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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-33666

Archrock, Inc.

(Exact name of registrant as specified in its charter)

​ | ​
Delaware | 74-3204509
(State or other jurisdiction of incorporation or organization) ​ or organization) | (I.R.S. Employer Identification No.)

​

9807 Katy Freeway, Suite 100, Houston, Texas 77024

(Address of principal executive offices, zip code)

(281) 836-8000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​
Title of each class | ​ |  | Trading Symbol |  | Name of each exchange on which registered ​
Common stock, $0.01 par value per share | ​ | ​ | AROC | ​ | New York Stock Exchange
​ | ​ | ​ | ​ | ​ | NYSE Texas ​

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

​ | ​ | ​ | ​ | ​
Large accelerated filer | ☒ | ​ | Accelerated filer | ☐
Non-accelerated filer | ☐ | ​ | Smaller reporting company | ☐
​ | ​ | ​ | Emerging growth company | ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

​

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of the common stock of the registrant outstanding as of October 22, 2025: 175,369,642 shares.

​

​

​

Table of Contents

TABLE OF CONTENTS

​ | ​
​ | ​
​ | Page
Glossary | 3
Forward-Looking Statements | 5
​ | ​
Part I. Financial Information | ​
Item 1. Financial Statements (unaudited) | 6
Condensed Consolidated Balance Sheets | 6
Condensed Consolidated Statements of Operations | 7
Condensed Consolidated Statements of Equity | 8
Condensed Consolidated Statements of Cash Flows | 10
Notes to Unaudited Condensed Consolidated Financial Statements | 11
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 36
Item 3. Quantitative and Qualitative Disclosures About Market Risk | 45
Item 4. Controls and Procedures | 46
​ | ​
Part II. Other Information | ​
Item 1. Legal Proceedings | 46
Item 1A. Risk Factors | 47
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 48
Item 3. Defaults Upon Senior Securities | 49
Item 4. Mine Safety Disclosures | 49
Item 5. Other Information | 49
Item 6. Exhibits | 49
​ | ​
Signatures | 50

​

​

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2

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GLOSSARY

The following terms and abbreviations appearing in the text of this report have the meanings indicated below.

​ | ​
2020 Plan | 2020 Stock Incentive Plan
2024 Form 10-K | Annual Report on Form 10-K for the year ended December 31, 2024
2027 Notes | $500.0 million of 6.875% senior notes due April 2027
2027 Notes Redemption | $300.0 million redemption
2027 Notes Tender Offer | $200.0 million partial redemption
2028 Notes | $800.0 million of 6.25% senior notes due April 2028
2032 Notes | $700.0 million of 6.625% senior notes due September 2032
Amended and Restated Credit Agreement | Amended and Restated Credit Agreement, dated May 16, 2023, which amended and restated that Credit Agreement, dated as of March 30, 2017, which governs the Credit Facility
Archrock, our, we, us | Archrock, Inc., individually and together with its wholly owned subsidiaries
Archrock ELT | Archrock ELT LLC, an indirect, wholly owned subsidiary of Archrock
ASU | Accounting Standards Update
CODM | Chief operating decision maker
ColdStream | ColdStream Energy Holdings, LLC
Credit Facility | $1.5 billion asset-based revolving credit facility due May 2028, as governed by the Amended and Restated Credit Agreement, as amended
ECOTEC | Ecotec International Holdings, LLC
ESPP | Employee Stock Purchase Plan
Exchange Act | Securities Exchange Act of 1934, as amended
FASB | Financial Accounting Standards Board
FGC Holdco | FGC Holdco LLC, a subsidiary of ColdStream
Financial Statements | Condensed consolidated financial statements included in Part I Item 1 of this Quarterly Report on Form 10-Q
First Amendment to the Amended and Restated Credit Agreement | First Amendment to the Amended and Restated Credit Agreement, dated August 28, 2024, which amended the Amended and Restated Credit Agreement
Flowco | Flowco Holdings Inc.
Flowco Disposition | Transaction completed on August 1, 2025 pursuant to the asset purchase agreement, dated as of July 1, 2025, whereby Archrock sold certain contract operations customer service agreements, compressors, and other assets to Flowco
GAAP | Accounting principles generally accepted in the U.S.
GHG | Greenhouse gases (carbon dioxide, methane and water vapor for example)
Hilcorp | Hilcorp Energy Company
Ionada | Ionada PLC
July 2024 Equity Offering | Public underwriting offering whereby Archrock sold approximately 12.7 million shares of its common stock, completed in July 2024
LIBOR | London Interbank Offered Rate
MaCH4 NRS | Natural gas liquid recovery patented technology solution developed by ColdStream, capable of capturing natural gas liquids instead of burning them and simultaneously delivering lean, dry fuel gas to natural gas fired engines and equipment at compressor stations
NGCS | Natural Gas Compression System, Inc. (“NGCSI”), and NGCSE, Inc. (“NGCSE”)
NGCS Acquisition | Transaction completed on May 1, 2025 (“NGCS acquisition date”) pursuant to certain definitive agreements dated as of March 10, 2025, whereby Archrock acquired all of the issued and outstanding equity interests in NGCS, referred to as “NGCSI Merger Agreement” and “NGCSE Merger Agreement” (together, “Merger Agreements”)
OB3 Tax Law | Public Law No. 119-21, a comprehensive tax and spending reform bill signed into law on July 4, 2025 also known as the “One Big Beautiful Bill Act” or “OBBBA”
OTC | Over-the-counter, as related to aftermarket services parts and components
SEC | U.S. Securities and Exchange Commission

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Second Amendment to the Amended and Restated Credit Agreement | Second Amendment to the Amended and Restated Credit Agreement, dated May 16, 2025, which amended the Amended and Restated Credit Agreement
Securities Act | Securities Act of 1933, as amended
SG&A | Selling, general and administrative
Share Repurchase Program | Share repurchase program approved by our Board of Directors that allows us to repurchase outstanding common stock and retire shares repurchased for a designated amount and period of time
Spin-off | Spin-off of our international contract operations, international aftermarket services and global fabrication businesses into a standalone public company operating as Exterran Corporation in November 2015. Exterran Corporation was subsequently acquired by Enerflex Ltd. (“Enerflex”) in October 2022. The separation and distribution agreement specifies our right to receive payments from Enerflex and our obligation to satisfy capital calls from Enerflex
SOFR | Secured Overnight Financing Rate
Tax Cuts and Jobs Act | Public Law No. 115-97, a comprehensive tax reform bill signed into law on December 22, 2017
TOPS | Total Operations and Production Services, LLC
TOPS Acquisition | Transaction completed on August 30, 2024 (“TOPS acquisition date”) pursuant to that certain purchase and sale agreement, dated as of July 22, 2024, whereby Archrock acquired all of the issued and outstanding equity interests in TOPS
U.S. | United States of America
VIE | Variable interest entity
WACC | Weighted-average cost of capital

​

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4

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FORWARD-LOOKING STATEMENTS

​

This Quarterly Report on Form 10-Q (this “Form 10-Q”) contains “forward-looking statements” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this Form 10-Q are forward-looking statements within the meaning of the Exchange Act, including, without limitation, our business growth strategy and projected costs; future financial position; the sufficiency of available cash flows to fund continuing operations and pay dividends; the expected amount of our capital expenditures; anticipated cost savings; future revenue, adjusted gross margin and other financial or operational measures related to our business; the future value of our equipment; and plans and objectives of our management for our future operations. You can identify many of these statements by words such as “believe,” “expect,” “intend,” “project,” “anticipate,” “estimate,” “will continue,” or similar words or the negative thereof.

Such forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those anticipated as of the date of this Form 10-Q. Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, no assurance can be given that these expectations will prove to be correct. Known material factors that could cause our actual results to differ materially from the expectations reflected in these forward-looking statements include the risk factors described in our 2024 Form 10-K and those set forth from time to time in our filings with the SEC, which are available through our website at www.archrock.com and through the SEC’s website at www.sec.gov. These risk factors include, but are not limited to, inability to achieve the expected benefits of the NGCS Acquisition and difficulties in integrating NGCS; risks of acquisitions or mergers, including the NGCS Acquisition, to reduce our ability to make distributions to our common stockholders; risks related to macroeconomic conditions, including an increase in inflation and trade tensions; pandemics and other public health crises; ongoing international conflicts and tensions; risks related to our operations; competitive pressures; inability to make acquisitions on economically acceptable terms; uncertainty to pay dividends in the future; risks related to a substantial amount of debt and our debt agreements; inability to access the capital and credit markets or borrow on affordable terms to obtain additional capital; inability to fund purchases of additional compression equipment; vulnerability to interest rate increases; erosion of the financial condition of our customers; risks related to the loss of our most significant customers; uncertainty of the renewals for our contract operations service agreements; risks related to losing management or operational personnel; dependence on particular suppliers and vulnerability to product shortages and price increases; information technology and cybersecurity risks; tax-related risks; legal and regulatory risks, including climate-related and environmental, social and governance risks.

All forward-looking statements included in this Form 10-Q are based on information available to us on the date of this Form 10-Q. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained throughout this Form 10-Q.

​

5

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Archrock, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except par value and share amounts)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | September 30, 2025 |  | December 31, 2024
Assets |  | ​ |  |  | ​ |
Current assets: |  | ​ |  |  | ​ |
Cash and cash equivalents | ​ | $ | 4,083 | ​ | $ | 4,420
Accounts receivable, net of allowance of $681 and $414, respectively | ​ |  | 179,888 | ​ |  | 132,478
Inventory | ​ |  | 112,112 | ​ |  | 89,686
Tax refund receivable | ​ | ​ | 12,388 | ​ | ​ | —
Other current assets | ​ |  | 11,372 | ​ |  | 6,538
Total current assets | ​ |  | 319,843 | ​ |  | 233,122
Property, plant and equipment, net | ​ |  | 3,699,032 | ​ |  | 3,323,830
Operating lease right-of-use assets | ​ |  | 15,307 | ​ |  | 15,365
Goodwill | ​ | ​ | 124,018 | ​ | ​ | 52,155
Intangible assets, net | ​ |  | 147,923 | ​ |  | 98,271
Contract costs, net | ​ |  | 39,453 | ​ |  | 37,764
Deferred tax assets | ​ |  | 1,932 | ​ |  | 2,975
Other assets | ​ |  | 51,942 | ​ |  | 52,855
Non-current assets of discontinued operations | ​ |  | 7,868 | ​ |  | 7,868
Total assets | ​ | $ | 4,407,318 | ​ | $ | 3,824,205
​ | ​ | ​ | ​ | ​ | ​ | ​
Liabilities and Stockholders' Equity | ​ |  |  | ​ |  |
Current liabilities: | ​ |  |  | ​ |  |
Accounts payable, trade | ​ | $ | 57,747 | ​ | $ | 57,567
Accrued liabilities | ​ |  | 138,641 | ​ |  | 124,105
Deferred revenue | ​ |  | 9,089 | ​ |  | 6,932
Total current liabilities | ​ |  | 205,477 | ​ |  | 188,604
Long-term debt | ​ |  | 2,559,944 | ​ |  | 2,198,376
Operating lease liabilities | ​ |  | 11,772 | ​ |  | 12,415
Deferred tax liabilities | ​ |  | 167,669 | ​ |  | 62,505
Other liabilities | ​ |  | 32,309 | ​ |  | 30,906
Non-current liabilities of discontinued operations | ​ |  | 7,868 | ​ |  | 7,868
Total liabilities | ​ |  | 2,985,039 | ​ |  | 2,500,674
​ | ​ | ​ | ​ | ​ | ​ | ​
Commitments and contingencies (Note 8) | ​ |  |  | ​ |  |
​ | ​ | ​ | ​ | ​ | ​ | ​
Equity: | ​ |  |  | ​ |  |
Preferred stock: $0.01 par value per share, 50,000,000 shares authorized, zero issued | ​ |  | — | ​ |  | —
Common stock: $0.01 par value per share, 250,000,000 shares authorized, 184,707,509 and 185,350,510 shares issued, respectively | ​ |  | 1,847 | ​ |  | 1,854
Additional paid-in capital | ​ |  | 3,871,699 | ​ |  | 3,880,936
Accumulated deficit | ​ |  | (2,337,282) | ​ |  | (2,438,074)
Treasury stock: 9,225,181 and 10,182,985 common shares, at cost, respectively | ​ |  | (113,985) | ​ |  | (121,185)
Total equity | ​ |  | 1,422,279 | ​ |  | 1,323,531
Total liabilities and equity | ​ | $ | 4,407,318 | ​ | $ | 3,824,205

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

6

Table of Contents

Archrock, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2025 |  | 2024 |  | 2025 |  | 2024
Revenue: |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |
Contract operations | ​ | $ | 326,269 | ​ | $ | 245,420 | ​ | $ | 944,993 | ​ | $ | 693,939
Aftermarket services | ​ |  | 56,161 | ​ |  | 46,741 | ​ |  | 167,752 | ​ |  | 137,236
Total revenue | ​ |  | 382,430 | ​ |  | 292,161 | ​ |  | 1,112,745 | ​ |  | 831,175
Cost of sales, exclusive of depreciation and amortization | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Contract operations | ​ |  | 86,710 | ​ |  | 79,810 | ​ |  | 272,661 | ​ |  | 236,831
Aftermarket services | ​ |  | 43,115 | ​ |  | 34,395 | ​ |  | 128,258 | ​ |  | 104,553
Total cost of sales, exclusive of depreciation and amortization | ​ |  | 129,825 | ​ |  | 114,205 | ​ |  | 400,919 | ​ |  | 341,384
Selling, general and administrative | ​ |  | 37,676 | ​ |  | 34,059 | ​ |  | 111,127 | ​ |  | 96,887
Depreciation and amortization | ​ |  | 67,130 | ​ |  | 48,377 | ​ |  | 187,889 | ​ |  | 135,065
Long-lived and other asset impairment | ​ |  | 4,676 | ​ |  | 2,509 | ​ |  | 16,495 | ​ |  | 9,478
Restructuring charges | ​ | ​ | 688 | ​ | ​ | — | ​ | ​ | 1,497 | ​ | ​ | —
Debt extinguishment loss | ​ | ​ | — | ​ | ​ | 3,181 | ​ | ​ | — | ​ | ​ | 3,181
Interest expense | ​ |  | 43,661 | ​ |  | 30,179 | ​ |  | 123,113 | ​ |  | 85,372
Transaction-related costs | ​ | ​ | 1,767 | ​ | ​ | 9,220 | ​ | ​ | 11,829 | ​ | ​ | 11,002
Gain on sale of assets, net | ​ | ​ | (3,835) | ​ | ​ | (2,218) | ​ | ​ | (15,467) | ​ | ​ | (5,175)
Other expense (income), net | ​ |  | 3,984 | ​ |  | (304) | ​ |  | 459 | ​ |  | (37)
Income before income taxes | ​ |  | 96,858 | ​ |  | 52,953 | ​ |  | 274,884 | ​ |  | 154,018
Provision for income taxes | ​ |  | 25,425 | ​ |  | 15,437 | ​ |  | 68,994 | ​ |  | 41,545
Income before equity in net loss of unconsolidated affiliate | ​ |  | 71,433 | ​ |  | 37,516 | ​ | ​ | 205,890 | ​ | ​ | 112,473
Equity in net loss of unconsolidated affiliate, net of tax | ​ |  | 185 | ​ |  | — | ​ |  | 372 | ​ |  | —
Net income | ​ | $ | 71,248 | ​ | $ | 37,516 | ​ | $ | 205,518 | ​ | $ | 112,473
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Basic and diluted earnings per common share | ​ | $ | 0.40 | ​ | $ | 0.22 | ​ | $ | 1.16 | ​ | $ | 0.70
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Weighted-average common shares outstanding: | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Basic | ​ |  | 174,619 | ​ |  | 165,847 | ​ |  | 174,549 | ​ |  | 158,205
Diluted | ​ |  | 174,913 | ​ |  | 166,173 | ​ |  | 174,855 | ​ |  | 158,518

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Archrock, Inc.

Condensed Consolidated Statements of Equity

(in thousands, except shares and per share amounts)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Additional | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Common Stock | ​ | Paid-in | ​ | Accumulated | ​ | Treasury Stock | ​ | ​ | ​
​ |  | ​ | Amount | ​ | Shares |  | Capital |  | Deficit | ​ | ​ | Amount | ​ | Shares | ​ | Total
Balance at June 30, 2024 | ​ | $ | 1,658 | ​ | 165,793,798 | ​ | $ | 3,478,597 | ​ | $ | (2,476,793) | ​ | $ | (108,966) | ​ | (9,493,262) | ​ | $ | 894,496
Shares repurchased | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ | ​ | (12,107) | ​ | (649,854) | ​ | ​ | (12,107)
Shares withheld related to net settlement of equity awards | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ |  | (106) | ​ | (5,291) | ​ |  | (106)
Cash dividends ($0.165 per common share) | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | (27,865) | ​ |  | — | ​ | — | ​ |  | (27,865)
Shares issued under ESPP | ​ | ​ | — | ​ | 14,485 | ​ |  | 263 | ​ |  | — | ​ |  | — | ​ | — | ​ |  | 263
Stock-based compensation, net of forfeitures | ​ | ​ | — | ​ | 1,853 | ​ |  | 3,738 | ​ |  | — | ​ |  | — | ​ | (9,735) | ​ |  | 3,738
Net proceeds from issuance of common stock | ​ | ​ | 127 | ​ | 12,650,000 | ​ | ​ | 255,620 | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | 255,747
Shares issued for TOPS Acquisition | ​ | ​ | 69 | ​ | 6,873,650 | ​ | ​ | 138,985 | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | 139,054
Net income | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | 37,516 | ​ |  | — | ​ | — | ​ |  | 37,516
Balance at September 30, 2024 | ​ | $ | 1,854 | ​ | 185,333,786 | ​ | $ | 3,877,203 | ​ | $ | (2,467,142) | ​ | $ | (121,179) | ​ | (10,158,142) | ​ | $ | 1,290,736
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance at June 30, 2025 | ​ | $ | 1,858 | ​ | 185,783,778 | ​ | $ | 3,892,168 | ​ | $ | (2,371,609) | ​ | $ | (113,977) | ​ | (9,216,485) | ​ | $ | 1,408,440
Shares repurchased | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ | ​ | (25,371) | ​ | (1,094,516) | ​ | ​ | (25,371)
Shares retired | ​ | ​ | (11) | ​ | (1,094,516) | ​ | ​ | (25,360) | ​ | ​ | — | ​ | ​ | 25,371 | ​ | 1,094,516 | ​ | ​ | —
Shares withheld related to net settlement of equity awards | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ |  | (8) | ​ | (301) | ​ |  | (8)
Cash dividends ($0.210 per common share) | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | (36,921) | ​ |  | — | ​ | — | ​ |  | (36,921)
Shares issued under ESPP | ​ | ​ | — | ​ | 18,247 | ​ |  | 403 | ​ |  | — | ​ |  | — | ​ | — | ​ |  | 403
Stock-based compensation, net of forfeitures | ​ | ​ | — | ​ | — | ​ |  | 4,488 | ​ |  | — | ​ |  | — | ​ | (8,395) | ​ |  | 4,488
Net income | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | 71,248 | ​ |  | — | ​ | — | ​ |  | 71,248
Balance at September 30, 2025 | ​ | $ | 1,847 | ​ | 184,707,509 | ​ | $ | 3,871,699 | ​ | $ | (2,337,282) | ​ | $ | (113,985) | ​ | (9,225,181) | ​ | $ | 1,422,279
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Archrock, Inc.

Condensed Consolidated Statements of Equity

(in thousands, except shares and per share amounts)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Additional | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Common Stock | ​ | Paid-in | ​ | Accumulated | ​ | Treasury Stock | ​ | ​ | ​
​ |  | ​ | Amount | ​ | Shares |  | Capital |  | Deficit | ​ | ​ | Amount | ​ | Shares | ​ | Total
Balance at December 31, 2023 | ​ | $ | 1,650 | ​ | 164,984,401 | ​ | $ | 3,470,576 | ​ | $ | (2,499,931) | ​ | $ | (101,274) | ​ | (9,020,454) | ​ | $ | 871,021
Shares repurchased | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ | ​ | (13,337) | ​ | (732,826) | ​ | ​ | (13,337)
Shares withheld related to net settlement of equity awards | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ |  | (6,568) | ​ | (391,868) | ​ | ​ | (6,568)
Cash dividends ($0.495 per common share) | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | (79,684) | ​ |  | — | ​ | — | ​ |  | (79,684)
Shares issued under ESPP | ​ | ​ | — | ​ | 49,602 | ​ |  | 815 | ​ |  | — | ​ |  | — | ​ | — | ​ |  | 815
Stock-based compensation, net of forfeitures | ​ | ​ | 8 | ​ | 776,133 | ​ |  | 11,207 | ​ |  | — | ​ |  | — | ​ | (12,994) | ​ |  | 11,215
Net proceeds from issuance of common stock | ​ | ​ | 127 | ​ | 12,650,000 | ​ | ​ | 255,620 | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | 255,747
Shares issued for TOPS Acquisition | ​ | ​ | 69 | ​ | 6,873,650 | ​ | ​ | 138,985 | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | 139,054
Net income | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | 112,473 | ​ |  | — | ​ | — | ​ |  | 112,473
Balance at September 30, 2024 | ​ | $ | 1,854 | ​ | 185,333,786 | ​ | $ | 3,877,203 | ​ | $ | (2,467,142) | ​ | $ | (121,179) | ​ | (10,158,142) | ​ | $ | 1,290,736
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance at December 31, 2024 | ​ | $ | 1,854 | ​ | 185,350,510 | ​ | $ | 3,880,936 | ​ | $ | (2,438,074) | ​ | $ | (121,185) | ​ | (10,182,985) | ​ | $ | 1,323,531
Shares repurchased | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ | ​ | (54,416) | ​ | (2,330,631) | ​ | ​ | (54,416)
Shares retired | ​ | ​ | (38) | ​ | (3,813,831) | ​ | ​ | (76,574) | ​ | ​ | — | ​ | ​ | 76,612 | ​ | 3,813,831 | ​ | ​ | —
Shares withheld related to net settlement of equity awards | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | — | ​ |  | (14,996) | ​ | (505,269) | ​ |  | (14,996)
Cash dividends ($0.590 per common share) | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | (104,726) | ​ |  | — | ​ | — | ​ |  | (104,726)
Shares issued under ESPP | ​ | ​ | — | ​ | 52,266 | ​ |  | 1,169 | ​ |  | — | ​ |  | — | ​ | — | ​ |  | 1,169
Stock-based compensation, net of forfeitures | ​ | ​ | 8 | ​ | 805,050 | ​ |  | 12,592 | ​ |  | — | ​ |  | — | ​ | (20,127) | ​ |  | 12,600
Time-based cash or equity settled units settled as equity | ​ | ​ | 1 | ​ | 62,500 | ​ | ​ | 1,755 | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | 1,756
Contribution to Enerflex | ​ | ​ | — | ​ | — | ​ | ​ | (1,123) | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | (1,123)
Shares issued for NGCS Acquisition | ​ | ​ | 22 | ​ | 2,251,014 | ​ | ​ | 52,944 | ​ | ​ | — | ​ | ​ | — | ​ | — | ​ |  | 52,966
Net income | ​ | ​ | — | ​ | — | ​ |  | — | ​ |  | 205,518 | ​ |  | — | ​ | — | ​ |  | 205,518
Balance at September 30, 2025 | ​ | $ | 1,847 | ​ | 184,707,509 | ​ | $ | 3,871,699 | ​ | $ | (2,337,282) | ​ | $ | (113,985) | ​ | (9,225,181) | ​ | $ | 1,422,279
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

​

​

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Archrock, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Nine Months Ended
​ | ​ | September 30,
​ |  | 2025 |  | 2024
Cash flows from operating activities: | ​ | ​ |  | ​ | ​ |
Net income | ​ | $ | 205,518 | ​ | $ | 112,473
Adjustments to reconcile net income to net cash provided by operating activities: | ​ |  |  | ​ |  |
Depreciation and amortization | ​ |  | 187,889 | ​ |  | 135,065
Long-lived and other asset impairment | ​ |  | 16,495 | ​ |  | 9,478
Non-cash restructuring charges | ​ | ​ | 251 | ​ | ​ | —
Equity in net loss of unconsolidated affiliate | ​ | ​ | 483 | ​ | ​ | —
Inventory write-downs | ​ |  | 792 | ​ |  | 568
Amortization of operating lease right-of-use assets | ​ | ​ | 3,469 | ​ | ​ | 2,789
Amortization of deferred financing costs | ​ | ​ | 4,772 | ​ | ​ | 3,575
Amortization of debt premium | ​ | ​ | (1,504) | ​ | ​ | (1,504)
Amortization of capitalized implementation costs | ​ | ​ | 2,431 | ​ | ​ | 2,259
Debt extinguishment loss | ​ | ​ | — | ​ | ​ | 3,181
Stock-based compensation expense | ​ |  | 14,356 | ​ |  | 11,215
Provision for credit losses | ​ |  | 524 | ​ |  | 95
Gain on sale of assets, net | ​ |  | (15,467) | ​ |  | (5,175)
Deferred income tax provision | ​ |  | 67,350 | ​ |  | 40,483
Amortization of contract costs | ​ | ​ | 17,053 | ​ | ​ | 17,771
Deferred revenue recognized in earnings | ​ | ​ | (14,596) | ​ | ​ | (9,707)
Changes in operating assets and liabilities: | ​ |  | ​ | ​ |  | ​
Accounts receivable, net | ​ | ​ | (46,064) | ​ | ​ | (4,883)
Inventory | ​ | ​ | (11,823) | ​ | ​ | 3,449
Other assets | ​ | ​ | (18,391) | ​ | ​ | (3,303)
Contract costs | ​ | ​ | (19,046) | ​ | ​ | (15,970)
Accounts payable and other liabilities | ​ | ​ | (4,600) | ​ | ​ | (7,126)
Deferred revenue | ​ | ​ | 17,700 | ​ | ​ | 10,598
Other | ​ | ​ | 37 | ​ | ​ | (78)
Net cash provided by operating activities | ​ |  | 407,629 | ​ |  | 305,253
​ | ​ | ​ | ​ | ​ | ​ | ​
Cash flows from investing activities: | ​ |  |  | ​ |  |
Capital expenditures | ​ |  | (414,667) | ​ |  | (261,044)
Proceeds from sale of business | ​ | ​ | 71,000 | ​ | ​ | —
Proceeds from sale of property, equipment and other assets | ​ |  | 42,556 | ​ |  | 24,204
Proceeds from insurance and other settlements | ​ | ​ | 3,811 | ​ | ​ | 45
Cash paid in TOPS Acquisition, net of cash acquired | ​ | ​ | — | ​ | ​ | (866,568)
Cash paid in NGCS Acquisition, net of cash acquired | ​ | ​ | (294,613) | ​ | ​ | —
Investments in unconsolidated affiliates | ​ | ​ | (471) | ​ | ​ | (1,307)
Net cash used in investing activities | ​ |  | (592,384) | ​ |  | (1,104,670)
​ | ​ | ​ | ​ | ​ | ​ | ​
Cash flows from financing activities: | ​ |  |  | ​ |  |
Borrowings of long-term debt | ​ |  | 1,495,701 | ​ |  | 1,133,425
Repayments of long-term debt | ​ |  | (1,135,301) | ​ |  | (974,275)
Proceeds from 2032 Notes offering | ​ | ​ | — | ​ | ​ | 700,000
Partial repayment of 2027 Notes | ​ | ​ | — | ​ | ​ | (201,987)
Payments of debt issuance costs | ​ |  | (1,890) | ​ |  | (12,308)
Dividends paid to stockholders | ​ |  | (104,726) | ​ |  | (79,684)
Repurchases of common stock | ​ | ​ | (54,416) | ​ | ​ | (13,337)
Taxes paid related to net share settlement of equity awards | ​ | ​ | (14,996) | ​ | ​ | (6,568)
Net proceeds from issuance of common stock | ​ | ​ | — | ​ | ​ | 255,747
Proceeds from stock issued under ESPP | ​ | ​ | 1,169 | ​ | ​ | 815
Contribution to Enerflex | ​ |  | (1,123) | ​ |  | —
Net cash provided by financing activities | ​ |  | 184,418 | ​ |  | 801,828
Net (decrease) increase in cash and cash equivalents | ​ |  | (337) | ​ |  | 2,411
Cash and cash equivalents, beginning of period | ​ |  | 4,420 | ​ |  | 1,338
Cash and cash equivalents, end of period | ​ | $ | 4,083 | ​ | $ | 3,749
​ | ​ | ​ | ​ | ​ | ​ | ​
Supplemental disclosure of non-cash investing transactions: | ​ | ​ | ​ | ​ | ​ | ​
Issuance of Archrock common stock pursuant to TOPS Acquisition | ​ | $ | — | ​ | $ | 139,054
Issuance of Archrock common stock pursuant to NGCS Acquisition | ​ | $ | 52,966 | ​ | $ | —

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

​

10

Table of Contents

Archrock, Inc.

Notes to Condensed Consolidated Financial Statements

1. Description of Business and Basis of Presentation

​

We are an energy infrastructure company with a primary focus on midstream natural gas compression. We are a premier provider of natural gas compression services, in terms of total compression fleet horsepower, to customers in the energy industry throughout the U.S., and a leading supplier of aftermarket services to customers that own compression equipment in the U.S. We operate in two business segments: contract operations and aftermarket services. Our predominant segment, contract operations, primarily includes designing, sourcing, owning, installing, operating, servicing, repairing and maintaining our owned fleet of natural gas compression equipment to provide natural gas compression services to our customers. In our aftermarket services business, we sell parts and components and provide operations, maintenance, overhaul and reconfiguration services to customers who own compression equipment.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to this Form 10-Q and do not include all information and disclosures required by GAAP. Therefore, this information should be read in conjunction with our consolidated financial statements and notes contained in our 2024 Form 10-K. The information furnished herein reflects all adjustments that are, in the opinion of management, of a normal recurring nature and considered necessary for a fair statement of the results of the interim periods reported. All intercompany balances and transactions have been eliminated in consolidation. Operating results for the nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

​

​

2. Recent Accounting Developments

​

Accounting Standards Updates Implemented

Segment Reporting

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires disclosures of significant expenses for each reportable segment, as well as certain other disclosures to help investors understand how the CODM evaluates segment expenses and operating results. ASU 2023-07 allows disclosure of multiple measures of segment profitability if those measures are used to allocate resources and assess performance. We adopted ASU 2023-07 retrospectively during the year ended December 31, 2024. See Note 17 (“Segments”) for further details.

Business Combinations – Joint Venture Formations

In August 2023, the FASB issued ASU 2023-05, to reduce diversity in practice and provide decision-useful information to a joint venture’s investors by requiring that a joint venture apply a new basis of accounting upon formation. By applying a new basis of accounting, a joint venture will recognize and initially measure its assets and liabilities at fair value, with exceptions to fair value measurement that are consistent with the business combinations guidance, on the date of formation. ASU 2023-05 is effective prospectively for all joint venture formations with a formation date on or after January 1, 2025. Additionally, a joint venture that was formed before January 1, 2025, may elect to apply the amendments retrospectively if it has sufficient information to do so. Early adoption is permitted in any interim or annual period in which financial statements have not been issued or been made available for issuance, either prospectively or retrospectively. We adopted ASU 2023-05 during the three months ended March 31, 2025 and its adoption had no impact on our condensed consolidated financial statements.

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Archrock, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Accounting Standards Updates Not Yet Implemented

Accounting for Internal-Use Software Costs

In September 2025, the FASB issued ASU 2025-06, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, to clarify and modernize the accounting for costs related to internal-use software. ASU 2025-06 removes all references to software project development stages in Subtopic 350-40 and clarifies cost capitalization may begin when (1) management has authorized and committed to funding the project and (2) it is probable the project will be completed, and the software will be used to perform its intended function and provides new examples to illustrate its application. ASU 2025-06 specifies that the property, plant and equipment disclosure requirements apply to capitalized software costs accounted for under Subtopic 350-40, regardless of how those costs are presented in the financial statements. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years. Entities may apply the guidance using a prospective, retrospective or modified transition approach. Early adoption is permitted. We are currently evaluating the potential impact of adopting this new guidance on our condensed consolidated financial statements and related disclosures.

Measurement of Credit Losses for Accounts Receivable and Contract Assets

In July 2025, the FASB issued ASU 2025-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which amends Topic 326 to provide for a practical expedient for all entities and an accounting policy election for entities other than public business entities related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under FASB ASU 2016-10, Revenue from Contracts with Customers (Topic 606). All entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. The amendments will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted. Entities should apply the new guidance prospectively. We are currently evaluating the potential impact of electing the practical expedient and do not expect it to have a material impact on our condensed consolidated financial statements.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40), which will require tabular disclosures about certain expenses included in the expense captions presented on the face of the income statement, as well as disclosures about selling expenses. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. Entities are required to adopt ASU 2024-03 prospectively with the option for retrospective application. We are currently evaluating the potential impact of adopting this new guidance on our condensed consolidated financial statements and related disclosures.

Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which will require significant additional disclosures, primarily focused on the disclosure of income taxes paid and the rate reconciliation table. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025, and should be applied on a prospective basis, with a retrospective option. Early adoption is permitted. We are assessing and modifying our systems and processes to comply with our future adoption of ASU 2023-09.

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Archrock, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

3. Business Transactions

Flowco Disposition

On August 1, 2025, we completed the sale of certain contract operations customer agreements and approximately 155 compressors, comprising approximately 47,000 horsepower, used to provide compression services under those agreements along with other supporting assets. Goodwill, customer-related intangible assets and deferred revenue were allocated based on a ratio of the horsepower sold relative to the total horsepower of the asset group. The disposal group was classified as held for sale as of June 30, 2025, and its carrying value was adjusted to estimated fair value less costs to sell. We recorded a write-down of $0.9 million and $9.6 million during the three and nine months ended September 30, 2025, respectively, which is included in long-lived and other asset impairment in our condensed consolidated statements of operations.

​

NGCS Acquisition

​

On May 1, 2025, we completed the NGCS Acquisition, whereby we acquired all of the issued and outstanding equity interests in NGCS, including a fleet of approximately 326,000 operating horsepower and a 18,000 horsepower backlog of contracted new equipment, for aggregate total consideration of $349.4 million. Total consideration consisted of $296.5 million in cash, of which we paid $265.1 million to NGCSI sellers and $31.4 million to NGCSE sellers, and approximately 2.3 million shares of common stock issued to NGCSE sellers with an NGCS acquisition date fair value of $53.0 million. The cash portion of the purchase price was funded with borrowings under the Credit Facility. In accordance with the terms of the Merger Agreement, customary post-closing adjustments were made during the third quarter of 2025, resulting in a reduction to the purchase price of approximately $2.0 million.

​

The NGCS Acquisition was accounted for using the acquisition method of accounting, which requires, among other things, assets acquired and liabilities assumed to be recorded at their fair value on the NGCS acquisition date. The excess of the consideration transferred over those fair values is recorded as goodwill. The preliminary allocation of the purchase price, which is subject to certain adjustments, was based upon preliminary valuations. Our estimates and assumptions are subject to change upon the completion of management’s review of the final valuations. We are in the process of finalizing valuations related to property, plant and equipment, identifiable intangible assets, deferred tax liabilities, tax contingencies and goodwill. This could impact future depreciation and amortization as well as income tax expense. The final valuation of net assets acquired is expected to be completed as soon as practicable, but no later than one year from the NGCS acquisition date.

​

The following table summarizes the preliminary purchase price allocation based on the estimated fair values of the assets acquired and liabilities assumed as of the NGCS acquisition date:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) |  | NGCSI |  | NGCSE | ​ | NGCS
Cash |  | $ | 1,671 |  | $ | 188 |  | $ | 1,859
Accounts receivable | ​ | ​ | 4,960 | ​ | ​ | 47 | ​ | ​ | 5,007
Inventory | ​ | ​ | 11,385 | ​ | ​ | — | ​ | ​ | 11,385
Other current assets | ​ | ​ | 143 | ​ | ​ | — | ​ | ​ | 143
Property, plant and equipment | ​ | ​ | 200,637 | ​ | ​ | 40,460 | ​ | ​ | 241,097
Operating lease right of use asset | ​ | ​ | 138 | ​ | ​ | — | ​ | ​ | 138
Goodwill | ​ | ​ | 50,348 | ​ | ​ | 22,063 | ​ | ​ | 72,411
Intangible assets | ​ | ​ | 33,320 | ​ | ​ | 31,210 | ​ | ​ | 64,530
Other assets | ​ | ​ | 385 | ​ | ​ | — | ​ | ​ | 385
Accounts payable, trade | ​ | ​ | (2,700) | ​ | ​ | (49) | ​ | ​ | (2,749)
Accrued liabilities | ​ | ​ | (1,751) | ​ | ​ | (225) | ​ | ​ | (1,976)
Operating lease liabilities | ​ | ​ | (138) | ​ | ​ | — | ​ | ​ | (138)
Deferred tax liabilities | ​ | ​ | (32,845) | ​ | ​ | (9,346) | ​ | ​ | (42,191)
Other liabilities | ​ | ​ | (463) | ​ | ​ | — | ​ | ​ | (463)
Purchase price | ​ | $ | 265,090 | ​ | $ | 84,348 | ​ | $ | 349,438

​

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Archrock, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Goodwill

​

The amount of goodwill resulting from the NGCS Acquisition is attributable to the expansion of our services in the Permian Basin where we currently operate and was allocated to our contract operations segment. The goodwill recorded is considered to have an indefinite life and will be reviewed annually for impairment or more frequently if indicators of potential impairment exist. None of the goodwill recorded for the NGCS Acquisition is expected to be deductible for U.S. federal income tax purposes.

​

Tax Contingency and Indemnification

We recorded a non-income tax-based contingency of $0.5 million and a corresponding indemnification asset of $0.5 million based on facts existing on the NGCS acquisition date. The non-income tax-based contingency arose from pre-acquisition activity at NGCS. As part of the NGCS Acquisition, the sellers agreed to indemnify us for certain non-income tax and environmental contingencies up to $11.4 million as of the NGCS acquisition date. Dependent upon facts and circumstances, the sellers’ indemnification obligation may be reduced over a period of four years from the NGCS acquisition date but may also be extended until the resolution of claims timely submitted to the sellers.

Results of Operations

The results of operations attributable to the NGCS Acquisition have been included in our condensed consolidated financial statements as part of our contract operations segment since the NGCS acquisition date. Revenue attributable to the assets acquired from the NGCS acquisition date through September 30, 2025 was $33.0 million. We are unable to provide earnings attributable to the assets acquired and liabilities assumed since the NGCS acquisition date, as we do not prepare full stand-alone earnings reports for those assets and liabilities.

Transaction-Related Costs

​

The following table presents transaction-related costs incurred in connection with the NGCS Acquisition by cost type:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three months ended | ​ | Nine months ended
(in thousands) | ​ | September 30, 2025 |  | September 30, 2025
Professional fees (1) | ​ | $ | 144 | ​ | $ | 6,646
Compensation-related costs (2) | ​ | ​ | 867 | ​ | ​ | 1,579
Other costs | ​ | ​ | 92 | ​ | ​ | 455
Total transaction-related costs | ​ | $ | 1,103 | ​ | $ | 8,680

(1) | Professional fees include legal, advisory, consulting and other fees.

(2) | Compensation-related costs include amounts related to NGCSI employee retention and severance associated with the NGCS Acquisition. Payments are due and payable at various times up to and including the one-year anniversary of the NGCS Acquisition.

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Archrock, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Unaudited Pro Forma Financial Information

​

The unaudited pro forma financial information for the three and nine months ended September 30, 2025 and 2024 was derived by adjusting our historical financial statements in order to give effect to the assets acquired and liabilities assumed in the NGCS Acquisition. The NGCS Acquisition is presented in this unaudited pro forma financial information as though the acquisition occurred as of January 1, 2024, and reflects the following:

​

| ● | the effects of the NGCSI employee retention and other compensation-related arrangements associated with the NGCS Acquisition;

| ● | the application of our accounting policies and adjusting the results of NGCS to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant, and equipment, and intangible assets had been applied from January 1, 2024;

| ● | the interest expense resulting from borrowings under the Credit Facility used to fund the cash portion of the purchase price;

| ● | the amortization of debt issuance costs associated with the Second Amendment to the Amended and Restated Credit Agreement;

| ● | the exclusion of $0.2 million and $7.1 million of nonrecurring financial advisory, legal, audit and other professional fees incurred related to the NGCS Acquisition and recorded to transaction-related costs in our condensed consolidated statements of operations during the three and nine months ended September 30, 2025, respectively. The nine months ended September 30, 2024 pro forma earnings were adjusted to reflect these charges; and

| ● | the income tax effects of the adjustments based on the estimated blended statutory tax rate of 23%.

The unaudited pro forma financial information below combines the effects of the NGCSI Merger Agreement and the NGCSE Merger Agreement, as the Merger Agreements were negotiated as a single transaction and mutually dependent to close. The unaudited pro forma financial information is presented for informational purposes only and is not necessarily indicative of our results of operations that would have occurred had the NGCS Acquisition been consummated at the beginning of the period presented, nor is it necessarily indicative of future results.

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Revenue | ​ | $ | 382,430 | ​ | $ | 310,853 | ​ | $ | 1,139,021 | ​ | $ | 887,142
Net income attributable to Archrock stockholders | ​ | ​ | 72,096 | ​ | ​ | 36,937 | ​ | ​ | 212,960 | ​ | ​ | 103,755

​

TOPS Acquisition

​

On August 30, 2024, we completed the TOPS Acquisition, whereby we acquired all of the issued and outstanding equity interests in TOPS, including a fleet of approximately 580,000 horsepower, including approximately 530,000 operating horsepower, for aggregate consideration consisting of $868.7 million in cash and approximately 6.9 million shares of common stock with a TOPS acquisition date fair value of $139.1 million. The cash portion of the purchase price was funded with proceeds from the July 2024 Equity Offering, the 2032 Notes offering and borrowings under the Credit Facility. In accordance with the terms of the purchase and sale agreement, customary post-closing adjustments were made during the fourth quarter of 2024, resulting in a $0.4 million reduction to the purchase price.

​

The TOPS Acquisition was accounted for using the acquisition method of accounting, which requires, among other things, assets acquired and liabilities assumed to be recorded at their fair value on the TOPS acquisition date. The excess of the consideration transferred over those fair values is recorded as goodwill.

​

15

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Archrock, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

The following table summarizes the purchase price allocation based on the fair values of the assets acquired and liabilities assumed as of the TOPS acquisition date:

​

​ | ​ | ​ | ​
(in thousands) |  | ​ | ​
Cash |  | $ | 2,498
Accounts receivable | ​ | ​ | 9,737
Inventory | ​ | ​ | 7,346
Other current assets | ​ | ​ | 495
Property, plant and equipment | ​ | ​ | 912,877
Operating lease right-of-use assets | ​ | ​ | 1,424
Goodwill | ​ | ​ | 52,155
Intangible assets | ​ | ​ | 76,228
Other assets | ​ | ​ | 4,032
Accounts payable, trade | ​ | ​ | (48,946)
Accrued liabilities | ​ | ​ | (4,667)
Operating lease liabilities | ​ | ​ | (1,424)
Other liabilities | ​ | ​ | (4,032)
Purchase price | ​ | $ | 1,007,723

​

Goodwill

The amount of goodwill resulting from the TOPS Acquisition is attributable to the expansion of our services in the Permian Basin where we currently operate and was allocated to our contract operations segment. The goodwill recorded is considered to have an indefinite life and will be reviewed annually for impairment or more frequently if indicators of potential impairment exist. All of the goodwill recorded for the TOPS Acquisition is expected to be deductible for U.S. federal income tax purposes.

Tax Contingency and Indemnification Asset

We recorded a non-income tax based contingency of $4.3 million and a corresponding indemnification asset of $4.3 million based on facts existing on the TOPS acquisition date. The tax contingency arose from pre-acquisition activities of TOPS. As part of the TOPS Acquisition, the sellers agreed to indemnify us for certain tax contingencies up to $21.6 million as of the TOPS acquisition date. Dependent upon facts and circumstances, the sellers’ indemnification obligation may be reduced over a period of five years from the TOPS acquisition date but may also be extended until the resolution of claims timely submitted to the sellers.

Results of Operations

The results of operations attributable to the TOPS Acquisition have been included in our condensed consolidated financial statements as part of our contract operations segment since the TOPS acquisition date.

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Notes to Condensed Consolidated Financial Statements (continued)

Transaction-Related Costs

​

The following table presents transaction-related costs incurred in connection with the TOPS Acquisition by cost type:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) | ​ | 2025 |  | 2024 |  | 2025 |  | 2024
Professional fees (1) | ​ | $ | 201 | ​ | $ | 8,762 | ​ | $ | 764 | ​ | $ | 10,544
Compensation-related costs (2) | ​ |  | 463 | ​ |  | 363 | ​ |  | 2,385 | ​ |  | 363
Other costs | ​ | ​ | — | ​ | ​ | 95 | ​ | ​ | — | ​ | ​ | 95
Total transaction-related costs | ​ | $ | 664 | ​ | $ | 9,220 | ​ | $ | 3,149 | ​ | $ | 11,002

(1) | Professional fees include legal, advisory, consulting and other fees.

(2) | Compensation-related costs include amounts related to employee retention and other compensation-related arrangements associated with the TOPS Acquisition. Payments are due and payable at various times up to and including the two-year anniversary of the TOPS Acquisition.

Unaudited Pro Forma Financial Information

​

The unaudited pro forma financial information for the three and nine months ended September 30, 2024 was derived by adjusting our historical financial statements in order to give effect to the assets acquired and liabilities assumed in the TOPS Acquisition. The TOPS Acquisition is presented in this unaudited pro forma financial information as though the acquisition occurred as of January 1, 2023, and reflects the following:

​

| ● | the effects of the employee retention and other compensation-related arrangements associated with the TOPS Acquisition;

| ● | the application of our accounting policies and adjusting the results of TOPS to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant, and equipment, and intangible assets had been applied from January 1, 2023;

| ● | the interest expense resulting from the 2032 Notes, the 2027 Notes Tender Offer, and the First Amendment to the Amended and Restated Credit Agreement;

| ● | the exclusion of $8.8 million and $10.5 million of nonrecurring financial advisory, legal, audit and other professional fees incurred related to the TOPS Acquisition and recorded to transaction-related costs in our condensed consolidated statements of operations during the three and nine months ended September 30, 2024, respectively; and

| ● | the income tax effects of the adjustments based on the estimated blended statutory tax rate of 23%.

The unaudited pro forma financial information below is presented for informational purposes only and is not necessarily indicative of our results of operations that would have occurred had the TOPS Acquisition been consummated at the beginning of the period presented, nor is it necessarily indicative of future results.

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
(in thousands) |  | September 30, 2024 |  | September 30, 2024
Revenue | ​ | $ | 321,775 | ​ | $ | 940,244
Net income attributable to Archrock stockholders | ​ | ​ | 49,494 | ​ | ​ | 133,164

​

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Notes to Condensed Consolidated Financial Statements (continued)

Valuation Methodologies

The valuation methodologies and significant inputs for fair value measurements associated with our business acquisitions are detailed by significant asset class below. The fair value measurements for property, plant and equipment and intangible assets are based on significant inputs that are not observable in the market and therefore represent Level 3 measurements.

​

Property, Plant and Equipment

​

Property, plant and equipment is primarily comprised of natural gas and electric motor drive compression equipment that will depreciate on a straight-line basis over an estimated average remaining useful life of 15 years for the NGCS Acquisition and 25 years for the TOPS Acquisition. The fair value of the property, plant and equipment was determined using both the cost and market approach. For most of the compression equipment, we estimated the replacement cost using the direct cost method by evaluating recent purchases of similar assets or published data, then adjusting the replacement cost for physical deterioration and functional and economic obsolescence, as applicable. For certain compression equipment, we then considered the market approach by comparing our estimated dollar per horsepower to market comparables and market participant assumptions and adjusted as necessary.

​

Other fixed assets were valued using the indirect cost method, whereby we applied asset-specific trend information using published indexes to calculate the estimated replacement cost of assets that were identified to be reflected at historical cost. Other assets were depreciated based on published normal useful life estimates and prior experience with similar assets.

Intangible Assets

​

The intangible assets consist of customer relationships and trade names that have estimated useful lives of 12 years and five years, respectively. The amount of intangible assets and their associated useful life were determined based on the period over which the assets are expected to contribute directly or indirectly to our future cash flows.

The fair value of the identifiable intangible assets related to customer relationships was determined using the multi-period excess earnings method, which is a specific application of the discounted cash flow method, an income approach, whereby we estimated and then discounted the future cash flows of the intangible asset by adjusting overall business revenue for attrition, obsolescence, cost of sales, operating expenses, taxes and the required returns attributable to other contributory assets acquired. Significant estimates made in arriving at expected future cash flows included our expected customer attrition rate and the amount of earnings attributable to the assets. To discount the estimated future cash flows, we utilized a discount rate that was at a premium to our WACC to reflect the less liquid nature of the customer relationships relative to the tangible assets acquired.

The trade name fair market value was measured using the relief-from-royalty method under the income approach, whereby we calculated the royalty savings by estimating a reasonable royalty rate that a third party would negotiate in a licensing agreement expressed as a percentage of total revenue involving a trade name. The revenue related to the trade name was multiplied by the selected royalty rate over the estimated expected useful life of the trade name to arrive at the royalty savings. The royalty savings were tax effected and discounted to present value using a discount rate commensurate with the risk profile of the trade name relative to our WACC and the return on the other acquired assets.

​

4. Inventory

​

Inventory was comprised of the following:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) | ​ | September 30, 2025 | ​ | December 31, 2024
Parts and supplies | ​ | $ | 96,696 | ​ | $ | 76,505
Work in progress | ​ |  | 15,416 | ​ |  | 13,181
Inventory | ​ | $ | 112,112 | ​ | $ | 89,686

​

​

​

​

​

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Notes to Condensed Consolidated Financial Statements (continued)

5. Property, Plant and Equipment, Net

​

Property, plant and equipment, net was comprised of the following:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) | ​ | September 30, 2025 | ​ | December 31, 2024
Compression equipment, facilities and other fleet assets | ​ | $ | 4,844,086 | ​ | $ | 4,392,818
Land and buildings | ​ |  | 33,805 | ​ |  | 32,060
Transportation and shop equipment | ​ |  | 141,410 | ​ |  | 118,413
Computer hardware and software | ​ |  | 79,333 | ​ |  | 78,021
Other | ​ |  | 8,938 | ​ |  | 7,411
Property, plant and equipment | ​ |  | 5,107,572 | ​ |  | 4,628,723
Accumulated depreciation | ​ |  | (1,408,540) | ​ |  | (1,304,893)
Property, plant and equipment, net | ​ | $ | 3,699,032 | ​ | $ | 3,323,830

​

​

​

​

6. Investments in Unconsolidated Affiliates

​

We determine at the inception of each arrangement whether an entity in which we have made an investment or in which we have other variable interests is considered a VIE. We are the primary beneficiary of a VIE when we have the power to direct activities that most significantly affect the economic performance of the VIE and have the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. We consider a variety of factors in identifying the entity that holds the power to direct matters that most significantly impact the VIE’s economic performance, including evaluating the nature of relationships and activities of the parties involved. We consolidate a VIE if we are the primary beneficiary. If we are not the primary beneficiary in a VIE, we account for the investment or other variable interests in a VIE in accordance with applicable GAAP. We periodically reassess whether any changes in an entity’s capital structure or our relationship with the entity affect our VIE determination and, if so, whether we are the primary beneficiary.

​

Investments in which we are deemed to exert significant influence, but not control, are accounted for using the equity method of accounting, except in cases where the fair value option is elected. For such investments where we have elected the fair value option, the election is irrevocable and is applied on an investment-by-investment basis at initial recognition.

​

For ownership interests that are not accounted for under the equity method and that do not have readily determinable fair values, we have elected the fair value measurement alternative to record these investments at cost minus impairment, if any, including adjustments for observable price changes in orderly transactions for an identical or similar investment of the same issuer. Investments in equity securities measured using the fair value measurement alternative are reviewed for impairment or observable price changes in orderly transactions each reporting period.

Investment in FGC Holdco

On October 1, 2024, we, together with ColdStream, entered into a limited liability agreement with FGC Holdco, a company that designs, manufactures and sells MaCH4 NRS equipment, through distributors. As of the effective date of the agreement, FGC Holdco had initial authorized capital of 1.0 million units, with 68% of its units issued to ColdStream and 32% of its units issued to us at a cost of $0.001 per unit. Subject to certain contractual provisions, we are obligated to fund, as capital contributions, our proportionate share of FGC Holdco’s general, administrative and operational costs and expenses. During the three and nine months ended September 30, 2025, we invested $0.1 million and $0.5 million, respectively, in FGC Holdco, and as of both September 30, 2025 and December 31, 2024, the carrying value of our investment in FGC Holdco, including transaction costs of $0.2 million, was $0.2 million.

​

We determined FGC Holdco is a VIE over which we do not have the power to direct the activities that most significantly impact economic performance and therefore are not the primary beneficiary. The board of directors of FGC Holdco have control over the activities that most significantly impact the economic performance, and while we have voting rights through board participation, we do not have the ability to control board decisions. We apply the equity method of accounting to account for this investment. The carrying value of our equity investment is impacted by our share of investee income or loss, distributions, amortization or accretion of basis differences and other-than-temporary impairments.

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Notes to Condensed Consolidated Financial Statements (continued)

As of September 30, 2025, we had a $0.2 million basis difference between the cost of our investment and our proportionate share of the carrying value of FGC Holdco’s underlying net assets. The basis difference is primarily attributed to intangible assets and is being amortized over the estimated 20-year useful life. Basis differences are updated as needed to reflect the impact of additional capital contributions. We recognized a loss of $0.3 million and $0.5 million related to our investment in FGC Holdco for the three and nine months ended September 30, 2025, respectively, which is included in equity in net loss of unconsolidated affiliate, net of tax, in our condensed consolidated statements of operations.

​

The investment is included in other assets in our condensed consolidated balance sheets. Cash contributions are included in the investing activities section of our condensed consolidated statements of cash flows. See Note 16 (“Related Party Transactions”) for further details.

​

Investment in Ionada

In November 2023, we agreed to serve as the lead investor in a series A preferred financing round and made an initial investment of $3.8 million in Ionada, a global carbon capture technology company committed to reducing GHG emissions and creating a sustainable future. Ionada has developed a post-combustion carbon capture solution to reduce carbon dioxide emissions from various small to mid-sized industrial emitters in the energy, marine and e-fuels industries, among others. We have elected the fair value measurement alternative to account for this investment. See Note 15 (“Fair Value Measurements”) for further details.

On November 19, 2024, subject to the same terms and conditions of our initial investment, we invested an additional $1.2 million and as a result, the carrying value of our investment in Ionada at both September 30, 2025 and December 31, 2024 was $5.5 million, including cumulative transaction costs of $0.5 million, and is included in other assets in our condensed consolidated balance sheets. As of both September 30, 2025 and December 31, 2024, we had a fully diluted ownership equity interest in Ionada of 12%. Subject to certain contractual conditions, we may invest on the same terms and conditions as the initial and secondary investments, up to $6.1 million prior to July 2026, for a fully diluted ownership interest up to 24%.

​

Investment in ECOTEC

In April 2022, we agreed to acquire for cash a 25% equity interest in ECOTEC, a company specializing in methane emissions detection, monitoring and management. We have elected the fair value option to account for this investment. Changes in the fair value of this investment are recognized in other expense (income), net in our condensed consolidated statements of operations; however during the three and nine months ended September 30, 2025 and 2024, we did not recognize unrealized gains or losses related to the change in fair value of our investment. See Note 15 (“Fair Value Measurements”) for further details. As of both September 30, 2025 and December 31, 2024, our ownership interest in ECOTEC was 25%, which is included in other assets in our condensed consolidated balance sheets.

​

​

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Notes to Condensed Consolidated Financial Statements (continued)

7. Long-Term Debt

​

Long-term debt was comprised of the following:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) |  | September 30, 2025 |  | December 31, 2024
Credit Facility | ​ | $ | 768,725 | ​ | $ | 408,325
​ | ​ | ​ | ​ | ​ | ​ | ​
6.625% senior notes due September 2032: | ​ | ​ | ​ | ​ | ​ | ​
Principal outstanding | ​ | ​ | 700,000 | ​ |  | 700,000
Unamortized debt issuance costs | ​ | ​ | (8,669) | ​ |  | (9,609)
​ | ​ | ​ | 691,331 | ​ |  | 690,391
6.25% senior notes due April 2028: | ​ | ​ | ​ | ​ | ​ | ​
Principal outstanding | ​ |  | 800,000 | ​ |  | 800,000
Unamortized debt premium | ​ | ​ | 5,014 | ​ |  | 6,519
Unamortized debt issuance costs | ​ |  | (4,154) | ​ |  | (5,401)
​ | ​ |  | 800,860 | ​ |  | 801,118
6.875% senior notes due April 2027: | ​ | ​ | ​ | ​ | ​ | ​
Principal outstanding | ​ | ​ | 300,000 | ​ |  | 300,000
Unamortized debt issuance costs | ​ | ​ | (972) | ​ |  | (1,458)
​ | ​ | ​ | 299,028 | ​ |  | 298,542
​ | ​ | ​ | ​ | ​ | ​ | ​
Long-term debt | ​ | $ | 2,559,944 | ​ | $ | 2,198,376

​

2027 Notes Redemption

In October 2025, we initiated the repurchase of our 2027 Notes. The 2027 Notes are expected to be redeemed on November 17, 2025 at 100% of their $300.0 million aggregate principal amount plus accrued and unpaid interest of approximately $2.6 million with borrowings under the Credit Facility. We expect to record a debt extinguishment loss related to unamortized debt issuance costs during the fourth quarter of 2025.

Second Amendment to the Amended and Restated Credit Agreement

On May 16, 2025, we amended our Amended and Restated Credit Agreement to increase the borrowing capacity of the Credit Facility from $1.1 billion to $1.5 billion and to provide for the ability for the borrowers to request additional increases in the aggregate commitments under the Credit Facility to a total amount not to exceed $2.3 billion (with any increase being at the discretion of the lenders and subject to the satisfaction of certain conditions set forth in the Amended and Restated Credit Agreement).

During the three and nine months ended September 30, 2025, we incurred $0.1 million and $1.9 million in transaction costs related to the Second Amendment to the Amended and Restated Credit Agreement, which were included in other assets in our condensed consolidated balance sheets and are being amortized over the remaining term of the Credit Facility.

The Credit Facility matures in May 2028 unless renewed or amended prior to that date. As of September 30, 2025, there were $3.0 million letters of credit outstanding under the Credit Facility and the applicable margin on borrowings outstanding was 2.2%. The weighted-average annual interest rate on the outstanding balance under the Credit Facility was 6.6% and 6.8% at September 30, 2025 and December 31, 2024, respectively. We incurred $0.5 million and $0.6 million of commitment fees on the daily unused amount of the Credit Facility during the three months ended September 30, 2025 and 2024, respectively, and $1.5 million during both the nine months ended September 30, 2025 and 2024.

As of September 30, 2025, we were in compliance with all covenants under our Credit Facility. Additionally, all undrawn capacity on our Credit Facility was available for borrowings as of September 30, 2025.

​

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Notes to Condensed Consolidated Financial Statements (continued)

First Amendment to the Amended and Restated Credit Agreement

On August 28, 2024, we amended our Amended and Restated Credit Agreement to, among other things:

| ● | increase the borrowing capacity of the Credit Facility from $750.0 million to $1.1 billion;

| ● | increase the portion of the Credit Facility available for the issuance of swing line loans from $75.0 million to $110.0 million;

| ● | increase the cash dominion trigger threshold amount from $75.0 million to $110.0 million;

| ● | add certain financial institutions as lenders under the Credit Facility;

| ● | join a newly formed wholly owned subsidiary of Archrock Services, L.P. as a guarantor and grantor under the Credit Facility; and

| ● | modify certain other covenants to which we are subject.

During the third quarter of 2024, we incurred $2.6 million in transaction costs related to the First Amendment to the Amended and Restated Credit Agreement, which were included in other assets in our condensed consolidated balance sheets and are being amortized over the remaining term of the Credit Facility.

2032 Notes

​

On August 26, 2024, we completed a private offering of $700.0 million aggregate principal amount of 6.625% senior notes due September 2032 and received net proceeds of $690.0 million after deducting issuance costs. The $10.0 million of issuance costs were recorded as deferred financing costs within long-term debt in our condensed consolidated balance sheets and are being amortized to interest expense in our condensed consolidated statements of operations over the term of the notes. A portion of the net proceeds were used to fund a portion of the cash consideration for the TOPS Acquisition, the 2027 Notes Tender Offer and to repay borrowings outstanding under our Credit Facility.

The 2032 Notes have not been and will not be registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the U.S. except pursuant to a registration exemption under the Securities Act and applicable state securities laws. We offered and issued the 2032 Notes only to qualified institutional buyers in accordance with Rule 144A under the Securities Act and to certain non-U.S. persons outside the U.S. in accordance with Regulation S under the Securities Act.

​

The 2032 Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by us, and by all of our existing subsidiaries, other than Archrock Partners Finance Corp., which is the issuer of the 2032 Notes. The 2032 Notes and the guarantees rank equally in right of payment with all of our and the guarantors’ existing and future senior indebtedness.

We may, at our option, redeem all or part of the 2032 Notes at any time on or after September 1, 2027, at specified redemption prices, plus any accrued and unpaid interest. In addition, prior to September 1, 2027, we may redeem up to 40% of the 2032 Notes at specified redemption prices and make-whole premiums, plus any accrued and unpaid interest.

​

2027 Notes Tender Offer

In connection with the offering of the 2032 Notes, we completed a concurrent cash tender offer of $202.0 million, which reflects approximately 101% of the aggregate principal amount of the tendered 2027 Notes and $0.2 million of agent and legal fees. On the date of tender, the net carrying value of the tendered 2027 Notes was $198.8 million and during the third quarter of 2024, we recorded a debt extinguishment loss of $3.2 million in our condensed consolidated statements of operations.

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Notes to Condensed Consolidated Financial Statements (continued)

8. Commitments and Contingencies

​

Insurance Matters

​

Our business can be hazardous, involving unforeseen circumstances such as uncontrollable flows of natural gas or well fluids and fires or explosions. As is customary in our industry, we review our safety equipment and procedures and carry insurance against some, but not all, risks of our business. Our insurance coverage includes property damage, general liability and commercial automobile liability and other coverage we believe is appropriate. We believe that our insurance coverage is customary for the industry and adequate for our business; however, losses and liabilities not covered by insurance would increase our costs.

​

Additionally, we are substantially self-insured for workers’ compensation and employee group health claims in view of the relatively high per-incident deductibles we absorb under our insurance arrangements for these risks. Losses up to the deductible amounts are estimated and accrued based upon known facts, historical trends and industry averages. We are also self-insured for property damage to our offshore assets.

​

Tax Matters

​

We are subject to a number of state and local taxes that are not income-based. As many of these taxes are subject to audit by the taxing authorities, it is possible that an audit could result in additional taxes due. We accrue for such additional taxes when we determine that it is probable that we have incurred a liability and we can reasonably estimate the amount of the liability. As of September 30, 2025 and December 31, 2024, we had $7.4 million and $8.6 million, respectively, accrued for the outcomes of non-income-based tax audits. We do not expect that the ultimate resolutions of these audits will result in a material variance from the amounts accrued. We do not accrue for unasserted claims for tax audits unless we believe the assertion of a claim is probable, it is probable that it will be determined that the claim is owed and we can reasonably estimate the claim or range of the claim. We believe the likelihood is remote that the impact of potential unasserted claims from non-income-based tax audits could be material to our condensed consolidated financial position, but it is possible that the resolution of future audits could be material to our condensed consolidated results of operations or cash flows.

As of December 31, 2024, $0.6 million of the tax contingencies mentioned above related to audits that had advanced to the contested hearing phase, and by September 30, 2025, these audits are now closed. As of September 30, 2025, and December 31, 2024, $4.0 million and $4.3 million, respectively, of the tax contingencies mentioned above had an offsetting indemnification asset.

We settled certain sales and use tax audits for which we recorded net benefits of $9.9 million and $10.8 million during the three and nine months ended September 30, 2025, respectively, which is primarily reflected as a decrease to cost of sales, exclusive of depreciation and amortization. As of September 30, 2025, these settlements were reflected in our condensed consolidated balance sheets as a $12.4 million tax refund receivable and an offsetting $3.9 million in accrued liabilities.

Litigation and Claims

​

In the ordinary course of business, we are involved in various pending or threatened legal actions. While we are unable to predict the ultimate outcome of these actions, we believe that any ultimate liability arising from any of these actions will not have a material adverse effect on our condensed consolidated financial position, results of operations or cash flows, including our ability to pay dividends. However, because of the inherent uncertainty of litigation and arbitration proceedings, we cannot provide assurance that the resolution of any particular claim or proceeding to which we are a party will not have a material adverse effect on our condensed consolidated financial position, results of operations or cash flows, including our ability to pay dividends.

​

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Notes to Condensed Consolidated Financial Statements (continued)

9. Stockholders’ Equity

​

NGCS Acquisition

On May 1, 2025, we completed the NGCS Acquisition and issued approximately 2.3 million shares of common stock to NGCSE sellers as part of the acquisition purchase price. The NGCS acquisition date fair value was $53.0 million and is reflected in common stock and additional paid-in capital in our condensed consolidated statements of equity. See Note 3 (“Business Transactions”) for further details.

TOPS Acquisition

On August 30, 2024, we completed the TOPS Acquisition and issued approximately 6.9 million shares of common stock to the sellers as part of the acquisition purchase price. The TOPS acquisition date fair value was $139.1 million and is reflected in common stock and additional paid-in capital in our condensed consolidated statements of equity. See Note 3 (“Business Transactions”) for further details.

July 2024 Equity Offering

On July 24, 2024, we sold, pursuant to a public underwriting offering, approximately 12.7 million shares, including approximately 1.7 million shares pursuant to an over-allotment option. Archrock received net proceeds of $255.7 million, after deducting underwriting discounts, commissions and offering expenses. Proceeds from this equity offering were used to fund a portion of the TOPS Acquisition.

Share Repurchases

​

Share Repurchase Program

​

Our Board of Directors authorized a share repurchase program in April 2023 that allowed us to repurchase and retire up to $50.0 million of outstanding common stock over a 12-month period. An extension of the Share Repurchase Program was approved by our Board of Directors in April 2024 for an additional 24-month period and replenished the amount of shares authorized for repurchase, resulting in available capacity of $50.0 million at that time. In April 2025, our Board of Directors approved an increase in the Share Repurchase Program by an additional $50.0 million through April 27, 2026. In October 2025, our Board of Directors approved an additional increase of $100.0 million through December 31, 2026, resulting in available capacity of $130.4 million at that time.

As of September 30, 2025, available capacity under the Share Repurchase Program was $33.5 million. Under the Share Repurchase Program, shares of our common stock may be repurchased periodically, including in the open market, privately negotiated transactions, or otherwise in accordance with applicable federal securities laws, at any time. Through September 30, 2025, we had repurchased 3,813,831 common shares at an average price of $20.09 per share for an aggregate of $76.6 million.

As of September 30, 2025, we have retired all of the shares that had been previously repurchased under the Share Repurchase Program.

Shares Withheld to Cover

​

The 2020 Plan allows us to withhold shares upon vesting of restricted stock at the then-current market price to cover taxes required to be withheld on the vesting date.

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Notes to Condensed Consolidated Financial Statements (continued)

The following tables summarize shares repurchased and shares withheld:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, 2025 | ​ | September 30, 2025
(dollars in thousands, except per share amounts) | ​ | Total Number of Shares | ​ | Average Price per Share | ​ | Total Cost of Shares | ​ | Total Number of Shares | ​ | Average Price per Share | ​ | Total Cost of Shares
Shares repurchased under the Share Repurchase Program | ​ | ​ | 1,094,516 | ​ | $ | 23.18 | ​ | $ | 25,371 | ​ | ​ | 2,330,631 | ​ | $ | 23.35 | ​ | $ | 54,416
Shares withheld related to net settlement of equity awards | ​ | ​ | 301 | ​ | ​ | 25.00 | ​ | ​ | 8 | ​ | ​ | 505,269 | ​ | ​ | 29.68 | ​ | ​ | 14,996
Total | ​ | ​ | 1,094,817 | ​ | $ | 23.18 | ​ | $ | 25,379 | ​ | ​ | 2,835,900 | ​ | $ | 24.48 | ​ | $ | 69,412
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, 2024 | ​ | September 30, 2024
(dollars in thousands, except per share amounts) | ​ | Total Number of Shares | ​ | Average Price per Share | ​ | Total Cost of Shares | ​ | Total Number of Shares | ​ | Average Price per Share | ​ | Total Cost of Shares
Shares repurchased under the Share Repurchase Program | ​ | ​ | 649,854 | ​ | $ | 18.63 | ​ | $ | 12,107 | ​ | ​ | 732,826 | ​ | $ | 18.20 | ​ | $ | 13,337
Shares withheld related to net settlement of equity awards | ​ | ​ | 5,291 | ​ | ​ | 20.05 | ​ | ​ | 106 | ​ | ​ | 391,868 | ​ | ​ | 16.76 | ​ | ​ | 6,568
Total | ​ | ​ | 655,145 | ​ | $ | 18.64 | ​ | $ | 12,213 | ​ | ​ | 1,124,694 | ​ | $ | 17.70 | ​ | $ | 19,905

​

Cash Dividends

​

The following table summarizes our dividends declared and paid in each of the quarterly periods of 2025 and 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Dividends per |  | ​
(dollars in thousands, except per share amounts) |  | Common Share |  | Dividends Paid
2025 | ​ |  |  | ​ |  |
Q3 | ​ | $ | 0.210 | ​ | $ | 36,921
Q2 | ​ | ​ | 0.190 | ​ | ​ | 33,620
Q1 | ​ | ​ | 0.190 | ​ | ​ | 34,185
​ | ​ | ​ | ​ | ​ | ​ | ​
2024 |  | ​ |  |  | ​ |
Q4 | ​ | $ | 0.175 | ​ | $ | 30,690
Q3 | ​ |  | 0.165 | ​ | ​ | 27,865
Q2 | ​ |  | 0.165 | ​ | ​ | 25,819
Q1 | ​ |  | 0.165 | ​ | ​ | 26,000

​

On October 23, 2025, our Board of Directors declared a quarterly dividend of $0.21 per share of common stock to be paid on November 13, 2025 to stockholders of record at the close of business on November 4, 2025.

​

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Notes to Condensed Consolidated Financial Statements (continued)

10. Revenue from Contracts with Customers

​

The following table presents our revenue from contracts with customers by segment and disaggregated by revenue source:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Contract operations: | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |
0 ― 1,000 horsepower per unit | ​ | $ | 107,606 | ​ | $ | 60,589 | ​ | $ | 318,508 | ​ | $ | 151,250
1,001 ― 1,500 horsepower per unit | ​ |  | 109,494 | ​ |  | 96,160 | ​ |  | 317,450 | ​ |  | 286,517
Over 1,500 horsepower per unit | ​ |  | 109,020 | ​ |  | 88,529 | ​ |  | 308,591 | ​ |  | 255,684
Other (1) | ​ |  | 149 | ​ |  | 142 | ​ |  | 444 | ​ |  | 488
Total contract operations revenue (2) | ​ |  | 326,269 | ​ |  | 245,420 | ​ |  | 944,993 | ​ |  | 693,939
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Aftermarket services: | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Services | ​ |  | 35,039 | ​ |  | 27,396 | ​ |  | 94,201 | ​ |  | 78,509
OTC parts and components sales | ​ |  | 21,122 | ​ |  | 19,029 | ​ |  | 71,679 | ​ |  | 58,411
Other | ​ | ​ | — | ​ | ​ | 316 | ​ | ​ | 1,872 | ​ | ​ | 316
Total aftermarket services revenue (3) | ​ |  | 56,161 | ​ |  | 46,741 | ​ |  | 167,752 | ​ |  | 137,236
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total revenue | ​ | $ | 382,430 | ​ | $ | 292,161 | ​ | $ | 1,112,745 | ​ | $ | 831,175

(1) Primarily relates to fees associated with owned non-compression equipment.
(2) Includes $1.3 million and $1.5 million for the three months ended September 30, 2025 and 2024, respectively, and $4.7 million and $3.8 million for the nine months ended September 30, 2025 and 2024, respectively, related to billable maintenance on owned compressors that was recognized at a point in time. All other contract operations revenue is recognized over time.
(3) Services revenue within aftermarket services is recognized over time. OTC parts and components sales revenue and other revenue is recognized at a point in time.

​

See Note 17 (“Segment Information”) for further details.

Performance Obligations

​

As of September 30, 2025, we had $870.6 million of remaining performance obligations related to our contract operations segment, which will be recognized through 2032 as follows:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) | ​ |  | 2025 |  | 2026 |  | 2027 |  | 2028 |  | 2029 |  | Thereafter (1) |  | Total
Remaining performance obligations | ​ | ​ | $ | 202,777 | ​ | $ | 427,364 | ​ | $ | 155,181 | ​ | $ | 55,833 | ​ | $ | 20,547 | ​ | $ | 8,894 | ​ | $ | 870,596

(1) Performance obligations of $7.6 million, $0.7 million and $0.5 million during the years ended December 31, 2030, 2031 and 2032, respectively.

​

We do not disclose the aggregate transaction price for the remaining performance obligations for aftermarket services as there are no contracts with customers with an original contract term that is greater than one year.

Receivables from Contracts with Customers

As of September 30, 2025 and December 31, 2024, our receivables from contracts with customers, net of allowance for credit losses, were $170.4 million and $126.3 million, respectively.

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Notes to Condensed Consolidated Financial Statements (continued)

Allowance for Credit Losses

​

Our allowance for credit losses balance changed as follows during the nine months ended September 30, 2025:

​

​ | ​ | ​ | ​
(in thousands) |  | ​ | ​
Balance at beginning of period |  | $ | 414
Provision for credit losses | ​ | ​ | 524
Write-offs charged against allowance | ​ | ​ | (257)
Balance at end of period | ​ | $ | 681

​

Contract Liabilities

​

Freight billings to customers for the transport of compression assets, customer-specified modifications of compression assets and milestone billings on aftermarket services often result in a contract liability. As of September 30, 2025 and December 31, 2024, our contract liabilities were $13.1 million and $10.0 million, respectively, which is included in other long-term liabilities in our condensed consolidated balance sheets.

During the nine months ended September 30, 2025, we deferred revenue of $17.7 million and recognized $14.6 million as revenue. The revenue recognized during the period primarily related to freight billings and milestone billings on aftermarket services.

11. Long-Lived and Other Asset Impairment

​

We review long-lived assets, including property, plant and equipment and identifiable intangibles that are being amortized, for impairment whenever events or changes in circumstances, including remeasurement of the disposal group classified as held for sale and the removal of compressors from our active fleet, indicate that the carrying amount of an asset may not be recoverable.

Compression Fleet

We periodically review the future deployment of our idle compression assets for units that are not of the type, configuration, condition, make or model that are cost efficient to maintain and operate. Based on these reviews, we determine that certain idle compressors should be retired from the active fleet. The retirement of these units from the active fleet triggers a review of these assets for impairment, and as a result of our review, we may record an asset impairment to reduce the book value of each unit to its estimated fair value. The fair value of each unit is estimated based on the expected net sale proceeds compared to other fleet units we recently sold, a review of other units recently offered for sale by third parties or the estimated component value of the equipment we plan to use.

In connection with our review of our idle compression assets, we evaluate for impairment idle units that were culled from our fleet in prior years and are available for sale. Based on that review, we may reduce the expected proceeds from disposition and record additional impairment to reduce the book value of each unit to its estimated fair value.

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Notes to Condensed Consolidated Financial Statements (continued)

The following table presents the results of our compression fleet impairment review as recorded in our contract operations segment:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(dollars in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Idle compressors retired from the active fleet |  | ​ | 20 |  | ​ | 15 |  | ​ | 70 |  | ​ | 80
Horsepower of idle compressors retired from the active fleet |  | ​ | 11,000 |  | ​ | 12,000 |  | ​ | 28,000 |  | ​ | 58,000
Impairment recorded on idle compressors retired from the active fleet | ​ | $ | 3,776 | ​ | $ | 2,509 | ​ | $ | 6,859 | ​ | $ | 9,478

​

See Note 15 (“Fair Value Measurements”) for further details.

​

Assets Held For Sale

​

In connection with the classification of the disposal group as assets held for sale as of June 30, 2025, we adjusted the carrying value of the disposal group to its estimated fair value less costs to sell and recorded a write-down of $0.9 million and $9.6 million during the three and nine months ended September 30, 2025, respectively, which is included in long-lived and other asset impairment in our condensed consolidated statements of operations. See Note 3 (“Business Transactions”) for further details.

​

12. Restructuring Charges

​

During the second quarter of 2025, management approved and initiated a plan to exit certain facilities that were no longer deemed economical for our business, and during the three and nine months ended September 30, 2025, we incurred $0.7 million and $0.8 million, respectively of costs to exit these facilities. The facility closure costs incurred under the above restructuring plan were recorded to restructuring charges in our condensed consolidated statements of operations. We expect to incur additional restructuring charges of $1.0 million over the next nine months related to these restructuring activities.

​

During the first quarter of 2025, management approved and executed a plan to exit a facility no longer deemed economical for our business, and in the first quarter of 2025, we incurred $0.7 million of costs to exit this facility. The severance and property disposal costs incurred under this restructuring plan were recorded to restructuring charges in our condensed consolidated statements of operations. We do not expect to incur additional restructuring charges related to these restructuring activities.

​

The following table presents the changes to our accrued liability balance related to restructuring charges during the nine months ended September 30, 2025:

​

​ | ​ | ​ | ​
(in thousands) | ​ | Total
Balance at December 31, 2024 |  | $ | —
Charges incurred | ​ |  | 1,497
Payments | ​ | ​ | (1,246)
Balance at September 30, 2025 | ​ | $ | 251

​

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Notes to Condensed Consolidated Financial Statements (continued)

The following table presents restructuring charges incurred by segment during the three and nine months ended September 30, 2025:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Contract | ​ | Aftermarket | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) | ​ | Operations | ​ | Services | ​ | Other(1) | ​ | Total
Three months ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Facility closure | ​ | $ | — | ​ | $ | — | ​ | $ | 688 | ​ | $ | 688
Total restructuring charges | ​ | $ | — | ​ | $ | — | ​ | $ | 688 | ​ | $ | 688
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine months ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Facility closure | ​ | $ | 520 | ​ | $ | — | ​ | $ | 977 | ​ | $ | 1,497
Total restructuring charges | ​ | $ | 520 | ​ | $ | — | ​ | $ | 977 | ​ | $ | 1,497

(1) | Represents expense incurred within our corporate function and not directly attributable to our segments.

The following table presents restructuring charges incurred by cost type:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three months ended | ​ | Nine months ended
(in thousands) | ​ | September 30, 2025 |  | September 30, 2025
Facility closure | ​ | ​ | ​ | ​ | ​ | ​
Severance costs | ​ | $ | — | ​ | $ | 596
Property disposal and closure costs | ​ | ​ | 688 | ​ | ​ | 901
Total restructuring costs | ​ | $ | 688 | ​ | $ | 1,497

​

​

13. Income Taxes

​

OB3 Tax Law

The OB3 Tax Law made permanent certain key elements of the Tax Cuts and Jobs Act, including reinstating: the add-back for depreciation and amortization in the business interest expense limitation, the allowance for 100% bonus depreciation, and a full expensing option for domestic research and experimental expenditures. These certain key elements allow for acceleration of certain deductions, which could lead to lower cash tax payments in the future. The OB3 Tax Law did not have a material impact on our condensed consolidated balance sheet as of September 30, 2025, or on our condensed consolidated statements of operations for the three and nine months ended September 30, 2025.

​

Effective Tax Rate

​

The year-to-date effective tax rate for the nine months ended September 30, 2025 differed significantly from our statutory rate primarily due to state taxes, unrecognized tax benefits and the limitation on executive compensation offset by the benefit from equity-settled long-term incentive compensation.

Unrecognized Tax Benefits

​

As of September 30, 2025, we believe it is reasonably possible that $3.7 million of our unrecognized tax benefits, including penalties, interest and discontinued operations, will be reduced prior to September 30, 2026 due to the settlement of audits or the expiration of statutes of limitations or both. However, due to the uncertain and complex application of the tax regulations, it is possible that the ultimate resolution of these matters may result in liabilities that could materially differ from this estimate.

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Notes to Condensed Consolidated Financial Statements (continued)

14. Earnings Per Common Share

​

Basic earnings per common share is computed using the two-class method, which is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. Under the two-class method, basic earnings per common share is determined by dividing net income, after deducting amounts allocated to participating securities, by the weighted-average number of common shares outstanding for the period. Participating securities include unvested restricted stock and stock-settled restricted stock units that have nonforfeitable rights to receive dividends or dividend equivalents, whether paid or unpaid. During periods of net loss, only distributed earnings (dividends) are allocated to participating securities, as participating securities do not have a contractual obligation to participate in our undistributed losses.

Diluted earnings per common share is computed using the weighted-average number of common shares outstanding adjusted for the incremental common stock equivalents attributed to outstanding performance-based and time-based restricted stock units and stock to be issued pursuant to our ESPP unless their effect would have been anti-dilutive.

The following table shows the calculation of net income attributable to common stockholders, which is used in the calculation of basic and diluted earnings per common share, potential shares of common stock that were included in computing diluted earnings per common share and the potential shares of common stock issuable that were excluded from computing diluted earnings per common share as their inclusion would have been anti-dilutive:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Net income | ​ | $ | 71,248 | ​ | $ | 37,516 | ​ | $ | 205,518 | ​ | $ | 112,473
Less: Allocation of earnings to participating securities | ​ |  | (544) | ​ |  | (430) | ​ |  | (2,434) | ​ |  | (1,607)
Net income attributable to common stockholders | ​ | $ | 70,704 | ​ | $ | 37,086 | ​ | $ | 203,084 | ​ | $ | 110,866
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Allocation of earnings to cash or share settled restricted stock units(1) | ​ | ​ | — | ​ | ​ | (129) | ​ | ​ | 1 | ​ | ​ | (352)
Diluted net income attributable to common stockholders | ​ | $ | 70,704 | ​ | $ | 36,957 | ​ | $ | 203,085 | ​ | $ | 110,514
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Weighted-average common shares outstanding used in basic earnings per common share | ​ | ​ | 174,619 | ​ | ​ | 165,847 | ​ | ​ | 174,549 | ​ | ​ | 158,205
Effect of dilutive securities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Performance-based restricted stock units | ​ | ​ | 278 | ​ | ​ | 325 | ​ | ​ | 295 | ​ | ​ | 306
Time-based restricted stock units | ​ | ​ | 14 | ​ | ​ | — | ​ | ​ | 5 | ​ | ​ | —
ESPP shares | ​ | ​ | 2 | ​ | ​ | 1 | ​ | ​ | 6 | ​ | ​ | 7
Weighted-average common shares outstanding used in diluted earnings per common share | ​ | ​ | 174,913 | ​ | ​ | 166,173 | ​ | ​ | 174,855 | ​ | ​ | 158,518

​

(1) Excludes the income effect of participating liability awards that permit share settlement as the effect would be anti-dilutive.

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Notes to Condensed Consolidated Financial Statements (continued)

15. Fair Value Measurements

​

Assets and Liabilities Measured at Fair Value on a Recurring Basis

​

Investment in ECOTEC

​

As of September 30, 2025, we owned a 25% equity interest in ECOTEC in which we have elected the fair value option to account for this investment. See Note 6 (“Investments in Unconsolidated Affiliates”) for further details. There were no purchases of equity interests or unrealized changes in the fair value of our investment in ECOTEC recognized during the three and nine months ended September 30, 2025 or 2024. The fair value of our investment in ECOTEC at both September 30, 2025 and December 31, 2024 was $14.7 million.

​

The fair value determination of this investment primarily consisted of unobservable inputs, which creates uncertainty in the measurement of fair value as of the reporting date. The significant unobservable inputs used in the fair value measurement, which was valued through an average of an income approach (discounted cash flow method) and a market approach (guideline public company method), are the WACC and the revenue multiples. Significant increases (decreases) in these inputs in isolation would result in a significantly higher (lower) fair value measurement. This fair value measurement is classified as Level 3.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

​

Investment in Ionada

As of September 30, 2025 and December 31, 2024, we had a fully diluted ownership equity interest in Ionada of 12%, in which we have elected the fair value measurement alternative to account for this investment. See Note 6 (“Investments in Unconsolidated Affiliates”) for further details. The carrying value of our investment in Ionada at both September 30, 2025 and December 31, 2024 was $5.5 million, which includes cumulative transaction costs of $0.5 million. There were no upward adjustments, impairments or downward adjustments to the carrying value of the investment as of September 30, 2025.

Compressors

​

During the nine months ended September 30, 2025, we recorded nonrecurring fair value measurements related to our idle compressors. Our estimate of the compressors’ fair value was primarily based on the expected net sale proceeds compared with other fleet units we recently sold and/or a review of other units recently offered for sale by third parties, or the estimated component value of the equipment we plan to use. We discounted the expected proceeds, net of selling and other carrying costs, using a weighted-average disposal period of four years. These fair value measurements are classified as Level 3.

The fair value of our impaired compression fleet was as follows:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) | ​ | ​ | ​ | September 30, 2025 | ​ | December 31, 2024
Impaired compression fleet | ​ | ​ | ​ | $ | 622 | ​ | $ | 1,048

​

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Notes to Condensed Consolidated Financial Statements (continued)

The significant unobservable inputs used to develop the above fair value measurements were weighted by the relative fair value of the compressors being measured. Additional quantitative information related to our significant unobservable inputs was as follows:

​

​ | ​ | ​ | ​ | ​
​ |  | Range |  | Weighted Average (1)
Estimated net sale proceeds: | ​ | ​ | ​ | ​
As of September 30, 2025 | ​ | $1 - $241 per horsepower | ​ | $53 per horsepower
As of December 31, 2024 | ​ | $0 - $188 per horsepower | ​ | $46 per horsepower

(1) | Calculated based on an estimated discount for market liquidity of 22% and 25% as of September 30, 2025 and December 31, 2024, respectively.

​

See Note 11 (“Long-Lived and Other Asset Impairments”) for further details.

​

Other Financial Instruments

​

The carrying amounts of our cash, accounts receivable and accounts payable approximate fair value due to the short-term nature of these instruments.

The carrying amount of borrowings outstanding under our Credit Facility approximates fair value due to the variable interest rate. The measurement of the fair value of these outstanding borrowings is a Level 3 measurement.

The fair value of our fixed rate debt is estimated using yields observable in active markets, which are Level 2 inputs, and was as follows:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) |  | September 30, 2025 |  | December 31, 2024
Carrying amount of fixed rate debt (1) | ​ | $ | 1,791,219 | ​ | $ | 1,790,051
Fair value of fixed rate debt | ​ |  | 1,820,000 | ​ |  | 1,796,000

(1) Carrying amounts are shown net of unamortized premium and deferred financing costs. See Note 7 (“Long-Term Debt”).

Assets held for sale

As of June 30, 2025, we adjusted the carrying value of the disposal group to its estimated fair value less costs to sell. The determination of the fair value was based on the indicative sales value of $71.0 million from Flowco pursuant to the asset purchase agreement entered into on July 1, 2025 and unobservable inputs which are categorized as Level 3 within the fair value hierarchy. See Note 3 (“Business Transactions”) for further details.

16. Related Party Transactions

​

ECOTEC

​

During the three and nine months ended September 30, 2025, we made purchases of $0.1 million and $0.4 million, respectively, from our unconsolidated affiliate ECOTEC for use in our operations.

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Notes to Condensed Consolidated Financial Statements (continued)

FGC Holdco

We are a distributer of MaCH4 NRS equipment in the U.S. market and have committed to purchase from FGC Holdco, at arm’s length, a minimum of $64.3 million of MaCH4 NRS equipment through March 31, 2026, subject to certain contractual provisions under the limited liability agreement that we, together with ColdStream, entered into with FGC Holdco on October 1, 2024. On August 26, 2025, we amended the limited liability agreement and agreed to, among other items, cancel our remaining MaCH4 NRS purchase commitments. We incurred and paid an amendment fee of $3.6 million to FGC Holdco, which is included in other expense (income), net, in our condensed consolidated statements of operations. During the three and nine months ended September 30, 2025, we made MaCH4 NRS purchases of $0.4 million and $3.5 million, respectively, from our unconsolidated affiliate FGC Holdco to sell to third parties or for use in our operations.

The carrying value of assets and liabilities recognized in our condensed consolidated balance sheets related to our variable interests in FGC Holdco and our maximum exposure to loss related to our involvement with an unconsolidated VIE were as follows:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(in thousands) | ​ | September 30, 2025 | ​ | December 31, 2024 | ​
Inventory | ​ | $ | 7,718 | ​ | $ | 6,103 | ​
Investment in unconsolidated affiliate | ​ |  | 179 | ​ |  | 191 | ​
Total VIE assets | ​ | ​ | 7,897 | ​ | ​ | 6,294 | ​
Maximum exposure to loss | ​ | $ | 7,897 | ​ | $ | 6,294 | ​

​

See Note 6 (“Investments in Unconsolidated Affiliates”) for further details.

Hilcorp

From August 2019 to present, our Board of Directors has included a member affiliated with our customer Hilcorp or its subsidiaries or affiliates. Revenue from Hilcorp was $9.2 million and $10.2 million during the three months ended September 30, 2025 and 2024, respectively, and $30.9 million and $30.6 million during the nine months ended September 30, 2025 and 2024, respectively.

​

Accounts receivable, net due from Hilcorp was $3.1 million and $3.6 million as of September 30, 2025 and December 31, 2024, respectively.

​

17. Segment Information

We manage our business segments primarily based on the type of product or service provided. We have two segments that we operate within the U.S.: contract operations and aftermarket services. Our contract operations segment primarily provides natural gas compression services to meet specific customer requirements. Our aftermarket services segment provides a full range of services to support the compression needs of customers, from parts sales and normal maintenance services to full operation of a customer’s owned assets.

The CODM of Archrock is our President & Chief Executive Officer. Our CODM evaluates the performance of our segments and allocates resources primarily based on adjusted gross margin, defined as revenue less cost of sales, exclusive of depreciation and amortization, which are key components of segment operations. Adjusted gross margin is the primary measure used by our CODM to evaluate segment performance because it focuses on the current performance of segment operations and excludes the impact of the prior historical costs of assets acquired or constructed that are utilized in those operations, the indirect costs associated with our SG&A activities, our financing methods and income taxes. Our CODM considers adjusted gross margin forecast to actual results and period over period financial variances in conjunction with product and customer service metrics and market trends when assessing segment performance and deciding how to allocate resources.

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Notes to Condensed Consolidated Financial Statements (continued)

Summarized financial information for our reporting segments is shown below:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Contract |  | Aftermarket |  | ​ | ​
(in thousands) |  | Operations |  | Services |  | Total
Three months ended September 30, 2025 |  | ​ |  |  | ​ |  |  | ​ |
Revenue(1) | ​ | $ | 326,269 | ​ | $ | 56,161 | ​ | $ | 382,430
Cost of sales, exclusive of depreciation and amortization | ​ | ​ | 86,710 | ​ | ​ | 43,115 | ​ | ​ | 129,825
Adjusted gross margin | ​ |  | 239,559 | ​ |  | 13,046 | ​ |  | 252,605
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Three months ended September 30, 2024 | ​ |  |  | ​ |  |  | ​ |  |
Revenue(1) | ​ | $ | 245,420 | ​ | $ | 46,741 | ​ | $ | 292,161
Cost of sales, exclusive of depreciation and amortization | ​ | ​ | 79,810 | ​ | ​ | 34,395 | ​ | ​ | 114,205
Adjusted gross margin | ​ |  | 165,610 | ​ |  | 12,346 | ​ |  | 177,956
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine months ended September 30, 2025 | ​ |  |  | ​ |  |  | ​ |  |
Revenue(1) | ​ | $ | 944,993 | ​ | $ | 167,752 | ​ | $ | 1,112,745
Cost of sales, exclusive of depreciation and amortization | ​ | ​ | 272,661 | ​ | ​ | 128,258 | ​ | ​ | 400,919
Adjusted gross margin | ​ |  | 672,332 | ​ |  | 39,494 | ​ |  | 711,826
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine months ended September 30, 2024 | ​ |  |  | ​ |  |  | ​ |  |
Revenue(1) | ​ | $ | 693,939 | ​ | $ | 137,236 | ​ | $ | 831,175
Cost of sales, exclusive of depreciation and amortization | ​ | ​ | 236,831 | ​ | ​ | 104,553 | ​ | ​ | 341,384
Adjusted gross margin | ​ |  | 457,108 | ​ |  | 32,683 | ​ |  | 489,791

(1) | Segment revenue includes only sales to external customers.

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Notes to Condensed Consolidated Financial Statements (continued)

The following table reconciles gross margin to adjusted gross margin:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Total revenues | ​ | $ | 382,430 | ​ | $ | 292,161 | ​ | $ | 1,112,745 | ​ | $ | 831,175
Cost of sales, exclusive of depreciation and amortization | ​ |  | (129,825) | ​ |  | (114,205) | ​ |  | (400,919) | ​ |  | (341,384)
Depreciation and amortization | ​ |  | (67,130) | ​ |  | (48,377) | ​ |  | (187,889) | ​ |  | (135,065)
Gross margin | ​ |  | 185,475 | ​ |  | 129,579 | ​ |  | 523,937 | ​ |  | 354,726
Depreciation and amortization | ​ | ​ | 67,130 | ​ | ​ | 48,377 | ​ | ​ | 187,889 | ​ | ​ | 135,065
Adjusted gross margin | ​ | $ | 252,605 | ​ | $ | 177,956 | ​ | $ | 711,826 | ​ | $ | 489,791

​

The following table reconciles total adjusted gross margin to income before income taxes:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended |  | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Adjusted gross margin | ​ | $ | 252,605 | ​ | $ | 177,956 | ​ | $ | 711,826 | ​ | $ | 489,791
Less: | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Selling, general and administrative | ​ |  | 37,676 | ​ |  | 34,059 | ​ |  | 111,127 | ​ |  | 96,887
Depreciation and amortization | ​ |  | 67,130 | ​ |  | 48,377 | ​ |  | 187,889 | ​ |  | 135,065
Long-lived and other asset impairment | ​ |  | 4,676 | ​ |  | 2,509 | ​ |  | 16,495 | ​ |  | 9,478
Restructuring charges | ​ | ​ | 688 | ​ | ​ | — | ​ | ​ | 1,497 | ​ | ​ | —
Debt extinguishment loss | ​ | ​ | — | ​ | ​ | 3,181 | ​ | ​ | — | ​ | ​ | 3,181
Interest expense | ​ |  | 43,661 | ​ |  | 30,179 | ​ |  | 123,113 | ​ |  | 85,372
Transaction-related costs | ​ | ​ | 1,767 | ​ | ​ | 9,220 | ​ | ​ | 11,829 | ​ | ​ | 11,002
Gain on sale of assets, net | ​ | ​ | (3,835) | ​ | ​ | (2,218) | ​ | ​ | (15,467) | ​ | ​ | (5,175)
Other expense (income), net | ​ |  | 3,984 | ​ |  | (304) | ​ |  | 459 | ​ |  | (37)
Income before income taxes | ​ | $ | 96,858 | ​ | $ | 52,953 | ​ | $ | 274,884 | ​ | $ | 154,018

​

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​

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

​

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included in this Form 10-Q and in conjunction with our 2024 Form 10-K.

OVERVIEW

​

We are an energy infrastructure company with a primary focus on midstream natural gas compression. We are a premier provider of natural gas compression services, in terms of total compression fleet horsepower, to customers in the energy industry throughout the U.S., and a leading supplier of aftermarket services to customers that own compression equipment in the U.S. We operate in two business segments: contract operations and aftermarket services. Our predominant segment, contract operations, primarily includes designing, sourcing, owning, installing, operating, servicing, repairing and maintaining our owned fleet of natural gas compression equipment to provide natural gas compression services to our customers. In our aftermarket services business, we sell parts and components and provide operations, maintenance, overhaul and reconfiguration services to customers who own compression equipment.

Operating Highlights

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | ​ | Nine Months Ended |
​ | ​ | September 30, | ​ | ​ | September 30,
(horsepower in thousands) |  | 2025 |  | 2024 |  |  | 2025 |  | ​ | 2024 |
Total available horsepower (at period end)(1) |  | 4,845 |  | 4,418 |  |  | 4,845 |  | ​ | 4,418 | ​
Total operating horsepower (at period end)(2) | ​ | 4,651 |  | 4,179 |  | ​ | 4,651 |  | ​ | 4,179 | ​
Average operating horsepower(3) | ​ | 4,647 |  | 3,757 |  | ​ | 4,454 |  | ​ | 3,668 | ​
Horsepower utilization: | ​ |  |  |  |  | ​ |  |  | ​ |  | ​
Spot (at period end) | ​ | 96 | % | 95 | % | ​ | 96 | % | ​ | 95 | %
Average | ​ | 96 | % | 95 | % | ​ | 96 | % | ​ | 95 | %

(1) Defined as idle and operating horsepower. Includes new compressors completed by third-party manufacturers that have been delivered to us.
(2) Defined as horsepower that is operating under contract and horsepower that is idle but under contract and generating revenue such as standby revenue.
(3) Defined as average of period end horsepower that is operating under contract and horsepower that is idle but under contract and generating revenue such as standby revenue, including operating horsepower for the compressors acquired in the NGCS Acquisition beginning May 1, 2025 through September 30, 2025 and for compressors acquired in the TOPS Acquisition beginning September 1, 2024 through September 30, 2025.

Non-GAAP Financial Measures

​

Management uses a variety of financial and operating metrics to analyze our performance. These metrics are significant factors in assessing our operating results and profitability and include the non–GAAP financial measure of adjusted gross margin.

We define adjusted gross margin as total revenue less cost of sales, exclusive of depreciation and amortization. Adjusted gross margin is included as a supplemental disclosure because it is a primary measure used by our management to evaluate the results of revenue and cost of sales, exclusive of depreciation and amortization, which are key components of our operations. We believe adjusted gross margin is important because it focuses on the current operating performance of our operations and excludes the impact of the prior historical costs of the assets acquired or constructed that are utilized in those operations, the indirect costs associated with our SG&A activities, our financing methods and income taxes. In addition, depreciation and amortization may not accurately reflect the costs required to maintain and replenish the operational usage of our assets and therefore may not portray the costs of current operating activity. As an indicator of our operating performance, adjusted gross margin should not be considered an alternative to, or more meaningful than, gross margin, net income (loss) or any other measures presented in accordance with GAAP. Our adjusted gross margin may not be comparable to a similarly titled measure of other entities because other entities may not calculate adjusted gross margin in the same manner.

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Adjusted gross margin has certain material limitations associated with its use as compared to net income. These limitations are primarily due to the exclusion of SG&A, depreciation and amortization, long-lived and other asset impairments, restructuring charges, interest expense, transaction-related costs, gain on sale of assets, net, other expense (income), net provision for income taxes, and equity in net loss of unconsolidated affiliate, net of tax. Because we intend to finance a portion of our operations through borrowings, interest expense is a necessary element of our costs and our ability to generate revenue. Additionally, because we use capital assets, depreciation expense is a necessary element of our costs and our ability to generate revenue and SG&A is necessary to support our operations and required corporate activities. To compensate for these limitations, management uses this non–GAAP measure as a supplemental measure to other GAAP results to provide a more complete understanding of our performance.

​

The following table reconciles net income to adjusted gross margin:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Net income | ​ | $ | 71,248 | ​ | $ | 37,516 | ​ | $ | 205,518 | ​ | $ | 112,473
Selling, general and administrative | ​ |  | 37,676 | ​ |  | 34,059 | ​ |  | 111,127 | ​ |  | 96,887
Depreciation and amortization | ​ |  | 67,130 | ​ |  | 48,377 | ​ |  | 187,889 | ​ |  | 135,065
Long-lived and other asset impairment | ​ |  | 4,676 | ​ |  | 2,509 | ​ |  | 16,495 | ​ |  | 9,478
Restructuring charges | ​ | ​ | 688 | ​ | ​ | — | ​ | ​ | 1,497 | ​ | ​ | —
Debt extinguishment loss | ​ | ​ | — | ​ | ​ | 3,181 | ​ | ​ | — | ​ | ​ | 3,181
Interest expense | ​ |  | 43,661 | ​ |  | 30,179 | ​ |  | 123,113 | ​ |  | 85,372
Transaction-related costs | ​ | ​ | 1,767 | ​ | ​ | 9,220 | ​ | ​ | 11,829 | ​ | ​ | 11,002
Gain on sale of assets, net | ​ | ​ | (3,835) | ​ | ​ | (2,218) | ​ | ​ | (15,467) | ​ | ​ | (5,175)
Other expense (income), net | ​ |  | 3,984 | ​ |  | (304) | ​ |  | 459 | ​ |  | (37)
Provision for income taxes | ​ |  | 25,425 | ​ |  | 15,437 | ​ |  | 68,994 | ​ |  | 41,545
Equity in net loss of unconsolidated affiliate, net of tax | ​ | ​ | 185 | ​ | ​ | — | ​ | ​ | 372 | ​ | ​ | —
Adjusted gross margin | ​ | $ | 252,605 | ​ | $ | 177,956 | ​ | $ | 711,826 | ​ | $ | 489,791

​

The following table reconciles gross margin, the most directly comparable GAAP measure, to adjusted gross margin:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Total revenues | ​ | $ | 382,430 | ​ | $ | 292,161 | ​ | $ | 1,112,745 | ​ | $ | 831,175
Cost of sales, exclusive of depreciation and amortization | ​ |  | (129,825) | ​ |  | (114,205) | ​ |  | (400,919) | ​ |  | (341,384)
Depreciation and amortization | ​ |  | (67,130) | ​ |  | (48,377) | ​ |  | (187,889) | ​ |  | (135,065)
Gross margin | ​ |  | 185,475 | ​ |  | 129,579 | ​ |  | 523,937 | ​ |  | 354,726
Depreciation and amortization | ​ | ​ | 67,130 | ​ | ​ | 48,377 | ​ | ​ | 187,889 | ​ | ​ | 135,065
Adjusted gross margin | ​ | $ | 252,605 | ​ | $ | 177,956 | ​ | $ | 711,826 | ​ | $ | 489,791

​

RESULTS OF OPERATIONS

​

Summary of Results

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Revenue was $382.4 million and $292.2 million during the three months ended September 30, 2025 and 2024, respectively, and $1,112.7 million and $831.2 million during the nine months ended September 30, 2025 and 2024, respectively. The increases in revenue were primarily due to increased revenue from both our contract operations business and aftermarket services business during the three and nine months ended September 30, 2025. See “Contract Operations” and “Aftermarket Services” below for further details.

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Net income was $71.2 million and $37.5 million during the three months ended September 30, 2025 and 2024, respectively. The increase was primarily driven by higher adjusted gross margin from our contract operations business and reductions in transaction-related costs and debt extinguishment loss as well as an increase in gain on sale of assets. These increases were partially offset by increases in depreciation and amortization, interest expense, provision for income taxes, other expense (income), net, SG&A and long-lived and other asset impairment.

Net income was $205.5 million and $112.5 million during the nine months ended September 30, 2025 and 2024, respectively. The increase was primarily driven by higher adjusted gross margin from both our contract operations business and aftermarket services business, as well as an increase in gain on sale of assets and a reduction in debt extinguishment loss. These increases were partially offset by increases in depreciation and amortization, interest expense, provision for income taxes, SG&A and long-lived and other asset impairment.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

​

Contract Operations

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended | ​ | ​ | ​
​ | ​ | September 30, | ​ | Increase | ​
(dollars in thousands) |  | 2025 |  | 2024 |  | (Decrease) | ​
Revenue | ​ | $ | 326,269 | ​ | $ | 245,420 | ​ | 33 | %
Cost of sales, exclusive of depreciation and amortization | ​ |  | 86,710 | ​ |  | 79,810 | ​ | 9 | %
Adjusted gross margin | ​ | $ | 239,559 | ​ | $ | 165,610 | ​ | 45 | %
Adjusted gross margin percentage (1) | ​ |  | 73 | % |  | 67 | % | 6 | %

(1) | Defined as adjusted gross margin divided by revenue.

​

Revenue in our contract operations business increased approximately $80.8 million, due primarily to the compression units acquired in the TOPS Acquisition and in the NGCS Acquisition, higher rates and an increase in average operating horsepower.

​

The increase in cost of sales, exclusive of depreciation and amortization, was primarily due to an $11.6 million increase in employee compensation, including the addition of headcount from the TOPS Acquisition and the NGCS Acquisition, and a $5.6 million increase in parts expense due to compression units acquired in the TOPS Acquisition and the NGCS Acquisition as well as an increase in operating horsepower. These increases were partially offset by a net benefit of $9.9 million as a result of certain sales and use tax audit settlements.

The increases in adjusted gross margin and adjusted gross margin percentage were mainly driven by revenue growth that outpaced the increase in cost of sales, exclusive of depreciation and amortization.

Aftermarket Services

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended |  | ​ | ​
​ | ​ | September 30, | ​ | Increase | ​
(dollars in thousands) |  | 2025 |  | 2024 |  | (Decrease) | ​
Revenue | ​ | $ | 56,161 | ​ | $ | 46,741 |  | 20 | %
Cost of sales, exclusive of depreciation and amortization | ​ |  | 43,115 | ​ |  | 34,395 |  | 25 | %
Adjusted gross margin | ​ | $ | 13,046 | ​ | $ | 12,346 |  | 6 | %
Adjusted gross margin percentage (1) | ​ |  | 23 | % |  | 26 | % | (3) | %

(1) Defined as adjusted gross margin divided by revenue.

​

Revenue in our aftermarket services business increased primarily due to increased service activity driven by higher customer demand, an increase in maintenance service contracts and higher parts sales.

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The increase in cost of sales, exclusive of depreciation and amortization, was driven by increased activity, including differences in the scope, timing and type of services performed.

Costs and Expenses

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended
​ | ​ | September 30,
(in thousands) |  | 2025 |  | 2024
Selling, general and administrative | ​ | $ | 37,676 | ​ | $ | 34,059
Depreciation and amortization | ​ |  | 67,130 | ​ |  | 48,377
Long-lived and other asset impairment | ​ |  | 4,676 | ​ |  | 2,509
Restructuring charges | ​ | ​ | 688 | ​ | ​ | —
Debt extinguishment loss | ​ | ​ | — | ​ | ​ | 3,181
Interest expense | ​ |  | 43,661 | ​ |  | 30,179
Transaction-related costs | ​ | ​ | 1,767 | ​ | ​ | 9,220
Gain on sale of assets, net | ​ | ​ | (3,835) | ​ | ​ | (2,218)
Other expense (income), net | ​ | ​ | 3,984 | ​ | ​ | (304)

​

Selling, general and administrative. The increase in SG&A was primarily driven by a $2.6 million increase in employee compensation and benefits expense and a $0.5 million increase in insurance expense, partially offset by a benefit of $0.8 million recognized during the three months ended September 30, 2025 related to a change in previously recognized tax contingencies.

Depreciation and amortization. The increase in depreciation and amortization was primarily due to fixed assets additions, including depreciation and amortization associated with the compression units and intangible assets acquired in the TOPS Acquisition and the NGCS Acquisition. The increase was partially offset by a decrease in depreciation associated with assets reaching the end of their depreciable lives as well as asset sales.

Long-lived and other asset impairment. The increase in long-lived and other asset impairment was primarily due to an increase of $1.3 million in compression fleet impairment as a result of fleet standardization as well as asset remeasurement of $0.9 million in connection with the Flowco Disposition. See Note 3 (“Business Transactions”) for further details.

We periodically review the future deployment of our idle compressors for units that are not of the type, configuration, condition, make or model that are cost efficient to maintain and operate. We also evaluate for impairment our idle units that have been culled from our compression fleet in prior years and are available for sale. See Note 11 (“Long-Lived Asset and Other Impairments”) for further details on these impairment charges. The following table presents the results of our compression fleet impairment review, as recorded in our contract operations segment:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended
​ | ​ | September 30,
(dollars in thousands) |  | 2025 |  | 2024
Idle compressors retired from the active fleet |  | ​ | 20 |  | ​ | 15
Horsepower of idle compressors retired from the active fleet |  | ​ | 11,000 |  | ​ | 12,000
Impairment recorded on idle compressors retired from the active fleet | ​ | $ | 3,776 | ​ | $ | 2,509

​

Restructuring charges. Restructuring charges of $0.7 million during the three months ended September 30, 2025 consisted of property consolidation and closure costs. See Note 12 (“Restructuring Charges”) for further details on these restructuring charges.

Debt extinguishment loss. We incurred $3.2 million of debt extinguishment loss during the three months ended September 30, 2024 as a result of the 2027 Notes Tender Offer.

Interest expense. The increase in interest expense was primarily due to a higher average outstanding balance of long-term debt primarily due to the 2032 Notes offering and borrowings under our Credit Facility to fund cash consideration of the TOPS Acquisition and the NGCS Acquisition.

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Transaction-related costs. We incurred $1.1 million of compensation costs, professional fees and other costs related to the NGCS Acquisition during the three months ended September 30, 2025, and we incurred $0.7 million and $9.2 million of compensation costs and professional fees related to the TOPS Acquisition during the three months ended September 30, 2025 and 2024, respectively. See Note 3 (“Business Transactions”) for further details on transaction-related costs for the NGCS Acquisition and the TOPS Acquisition.

Gain on sale of assets, net. The increase in gain on sale of assets, net was primarily due to gains of $3.1 million and $0.7 million, respectively, on compression asset sales and transportation and shop equipment sales during the three months ended September 30, 2025, compared to gains of $2.6 million and $0.1 million, respectively, on compression asset sales and transportation and shop equipment sales during the three months ended September 30, 2024.

Other expense (income), net. The change to other expense during the three months ended September 30, 2025 from other income during the three months ended September 30, 2024 was primarily due to a limited liability agreement amendment fee of $3.6 million paid to FGC Holdco, see Note 16 (“Related Party Transactions”) for further details, and indemnification expense of $0.8 million related to a change in a previously recognized indemnification asset.

Provision for Income Taxes

​

The increase in provision for income taxes was primarily due to the tax effect of the increase in book income during the three months ended September 30, 2025 compared with the three months ended September 30, 2024.

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended |  | ​ | ​
​ | ​ | September 30, | ​ | Increase | ​
(dollars in thousands) |  | 2025 |  | 2024 |  | (Decrease) | ​
Provision for income taxes | ​ | $ | 25,425 | ​ | $ | 15,437 |  | 65 | %
Effective tax rate | ​ |  | 26 | % |  | 29 | % | (3) | %

​

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

​

Contract Operations

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine Months Ended | ​ | ​ | ​
​ | ​ | September 30, | ​ | Increase | ​
(dollars in thousands) |  | 2025 |  | 2024 |  | (Decrease) | ​
Revenue | ​ | $ | 944,993 | ​ | $ | 693,939 | ​ | 36 | %
Cost of sales, exclusive of depreciation and amortization | ​ |  | 272,661 | ​ |  | 236,831 | ​ | 15 | %
Adjusted gross margin | ​ | $ | 672,332 | ​ | $ | 457,108 | ​ | 47 | %
Adjusted gross margin percentage (1) | ​ |  | 71 | % |  | 66 | % | 5 | %

(1) | Defined as adjusted gross margin divided by revenue.

​

Revenue in our contract operations business increased approximately $251.1 million, due primarily to the compression units acquired in the TOPS Acquisition and in the NGCS Acquisition, higher rates and an increase in average operating horsepower.

​

The increase in cost of sales, exclusive of depreciation and amortization, was primarily due to a $32.0 million increase in employee compensation, including the addition of headcount from the TOPS Acquisition and the NGCS Acquisition, and a $12.9 million increase in parts expense due to compression units acquired in the TOPS Acquisition and the NGCS Acquisition, as well as an increase in operating horsepower. These increases were partially offset by a net benefit of $10.0 million as a result of certain sales and use tax audit settlements.

The increases in adjusted gross margin and adjusted gross margin percentage were mainly driven by revenue growth that outpaced the increase in cost of sales, exclusive of depreciation and amortization.

​

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Aftermarket Services

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine Months Ended |  | ​ | ​
​ | ​ | September 30, | ​ | Increase | ​
(dollars in thousands) |  | 2025 |  | 2024 |  | (Decrease) | ​
Revenue | ​ | $ | 167,752 | ​ | $ | 137,236 |  | 22 | %
Cost of sales, exclusive of depreciation and amortization | ​ |  | 128,258 | ​ |  | 104,553 |  | 23 | %
Adjusted gross margin | ​ | $ | 39,494 | ​ | $ | 32,683 |  | 21 | %
Adjusted gross margin percentage (1) | ​ |  | 24 | % |  | 24 | % | 0 | %

(1) Defined as adjusted gross margin divided by revenue.

​

Revenue in our aftermarket services business increased primarily due to increased service activity driven by higher customer demand, an increase in maintenance service contracts and higher parts sales, including the non-recurring sale of overhauled engines.

The increase in cost of sales, exclusive of depreciation and amortization, was driven by increased activity, including differences in the scope, timing and type of services performed.

Costs and Expenses

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine Months Ended
​ | ​ | September 30,
(in thousands) |  | 2025 |  | 2024
Selling, general and administrative | ​ | $ | 111,127 | ​ | $ | 96,887
Depreciation and amortization | ​ |  | 187,889 | ​ | ​ | 135,065
Long-lived and other asset impairment | ​ |  | 16,495 | ​ | ​ | 9,478
Restructuring charges | ​ | ​ | 1,497 | ​ | ​ | —
Debt extinguishment loss | ​ | ​ | — | ​ | ​ | 3,181
Interest expense | ​ |  | 123,113 | ​ | ​ | 85,372
Transaction-related costs | ​ |  | 11,829 | ​ | ​ | 11,002
Gain on sale of assets, net | ​ | ​ | (15,467) | ​ | ​ | (5,175)
Other expense (income), net | ​ | ​ | 459 | ​ | ​ | (37)

​

Selling, general and administrative. The increase in SG&A was primarily driven by a $7.5 million increase in employee compensation and benefits expense, a $4.0 million increase in professional fees, a $1.3 million increase in information technology expense, a $0.9 million increase in insurance expense and a $0.8 million increase in sales commission. These increases were partially offset by a benefit of $0.8 million recognized during the nine months ended September 30, 2025 related to a change in previously recognized tax contingencies.

Depreciation and amortization. The increase in depreciation and amortization was primarily due to fixed assets additions, including depreciation and amortization associated with the compression units and intangible assets acquired in the TOPS Acquisition and the NGCS Acquisition. The increase was partially offset by a decrease in depreciation associated with assets reaching the end of their depreciable lives as well as asset sales.

Long-lived and other asset impairment. The increase in long-lived and other asset impairment was primarily due to asset remeasurement of $9.6 million in connection with the Flowco Disposition. See Note 3 (“Business Transactions”) for further details. This increase was partially offset by a decrease of $2.6 million in compression fleet impairment due to an increase in customer demand and as a result, higher utilization of our equipment.

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We periodically review the future deployment of our idle compressors for units that are not of the type, configuration, condition, make or model that are cost efficient to maintain and operate. We also evaluate for impairment our idle units that have been culled from our compression fleet in prior years and are available for sale. See Note 11 (“Long-Lived Asset and Other Impairments”) for further details on these impairment charges. The following table presents the results of our compression fleet impairment review, as recorded in our contract operations segment:

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine Months Ended
​ | ​ | September 30,
(dollars in thousands) |  | 2025 |  | 2024
Idle compressors retired from the active fleet |  | ​ | 70 |  | ​ | 80
Horsepower of idle compressors retired from the active fleet |  | ​ | 28,000 |  | ​ | 58,000
Impairment recorded on idle compressors retired from the active fleet | ​ | $ | 6,859 | ​ | $ | 9,478

​

Restructuring charges. Restructuring charges of $1.5 million during the nine months ended September 30, 2025 consisted of severance and property disposal as well as consolidation and closure costs. See Note 12 (“Restructuring Charges”) for further details on these restructuring charges.

Debt extinguishment loss. We incurred $3.2 million of debt extinguishment loss during the nine months ended September 30, 2024 as a result of the 2027 Notes Tender Offer.

Interest expense. The increase in interest expense was primarily due to a higher average outstanding balance of long-term debt primarily due to the 2032 Notes offering and borrowings under our Credit Facility to fund cash consideration of the TOPS Acquisition and the NGCS Acquisition.

Transaction-related costs. We incurred $8.7 million of professional fees, compensation and other costs related to the NGCS Acquisition during the nine months ended September 30, 2025, and we incurred $3.1 million and $11.0 million of professional fees, compensation and other costs related to the TOPS Acquisition during the nine months ended September 30, 2025 and 2024, respectively. See Note 3 (“Business Transactions”) for further details on transaction-related costs for the NGCS Acquisition and the TOPS Acquisition.

Gain on sale of assets, net. The increase in gain on sale of assets was primarily due to gains of $13.8 million and $1.5 million, respectively, on compression asset sales and transportation and shop equipment sales during the nine months ended September 30, 2025, compared to gains of $5.1 million and $0.5 million, respectively, on compression asset sales and transportation and shop equipment sales during the nine months ended September 30, 2024.

Other expense (income), net. The change to other expense during the nine months ended September 30, 2025 from other income during the nine months ended September 30, 2024, was primarily due to a limited liability agreement amendment fee of $3.6 million paid to FGC Holdco, see Note 16 (“Related Party Transactions”) for further details, and indemnification expense of $0.8 million related to a change in a previously recognized indemnification asset. These increases to other expense were partially offset by an increase in proceeds from insurance and other settlements.

Provision for Income Taxes

​

The increase in provision for income taxes was primarily due to the tax effect of the increase in book income during the nine months ended September 30, 2025 compared with nine months ended September 30, 2024.

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine Months Ended |  | ​ | ​
​ | ​ | September 30, | ​ | Increase | ​
(dollars in thousands) |  | 2025 |  | 2024 |  | (Decrease) | ​
Provision for income taxes | ​ | $ | 68,994 | ​ | $ | 41,545 |  | 66 | %
Effective tax rate | ​ |  | 25 | % |  | 27 | % | (2) | %

​

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LIQUIDITY AND CAPITAL RESOURCES

​

Overview

Our ability to fund operations, finance capital expenditures and pay dividends depends on the levels of our operating cash flows and access to the capital and credit markets. Our primary sources of liquidity are cash flows generated from our operations and our borrowing availability under our Credit Facility. Our cash flow is affected by numerous factors including prices and demand for our services, oil and natural gas exploration and production spending, conditions in the financial markets and other factors. We have no near-term maturities and believe that our operating cash flows and borrowings under the Credit Facility will be sufficient to meet our future liquidity needs.

We may from time to time seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity or debt securities in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, may be material, will be upon terms and prices as we may determine and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

Cash Requirements

​

Our contract operations business is capital intensive, requiring significant investment to maintain and upgrade existing operations. Our capital spending is primarily dependent on the demand for our contract operations services and the availability of the type of compression equipment required for us to provide those contract operations services to our customers. Our capital requirements have consisted primarily of, and we anticipate will continue to consist of, the following:

| • | operating expenses, namely employee compensation and benefits, inventory and lube oil purchases;

| • | growth capital expenditures;

| • | maintenance capital expenditures;

| • | interest on our outstanding debt obligations;

| • | dividend payments to our stockholders; and

| • | shares repurchased under the Share Repurchase Program and to cover taxes required to be withheld on the vesting date of long-term incentive grants to employees.

Capital Expenditures

​

Growth Capital Expenditures. The majority of our growth capital expenditures are related to the acquisition cost of new compressors when our idle equipment cannot be reconfigured to economically fulfill a project’s requirements and the new compressor is expected to generate economic returns that exceed our cost of capital over the compressor’s expected useful life. In addition to newly-acquired compressors, growth capital expenditures include the upgrading of major components on an existing compression package where the current configuration of the compression package is no longer in demand and the compressor is not likely to return to an operating status without the capital expenditures. These expenditures substantially modify the operating parameters of the compression package such that it can be used in applications for which it previously was not suited.

Growth capital expenditures were $299.0 million and $181.6 million for the nine months ended September 30, 2025 and 2024, respectively.

Maintenance Capital Expenditures. Maintenance capital expenditures are related to major overhauls of significant components of a compression package, such as the engine, electric motor, compressor and cooler, which return the components to a like-new condition, but do not modify the application for which the compression package was designed.

Maintenance capital expenditures were $84.8 million and $66.1 million during the nine months ended September 30, 2025 and 2024, respectively. The increase in maintenance capital expenditures was primarily due to an increase in scheduled and unscheduled maintenance activities due to maintenance cycle requirements and the addition of the compression units acquired in the TOPS Acquisition, partially offset by lower make–ready investment.

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Projected Capital Expenditures. We currently plan to spend approximately $490 million to $510 million on capital expenditures during 2025, primarily consisting of approximately $345 million to $355 million for growth capital expenditures and approximately $110 million to $115 million for maintenance capital expenditures.

Returning Capital to Stockholders

​

We continue to return capital to stockholders through quarterly dividends and share repurchases. On October 23, 2025, our Board of Directors declared a quarterly dividend of $0.21 per share of common stock to be paid on November 13, 2025 to stockholders of record at the close of business on November 4, 2025. Any future determinations to pay cash dividends to our stockholders will be at the discretion of our Board of Directors and will be dependent upon our financial condition, results of operations and credit and loan agreements in effect at that time and other factors deemed relevant by our Board of Directors. Our Board of Directors also approved an additional increase to our Share Repurchase Program of $100.0 million through December 31, 2026, resulting in available capacity of $130.4 million at that time. The actual number of shares repurchased will depend on prevailing market conditions, alternative uses of capital and other factors, and will be determined at management’s discretion.

2027 Notes Redemption

In October 2025, we initiated the repurchase of our 2027 Notes. The 2027 Notes are expected to be redeemed on November 17, 2025 at 100% of their $300.0 million aggregate principal amount plus accrued and unpaid interest of approximately $2.6 million with borrowings under the Credit Facility. We expect to record a debt extinguishment loss related to unamortized debt issuance costs during the fourth quarter of 2025.

Sources of Cash

​

Credit Facility

​

On May 16, 2025, we amended our Amended and Restated Credit Agreement to increase the borrowing capacity of the Credit Facility from $1.1 billion to $1.5 billion and to provide for the ability for the borrowers to request additional increases in the aggregate commitments under the Credit Facility to a total amount not to exceed $2.3 billion (with any increase being at the discretion of the lenders and subject to the satisfaction of certain conditions set forth in the Amended and Restated Credit Agreement).

​

During the nine months ended September 30, 2025 and 2024, our Credit Facility had an average debt balance of $653.6 million and $268.7 million, respectively. The weighted-average annual interest rate on the outstanding balance under the Credit Facility was 6.6% and 6.8% at September 30, 2025 and December 31, 2024, respectively. As of September 30, 2025, there were $3.0 million letters of credit outstanding under the Credit Facility and the applicable margin on borrowings outstanding was 2.2%.

​

As of September 30, 2025, we were in compliance with all covenants under our Credit Facility. Additionally, all undrawn capacity on our Credit Facility was available for borrowings as of September 30, 2025.

2032 Notes and 2027 Notes Tender Offer

On August 26, 2024, we completed a private offering of $700.0 million aggregate principal amount of 6.625% senior notes due September 2032 and received net proceeds of $690.0 million after deducting issuance costs. In connection with the offering of the 2032 Notes, we completed a concurrent cash tender offer of $202.0 million. See Note 7 (“Long-Term Debt”) for further details.

July 2024 Equity Offering

On July 24, 2024, we sold, pursuant to a public underwriting offering, approximately 12.7 million shares, including approximately 1.7 million shares pursuant to an over-allotment option. We received net proceeds of $255.7 million, after deducting underwriting discounts, commissions and offering expenses. See Note 9 (“Stockholders’ Equity”) for further details.

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Cash Flows

​

Our cash flows, as reflected in our unaudited condensed consolidated statements of cash flows, are summarized below:

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Nine Months Ended
​ | ​ | September 30,
(in thousands) |  | 2025 |  | 2024
Net cash provided by (used in): |  | ​ |  |  | ​ |
Operating activities | ​ | $ | 407,629 | ​ | $ | 305,253
Investing activities | ​ |  | (592,384) | ​ |  | (1,104,670)
Financing activities | ​ | ​ | 184,418 | ​ |  | 801,828
Net (decrease) increase in cash and cash equivalents | ​ | $ | (337) | ​ | $ | 2,411

​

Operating Activities

​

The increase in net cash provided by operating activities was primarily due to an overall increase in levels of activity, including the impact from the NGCS Acquisition and the TOPS Acquisition, which resulted in increases in accounts receivable and inventory, as well as higher adjusted gross margin from both our contract operations business and aftermarket services business, partially offset by an increase in accrued liabilities.

Investing Activities

​

The decrease in net cash used in investing activities was primarily due to cash paid in the TOPS acquisition of $868.7 million compared to cash paid in the NGCS Acquisition of $296.5 million, an increase of $71.0 million in proceeds from the sale of a business and an increase in $18.4 million in proceeds from the sale of property, equipment and other assets. These changes were partially offset by a $153.6 million increase in capital expenditures.

Financing Activities

​

The decrease in net cash provided by financing activities was primarily due to a $296.8 million decrease in net borrowings of long-term debt, a $255.7 million decrease in the issuance of common stock, a $41.1 million increase in common stock purchased under the Share Repurchase Program and a $25.0 million increase in dividends paid to stockholders. These changes were partially offset by a $10.4 million decrease in deferred financing costs.

​

​

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

​

We are exposed to market risks associated with changes in the variable interest rate of our Credit Facility.

​

As of September 30, 2025, we had $768.7 million of variable interest rate indebtedness outstanding at a weighted average interest rate of 6.6%.

​

A 1% increase or decrease in the effective interest rate on our Credit Facility’s outstanding balance at September 30, 2025 would have resulted in an annual increase or decrease in our interest expense of $7.7 million.

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ITEM 4. CONTROLS AND PROCEDURES

​

This Item 4 includes information concerning the controls and controls evaluation referred to in the certifications of our Chief Executive Officer and Chief Financial Officer required by Rule 13a-14 of the Exchange Act included in this Form 10-Q as Exhibits 31.1 and 31.2.

Management’s Evaluation of Disclosure Controls and Procedures

​

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to management to allow timely decisions regarding required disclosures.

As of the end of the period covered by this Quarterly Report on Form 10-Q, our principal executive officer and principal financial officer evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act), which are designed to provide reasonable assurance that we are able to record, process, summarize and report the information required to be disclosed in our reports under the Exchange Act within the time periods specified in the rules and forms of the SEC. Based on the evaluation, as of September 30, 2025, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that the information required to be disclosed in reports that we file or submit under the Exchange Act is accumulated and communicated to management, and made known to our principal executive officer and principal financial officer, on a timely basis to ensure that it is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) during the last fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

​

In the ordinary course of business, we are involved in various pending or threatened legal actions. While we are unable to predict the ultimate outcome of these actions, we believe that any ultimate liability arising from any of these actions will not have a material adverse effect on our condensed consolidated financial position, results of operations or cash flows, including our ability to pay dividends. However, because of the inherent uncertainty of litigation and arbitration proceedings, we cannot provide assurance that the resolution of any particular claim or proceeding to which we are a party will not have a material adverse effect on our condensed consolidated financial position, results of operations or cash flows, including our ability to pay dividends.

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ITEM 1A. RISK FACTORS

​

Other than the following items, there have been no material changes or updates to the risk factors previously disclosed in our 2024 Form 10-K.

Risks Related to the NGCS Acquisition

​

We may not be able to achieve the expected benefits of the NGCS Acquisition. We may also encounter significant

difficulties in integrating NGCS.

​

We may not be able to achieve the expected benefits of the NGCS Acquisition. There can be no assurance that the NGCS Acquisition will be beneficial to us. We may not be able to integrate the assets acquired in the NGCS Acquisition without increases in costs or other difficulties. The integration of a business is a complex, costly and time-consuming process. As a result, we will be required to devote significant management attention and resources to integrating our business practices and operations with the business practices and operations of NGCS. The integration process may disrupt our business and, if implemented ineffectively, would restrict the full realization of the anticipated benefits from the NGCS Acquisition. The failure to meet the challenges involved in integrating NGCS and to realize the anticipated benefits of the NGCS Acquisition could have an adverse effect on our business, results of operations, financial condition and prospects, as well as the market price of our common stock. The challenges of integrating the operations of acquired businesses include, among others:

​

| ● | difficulties with the integration of the business of NGCS and workforce following the completion of the NGCS Acquisition;

| ● | conditions in the oil and natural gas industry, including the level of production of, demand for or price of oil or natural gas;

| ● | our reduced profit margins or the loss of market share resulting from competition or the introduction of competing technologies by other companies;

| ● | changes in economic or political conditions, including terrorism and legislative changes;

| ● | the inherent risks associated with our operations, such as equipment defects, impairments, malfunctions and natural disasters;

| ● | the risk that counterparties will not perform their obligations under our financial instruments;

| ● | the financial condition of our customers;

| ● | our ability to timely and cost-effectively obtain components necessary to conduct our business;

| ● | employment and workforce factors, including our ability to hire, train and retain key employees;

| ● | our ability to implement certain business and financial objectives, such as:

| ● | winning profitable new business;

| ● | growing our asset base and enhancing asset utilization;

| ● | integrating acquired businesses;

| ● | generating sufficient cash; and

| ● | accessing the capital markets at an acceptable cost;

| ● | liability related to the use of our services;

| ● | changes in governmental safety, health, environmental or other regulations, which could require us to make significant expenditures;

| ● | the effectiveness of our control environment, including the identification of control deficiencies; and

| ● | our level of indebtedness and ability to fund our business.

​

Many of these factors are outside of our control, and any one of them could result in increased costs and liabilities, decreases in the amount of expected revenue and earnings, and diversion of management’s time and energy, which could have a material adverse effect on our business, financial condition and results of operations. Further, additional unanticipated costs may be incurred in the integration of the acquired business.

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The market price of our common stock may decline as a result of the NGCS Acquisition if, among other things, the integration of the properties acquired in the NGCS Acquisition is unsuccessful or transaction costs related to the NGCS Acquisition are greater than expected. The market price of our common stock may decline if we do not achieve the perceived benefits of the NGCS Acquisition as rapidly or to the extent anticipated by us or by securities market participants or if the effect of NGCS Acquisition on our business, results of operations or financial condition or prospects is not consistent with our expectations or those of securities market participants.

​

Any acquisitions we complete, including the NGCS Acquisition, are subject to substantial risks that could reduce our ability to make distributions to our common stockholders.

​

Even if we do make acquisitions that we believe will increase the amount of cash available for distribution to our common stockholders, these acquisitions, including the NGCS Acquisition, may nevertheless result in a decrease in the amount of cash available for distribution to our common stockholders. Any acquisition, including the NGCS Acquisition, involves potential risks, including, among other things:

​

| ● | the assumption of unknown liabilities, losses or costs for which we are not indemnified or for which any indemnity we receive is inadequate;

| ● | our inability to obtain satisfactory title to the assets we acquire; and

| ● | the occurrence of other significant changes, such as impairment of long-lived assets, asset devaluation or restructuring charges.

​

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES BY ISSUER AND USE OF PROCEEDS

​

Sales of Unregistered Securities

​

None.

​

Purchase of Equity Securities by the Issuer and Affiliated Purchasers

​

The following table summarizes shares repurchased and shares withheld during the three months ended September 30, 2025:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Maximum number (or
​ | ​ | ​ | ​ | ​ | ​ | ​ | Total number of | ​ | approximate dollar
​ | ​ | ​ | ​ | Average | ​ | shares repurchased | ​ | value) of shares
​ | ​ | ​ | ​ | price | ​ | as part of publicly | ​ | that may yet be
​ | ​ | Total number | ​ | paid per | ​ | announced plans | ​ | purchased under the
(dollars in thousands, except per share amounts) |  | of shares purchased(1) |  | share(2) |  | or programs(3) |  | plans or programs
July 1, 2025 — July 31, 2025 | ​ | 846,159 | ​ | $ | 23.40 | ​ | 845,858 | ​ | $ | 39,058
August 1, 2025 — August 31, 2025 |  | 242,858 | ​ |  | 22.40 |  | 242,858 |  |  | 33,617
September 1, 2025 — September 30, 2025 |  | 5,800 | ​ |  | 23.97 |  | 5,800 |  |  | 33,478
Total |  | 1,094,817 | ​ | $ | 23.18 |  | 1,094,516 |  | ​ | ​

(1) | Represents shares of common stock purchased from employees to satisfy tax withholding obligations in connection with the vesting of restricted stock awards and shares repurchased under the Share Repurchase Program during the period. See Note 9 (“Stockholders’ Equity”) for further details.

(2) | Average price paid per share includes costs associated with the repurchase, as applicable.

(3) | Our Board of Directors authorized a share repurchase program in April 2023 that allowed us to repurchase and retire up to $50.0 million of outstanding common stock over a 12-month period. An extension of the Share Repurchase Program was approved by our Board of Directors in April 2024 for an additional 24-month period and replenished the amount of shares authorized for repurchase, resulting in available capacity of $50.0 million at that time. In April 2025, our Board of Directors approved an increase in the Share Repurchase Program by an additional $50.0 million through April 27, 2026. In October 2025, our Board of Directors approved an additional increase of $100.0 million through December 31, 2026. See Note 9 (“Stockholders’ Equity”) for further details regarding the Share Repurchase Program and share repurchase activity.

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ITEM 3. DEFAULTS UPON SENIOR SECURITIES

​

None.

ITEM 4. MINE SAFETY DISCLOSURES

​

Not applicable.

ITEM 5. OTHER INFORMATION

​

During the three months ended September 30, 2025, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

ITEM 6. EXHIBITS

​

The exhibits listed below are filed or furnished as part of this report:

​ | ​ | ​
​ | ​ | ​
​ | ​ | ​
3.1 | ​ | Composite Certificate of Incorporation of Archrock, Inc., as amended as of November 3, 2015 (incorporated by reference to Exhibit 3.3 to Archrock Inc.’s Annual Report on Form 10-K for the year ended December 31, 2015)
3.2 | ​ | Fourth Amended and Restated Bylaws of Exterran Holdings, Inc., now Archrock, Inc. (incorporated by reference to Exhibit 3.1 of Archrock Inc.’s Current Report on Form 8-K filed on July 27, 2023)
31.1* | ​ | Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2* | ​ | Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1** | ​ | Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2** | ​ | Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.1* | ​ | Interactive data files (formatted in Inline XBRL) pursuant to Rule 405 of Regulation S-T
104.1* | ​ | Cover page interactive data file (formatted in Inline XBRL) pursuant to Rule 406 of Regulation S-T

​

* Filed herewith

** Furnished, not filed

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

​ | ​ | ​
​ | Archrock, Inc.
​ | ​ | ​
​ | By: | /s/ Douglas S. Aron
​ | ​ | Douglas S. Aron
​ | ​ | Senior Vice President and Chief Financial Officer
​ | ​ | (Principal Financial Officer)
​ | ​ | ​
​ | By: | /s/ Donna A. Henderson
​ | ​ | Donna A. Henderson
​ | ​ | Vice President and Chief Accounting Officer
​ | ​ | (Principal Accounting Officer)
​ | ​ | ​
​ | ​ | October 29, 2025

​

​

​

​

​

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