NOW : First Quarter 2022 Key Takeaways

Key Takeaways

FIRST QUARTER 2022

Disclosure Statement

Statements made in the course of this presentation that state the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. It is important to note that the Company's actual results could differ materially from those projected in such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time-to-time in the Company's filings with the U.S. Securities and Exchange Commission (SEC). Any decision regarding the Company or its securities should be made upon careful consideration of not only the information here presented, but also other available information, including the information filed by the Company with the SEC. Copies of these filings may be obtained by contacting the Company or the SEC.

In an effort to provide investors with additional information regarding our results as determined by U.S. Generally Accepted Accounting Principles (GAAP), we disclose various non-GAAP financial measures in our quarterly earnings press releases and other public disclosures. We use these non-GAAP financial measures internally to evaluate and manage the Company's operations because we believe it provides useful supplemental information regarding the Company's ongoing economic performance. The non-GAAP financial measures include: (i) earnings before interest, taxes, depreciation and amortization (EBITDA) excluding other costs

(sometimes referred to as "EBITDA"), (ii) net income (loss) excluding other costs and (iii) diluted earnings (loss) per share excluding other costs. Each of these financial measures excludes the impact of certain other costs and therefore has not been calculated in accordance with GAAP. A reconciliation of each non-GAAP financial measure to its most comparable GAAP financial measure can be found in our earnings press release.

In an effort to better align with management's evaluation of the Company's performance and to facilitate comparison of our results to those of peer companies, beginning for the fourth quarter and full-year ended December 31, 2021, EBITDA excluding other costs excludes non-cash stock-based compensation expense. Prior periods presented have been adjusted to conform with the current period presentation.

Quarterly Results

• ▪ 1Q22 revenue was $473M, an increase of 9.5% sequentially, or $41M, driven by greater activity in the United States and Canada

• ▪ U.S. revenue was $334M for 1Q22, an increase of 10% sequentially, or $31M, on increased U.S. rig and completion activity

• ▪ Canada revenue improved to $82M in 1Q22, an increase of 14% sequentially, or $10M, on growth in Canadian rig and completions activity

• ▪ International revenue was $57M for 1Q22, flat sequentially

• ▪ Gross margins in 1Q22 were 22.6%, above our full-year 2022 guided range of 21.9%

• ▪ Cash balance of $293M and zero debt as of March 31, 2022, with zero interest expense. Working capital increased in the quarter as we further position ourselves to take advantage of growing upstream market opportunity

• ▪ EBITDA was $28M for 1Q22, or 5.9% of revenue, an all-time high since becoming a publicly traded company in 2014

1Q22 Key Market Indicators

WTI/Rig Counts

• ▪ WTI avg of $94 per barrel for 1Q22

• ▪ U.S. avg rig count of 633, up 13% sequentially

• ▪ Canada avg rig count of 198, up 23% sequentially

• ▪ International avg rig count of 823, up 1% sequentially

DNOW annualized revenue per rig at $1.1M for 1Q22

DUCs are future revenue opportunities for

DNOW

Presents an immediate opportunity for DNOW U.S.

as tank batteries and gathering systems are constructed after completions

1Q22 Highlights - United States

• ▪ Contributed 79% of U.S. revenue

• ▪ Revenue grew from strong demand for PVF and MRO distributed products from our network of branches and regionalized fulfillment centers

• ▪ Renewed top 10 customer PVF contract for 5-year commitment and experienced growth with a number of mid-to-large cap customers in Permian, Eagle Ford, Powder River and Williston basin

• ▪ New PVF+ Casper, WY and PVF+ Permian regionalized fulfillment centers fully operational for majority of the quarter leading to performance improvements

• ▪ Provided a large number of valves for a biofuels project at a California refinery which will provide renewable diesel, gasoline and sustainable jet fuel from cooking oils, fats, greases and soybean oils

• ▪ Downstream end-market revenue expanded sequentially due to increased seasonal turnaround activity expanding maintenance spend in core products

U.S. Energy

• ▪ Contributed 21% of U.S. revenue.

• ▪ Revenue grew with increased demand for engineered pump packages and process and production equipment

• ▪ Delivered a number of three phase separator packages, LACT units, pipe racks, modular metering units, oil and water booster skids, water transfer units, SWDs from our Casper, WY and Tomball, TX engineering and fabrication facilities

• ▪ Continue to see strong demand for our instrument air compressor skids to replace gas pneumatic operated systems and reduce customers' greenhouse gas emissions

• ▪ Supply chain related issues for high pressure, high flow pumps create improving demand for pump rentals

U.S. Process Solutions