The company exhibits poor cash conversion efficiency, highlighted by a $10.8 million free cash flow deficit in 2026Q1 and a persistent disconnect where operating cash flow of -$3.2 million failed to support net income.
| Cash from Operations | 14.33M | 19.92M | 6.06M | 23.33M | 13.99M | -494K |
| Operating CF Margin % | - | 12.48% | 3.92% | 15.35% | 10.8% | -0.64% |
| Operating CF Growth % | 205.72% | 228.87% | -74.04% | 66.74% | 2932.79% | - |
| Net Income | -3.63M | -3.76M | 3.01M | 14.75M | 21.08M | 2.1M |
| Depreciation & Amortization | 27.58M | 27.29M | 23.83M | 20.35M | 19.71M | 21.72M |
| Stock-Based Compensation | 1.29M | 2.46M | 2.09M | 3.99M | 0 | 32K |
| Deferred Taxes | -1.64M | -539K | -778K | 3.44M | 1.08M | -1.34M |
| Other Non-Cash Items | -3.58M | -1.68M | -4.51M | -11.07M | -13.44M | -17.82M |
| Working Capital Changes | -5.7M | -3.86M | -17.59M | -8.13M | -14.43M | -5.18M |
| Change in Receivables | 1.63M | 4.03M | -4.01M | -1.05M | -9.27M | -9.35M |
| Change in Inventory | -1.72M | 953K | -4.32M | -1.72M | -906K | 648K |
| Change in Payables | 1.56M | -4.75M | -78K | -1.55M | -1.43M | 3.08M |
| Cash from Investing | -8.96M | -13.27M | -53.59M | -23.86M | -2.53M | 3.34M |
| Capital Expenditures | -23.21M | -20.15M | -22.89M | -43.75M | -24.69M | -11.39M |
| CapEx % of Revenue | 15% | 12.62% | 14.82% | 28.78% | 19.06% | 14.72% |
| Acquisitions | 5.13M | -5.62M | -47.26M | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - |
| Other Investing | 9.12M | 12.5M | 15.32M | 19.89M | 22.16M | 223.79M |
| Cash from Financing | -5.41M | -9.3M | 47.88M | 4.29M | -9.34M | -2.87M |
| Debt Issued (Net) | 29.66M | -8.04M | 48.61M | 4.81M | -9.09M | -135.21K |
| Equity Issued (Net) | -1.3M | -1.26M | 0 | -194K | 0 | 210.58M |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | -1.36M | -1.26M | 0 | 0 | 0 | 0 |
| Other Financing | -33.77M | 12K | -722K | -324K | -251K | -213.31M |
| Net Change in Cash | 51K | -2.54M | 182K | 3.65M | 2.3M | -83K |
| Free Cash Flow | -8.88M | -1.92M | -16.83M | -20.42M | -10.69M | -11.88M |
| FCF Margin % | -5.74% | -1.2% | -10.9% | -13.43% | -8.25% | -15.35% |
| FCF Growth % | 46.34% | 88.61% | 17.55% | -90.91% | 9.99% | - |
| FCF per Share | -0.25 | -0.05 | -0.52 | -0.81 | -0.54 | -0.44 |
| FCF Conversion (FCF/Net Income) | 2.44x | -5.30x | 2.01x | 1.58x | 0.66x | -0.24x |
| Interest Paid | 0 | 0 | 2.67M | 1.17M | 340K | 1.93M |
| Taxes Paid | 0 | 0 | 2.97M | 3.01M | 723K | 422K |
Liquidity and fleet reinvestment
According to recent financial disclosures, DTI exhibits a persistent disconnect between net income and operating cash flow, evidenced by a 2026Q1 operating cash flow of -$3.2 million against a net loss of $1.5 million, suggesting that reported earnings fail to capture the underlying cash burn.
The consistent divergence between net income and operating cash flow indicates that non-cash charges and working capital requirements are significantly outpacing the company's ability to generate liquidity from core operations. Investors should monitor whether this trend reflects structural inefficiencies in the rental model or temporary timing mismatches in customer collections.
As reported in quarterly filings, DTI's free cash flow trajectory is consistently negative, culminating in a $10.8 million outflow in 2026Q1, which highlights the company's inability to self-fund its capital-intensive rental fleet maintenance and expansion requirements under current market conditions.
The persistent negative free cash flow margin suggests that the business model is currently consuming more capital than it produces, placing significant pressure on the balance sheet. This trajectory warrants further investigation into whether management can optimize fleet utilization to reach a cash-neutral state without further dilutive financing.
Based on DTI's reported figures, capital expenditures remain elevated relative to revenue, with a 21.3% CapEx-to-revenue ratio in 2026Q1, indicating that the company must continue heavy reinvestment in its rental fleet just to maintain its current operational footprint in a challenging drilling environment.
The high capital intensity suggests that the company's rental assets require constant refurbishment or replacement to remain competitive, which limits the potential for free cash flow generation. This structural requirement for high maintenance CapEx appears to be a primary driver of the company's ongoing liquidity constraints.
As indicated by the company's financial statements, working capital fluctuations have frequently turned negative, including a $5.6 million outflow in 2026Q1, which suggests that the company is struggling to manage its cash conversion cycle effectively amidst shifting customer payment patterns and inventory demands.
The recurring negative impact of working capital changes on operating cash flow may imply that the company is extending credit terms to maintain market share or facing delays in collecting receivables. This volatility appears to exacerbate the company's already thin cash position, increasing the risk of operational disruption.
Quick answers to the most common questions about buying DTI stock.
Drilling Tools International Corp. (DTI) generated $19.9M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Drilling Tools International Corp. (DTI) reported negative free cash flow of $1.9M in 2025, indicating capital requirements exceeded cash from operations.
Drilling Tools International Corp. (DTI) spent $20.1M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Drilling Tools International Corp. (DTI) spent $1.3M on share repurchases. This shows the company's commitment to returning capital to its equity investors.