NYSE:USAC
USA Compression Partners, LP
USA Compression Partners delivers essential midstream compression services across key U.S. natural gas basins, driving steady revenue growth through 2025.
Key Metrics
Investment Thesis
Bull Case
USAC presents a compelling value proposition backed by strong free cash flow generation of nearly $400 million and a proven track record of revenue expansion over the last three years. The company's strategic positioning in high-growth basins offers visibility into future earnings as North American gas production continues to expand.
Bear Case
The balance sheet carries substantial long-term debt obligations that could constrain financial flexibility during periods of market stress or rising interest rates. With shareholders' equity currently negative at -$112.5 million, the company's solvency relies heavily on consistent cash flow coverage and favorable credit terms.
About USA Compression Partners, LP
USA Compression Partners (USAC) is a leading midstream energy company providing compression services to natural gas gathering and transmission systems across the United States. The firm generates revenue primarily through capacity sales in major shale basins including the Permian, Eagle Ford, and Marcellus regions, leveraging its extensive fleet of compressor units to deliver critical infrastructure support for the North American energy sector.
Analysis
Management Discussion
Financial performance demonstrates robust operational efficiency with operating cash flow reaching $394.3 million against a net income of $111.3 million in 2025. Revenue growth has been consistent, rising from $704.6 million in 2022 to $998.1 million in 2025, reflecting successful capacity expansion and market share gains.
Industry Overview
The midstream natural gas compression sector is cyclical but essential for moving energy from production sites to consumption centers. Industry trends favor companies with low-cost operating models and long-term contracts that provide stable returns regardless of short-term commodity price fluctuations.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $704.6M | $846.2M | $950.4M | $998.1M |
| Cost of Revenue | $234.3M | $284.7M | $312.7M | $328.8M |
| Gross Profit | $470.3M | $561.5M | $637.7M | $669.3M |
| Operating Expenses | $301.0M | $329.5M | $343.3M | $362.8M |
| Operating Income | $169.3M | $232.0M | $294.4M | $306.5M |
| G&A | $61.3M | $72.7M | $72.7M | $66.3M |
| Stock-Based Comp | $15.9M | $22.2M | $16.6M | $4.3M |
| D&A | $236.7M | $246.1M | $264.8M | $284.8M |
| Depreciation | $207.3M | $216.7M | $235.4M | $255.4M |
| Amortization | $29.4M | $29.4M | $29.4M | $29.4M |
| Other OpEx | $239.7M | $256.8M | $270.6M | $296.4M |
| Non-Operating Income | $-138.0M | $-162.3M | $-192.6M | $-190.3M |
| Interest Expense | $138.1M | $169.9M | — | — |
| Pre-Tax Income | $31.3M | $69.6M | $101.8M | $116.2M |
| Income Tax | $1.0M | $1.4M | $2.2M | $4.9M |
| Continuing Ops | $30.3M | $68.3M | $99.6M | $111.3M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $30.3M | $68.3M | $99.6M | $111.3M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $30.3M | $68.3M | $99.6M | $111.3M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $186.4M | $226.4M | $235.0M | $236.6M |
| Cash & Equivalents | $35.0K | $11.0K | $14.0K | $8.6M |
| Accounts Receivable | $83.8M | — | — | — |
| Inventory | $93.8M | $114.7M | $133.9M | $134.5M |
| Prepaid Expenses | $8.8M | $10.6M | $12.0M | $11.0M |
| Other Current Assets | $52.0K | $101.1M | $89.1M | $82.5M |
| Long-Term Assets | $2.48B | $2.51B | $2.51B | $2.38B |
| Operating Leases | $18.2M | $17.3M | $14.3M | $13.7M |
| Other LT Assets | $2.46B | $2.49B | $2.50B | $2.37B |
| Total Assets | $2.67B | $2.74B | $2.75B | $2.62B |
| Current Liabilities | $173.7M | $187.5M | $190.7M | $186.9M |
| Accounts Payable | $35.3M | $39.8M | — | — |
| Current Debt | $0 | $0 | $0 | $0 |
| Current Leases | $3.6M | $4.1M | $4.0M | $4.4M |
| Deferred Revenue | $62.3M | $62.6M | $63.9M | $65.0M |
| Other Current Liab | $-3.6M | $-4.1M | $23.3M | $23.7M |
| Long-Term Liabilities | $2.13B | $2.37B | $2.53B | $2.55B |
| Long-Term Debt | $2.11B | $2.34B | $2.50B | $2.52B |
| LT Operating Leases | $16.1M | $14.7M | $11.7M | $10.7M |
| Other LT Liab | $5.5M | $9.4M | $6.3M | $6.4M |
| Total Liabilities | $2.30B | $2.55B | $2.72B | $2.73B |
| Shareholders' Equity | $361.0M | $183.0M | $27.8M | $-112.5M |
| Total L&E | $2.67B | $2.74B | $2.75B | $2.62B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $30.3M | $68.3M | $99.6M | $111.3M |
| Non-Cash Adjustments | $260.2M | $111.5M | $116.0M | $238.1M |
| Working Capital Changes | $-29.9M | $92.1M | $125.8M | $44.9M |
| Cash from Operations | $260.6M | $271.9M | $341.3M | $394.3M |
| Capital Expenditures | $134.2M | $238.5M | $204.9M | $117.3M |
| Cash from Investing | $-129.9M | $-232.7M | $-202.0M | $-115.0M |
| Cash from Financing | $-130.6M | $-39.3M | $-139.3M | $-270.8M |
| FX Effect | $0 | $0 | $0 | $0 |
| Net Change in Cash | $35.0K | $-24.0K | $3.0K | $8.6M |
| Beginning Cash | $0 | $35.0K | $11.0K | $14.0K |
| Ending Cash | $35.0K | $11.0K | $14.0K | $8.6M |
Frequently Asked Questions
How does USA Compression Partners, LP make money?
Core revenue is derived from long-term capacity sales agreements with major pipeline operators in high-demand regions such as the Permian Basin and Eagle Ford Shale. Additional streams include spot market capacity transactions and maintenance services for compressor units deployed across the network, supported by a fleet of proprietary assets valued at over $2.3 billion.
What are the main risks for USAC?
Investors face exposure to volatile commodity prices that may impact credit terms with pipeline partners and potential delays in new well completions. Significant debt levels totaling approximately $2.5 billion create refinancing risks should interest rates rise or leverage ratios tighten. Operational risks include maintenance costs, equipment failures, and supply chain disruptions affecting compressor unit availability.
What is USAC's competitive advantage?
The company benefits from its strategic asset footprint concentrated in the most prolific natural gas producing regions, ensuring consistent demand visibility. A diversified customer base comprising top-tier pipeline companies mitigates concentration risk, while a proven operational track record allows for favorable contract pricing and retention rates.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.