What happened 

Shares of oil stock Solaris Oilfield Infrastructure (SOI -0.22%) fell as much as 22.5% in trading on Tuesday after reporting third-quarter 2022 financial results. Shares closed the day down 20.1%. 

So what 

Total revenue rose from $49.4 million a year ago to $92.3 million in Q3, and net income jumped from $874,000 to $7.4 million, or $0.22 per share.

On an adjusted basis, which pulls out one-time items, earnings were $0.24 per share, one cent ahead of estimates. But what investors didn't like was revenue falling 5% below estimates, and that's why the stock is down big today. 

Now what 

The oil business is clearly recovering, but it's going more slowly than some in the services business would like. Explorers aren't opening their pocketbooks too quickly, because oil futures prices are low, and they're more than happy to cash flow the existing business. That means oil producers are swimming in cash while services companies are struggling. 

I don't see this dynamic changing anytime soon either. Oil companies don't have much incentive to increase production in an environment where demand will likely fall as EVs gain market share, and it's difficult and expensive to borrow money for growth. That'll put a cap on the earnings of a company like Solaris and is a big reason I'm not buying this stock even after a slight beat on the bottom line.