DNOW Targets $70M in MRC Synergies as Data Centers Fuel Growth

DNOW reported stronger second-quarter performance , with revenue rising 10% sequentially to $1.3 billion, EBITDA increasing 54% to $60 million, and record operating cash flow of $133 million. The company forecasts full-year revenue of slightly more than $5 billion. The company raised its first-year MRC Global cost-synergy target to $30 million , while maintaining its three-year goal of $70 million. ERP disruptions at MRC’s U.S. operations have stabilized, supporting further margin improvement. DNOW’s revenue mix is becoming more diversified, with growth opportunities in gas utilities, midstream infrastructure, industrial markets and data-center construction . It also repurchased $75 million of shares in the first half of 2026 and reduced debt by $95 million during the second quarter. DNOW NYSE: DNOW outlined a strategy centered on greater end-market diversification, integration of MRC Global and margin expansion, while highlighting growth opportunities tied to oil-and-gas production volumes, natural-gas infrastructure and data-center development. The company said it has transformed since becoming a standalone public company in 2014 following its spinoff from National Oilwell Varco. While upstream oil-and-gas markets remain its largest source of revenue, DNOW said its November 2025 merger with MRC Global has broadened its exposure to gas utilities, midstream operations and downstream industrial customers. DNOW provides pipe, valves and fittings, pumps, fabricated equipment and related services. It said its business benefits from rising production volumes because its products support infrastructure used to move oil, gas and produced water. The company noted that U.S. production has increased even as rig counts and completions have declined in recent years. Second-Quarter Results and Cash Flow For the second quarter, DNOW reported revenue of $1.3 billion, up 10% sequentially. U.S. revenue increased 13% from the first quarter, according to the presentation. EBITDA rose 54% sequentially to $60 million from $39 million in the first quarter. DNOW attributed part of the improvement to progress in resolving disruption associated with an enterprise resource planning system at MRC Global’s U.S. business. The company said it generated a record $133 million in cash flow from operations during the second quarter. Working capital as a percentage of revenue improved to 19% from 25.5% in the prior quarter, which DNOW said reflected more efficient inventory management and lower days sales outstanding. DNOW forecast full-year revenue of slightly more than $5 billion, with its first-half revenue run rate at approximately $2.5 billion. The company has 300 locations and 5,100 employees across the U.S., Canada, the U.K., Europe, the Middle East and Southeast Asia. MRC Global Integration and Cost Synergies The company said the MRC Global integration remains a major focus. DNOW characterized the MRC U.S. ERP system as stabilized and said it has moved into an optimization phase. Temporary elevated costs associated with the disruption are expected to be reduced over the remainder of the year, while the company also works to recover revenue and expand customer share. DNOW continues to target $70 million in cost synergies over three years from the MRC Global combination. It originally expected to reach $17 million in savings by the end of the first year, but has raised that expectation to $30 million. The total three-year target remains unchanged at $70 million. The company said it is also seeking product-margin, operating-profit and EBITDA-margin improvements as it integrates the businesses.