inflation. Labor and fuel costs both increased as a percent of revenue with employee expenses, including medical costs I mentioned and diesel prices running even higher this summer, deteriorating margins further. We are presently redeploying some of our displaced rigs with customers who have work available, restructuring some of our operations and working with key customers who see the value in Ranger differentiation on cost adjustments that reflect wage and fuel inflation. In Processing Solutions and Ancillary Services, segment revenue was $40 million, a decrease of $4.5 million or 10% from $44.5 million in the second quarter.

Segment adjusted EBITDA was $6.8 million compared to $10 million in the second quarter, and segment margins were 17% compared to 22.5% in the second quarter. Declines were attributable to a few service lines. Most notably, certain service lines we acquired through AWS, including transportation, mixing plants and tubing inspection saw significant declines in activity this quarter, which had a knock-on effect on margins. Torrent grew revenue on expanding contracts, but its results were affected by onetime charges, including legal fees, mobilization costs and unique rental charges, along with the loss of some higher-margin rentals. There were bright spots, though, with plug and abandonment as well as rental margins improving and reaching their highest level in the past several quarters.

In Wireline services, revenue was $12.3 million, an expected decrease of $6.3 million or 34% from $18.6 million in the second quarter. Our Wireline completion service line saw gaps in customer work schedules after the completion programs that drove our strong second quarter in closing. Segment adjusted EBITDA was $200,000 compared with $3.6 million in the second quarter. Turning to cash flow. Cash provided by operating activities was $30.5 million in the third quarter and $53.5 million year-to-date.

Free cash flow was $20 million for the quarter and year-to-date free cash flow was $18.3 million compared to $25.8 million over the same period in 2025, with the decrease primarily reflecting higher customer receivables resulting from a customer changing to 90-day payment terms, partially offset by internal efforts that have reduced our internal processing time. Capital expenditures were $10.5 million in the third quarter and $35.2 million year-to-date compared to $19.1 million over the same period in 2025, with approximately $16.8 million of this year's spend related to ECHO construction payments. Our ECHO contracts include upfront customer contributions, which we record as contract liabilities and recognize as revenue over the life of those contracts.

Short- and long-term contract liabilities totaled $19 million at the end of the quarter. As of September 30, we had no borrowings outstanding under our revolving credit facility and total liquidity was $76.2 million consisting of $70.2 million of revolver availability and $6 million of cash on hand, up from $61.3 million at the end of the second quarter. Paying down the outstanding borrowings this quarter means we fully repaid for the AWS acquisition within a year of closing. After quarter end, we funded the cash consideration for STEP with revolver borrowings, consistent with the plan we outlined when we announced the transaction.

Ranger expects to allocate the majority of its cash flows in the next several quarters to ECHO delivery payments and repayments on the borrowings used to fund the STEP acquisition. On the capital returns front, we repurchased 142,100 shares during the third quarter for $2.2 million at an average price of $15.74 per share. Since the inception of our repurchase program in 2023, we have repurchased approximately 4.8 million shares for $54.1 million at an average price of $11.31 per share. Year-to-date, we have returned $11.7 million to shareholders through repurchases and dividends or 64% of year-to-date free cash flow, well above our commitment to return at least 25%.

Our Board has also declared a quarterly cash dividend of $0.06 per share payable on December 4 to stockholders of record as of November 20. With that, I'll turn the call back over to Stuart for closing remarks.

Stuart Bodden: Thanks, Melissa. Before we open the line for questions, I want to leave you with a few thoughts. This quarter tested us, and our teams responded the way Ranger always does, by holding the line on safety, service quality and pricing discipline and by continuing to execute on the strategy that will drive our next phase of growth. That strategy is working. Within the span of a year, we have closed 2 acquisitions, AWS and now STEP at attractive prices, and we fully repaid the borrowings for the AWS transaction within a year of closing.

We are growing our contracted ECHO fleet to 24 rigs with conversations for additional rigs underway, and we have returned $11.7 million to our shareholders through share repurchases and dividends so far this year. I said earlier that Ranger has more ways to grow than at any point in our history. A fast-growing ECHO fleet, an expanded coiled tubing platform and a streamlined ancillary business with room to grow gives us more levers than we have ever had. I want to thank our professionals for their hard work and commitment this quarter and those who have recently joined the One Ranger family.

With a strong balance sheet and a consistent record of performance, we are confident in Ranger's ability to deliver durable long-term value. With that, operator, we can now open the line for questions.

Operator: [Operator Instructions] The first question is from Don Crist with Johnson Rice.

Donald Crist: I wanted to start with the STEP acquisition. I know you've only had it for a couple of weeks now and you're still integrating. But just the customer dynamic of having more flexibility to either use stick pipe or coil to drill out and do workovers with longer coil, et cetera. How are those conversations going? It seems like STEP was kind of underutilized for what they had in the U.S. And just how is that progressing as you've handled that last couple of weeks?

Stuart Bodden: Yes. Thanks for the question, Don. I think we're really encouraged by the conversations we've been having so far with customers. The Ranger coiled business was really a one-basin business. We were focused in the Rockies. And we had some of our biggest customers tell us they wish we were in multiple basins. And STEP obviously gives us that ability. And I'll just sort of say just the reputation that the STEP professionals have built around service quality, technology differentiation, et cetera. So we're pretty encouraged. It's kind of, as you said, early days.

I think we're a month and 2 days into it, but we feel like the customers have been really receptive to it and appreciate having the ability to either use stick pipe or coil kind of depending on the well profile.

Donald Crist: Okay. And I don't know if you really want to answer this question, but I'll ask it anyway. It seems like every couple of years, the market kind of ebbs and flows and tries to get cheaper services and then kind of goes back to more quality operators. And it sounds like that's kind of what happened in the third quarter. But how -- are you seeing customers kind of revert back to higher quality workover rig or coiled or wireline providers after going through a little bit of budget exhaustion in the third quarter and using some of the lower quality operators out there.

We've heard of a couple of accidents that have happened for low-quality operators and it seems like everything ebbs and flows over the past couple of years. But are you seeing people revert back now and kind of contract for next year?

Stuart Bodden: I think the honest answer, John, is that -- I mean, Don, is right now, I think it's too early to tell. As we said in the -- in my comments, we made a very conscious decision not to chase down that price. Our experience has been if you do that, it's almost impossible to get it back. And I think underpinning that is a belief that certainly the largest operators will stick with and go with the most reputable players. As far as the kind of shift back, right now, I think it's too early to say.

Donald Crist: Okay. Well, I fully believe that you'll gain more work going forward because it's better to be safe than to chase price. But that's just my opinion, and we'll leave it there.

Stuart Bodden: That assumption is correct.

Donald Crist: My last question -- yes, exactly. My last question is just on labor. Obviously, a lot of data centers and whatnot construction out there that seems to be a little bit more stable than oilfield work has drawn a lot of people away. Are you seeing any labor constraints or people leaving for other construction jobs out there?

Stuart Bodden: I think we feel like we are, Don. It doesn't feel like it's a full-blown labor crisis yet. But I think we do think that we are seeing the labor market tighten, and we expect it to continue into next year. So I think that's something we're pretty mindful of.

Operator: The next question is from Derek Podhaizer with Piper Sandler.

Derek Podhaizer: Just I guess maybe to kind of continue the conversation around losing some of the work to lower-priced competitors. And as Don mentioned, accidents, obviously, safety first and foremost. So what other challenges do you expect these customers to face going with lower price, lower quality work that would cause them to come back to Ranger next year when budgets reset? Just thinking through the operational challenges that E&Ps might face going to lower quality aside from safety and accidents, but what else should we think about that would bring back to these customers back to Ranger?

Stuart Bodden: I think what our experience has been, Derek, is I'd highlight a couple of things is, one is, out in the field, the company men get very attached to our tool pushers, our supervisors. And it is not uncommon for us to see the company men really start to raise a bit of a fuss and kind of ask for Ranger crews to come back. I think that's one thing. The second thing I would highlight, and it's related to safety, but is on inspections. So a lot of times, what we find is some of these smaller players aren't doing the proper inspections on their equipment.

And more than once, we've been in situations where we got a call and says, hey, you need to come out because we just did a spot inspection or a spot audit on a smaller player and the Derek, the blocks weren't properly inspected and we're not comfortable. So I would highlight that. It's -- we have certainly seen that historically as well. And then again, I think just the familiarity with our crews. We spent a lot of time and effort and money training our crews, and we feel like it really shows out in the field.

Derek Podhaizer: Got it. Okay. That's helpful color. And maybe just a bigger picture question, looking into 2027, just your initial views on it. Maybe you can kind of walk through the 3 different segments and what you expect to be some of the drivers as we go into next year and think about potential top line growth, margin expansion. You obviously have the couple of acquisitions getting up and running, but just more high level, big picture, just would love to get your initial views into next year.

Stuart Bodden: Yes. I think right now, we're -- we don't have kind of a firm view. There's obviously a lot of moving parts. But I think the things I would highlight were, obviously, we're encouraged, early days, but with the STEP acquisition, the asset acquisition, our ability to provide coil in multiple basins. I think that's something that we're pretty excited about. We've talked about ancillary some of the changes we're making to sort of drive more profitability and accountability. I think some of the things that we're kind of wrestling with right now, just as we think about next year, Derek, are we've talked about labor -- [Technical Difficulty] go up and ultimately from customers. I think that's one thing.

And just I'll kind of say the volatility in commodity pricing. We obviously seen a lot of volatility in the last week. So it's -- again, I think we're kind of cautiously optimistic, but I think it's kind of too early to just put firm numbers to anything.

Operator: The next question is from John Daniel with Daniel Energy Partners.

John Daniel: Stuart, hopefully you can hear me. I guess there's some background noise. But my question relates to the ECHO rig. I'm curious if you can characterize interest levels. Are they broadening yet? Or is it sort of the same 2 or 3 key customers coming back looking for more?

Stuart Bodden: Yes. It is starting to broaden. I think we're getting more people taking a look, hearing about it at conferences, et cetera. So again, we're not at the point where we have another customer that is contracted for one, but I would say it's fair to say that interest is growing for sure.

Operator: This concludes our question-and-answer session. I will now turn the conference back over to Stuart Bodden for any closing remarks.

Stuart Bodden: Thanks, operator, and thanks to everyone on the call. I appreciate your interest in Ranger and don't hesitate to reach out if you have any questions. Have a great week, everybody. Thank you.

Operator: The conference has concluded. Thank you for attending today's presentation. You may now disconnect.

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