FORUM ENERGY TECHNOLOGIES, INC. 10-Q

Item 1. Financial Statements Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Comprehensive Loss (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per share information) 2025 2024 2025 2024 Revenue $ 196,231 $ 207,806 $ 589,274 $ 615,407 Cost of sales 155,994 142,070 431,320 422,839 Gross profit 40,237 65,736 157,954 192,568 Operating expenses Selling, general and administrative expenses 50,449 56,326 151,017 164,683 Transaction expenses 254 579 489 7,728 Gain on sale-leaseback transactions ( 4,279 ) — ( 11,182 ) — Loss (gain) on disposal of assets and other ( 81 ) ( 85 ) 249 107 Total operating expenses 46,343 56,820 140,573 172,518 Operating income (loss) ( 6,106 ) 8,916 17,381 20,050 Other expense (income) Interest expense 4,365 7,650 14,054 25,069 Foreign exchange losses (gains) and other, net 9 9,631 ( 5,001 ) 13,864 Loss on extinguishment of debt — 1,839 — 2,302 Total other expense 4,374 19,120 9,053 41,235 Income (loss) before income taxes ( 10,480 ) ( 10,204 ) 8,328 ( 21,185 ) Income tax expense 10,074 4,611 20,060 10,641 Net loss $ ( 20,554 ) $ ( 14,815 ) $ ( 11,732 ) $ ( 31,826 ) Weighted average shares outstanding Basic 11,682 12,330 12,110 12,287 Diluted 11,682 12,330 12,110 12,287 Loss per share Basic $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 ) Diluted $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 ) Other comprehensive income (loss), net of tax of $ 0 : Net loss $ ( 20,554 ) $ ( 14,815 ) $ ( 11,732 ) $ ( 31,826 ) Change in foreign currency translation ( 4,308 ) 14,254 5,105 14,071 Gain (loss) on pension liability ( 4 ) 25 107 5 Comprehensive loss $ ( 24,866 ) $ ( 536 ) $ ( 6,520 ) $ ( 17,750 ) The accompanying notes are an integral part of these condensed consolidated financial statements. 4 Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) (in thousands, except share information) September 30, 2025 December 31, 2024 Assets Current assets Cash and cash equivalents $ 31,693 $ 44,661 Accounts receivable—trade, net of allowances of $ 9,180 and $ 9,529 146,938 153,926 Inventories, net 248,255 265,487 Prepaid expenses and other current assets 15,985 19,179 Costs and estimated profits in excess of billings 16,388 11,632 Accrued revenue 21 752 Total current assets 459,280 495,637 Property and equipment, net of accumulated depreciation 52,283 63,421 Operating lease assets 81,268 70,389 Deferred financing costs, net 1,723 2,154 Goodwill 63,779 61,653 Intangible assets, net 97,234 109,230 Deferred income taxes, net 11,463 11,445 Other long-term assets 3,062 2,025 Total assets $ 770,092 $ 815,954 Liabilities and equity Current liabilities Current portion of long-term debt $ 1,437 $ 1,866 Accounts payable—trade 113,732 109,651 Accrued liabilities 69,477 77,239 Deferred revenue 13,694 8,584 Billings in excess of costs and profits recognized 11,285 4,516 Total current liabilities 209,625 201,856 Long-term debt, net of current portion 138,548 186,525 Deferred income taxes, net 20,837 23,678 Operating lease liabilities 85,182 73,145 Other long-term liabilities 18,590 10,850 Total liabilities 472,782 496,054 Commitments and contingencies Equity Common stock, $ 0.01 par value, 29,600,000 and 14,800,000 shares authorized, 13,191,488 and 12,999,246 shares issued 132 130 Additional paid-in capital 1,424,919 1,419,871 Treasury stock at cost, 1,674,534 and 708,900 shares ( 163,177 ) ( 142,057 ) Retained deficit ( 846,529 ) ( 834,797 ) Accumulated other comprehensive loss ( 118,035 ) ( 123,247 ) Total equity 297,310 319,900 Total liabilities and equity $ 770,092 $ 815,954 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended September 30, (in thousands) 2025 2024 Cash flows from operating activities Net loss $ ( 11,732 ) $ ( 31,826 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation expense 10,547 12,660 Amortization of intangible assets 15,367 28,896 Impairment of property and equipment and other assets 4,406 — Inventory write-down 17,407 3,313 Stock-based compensation expense 6,371 5,180 Deferred income taxes ( 3,264 ) ( 3,180 ) Gain on sale-leaseback transactions ( 11,182 ) — Loss on extinguishment of debt — 2,302 Other 1,485 5,572 Changes in operating assets and liabilities Accounts receivable—trade 9,812 7,619 Inventories 4,158 23,441 Prepaid expenses and other current assets 2,761 4,572 Cost and estimated profit in excess of billings ( 4,434 ) ( 2,766 ) Accounts payable, deferred revenue and other accrued liabilities ( 213 ) ( 2,499 ) Billings in excess of costs and profits recognized 6,476 391 Net cash provided by operating activities 47,965 53,675 Cash flows from investing activities Capital expenditures for property and equipment ( 4,453 ) ( 5,735 ) Proceeds from sale of property and equipment 163 236 Proceeds from sale-leaseback transactions 14,574 — Payments related to business acquisition, net of cash acquired — ( 150,408 ) Net cash provided by (used in) investing activities 10,284 ( 155,907 ) Cash flows from financing activities Borrowings on Credit Facility 398,746 568,293 Repayments on Credit Facility ( 446,353 ) ( 459,250 ) Cash paid to repurchase 2025 Notes — ( 72,996 ) Proceeds from issuance of Seller Term Loan — 59,677 Payment of Seller Term Loan — ( 1,250 ) Payment of capital lease obligations ( 1,413 ) ( 887 ) Deferred financing costs ( 914 ) ( 3,070 ) Repurchases of stock ( 21,120 ) — Payment of withheld taxes on stock-based compensation plans ( 1,321 ) ( 1,090 ) Net cash provided by (used in) financing activities ( 72,375 ) 89,427 Effect of exchange rate changes on cash 1,158 ( 47 ) Net decrease in cash, cash equivalents and restricted cash ( 12,968 ) ( 12,852 ) Cash, cash equivalents and restricted cash at beginning of period 44,661 46,165 Cash, cash equivalents and restricted cash at end of period $ 31,693 $ 33,313 6 Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Continued) (Unaudited) Nine Months Ended September 30, (in thousands) 2025 2024 Supplemental cash flow disclosures Cash paid for interest $ 10,681 $ 19,791 Cash paid for income taxes 22,064 18,762 Noncash activities Operating lease assets obtained in exchange for lease obligations $ 17,132 $ 6,574 Finance lease assets obtained in exchange for lease obligations 1,033 2,032 Accrued purchases of property and equipment 91 1,225 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. 7 Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) Nine Months Ended September 30, 2025 (in thousands) Common stock Additional paid-in capital Treasury stock Retained deficit Accumulated other comprehensive income / (loss) Total equity Balance at December 31, 2024 $ 130 $ 1,419,871 $ ( 142,057 ) $ ( 834,797 ) $ ( 123,247 ) $ 319,900 Stock-based compensation expense — 1,818 — — — 1,818 Restricted stock issuance, net of forfeitures 2 ( 1,323 ) — — — ( 1,321 ) Treasury stock — — ( 1,997 ) — — ( 1,997 ) Currency translation adjustment — — — — 484 484 Change in pension liability — — — — 36 36 Net income — — — 1,122 — 1,122 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 Stock-based compensation expense — 2,781 — — — 2,781 Treasury stock — — ( 14,825 ) — — ( 14,825 ) Currency translation adjustment — — — — ( 4,308 ) ( 4,308 ) Change in pension liability — — — — ( 4 ) ( 4 ) Net loss — — — ( 20,554 ) — ( 20,554 ) Balance at September 30, 2025 $ 132 $ 1,424,919 $ ( 163,177 ) $ ( 846,529 ) $ ( 118,035 ) $ 297,310 The accompanying notes are an integral part of these condensed consolidated financial statements. 8 Forum Energy Technologies, Inc. and subsidiaries Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) Nine Months Ended September 30, 2024 (in thousands) Common stock Additional paid-in capital Treasury stock Retained deficit Accumulated other comprehensive income / (loss) Total equity Balance at December 31, 2023 $ 109 $ 1,369,288 $ ( 142,057 ) $ ( 699,471 ) $ ( 115,236 ) $ 412,633 Stock-based compensation expense — 1,573 — — — 1,573 Restricted stock issuance, net of forfeitures 1 ( 1,091 ) — — — ( 1,090 ) Stock issuance related to business acquisition 20 44,200 — — — 44,220 Currency translation adjustment — — — — ( 804 ) ( 804 ) Change in pension liability — — — — ( 15 ) ( 15 ) Net loss — — — ( 10,315 ) — ( 10,315 ) 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 Stock-based compensation expense — 2,076 — — — 2,076 Currency translation adjustment — — — — 14,254 14,254 Change in pension liability — — — — 25 25 Net loss — — — ( 14,815 ) — ( 14,815 ) Balance at September 30, 2024 $ 130 $ 1,417,914 $ ( 142,057 ) $ ( 731,297 ) $ ( 101,160 ) $ 443,530 The accompanying notes are an integral part of these condensed consolidated financial statements. 9 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Unaudited) 1. Organization and Basis of Presentation Forum Energy Technologies, Inc. (the “Company,” “FET ® ,” “we,” “our,” or “us”), a Delaware corporation, is a global manufacturing company serving the oil, natural gas, industrial and renewable energy industries. With headquarters located in Houston, Texas, FET provides value added solutions that increase the safety and efficiency of energy exploration and production. Basis of Presentation The Company's accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions have been eliminated in consolidation. 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 and nine months ended September 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. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America (“U.S. 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. Common Stock 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. 2. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB"), which the Company adopts as of the specified effective date. Unless otherwise discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company's consolidated financial statements upon adoption. Accounting Standards Issued But Not Yet Adopted Income Taxes (Topic 740). In December 2023, FASB issued ASU 2023-09, which improves income tax disclosures. This update is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. This update should be applied prospectively but retrospective application is permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements. Disaggregation of Income Statement Expenses (Subtopic 220-40). In November 2024, FASB issued ASU 2024-03 to improve financial reporting by requiring entities to disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. This update is effective for fiscal years beginning after December 15, 2026. Early adoption is permitted, and this update may be applied either prospectively or retrospectively. The Company is currently evaluating the impact of this standard on its consolidated financial statements. 3. Revenue Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to receive in exchange for those goods or services. For a detailed discussion of our revenue recognition policies, refer to the Company’s 2024 Annual Report on Form 10-K. Disaggregated Revenue Refer to Note 9 Business Segments for disaggregated revenue by product line and geography. 10 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) Contract Balances Contract balances are determined on a contract by contract basis. Contract assets represent revenue recognized for goods and services provided to our customers when payment is conditioned on something other than the passage of time. Similarly, the Company records a contract liability when we receive consideration, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a sales contract. 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 nine months ended September 30, 2025 (in thousands): September 30, 2025 December 31, 2024 Increase $ % Accrued revenue $ 21 $ 752 Costs and estimated profits in excess of billings 16,388 11,632 Contract assets $ 16,409 $ 12,384 $ 4,025 33 % Deferred revenue $ 13,694 $ 8,584 Billings in excess of costs and profits recognized 11,285 4,516 Contract liabilities $ 24,979 $ 13,100 $ 11,879 91 % During the nine months ended September 30, 2025, our contract assets increased by $ 4.0 million and our contract liabilities increased $ 11.9 million primarily due to the timing of milestone billings for projects in our Subsea product line. During the nine months ended September 30, 2025, we recognized $ 10.7 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. 4. Inventories The Company's significant components of inventory at September 30, 2025 and December 31, 2024 were as follows (in thousands): September 30, 2025 December 31, 2024 Raw materials and parts $ 94,361 $ 99,185 Work in process 30,068 27,880 Finished goods 145,894 174,114 Total inventories 270,323 301,179 Less: inventory reserve ( 22,068 ) ( 35,692 ) Inventories, net $ 248,255 $ 265,487 During the nine months ended September 30, 2025, we recognized $ 16.5 million of inventory write-downs related to the Company’s strategic decision to consolidate facilities and discontinue certain products. 11 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 5. Goodwill and Intangible Assets Goodwill The changes in the carrying amount of goodwill from December 31, 2024 to September 30, 2025, were as follows (in thousands): Artificial Lift and Downhole Goodwill, December 31, 2024 $ 61,653 Impact on non-U.S. local currency translation 2,126 Goodwill, September 30, 2025 $ 63,779 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 September 30, 2025 and December 31, 2024, respectively (in thousands): September 30, 2025 Gross Carrying Amount Accumulated Amortization Net Intangibles Amortization Period (In Years) Customer relationships $ 219,526 $ ( 138,534 ) $ 80,992 2 - 15 Patents and technology 30,125 ( 19,788 ) 10,337 10 - 19 Trade names and other 29,635 ( 23,730 ) 5,905 8 - 19 Total intangible assets $ 279,286 $ ( 182,052 ) $ 97,234 December 31, 2024 Gross Carrying Amount Accumulated Amortization Net Intangibles Amortization Period (In Years) Customer relationships $ 212,990 $ ( 121,405 ) $ 91,585 2 - 15 Patents and technology 29,166 ( 17,867 ) 11,299 10 - 19 Trade names and other 28,913 ( 22,567 ) 6,346 8 - 19 Total intangible assets $ 271,069 $ ( 161,839 ) $ 109,230 Intangible assets with definite lives are tested for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. 12 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 6. Debt Debt as of September 30, 2025 and December 31, 2024 consisted of the following (in thousands): September 30, 2025 December 31, 2024 2029 Bonds $ 100,000 $ 100,000 Credit Facility 42,785 90,392 Other debt 2,804 3,373 Long-term debt, principal amount 145,589 193,765 Debt issuance cost ( 5,604 ) ( 5,374 ) Long-term debt, carrying value 139,985 188,391 Less: current portion ( 1,437 ) ( 1,866 ) Long-term debt, net of current portion $ 138,548 $ 186,525 2029 Bonds The 10.5 % senior secured bonds due 2029 (“2029 Bonds”) were issued pursuant to the Bond Terms, dated as of November 5, 2024 (“Bond Terms”), between the Company and Nordic Trustee AS, as bond trustee and security agent (“Bond Trustee”). The 2029 Bonds are the Company’s senior secured obligations and are jointly and severally guaranteed on a senior secured basis by each of the Company’s direct and indirect domestic subsidiaries that guarantees its Credit Facility and certain of the Company’s foreign subsidiaries. The 2029 Bonds will mature on November 7, 2029. Interest on the 2029 Bonds will accrue at a rate of 10.5 % per annum payable semi-annually in arrears on May 7 and November 7 of each year in cash, beginning May 7, 2025. Prepayment of the 2029 Bonds prior to May 7, 2027 requires the payment of make-whole amounts, and prepayments on or after that date are subject to prepayment premiums that decline over time. The 2029 Bonds contain the following financial covenants: (i) a maximum leverage ratio of 4.0 x; and (ii) a minimum liquidity test equal to $ 25.0 million, in each case, for the Company and its consolidated subsidiaries. The Bond Terms also contain certain equity cure rights with respect to such financial covenants. The 2029 Bonds are also subject to negative covenants as set forth in the Bond Terms. As of September 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. The Bond Terms contain certain customary events of default, including, among other things: (i) default in the payment of any amount when due; (ii) default in the performance or breach of any other covenant in the Finance Documents, as defined in the Bond Terms, which default continues uncured for a period of 20 business days after the earlier of (1) the Company’s actual knowledge of such event or (2) the Company’s receipt of notice from the Bond Trustee; and (iii) certain voluntary or involuntary events of bankruptcy, insolvency or reorganization of the Company. Credit Facility Our senior secured asset-based lending facility (“Credit Facility”) matures on the earliest of (a) September 8, 2028 and (b) the date that is 91 days prior to the maturity of the 2029 Bonds (which will not apply if the 2029 Bonds are repaid prior to such 91st day). Th e Credit Facility provides revolving credit commitments of $ 250.0 million (with a sublimit of up to $ 70.0 million available for the issuance of letters of credit for the account of the Company and certain of its domestic subsidiaries) (the “U.S. Line”), of which up to $ 50.0 million is available to certain of our Canadian subsidiaries for loans in U.S. or Canadian dollars (with a sublimit of up to $ 10.0 million available for the issuance of letters of credit for the account of our Canadian subsidiaries) (the “Canadian Line”). Lender commitments under the Credit Facility, subject to certain limitations, may be increased by an additional $ 100.0 million . 13 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) Availability under the Credit Facility is subject to a borrowing base calculated by reference to eligible accounts receivable in the U.S., Canada and certain other jurisdictions (subject to a cap) and eligible inventory in the U.S. and Canada. Our borrowing capacity under the Credit Facility could be reduced or eliminated, depending on future fluctuations in our receivables and inventory. As of September 30, 2025, our total borrowing base was $ 160.0 million, of which $ 42.8 million amount was drawn and $ 31.5 million was used as security for outstanding letters of credit, resulting in remaining availability of $ 85.7 million. Borrowings under the U.S. Line bear interest at a rate equal to, at our option, either (a) the Secured Overnight Financing Rate (“SOFR”), subject to a floor of 0.00 %, plus a margin of 2.25 % to 2.75 %, or (b) a base rate plus a margin of 1.25 % to 1.75 %, in each case based upon the Company's quarterly total net leverage ratio. The U.S. Line base rate is determined by reference to the greatest of (i) the federal funds rate plus 0.50 % per annum, (ii) the one-month adjusted term SOFR plus 1.00 % per annum, and (iii) the “prime rate” of interest announced by Wells Fargo Bank, National Association, subject to a floor of 0.00 %. Borrowings under the Canadian Line bear interest at a rate equal to, at our Canadian borrowers’ option, either (a) Canadian Overnight Repo Rate Average (“CORRA”), subject to a floor of 0.00 %, plus a margin of 2.25 % to 2.75 %, or (b) a base rate plus a margin of 1.25 % to 1.75 %, in each case based upon the Company's quarterly net leverage ratio. 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 7.36 % and 8.37 % for the nine months ended September 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 %. If excess availability under the Credit Facility falls below the greater of 12.5 % of the borrowing base and $ 31.25 million, we will be required to maintain a fixed charge coverage ratio of at least 1.00 :1.00 as of the end of each fiscal quarter until excess availability under the Credit Facility exceeds such threshold for 60 consecutive days. Subject to customary exceptions, all obligations under the Credit Facility are guaranteed, jointly and severally, by our wholly-owned U.S. subsidiaries and, in the case of the Canadian Line, our wholly-owned Canadian subsidiaries, and are secured by substantially all assets of each such entity and the Company, subject to customary exclusions. The Credit Facility contains various covenants that, among other things, limit our ability (none of which are absolute) to incur additional indebtedness or issue certain preferred shares, grant certain liens, make certain loans and investments, pay dividends, make distributions or make other restricted payments, enter into mergers or acquisitions unless certain conditions are satisfied, change our lines of business, prepay certain indebtedness, enter into certain affiliate transactions or engage in certain asset dispositions. If an event of default exists under the Credit Facility, the lenders will have the right to accelerate the maturity of the obligations outstanding under the Credit Facility and exercise other rights and remedies. Obligations outstanding under the Credit Facility, however, will be automatically accelerated upon an event of default arising from a bankruptcy or insolvency event. An event of default includes, among other things, nonpayment of principal, interest, fees or other amounts within certain grace periods; representations and warranties proving to be untrue in any material respect; failure to perform or otherwise comply with covenants in the Credit Facility or other loan documents, subject, in certain instances, to grace periods; cross-defaults to certain other indebtedness if such default occurs at the final maturity of such indebtedness or if the effect of such default is to cause, or permit the holders of such indebtedness to cause, the acceleration of such indebtedness; bankruptcy or insolvency events; material monetary judgment defaults; invalidity or unenforceability of the Credit Facility or any other loan document; and the occurrence of a Change of Control (as defined in the Credit Facility). As of September 30, 2025, the Company was in compliance with all of its Credit Facility financial covenants. 14 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) Other Debt Other debt consists of various finance leases of equipment. Letters of Credit and Guarantees 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 $ 31.5 million and $ 17.8 million in total outstanding letters of credit as of September 30, 2025 and December 31, 2024, respectively. 7. Income Taxes 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 and nine months ended September 30, 2025, the Company recorded a tax expense of $ 10.1 million and $ 20.1 million, respectively. For the three and nine months ended September 30, 2024, the Company recorded tax expense of $ 4.6 million and $ 10.6 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. Furthermore, the tax expense or benefit recorded can vary from period to period depending on the Company’s relative mix of earnings and losses by jurisdiction. The Organization for Economic Co-operation and Development introduced Base Erosion and Profit Shifting (“BEPS”) Pillar 2 rules that impose a global minimum tax rate of 15%. Numerous countries, including European Union member states, have enacted a global minimum tax and more countries are expected to enact similar minimum tax regimes in 2025. Based on current enacted legislation, we do not expect a material impact on our future effective tax rate. We have deferred tax assets related to net operating loss and other tax carryforwards in the U.S. and in certain states and foreign jurisdictions. We recognize deferred tax assets to the extent that we believe these assets are more likely than not to be realized. 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. During the three months ended September 30, 2025, we recorded a valuation allowance reserve of $ 5.2 million on our deferred tax assets relating to certain net operating loss carryforwards that we will more than likely not be able to realize prior to their expiration. As of September 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., United Kingdom ("U.K."), Singapore and China. As a result, we have certain valuation allowances against our deferred tax assets as of September 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. 8. Fair Value Measurements The Company had $ 42.8 million and $ 100.0 million borrowings outstanding under the Credit Facility and 2029 Bonds as of September 30, 2025, respectively. The Credit Facility incurs interest at a variable interest rate and therefore, the carrying amount approximates fair value. The fair value of the debt is classified as a Level 2 measurement because interest rates charged are similar to other financial instruments with similar terms and maturities. 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 September 30, 2025, the fair value and the carrying value of our 2029 Bonds approximated $ 102.0 million and $ 94.4 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 September 30, 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 nine months ended September 30, 2025. 15 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 9. Business Segments The Company operates in the following two reportable segments: (1) Drilling and Completions and (2) Artificial Lift and Downhole. The Drilling and Completions segment designs, manufactures and supplies products and solutions to the drilling, subsea, coiled tubing, well stimulation and intervention markets, including applications in oil and natural gas, renewable energy, defense and communications. The Artificial Lift and Downhole segment designs, manufactures and supplies products and solutions for the artificial lift, production and infrastructure markets. The Company’s reportable segments are strategic units that offer distinct products and services. They are managed separately since each business segment requires different marketing strategies. Operating segments have not been aggregated as part of a reportable segment. 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 September 30, 2025 Nine Months Ended September 30, 2025 Drilling and Completions Artificial Lift and Downhole Total Drilling and Completions Artificial Lift and Downhole Total Revenue from external customers $ 117,250 $ 78,981 $ 196,231 $ 349,950 $ 239,324 $ 589,274 Intersegment revenue 219 — 219 325 — 325 Segment revenue 117,469 78,981 196,450 350,275 239,324 589,599 Elimination of intersegment revenue ( 219 ) ( 325 ) Total consolidated revenue 196,231 589,274 Less: Cost of sales 107,980 48,233 156,213 280,545 151,100 431,645 Selling, general and administrative expenses 23,040 18,970 42,010 66,631 58,758 125,389 Segment operating income (loss) $ ( 13,551 ) $ 11,778 $ ( 1,773 ) $ 3,099 $ 29,466 $ 32,565 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024 Drilling and Completions Artificial Lift and Downhole Total Drilling and Completions Artificial Lift and Downhole Total Revenue from external customers $ 123,580 $ 84,226 $ 207,806 $ 359,670 $ 255,737 $ 615,407 Intersegment revenue 7 — 7 13 — 13 Segment revenue 123,587 84,226 207,813 359,683 255,737 615,420 Elimination of intersegment revenue ( 7 ) ( 13 ) Total consolidated revenue 207,806 615,407 Less: Cost of sales 90,396 51,681 142,077 266,189 156,663 422,852 Selling, general and administrative expenses 26,161 21,761 47,922 79,030 63,043 142,073 Segment operating income $ 7,030 $ 10,784 $ 17,814 $ 14,464 $ 36,031 $ 50,495 16 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) A reconciliation of segment operating income to income (loss) before income taxes is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2025 2024 2025 2024 Segment operating income $ ( 1,773 ) $ 17,814 $ 32,565 $ 50,495 Less: Other corporate expenses 8,439 8,404 25,628 22,610 Transaction expenses 254 579 489 7,728 Gain on sale-leaseback transactions ( 4,279 ) — ( 11,182 ) — Loss (gain) on disposal of assets and other ( 81 ) ( 85 ) 249 107 Interest expense 4,365 7,650 14,054 25,069 Foreign exchange losses (gains) and other, net 9 9,631 ( 5,001 ) 13,864 Loss on extinguishment of debt — 1,839 — 2,302 Loss before income taxes $ ( 10,480 ) $ ( 10,204 ) $ 8,328 $ ( 21,185 ) A summary of consolidated assets by reportable segment is as follows (in thousands): September 30, 2025 December 31, 2024 Drilling and Completions $ 402,445 $ 418,583 Artificial Lift and Downhole 357,912 371,178 Corporate 9,735 26,193 Total assets $ 770,092 $ 815,954 Corporate assets primarily include cash, certain prepaid assets and deferred loan costs. 17 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) The following table presents our revenues disaggregated by product line (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2025 2024 2025 2024 Drilling $ 32,234 $ 35,741 $ 97,193 $ 107,714 Subsea 23,582 20,903 68,111 59,537 Stimulation and Intervention 34,271 38,037 104,555 113,823 Coiled Tubing 27,382 28,906 80,416 78,609 Downhole 48,073 50,562 147,025 155,883 Production Equipment 18,647 17,968 58,368 54,508 Valve Solutions 12,261 15,696 33,931 45,346 Eliminations ( 219 ) ( 7 ) ( 325 ) ( 13 ) Total revenue $ 196,231 $ 207,806 $ 589,274 $ 615,407 The following table presents our revenues disaggregated by geography (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2025 2024 2025 2024 United States $ 96,511 $ 108,363 $ 307,690 $ 322,232 Canada 34,583 35,719 97,041 107,694 Middle East 26,275 24,678 67,851 67,411 Europe & Africa 20,925 15,826 59,318 58,481 Asia-Pacific 10,074 10,472 30,582 30,790 Latin America 7,863 12,748 26,792 28,799 Total revenue $ 196,231 $ 207,806 $ 589,274 $ 615,407 10. Commitments and Contingencies In the ordinary course of business, the Company is, and in the future could be, involved in various pending or threatened legal actions, some of which may or may not be covered by insurance. 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 September 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. For further disclosure regarding certain litigation matters, refer to Note 12 of the notes to the consolidated financial statements included in Item 8 of the Company’s 2024 Annual Report on Form 10-K filed with the SEC on March 3, 2025. 18 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 11. Earnings (Loss) Per Share 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 Nine Months Ended September 30, September 30, 2025 2024 2025 2024 Net loss $ ( 20,554 ) $ ( 14,815 ) $ ( 11,732 ) $ ( 31,826 ) Weighted average shares outstanding - basic 11,682 12,330 12,110 12,287 Dilutive effect of stock options and restricted stock — — — — Weighted average shares outstanding - diluted 11,682 12,330 12,110 12,287 Loss per share Basic $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 ) Diluted $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 ) For the three and nine months ended September 30, 2025, we excluded approximately 8 thousand and 15 thousand shares, respectively, and for the three and nine months ended September 30, 2024, we excluded approximately 153 thousand and 94 thousand shares, respectively, of 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. 12. Stock-based Compensation Restricted Stock and Time-Based Restricted Stock Units During the nine months ended September 30, 2025, the Company granted 190,392 time-based restricted stock units to employees that vest ratably over three years . Also, during the nine months ended September 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 nine months ended September 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 nine months ended September 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 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. 19 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) During the nine months ended September 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. 13. Related Party Transactions The Company has sold and purchased inventory, services and fixed assets to and from affiliates of certain directors. The dollar amounts of these related party activities are not significant to the Company’s unaudited condensed consolidated financial statements. 14. Leases 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. In August 2025, the Company sold and leased back land and buildings with a net book value of approximately $ 2.3 million and received net proceeds of $ 6.5 million. The initial annual rent for the assets is $ 0.6 million with an initial term of 18 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 $ 7.2 million were recorded in the consolidated balance sheets. 20