Mammoth (TUSK) Q2 2026 earnings review
Aviation Pivot Accelerates Revenue, But Devours Cash
Mammoth's aggressive strategic turnaround is yielding undeniable top-line results, pushing Q2 revenue up 110% YoY to $26.1 million. The company raised its full-year revenue growth guidance for the second time, now targeting >90% growth. However, this growth is highly capital-intensive. Unrestricted cash plummeted from $125.1 million in Q1 to just $40.4 million by August as the company deployed massive CapEx into its aviation fleet. While Adjusted EBITDA accelerated to a positive $2.6 million, net income reversed back into the red (-$1.2 million), proving that a sustainable bottom-line turnaround is still a work in progress.
🐂 Bull Case
Management raised FY26 revenue growth guidance from >60% to >90%, and set an Adjusted EBITDA margin target of >10%. The core legacy businesses (Sand and Drilling) are finally rebounding alongside the new Aviation segment.
Drilling generated positive Adjusted EBITDA ahead of expectations, and Sand returned to positive gross margins. The bleeding from legacy oil and gas segments has stopped.
🐻 Bear Case
Total liquidity is vanishing fast. Unrestricted cash fell roughly $85 million between March 31 and August 4, driven by heavy aviation CapEx. The self-funded runway is shortening rapidly.
Net income reversed back to a $1.2 million loss after a positive Q1. Segment revenues are heavily skewed by one-off asset sales (a $2.0M airframe sale in Q2, and a $6.5M APU sale in Q1).
⚖️ Verdict: ⚪
Neutral. The top-line recovery and sequential EBITDA improvements are commendable, proving the aviation pivot is real. However, the sheer velocity of cash consumption to achieve this growth limits near-term upside until the CapEx cycle normalizes.
Key Themes
Aviation Fleet Expansion Remains the Core Engine
The Rental Services segment continues to lead the turnaround, generating $10.2 million in Q2 (up from $3.1 million YoY). While this appears to be a sequential deceleration from Q1's $13.0 million, the underlying recurring lease trend is stable. The volatility is driven by active portfolio management: Q1 included a $6.5 million APU sale, while Q2 included a $2.0 million airframe and landing gear sale. The company is successfully executing its strategy of acquiring, leasing, and opportunistically flipping aviation assets at high IRRs.
Alarming Deceleration in Cash Reserves
Mammoth's transformation is proving highly capital intensive. The company recorded $43.9 million in CapEx during Q2 ($41.2 million directed at aviation rentals). Consequently, unrestricted cash plummeted from $125.1 million at the end of Q1 to $50.9 million at June 30, and further down to $40.4 million by August 4. If this rate of investment continues, the company will quickly exhaust its cash buffer and be forced to tap its $20 million revolving credit facility.
Sand Segment Volumes Reversing Upward
After a disastrous end to 2025, the Natural Sand Proppant segment is accelerating. Revenue jumped to $8.0 million (up from $3.9 million in Q1). Volumes increased sequentially from 156,000 tons to 229,000 tons, while average pricing remained relatively stable at $21.36 per ton. The segment has successfully returned to positive gross margins, removing a critical cash-drain from the legacy portfolio.
Drilling Turnaround Finally Gains Traction
Drilling services delivered a major positive surprise, accelerating revenue to $3.8 million (up from $1.4 million in Q1 and $0.7 million YoY). More importantly, management noted the segment generated positive Adjusted EBITDA ahead of expectations due to increased utilization and activity levels in its targeted basins.
Doubling Down on the Infrastructure 'Overhang'
Mammoth acquired Mission Construction and BERE Rentals in Q2 to expand its fiber infrastructure capabilities. While this diversifies the portfolio away from cyclical O&G markets (a key macro theme for the company), it introduces severe execution risk. Just two quarters ago, management explicitly cited the infrastructure segment as an 'EBITDA overhang' plagued by significant cost overruns and execution failures. Buying new assets before entirely fixing the core operations could compound margin pressure.
Earnings Quality Reversing to Negative
Despite the bullish narrative surrounding revenue and EBITDA growth, actual bottom-line profitability remains elusive. Net income reversed from a $4.7 million profit in Q1 back to a $1.2 million loss in Q2. SG&A remains somewhat sticky at $4.2 million for the quarter, and depreciation is naturally increasing ($4.6 million in Q2 vs $2.8 million YoY) as the asset base expands via aggressive CapEx.
Other KPIs
Stable. Revenue slightly decelerated sequentially from $3.5M in Q1, but average rooms utilized remained healthy at 259 (vs 275 in Q1 and 145 YoY). This segment continues to be a quiet, reliable cash flow generator for the broader portfolio.
Decelerating YoY. While slightly higher than Q1's $3.6 million, it is well below the $5.0 million recorded in Q2 2025. The drastic legacy cost-cutting program initiated in 2025 appears to have established a new, sustainable baseline in the $14-$16 million annualized range.
Guidance
Accelerating. This is the second consecutive quarter management has raised this target (originally >50% in Q4 2025, raised to >60% in Q1 2026, now >90%). Applying this to FY25's $44.3 million baseline implies FY26 revenue exceeding $84 million. This reflects soaring confidence in aviation asset deployment and the recovery in legacy sand/drilling volumes.
Accelerating. Establishing a firm margin floor is a critical milestone for a company emerging from severe structural losses. A 10% margin on >$84 million in revenue implies FY26 Adjusted EBITDA of at least $8.4 million—a massive reversal from FY25's $17.4 million loss.
Key Questions
Aviation Lease vs. Asset Sale Mix
Q1 and Q2 rentals revenue benefited heavily from opportunistic asset sales ($6.5M APU and $2.0M airframe). What is the underlying, recurring monthly run-rate of the pure aviation leasing fleet today?
CapEx Runway and Liquidity
Unrestricted cash has drawn down from $125M to $40M since March. Does the company plan to continue this level of aggressive aviation CapEx in H2, and at what point will you need to draw on the revolving credit facility?
Infrastructure M&A Rationale
Given the severe execution issues and margin compression cited in the fiber business just a few quarters ago, what gave management the confidence that the operations are sufficiently stabilized to successfully integrate the Mission Construction and BERE Rentals acquisitions?