Tetra Technologies (NYSE:TTI) executives used the company’s fourth-quarter and full-year 2025 earnings call to highlight what they described as a record-setting year, driven by strength in offshore completion fluids, higher electrolyte shipments, and record results in its global calcium chloride business. Management also provided updates on key strategic initiatives tied to its “ONE TETRA 2030” strategy, including a planned bromine processing plant in Arkansas, a produced-water desalination offering, and international expansion in Argentina.
Record 2025 performance led by offshore completion fluids
Chief Executive Officer Brady Murphy said 2025 was challenging for the U.S. oil and gas industry due to reduced U.S. onshore activity and a volatile global economic environment, but noted that TETRA delivered “record financial achievements.” He pointed to the company’s Gulf of America completion fluids business as a key driver, noting that TETRA was ranked the top supplier for product quality and overall performance for offshore completion fluid suppliers for the fifth consecutive year in the Kimberlite International Oilfield Research report.
Q4 segment results: electrolyte shipments, cost actions, and corporate expense
Chief Commercial Officer Matt Sanderson said the company delivered a strong fourth quarter as part of its record 2025 performance.
- Completion Fluids & Products: Q4 revenue was $83.7 million, up 22% year over year, which Sanderson said included a “material increase” in electrolyte shipments. Adjusted EBITDA margin was 28.2%.
- Water & Flowback Services: Q4 revenue was $63 million, flat sequentially versus Q3 despite a typical year-end slowdown in the U.S. market. Sanderson noted stronger activity in Argentina during the quarter as another early production facility began operating.
Sanderson said Water & Flowback adjusted EBITDA margins improved 100 basis points, attributing the improvement to cost reductions and an ongoing focus on technology and automation to reduce personnel at the well site. He also said that despite competitive pricing pressure in U.S. land markets, segment margins were “relatively flat” during the year, with the company focused on deploying technology into higher-margin opportunities and generating free cash flow.
Corporate and other expenses were $11.3 million in Q4 and included higher variable compensation tied to the company’s 2025 performance. Sanderson said incentives include returns on net capital employed and three-year total shareholder return metrics, noting that TETRA ranked in the top quartile of its peer group for the relevant period. He also said the company changed its corporate office location in Q4, a move expected to reduce corporate G&A by about $2 million per year.
Cash flow, leverage, and working capital
Chief Financial Officer Elijio Serrano emphasized cash generation and balance sheet improvement. He said cash flow from the base business was $21.8 million in Q4 and that full-year 2025 free cash flow from the base business totaled $83 million, exceeding the company’s communicated objective of more than $50 million.
Serrano said 2025 base-business free cash flow included $19 million in cash proceeds from the sale of TETRA’s shares in Kodiak Gas Services following the divestiture of CSI Compressco, adding that the company timed the sale near Kodiak’s 52-week high, similar to a prior sale of shares in Standard Lithium.
He also said that working capital declined nearly 20% (down $21 million) to $88 million at year-end 2025, even with a $12 million increase in Q4 revenue versus the prior year. Serrano said days sales outstanding improved 13% year over year, from 71 days at the end of 2024 to 62 days at the end of 2025.
Capital allocation in 2025 included $30.5 million of base business capital expenditures and $45 million of investments in Arkansas projects. Serrano said TETRA capitalized $4.5 million of interest expense related to large capital projects and reported consolidated free cash flow of $33 million for 2025 after Arkansas investments. He said the result demonstrated the company’s ability to invest while remaining free cash flow positive and without “over-leveraging” the business.
On leverage, Serrano said year-end cash was $73 million, about double the level at the start of 2025. Net debt fell to $109 million from $143 million at the end of 2024, and net leverage improved to 1.1x from 1.8x. He also said there were no borrowings outstanding on revolvers and that borrowing capacity was approximately $7 million.
He added that Argentina operations are “cash self-sufficient,” and the company expects to begin repatriating cash to the U.S. in 2027 based on anticipated performance and the long-term nature of contracts there.
Strategic initiatives: bromine plant, magnesium JV progress, and desalination pivot
Murphy outlined progress on the company’s Arkansas bromine processing plant. He said TETRA erected a 120-foot titanium bromine tower and support structure at the Evergreen site in Southwest Arkansas in December, completing Phase 1 on time and “materially below budget.” He said the plant is now being designed around tower capacity of 75 million pounds of bromine annually, which he described as 56% more low-cost bromine than the 48 million pounds cited in the company’s August 2024 definitive feasibility study. He said TETRA now expects total bromine product demand to reach 75 million pounds by 2029, reflecting increased deepwater completion fluids demand expectations.
Management said the company has secured third-party bromine supply for 2026 and 2027 to bridge growing demand until the Arkansas plant is online, acknowledging the incremental cost versus its long-term supply agreement. In response to analyst questions, management said there were no issues with its current long-term contract and that historically about 75% of bromine needs have been met under the long-term agreement, with the remainder purchased on the open market. The company also said it expects the bromine plant to be online in Q4 2027, and while there may be some opportunity to pull in timing, it wants to remain conservative. When asked about supply sufficiency, management said it has contractually secured what it needs for 2026 and expects to do the same for 2027.
Murphy also said the company is progressing toward finalizing joint venture terms with Magrathea for magnesium metal production using Smackover brine on TETRA’s 40,000 acres. He noted that Magrathea has secured Defense Production Act Title III funding from the Department of War to support a commercial Phase One planned to be on-site at Evergreen, and he said additional government support could be possible.
On desalination, Murphy said TETRA is pleased with results from its commercial plant desalination operation with EOG in the Permian Basin, noting over 95% uptime for the past four months in a “phase two grassland study” evaluating produced-water desalination using TETRA’s OASIS technology. He also said the company received a patent for its “TETRA Oasis TDS end-to-end desalination solution,” describing a combination of pretreatment, exclusive membrane, and post-treatment technologies.
Management said customer interest has shifted toward much larger produced-water desalination plants in West Texas due to data center demand, with discussions moving from 25,000 barrels per day designs to facilities above 100,000 barrels per day. Murphy said one data center could require as much as 200,000 barrels per day of desalinated water, and that the environment is “dynamic.” In Q&A, he said TETRA is hopeful a data center-related desalination project could materialize in the first half of the year and could set the stage for first revenue from a large facility sometime in 2027. In a later exchange, he said the earliest expectation for a large-scale facility coming online would be around mid-2027.
2026 outlook: Argentina growth, offshore cycle shift, and margin expectations
Looking ahead, Murphy said TETRA expects incremental revenue growth in 2026 largely driven by a “material increase” in the electrolyte business and major contract awards in Argentina. He said Argentina contracts are expected to meaningfully expand production testing services anchored by the company’s SandStorm technology, alongside three early production facility contracts. Murphy said the combination is expected to double Argentina revenue in 2026 compared to 2025 and that margins are accretive and more stable due to the long-term nature of the contracts.
For offshore completion fluids, Murphy said 2025 Gulf of America activity was weighted more toward completion than drilling, while 2026 is expected to tilt toward more drilling and exploration with less completion activity. As a result, the company does not expect Gulf of America results to match 2025 record levels, but said the cycle is projected to shift back into stronger completions in 2027.
Murphy said that without CS Neptune projects and with higher short-term bromine costs, completion fluids and products adjusted EBITDA margins are expected to be in the 25% to 30% range, which he said is consistent with the segment’s average over the past seven years. For Water & Flowback Services, management said the net effect of operating trends should result in modest growth in 2026, with adjusted EBITDA margins expected to improve from 12% in 2025 to the mid-teens in 2026, supported by technology initiatives and international growth.
The call also marked Serrano’s final quarterly earnings call ahead of his planned retirement at the end of March. Murphy said the CFO transition is underway, with Sanderson working with Serrano to ensure a seamless handoff, and noted that Serrano has agreed to remain available as an advisor.
About Tetra Technologies (NYSE:TTI)
Tetra Technologies, Inc (NYSE: TTI) is a provider of specialized products and services to the upstream oil and gas industry. The company operates through two primary segments: Oilfield Services, which offers hydraulic fracturing and wellsite fluid systems, and Chemical Solutions, which manufactures and delivers a broad range of drilling, completion and production chemicals. Tetra’s integrated service model spans the design, blending and on-site delivery of fluids, as well as pumping equipment and related wellsite operations.
Within the Oilfield Services segment, Tetra supplies pressure pumping fleets and associated equipment to support onshore hydraulic fracturing and well placement activities.
