YARDLEY, PA — Smart Sand, Inc. (Nasdaq: SND) increased frac sand sales to a quarterly record in the first quarter as rising natural gas demand tied to LNG expansion and AI-driven power consumption continued supporting drilling activity across North American shale basins.
The Pennsylvania-based sand supplier reported first-quarter revenue of $93.1 million, up 42% from a year earlier, as volumes climbed to nearly 1.5 million tons sold. The company generated $3.0 million in operating cash flow and $0.8 million in free cash flow during the quarter.
Despite higher sales volumes and revenue, Smart Sand posted a net loss of $3.9 million, compared with net income of $1.2 million in the prior quarter, as production and freight costs compressed margins. Gross profit fell to $6.1 million from $11.2 million in the fourth quarter.
Chief Executive Officer Charles Young pointed to strengthening activity in the Appalachian Basin and Canadian shale regions, including the Montney and Duvernay formations, as natural gas producers position for expected long-term demand growth.
“We have positioned Smart Sand to benefit from expected long-term growth in North American natural gas demand driven by expanding LNG export capacity and increasing gas-fired power generation to support AI data center electricity needs,” Young stated.
Frac sand suppliers have increasingly tied growth expectations to rising electricity demand from artificial intelligence infrastructure, which has accelerated forecasts for natural gas-fired generation expansion across the U.S.
Smart Sand sold approximately 1.49 million tons during the quarter, up 40% from the same period last year and slightly above fourth-quarter levels. The company described the quarter as its fourth consecutive period exceeding 1.4 million tons sold.
Contribution margin declined sequentially to $13.2 million from $18.0 million in the prior quarter as logistics and production expenses increased. Adjusted EBITDA fell to $3.8 million from $7.1 million in the fourth quarter.
The company continued expanding its industrial sand business through its Ottawa, Illinois facility and indicated industrial volumes are expected to rise year over year.
Smart Sand also deployed a redesigned version of its SmartSystem logistics equipment intended to handle higher daily sand volumes used in modern well completions. Young indicated the company plans to remain disciplined on additional fleet expansion pending further customer commitments.
The company repurchased approximately $1.4 million of stock during the quarter and completed a prior $10 million repurchase authorization in April. Smart Sand also authorized a new $20 million repurchase program running through April 2028.
In April, the board approved a special dividend of $0.10 per share, distributing approximately $3.9 million to shareholders.
As of March 31, Smart Sand held $19.5 million in cash and had full availability under its $30 million credit facility. The company projected 2026 sales-volume growth of 5% to 10% and stated it expects to remain free-cash-flow positive for the year.
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