What changed in this filing

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Item 1. Financial Statements

2025-08-08 compared with 2025-05-02 · 98 added, 55 removed, 400 unchanged (28% of the section changed)

3 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in thousands, except per share information) 2025 2024 2025 2024

5 unchanged sentences

Transaction expenses 184 1,228 235 7,149

Loss (gain) on disposal of assets and other 123 ( 28 )

Gain on sale-leaseback transactions ( 6,903 ) — ( 6,903 ) —

Loss on disposal of assets and other 207 220 330 192

Total operating expenses 44,673 55,139 94,230 115,698

3 unchanged sentences

Foreign exchange losses (gains) and other, net ( 3,942 ) 3,006 ( 5,010 ) 4,233

Loss on extinguishment of debt — 463 — 463

Total other expense 764 12,128 4,679 22,115

17 unchanged sentences

Condensed Consolidated Balance Sheets

(in thousands, except share information) March 31, 2025 December 31, 2024

(in thousands, except share information) June 30, 2025 December 31, 2024

Current assets

29 unchanged sentences

Commitments and contingencies

Common stock, $ 0.01 par value, 14,800,000 shares authorized, 13,183,778 and 12,999,246 shares issued

Common stock, $ 0.01 par value, 29,600,000 and 14,800,000 shares authorized, 13,191,488 and 12,999,246 shares issued

Additional paid-in capital 1,422,138 1,419,871

9 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Three Months Ended March 31,

Six Months Ended June 30,

(in thousands) 2025 2024

6 unchanged sentences

Stock-based compensation expense 3,590 3,104

Loss on extinguishment of debt — 463

Deferred income taxes ( 3,670 ) ( 2,272 )

Gain on sale-leaseback transactions ( 6,903 ) —

Other 1,041 3,380

11 unchanged sentences

Payments related to business acquisition, net of cash acquired — ( 150,086 )

Net cash used in investing activities ( 2,096 ) ( 152,819 )

Proceeds from sale-leaseback transactions 8,028 —

Net cash provided by (used in) investing activities 5,024 ( 154,476 )

Cash flows from financing activities

1 unchanged sentence

Repayments on Credit Facility ( 299,360 ) ( 313,397 )

Cash paid to repurchase 2025 Notes — ( 12,996 )

Proceeds from issuance of Seller Term Loan — 59,677

5 unchanged sentences

Effect of exchange rate changes on cash 1,479 ( 2,844 )

Net increase (decrease) in cash, cash equivalents and restricted cash ( 13,518 ) 2,323

Net decrease in cash, cash equivalents and restricted cash ( 5,694 ) ( 14,339 )

Cash, cash equivalents and restricted cash at beginning of period 44,661 46,165

8 unchanged sentences

Stock issuance related to business acquisition — 44,220

Liability awards converted to shares settled — 337

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Three Months Ended March 31, 2025

Six Months Ended June 30, 2025

(in thousands) Common stock Additional paid-in capital Treasury stock Retained

10 unchanged sentences

Balance at March 31, 2025 $ 132 $ 1,420,366 $ ( 144,054 ) $ ( 833,675 ) $ ( 122,727 ) $ 320,042

Stock-based compensation expense — 1,772 — — — 1,772

Treasury stock — — ( 4,298 ) — — ( 4,298 )

Currency translation adjustment — — — — 8,929 8,929

Change in pension liability — — — — 75 75

Net income — — — 7,700 — 7,700

Balance at June 30, 2025 $ 132 $ 1,422,138 $ ( 148,352 ) $ ( 825,975 ) $ ( 113,723 ) $ 334,220

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Three Months Ended March 31, 2024

Six Months Ended June 30, 2024

(in thousands) Common stock Additional paid-in capital Treasury stock Retained

10 unchanged sentences

Balance at March 31, 2024 $ 130 $ 1,413,970 $ ( 142,057 ) $ ( 709,786 ) $ ( 116,055 ) $ 446,202

Stock-based compensation expense — 1,531 — — — 1,531

Liability awards converted to share settled — 337 — — — 337

Currency translation adjustment — — — — 621 621

Change in pension liability — — — — ( 5 ) ( 5 )

Net loss — — — ( 6,696 ) — ( 6,696 )

Balance at June 30, 2024 $ 130 $ 1,415,838 $ ( 142,057 ) $ ( 716,482 ) $ ( 115,439 ) $ 441,990

The accompanying notes are an integral part of these condensed consolidated financial statements.

10 unchanged sentences

In management's opinion, all adjustments, consisting of normal recurring adjustments, necessary for the fair statement of the Company’s financial position, results of operations and cash flows have been included.

Operating results for the three months ended March 31, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025 or any other interim period.

Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025 or any other interim period.

These interim financial statements are unaudited and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting.

1 unchanged sentence

GAAP”) for complete consolidated financial statements and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024, which are included in the Company’s 2024 Annual Report on Form 10-K filed with the SEC on March 3, 2025.

On May 9, 2025, the Company’s stockholders approved an amendment to the Company’s Third Amended and Restated Certificate of Incorporation to increase the Company’s authorized shares of common stock from 14.8 million shares to 29.6 million shares.

Recent Accounting Pronouncements

25 unchanged sentences

Such contract liabilities typically result from billings in excess of costs incurred on construction contracts and advance payments received on product sales.

The following table reflects the changes in our contract assets and contract liabilities balances for the three months ended March 31, 2025 (in thousands):

March 31, 2025 December 31, 2024 Increase (Decrease)

The following table reflects the changes in our contract assets and contract liabilities balances for the six months ended June 30, 2025 (in thousands):

June 30, 2025 December 31, 2024 Increase

Accrued revenue $ 99 $ 752

4 unchanged sentences

Contract liabilities $ 24,031 $ 13,100 $ 10,931 83 %

During the three months ended March 31, 2025, our contract assets decreased by $ 0.3 million and our contract liabilities increased $ 1.7 million primarily due to the timing of milestone billings for projects in our Subsea product line.

During the three months ended March 31, 2025, we recognized $ 5.4 million of revenue that was included in the contract liabilities balance at the beginning of the period.

During the six months ended June 30, 2025, our contract assets increased by $ 2.2 million and our contract liabilities increased $ 10.9 million primarily due to the timing of milestone billings for projects in our Subsea product line.

During the six months ended June 30, 2025, we recognized $ 8.5 million of revenue that was included in the contract liabilities balance at the beginning of the period.

Substantially all of our contracts are less than one year in duration.

As such, we have elected to apply the practical expedient which allows an entity to exclude disclosures about its remaining performance obligations if such obligation is part of a contract that has an original expected duration of one year or less .

The Company's significant components of inventory at March 31, 2025 and December 31, 2024 were as follows (in thousands):

March 31, 2025 December 31, 2024

The Company's significant components of inventory at June 30, 2025 and December 31, 2024 were as follows (in thousands):

June 30, 2025 December 31, 2024

Raw materials and parts $ 99,470 $ 99,185

8 unchanged sentences

Goodwill and Intangible Assets

The changes in the carrying amount of goodwill from December 31, 2024 to March 31, 2025, were as follows (in thousands):

The changes in the carrying amount of goodwill from December 31, 2024 to June 30, 2025, were as follows (in thousands):

Artificial Lift and Downhole

2 unchanged sentences

local currency translation 3,569

Goodwill, March 31, 2025 $ 61,703

Goodwill, June 30, 2025 $ 65,222

Goodwill is not amortized and is tested for impairment at least annually or when events and circumstances indicate that fair value may be below its carrying value.

Intangible Assets

Intangible assets consisted of the following as of March 31, 2025 and December 31, 2024, respectively (in thousands):

March 31, 2025

Intangible assets consisted of the following as of June 30, 2025 and December 31, 2024, respectively (in thousands):

June 30, 2025

Gross Carrying Amount Accumulated Amortization Net Intangibles Amortization Period (In Years)

13 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Continued)

Debt as of March 31, 2025 and December 31, 2024 consisted of the following (in thousands):

March 31, 2025 December 31, 2024

Debt as of June 30, 2025 and December 31, 2024 consisted of the following (in thousands):

June 30, 2025 December 31, 2024

2029 Bonds $ 100,000 $ 100,000

16 unchanged sentences

The 2029 Bonds are also subject to negative covenants as set forth in the Bond Terms.

As of March 31, 2025, the Company was in compliance with all of its 2029 Bonds financial covenants.

As of June 30, 2025, the Company was in compliance with all of its 2029 Bonds financial covenants.

Upon the occurrence of certain change of control events, as specified in the Bond Terms, each holder of the 2029 Bonds will have the right to require that the Company repurchase all or some of such holder’s 2029 Bonds in cash at a purchase price equal to 101 % of the aggregate principal amount thereof.

14 unchanged sentences

Our borrowing capacity under the Credit Facility could be reduced or eliminated, depending on future fluctuations in our receivables and inventory.

As of March 31, 2025, our total borrowing base was $ 168.5 million, of which $ 73.8 million amount was drawn and $ 17.3 million was used as security for outstanding letters of credit, resulting in remaining availability of $ 77.4 million.

As of June 30, 2025, our total borrowing base was $ 171.8 million, of which $ 62.4 million amount was drawn and $ 16.3 million was used as security for outstanding letters of credit, resulting in remaining availability of $ 93.1 million.

Borrowings under the U.S.

3 unchanged sentences

The Canadian Line base rate is determined by reference to the greater of (i) the one-month CORRA plus 1.00 % per annum and (ii) the prime rate for Canadian dollar commercial loans made in Canada as reported by Thomson Reuters, subject to a floor of 0.00 %.

The weighted average interest rate under the Credit Facility was approximately 7.55 % and 8.34 % for the three months ended March 31, 2025 and 2024, respectively.

The weighted average interest rate under the Credit Facility was approximately 7.42 % and 8.45 % for the six months ended June 30, 2025 and 2024, respectively.

The Credit Facility also provides for a commitment fee in the amount of (a) 0.375 % on the unused portion of revolving commitments if average usage of the Credit Facility is greater than 50 % and (b) 0.500 % on the unused portion of revolving commitments if average usage of the Credit Facility is less than or equal to 50 %.

13 unchanged sentences

and the occurrence of a Change of Control (as defined in the Credit Facility).

As of March 31, 2025, the Company was in compliance with all of its Credit Facility financial covenants.

As of June 30, 2025, the Company was in compliance with all of its Credit Facility financial covenants.

Forum Energy Technologies, Inc.

4 unchanged sentences

We execute letters of credit in the normal course of business to secure the delivery of product from specific vendors and also to guarantee our fulfillment of performance obligations relating to certain large contracts.

The Company had $ 17.3 million and $ 17.8 million in total outstanding letters of credit as of March 31, 2025 and December 31, 2024, respectively.

The Company had $ 16.3 million and $ 17.8 million in total outstanding letters of credit as of June 30, 2025 and December 31, 2024, respectively.

For interim periods, our income tax expense or benefit is computed based on our estimated annual effective tax rate and any discrete items that impact the interim periods.

For the three months ended March 31, 2025 and 2024, the Company recorded a tax expense of $ 3.8 million and $ 3.5 million, respectively.

For the three and six months ended June 30, 2025, the Company recorded a tax expense of $ 6.2 million and $ 10.0 million, respectively.

For the three and six months ended June 30, 2024, the Company recorded tax expense of $ 2.5 million and $ 6.0 million, respectively.

The estimated annual effective tax rates for all periods were impacted by losses in jurisdictions where the recording of a tax benefit is not available.

8 unchanged sentences

In making such a determination, we consider all available positive and negative evidence, including, but not limited to, our recent history of pretax losses over the prior three year period, the goodwill and intangible asset impairments for various reporting units, the future reversals of existing taxable temporary differences, the projected future taxable income or loss and tax-planning.

As of March 31, 2025, we do not anticipate being able to fully utilize all of the losses prior to their expiration in the following jurisdictions:

As of June 30, 2025, we do not anticipate being able to fully utilize all of the losses prior to their expiration in the following jurisdictions:

the U.S., the U.K., Singapore and China.

As a result, we have certain valuation allowances against our deferred tax assets as of March 31, 2025.

As a result, we have certain valuation allowances against our deferred tax assets as of June 30, 2025.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act ("OBBBA").

The OBBBA includes various provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

The Company is currently evaluating the impact of this legislation on its consolidated financial statements.

Fair Value Measurements

The Company had $ 73.8 million and $ 100.0 million borrowings outstanding under the Credit Facility and 2029 Bonds as of March 31, 2025, respectively.

The Company had $ 62.4 million and $ 100.0 million borrowings outstanding under the Credit Facility and 2029 Bonds as of June 30, 2025, respectively.

The Credit Facility incurs interest at a variable interest rate and therefore, the carrying amount approximates fair value.

1 unchanged sentence

The fair value of our 2029 Bonds is estimated using Level 2 inputs in the fair value hierarchy and is based on quoted prices for those or similar instruments.

At March 31, 2025, the fair value and the carrying value of our 2029 Bonds approximated $ 102.0 million and $ 94.1 million, respectively.

At June 30, 2025, the fair value and the carrying value of our 2029 Bonds approximated $ 102.0 million and $ 94.1 million, respectively.

At December 31, 2024, the fair value and the carrying value of our 2029 Bonds approximated $ 99.5 million and $ 94.6 million, respectively.

There were no other significant outstanding financial instruments as of March 31, 2025 and December 31, 2024 that required measuring the amounts at fair value on a recurring basis.

We did not change our valuation techniques associated with recurring fair value measurements from prior periods, and there were no transfers between levels of the fair value hierarchy during the three months ended March 31, 2025.

There were no other significant outstanding financial instruments as of June 30, 2025 and December 31, 2024 that required measuring the amounts at fair value on a recurring basis.

Forum Energy Technologies, Inc.

9 unchanged sentences

Operating segments have not been aggregated as part of a reportable segment.

The Company evaluates the performance of its reportable segments based on operating income.

This segmentation is representative of the manner in which our Chief Operating Decision Maker and our board of directors make decisions on how to allocate resources and assess performance.

We consider the Chief Operating Decision Maker to be the Chief Executive Officer.

This segmentation is representative of the manner in which our Chief Operating Decision Maker ("CODM") and our board of directors make decisions on how to allocate resources and assess performance.

We consider the CODM to be the Chief Executive Officer.

The CODM evaluates segment performance based on operating income through monitoring actual results compared to strategic plans and forecasts on a quarterly basis.

This analysis guides our CODM's decision-making processes, particularly in evaluating segment profitability, optimizing resource allocation, and managing costs effectively.

Summary financial data by segment follows (in thousands):

Three Months Ended March 31, 2025 Drilling and Completions Artificial Lift and Downhole Total

Three Months Ended June 30, 2025 Six Months Ended June 30, 2025

Drilling and Completions Artificial Lift and Downhole Total Drilling and Completions Artificial Lift and Downhole Total

Revenue from external customers $ 117,217 $ 82,547 $ 199,764 $ 232,700 $ 160,343 $ 393,043

6 unchanged sentences

Segment operating income $ 7,271 $ 10,391 $ 17,662 $ 16,650 $ 17,688 $ 34,338

Three Months Ended March 31, 2024 Drilling and Completions Artificial Lift and Downhole Total

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024

Drilling and Completions Artificial Lift and Downhole Total Drilling and Completions Artificial Lift and Downhole Total

Revenue from external customers $ 117,040 $ 88,169 $ 205,209 $ 236,090 $ 171,511 $ 407,601

10 unchanged sentences

A reconciliation of segment operating income to income (loss) before income taxes is as follows (in thousands):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Segment operating income $ 17,662 $ 16,336 $ 34,338 $ 32,681

Other corporate expenses

9,491 6,954 17,189 14,206

Transaction expenses 184 1,228 235 7,149

Loss (gain) on disposal of assets and other 123 ( 28 )

Gain on sale-leaseback transactions ( 6,903 ) — ( 6,903 ) —

Loss on disposal of assets and other 207 220 330 192

Interest expense 4,706 8,659 9,689 17,419

Foreign exchange losses (gains) and other, net ( 3,942 ) 3,006 ( 5,010 ) 4,233

Loss on extinguishment of debt — 463 — 463

Income (loss) before income taxes $ 13,919 $ ( 4,194 ) $ 18,808 $ ( 10,981 )

A summary of consolidated assets by reportable segment is as follows (in thousands):

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Drilling and Completions $ 423,953 $ 418,583

4 unchanged sentences

The following table presents our revenues disaggregated by product line (in thousands):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Drilling $ 32,846 $ 35,501 $ 64,959 $ 71,973

11 unchanged sentences

The following table presents our revenues disaggregated by geography (in thousands):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

United States $ 107,276 $ 102,552 $ 211,179 $ 213,869

Canada 31,021 36,336 62,458 71,975

Europe & Africa 19,788 21,602

Middle East 21,931 25,378 41,576 42,733

Europe & Africa 18,605 21,053 38,393 42,655

Asia-Pacific 10,065 10,150 20,508 20,318

4 unchanged sentences

Management has reviewed such pending judicial and legal proceedings, the reasonably anticipated costs and expenses in connection with such proceedings, and the availability and limits of insurance coverage, and has established reserves that are believed to be appropriate in light of those outcomes that are believed to be probable and can be estimated.

The reserves accrued at March 31, 2025 and December 31, 2024, respectively, are immaterial.

The reserves accrued at June 30, 2025 and December 31, 2024, respectively, are immaterial.

In the opinion of management, the Company’s ultimate liability, if any, with respect to these actions is not expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows.

2 unchanged sentences

The calculation of basic and diluted earnings (loss) per share for each period presented was as follows (dollars and shares in thousands, except per share amounts):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Net income (loss) $ 7,700 $ ( 6,696 ) $ 8,822 $ ( 17,011 )

5 unchanged sentences

Diluted $ 0.61 $ ( 0.54 ) $ 0.70 $ ( 1.39 )

For the three months ended March 31, 2025, the diluted earnings per share excludes approximately nine thousand shares because they were anti-dilutive.

For the three months ended 2024, we excluded all potentially dilutive stock options and restricted stock in calculating diluted earnings per share as the effect was anti-dilutive due to net losses incurred for the period.

Diluted earnings per share was calculated using treasury stock method for the stock options and restricted stock.

Forum Energy Technologies, Inc.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements (Continued)

For the three and six months ended June 30, 2025, the diluted earnings per share excludes approximately 28 thousand and 19 thousand shares, respectively, because they were anti-dilutive.

For the three and six months ended June 30, 2024, we excluded all potentially dilutive stock options and restricted stock in calculating diluted earnings per share as the effect was anti-dilutive due to net losses incurred for these periods.

Diluted earnings per share was calculated using treasury stock method for the stock options and restricted stock.

Stock-based Compensation

Restricted Stock and Time-Based Restricted Stock Units

During the three months ended March 31, 2025, the Company granted 190,392 time-based restricted stock units to employees that vest after three years .

Also, during the three months ended March 31, 2025, the Company granted 34,228 time-based restricted stock and 8,557 time-based restricted stock units to non-employee members of the Board of Directors that vest after one year .

During the six months ended June 30, 2025, the Company granted 190,392 time-based restricted stock units to employees that vest after three years .

Also, during the six months ended June 30, 2025, the Company granted 41,938 time-based restricted stock and 8,557 time-based restricted stock units to non-employee members of the Board of Directors that vest after one year .

Performance Share Awards

During the three months ended March 31, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's total shareholder return compared to the total shareholder return of a group of peer companies over three different performance periods.

During the six months ended June 30, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's total shareholder return compared to the total shareholder return of a group of peer companies over three different performance periods.

The performance periods run from January 1, 2025 through December 31, 2025, January 1, 2025 through December 31, 2026 and January 1, 2025 through December 31, 2027, and one-third of each award is allocated to each performance period.

The performance restricted stock units may settle for between 0 % and 200 % of the target units granted.

During the three months ended March 31, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's free cash flow over three different performance periods.

During the six months ended June 30, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's free cash flow over three different performance periods.

The performance restricted stock units may settle for between 0 % and 200 % of the target units granted.

During the three months ended March 31, 2025, the Company granted 114,000 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's minimum stock price threshold of $ 21.91 per share, for 20 consecutive trading days during the period commencing on grant date of March 5, 2025 and ending on the third anniversary thereof.

During the six months ended June 30, 2025, the Company granted 114,000 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's minimum stock price threshold of $ 21.91 per share, for 20 consecutive trading days during the period commencing on grant date of March 5, 2025 and ending on the third anniversary thereof.

Related Party Transactions

1 unchanged sentence

The dollar amounts of these related party activities are not significant to the Company’s unaudited condensed consolidated financial statements.

Sale-leaseback transactions

In June 2025, the Company sold and leased back land and buildings with a net book value of approximately $ 1.9 million and received net proceeds of $ 8.8 million, of which $ 0.8 million is receivable with a due date of June 2027.

The initial annual rent for the assets is $ 0.7 million with an initial term of 15 years, subject to annual increases.

The transactions met the requirements of sale-leaseback accounting.

The related assets were removed from property and equipment and the appropriate operating lease assets and liabilities of approximately $ 7.6 million were recorded in the consolidated balance sheets.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements