FORUM ENERGY TECHNOLOGIES, INC. 10-Q

Item 1. Financial Statements Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three Months Ended March 31, (in thousands, except per share information) 2026 2025 Revenue $ 208,700 $ 193,279 Cost of sales 147,709 134,918 Gross profit 60,991 58,361 Operating expenses Selling, general and administrative expenses 50,008 49,383 Transaction expenses 148 51 Loss (gain) on disposal of assets and other ( 170 ) 123 Total operating expenses 49,986 49,557 Operating income 11,005 8,804 Other expense (income) Interest expense 4,141 4,983 Foreign exchange gains and other, net ( 523 ) ( 1,068 ) Total other expense 3,618 3,915 Income before taxes 7,387 4,889 Income tax expense 2,895 3,767 Net income $ 4,492 $ 1,122 Weighted average shares outstanding Basic 11,214 12,303 Diluted 11,641 12,568 Earnings per share Basic $ 0.40 $ 0.09 Diluted $ 0.39 $ 0.09 Other comprehensive income (loss), net of tax of $ 0 and $ 0 : Net income $ 4,492 $ 1,122 Change in foreign currency translation ( 3,612 ) 484 Gain (loss) on pension liability ( 17 ) 36 Comprehensive income $ 863 $ 1,642 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) March 31, 2026 December 31, 2025 Assets Current assets Cash and cash equivalents $ 37,488 $ 34,661 Accounts receivable—trade, net of allowances of $ 9,611 and $ 8,953 155,480 142,396 Inventories, net 236,412 239,420 Prepaid expenses and other current assets 21,907 23,017 Costs and estimated profits in excess of billings 12,894 9,369 Accrued revenue 135 21 Total current assets 464,316 448,884 Property and equipment, net of accumulated depreciation 49,590 51,905 Operating lease assets 83,217 80,733 Deferred financing costs, net 3,085 1,580 Goodwill 63,779 64,667 Intangible assets, net 87,962 93,637 Deferred income taxes, net 7,725 7,887 Other long-term assets 3,391 3,162 Total assets $ 763,065 $ 752,455 Liabilities and equity Current liabilities Current portion of long-term debt $ 1,383 $ 1,407 Accounts payable—trade 114,689 94,561 Accrued liabilities 63,834 76,244 Deferred revenue 17,220 17,438 Billings in excess of costs and profits recognized 11,486 16,884 Total current liabilities 208,612 206,534 Long-term debt, net of current portion 152,337 134,521 Deferred income taxes, net 19,234 20,425 Operating lease liabilities 86,476 83,957 Other long-term liabilities 15,723 15,875 Total liabilities 482,382 461,312 Commitments and contingencies Equity Common stock, $ 0.01 par value, 29,600,000 shares authorized, 13,507,226 and 13,192,818 shares issued 135 132 Additional paid-in capital 1,420,832 1,427,589 Treasury stock at cost, 2,188,713 and 2,095,969 shares ( 181,238 ) ( 176,669 ) Retained deficit ( 839,965 ) ( 844,457 ) Accumulated other comprehensive loss ( 119,081 ) ( 115,452 ) Total equity 280,683 291,143 Total liabilities and equity $ 763,065 $ 752,455 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) Three Months Ended March 31, (in thousands) 2026 2025 Cash flows from operating activities Net income $ 4,492 $ 1,122 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense 3,186 3,689 Amortization of intangible assets 4,616 5,286 Inventory write-down 397 390 Stock-based compensation expense 2,520 1,818 Deferred income taxes ( 846 ) ( 1,559 ) Other 1,438 334 Changes in operating assets and liabilities Accounts receivable—trade ( 14,810 ) 1,113 Inventories 1,756 2,850 Prepaid expenses and other current assets 604 1,740 Cost and estimated profit in excess of billings ( 3,663 ) ( 27 ) Accounts payable, deferred revenue and other accrued liabilities 7,292 ( 8,587 ) Billings in excess of costs and profits recognized ( 5,355 ) 1,157 Net cash provided by operating activities 1,627 9,326 Cash flows from investing activities Capital expenditures for property and equipment ( 256 ) ( 2,110 ) Proceeds from sale of property and equipment 3 14 Net cash used in investing activities ( 253 ) ( 2,096 ) Cash flows from financing activities Borrowings on Credit Facility 137,934 132,038 Repayments on Credit Facility ( 120,163 ) ( 148,585 ) Payment of capital lease obligations ( 417 ) ( 455 ) Deferred financing costs ( 1,659 ) ( 693 ) Repurchases of stock ( 4,569 ) ( 1,997 ) Payment of withheld taxes on stock-based compensation plans ( 9,274 ) ( 1,321 ) Net cash provided by (used in) financing activities 1,852 ( 21,013 ) Effect of exchange rate changes on cash ( 399 ) 265 Net increase (decrease) in cash, cash equivalents and restricted cash 2,827 ( 13,518 ) Cash, cash equivalents and restricted cash at beginning of period 34,661 44,661 Cash, cash equivalents and restricted cash at end of period $ 37,488 $ 31,143 Supplemental cash flow disclosures Cash paid for interest $ 1,094 $ 1,942 Cash paid for income taxes 7,819 1,585 Noncash activities Operating lease assets obtained in exchange for lease obligations $ 5,397 $ 629 Finance lease assets obtained in exchange for lease obligations 185 262 Accrued purchases of property and equipment 833 814 The accompanying notes are an integral part of these condensed consolidated financial statements. 6 Forum Energy Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) Three Months Ended March 31, 2026 (in thousands) Common stock Additional paid-in capital Treasury stock Retained deficit Accumulated other comprehensive income / (loss) Total equity Balance at December 31, 2025 $ 132 $ 1,427,589 $ ( 176,669 ) $ ( 844,457 ) $ ( 115,452 ) $ 291,143 Stock-based compensation expense — 2,520 — — — 2,520 Restricted stock issuance, net of shares withheld for taxes 3 ( 9,277 ) — — — ( 9,274 ) Treasury stock — — ( 4,569 ) — — ( 4,569 ) Currency translation adjustment — — — — ( 3,612 ) ( 3,612 ) Change in pension liability — — — — ( 17 ) ( 17 ) Net income — — — 4,492 — 4,492 Balance at March 31, 2026 $ 135 $ 1,420,832 $ ( 181,238 ) $ ( 839,965 ) $ ( 119,081 ) $ 280,683 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) Three Months Ended March 31, 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 shares withheld for taxes 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 The accompanying notes are an integral part of these condensed consolidated financial statements. 8 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, defense and renewable energy industries. With headquarters located in Houston, Texas, FET optimizes customer operations by improving safety, increasing efficiency, and reducing environmental impact. 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 months ended March 31, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026 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, 2025, which are included in the Company’s 2025 Annual Report on Form 10-K filed with the SEC on February 27, 2026. 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 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 2025 Annual Report on Form 10-K. Disaggregated Revenue Refer to Note 9 Business Segments for disaggregated revenue by product line and geography. 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. 9 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) The following table reflects the changes in our contract assets and contract liabilities balances for the three months ended March 31, 2026 (in thousands): March 31, 2026 December 31, 2025 Increase (Decrease) $ % Accrued revenue $ 135 $ 21 Costs and estimated profits in excess of billings 12,894 9,369 Contract assets $ 13,029 $ 9,390 $ 3,639 39 % Deferred revenue $ 17,220 $ 17,438 Billings in excess of costs and profits recognized 11,486 16,884 Contract liabilities $ 28,706 $ 34,322 $ ( 5,616 ) ( 16 ) % During the three months ended March 31, 2026, our contract assets increased by $ 3.6 million and our contract liabilities decreased $ 5.6 million primarily due to the timing of milestone billings for projects in our Subsea product line. During the three months ended March 31, 2026, we recognized $ 16.2 million of revenue that was included in the contract liabilities balance at the beginning of the period. As of March 31, 2026, the Company’s remaining performance obligations totaled approximately $ 44.2 million related to contracts with an original expected duration of greater than one year. The remaining performance obligations represent contracted revenue that has not yet been recognized and excludes amounts related to contracts with an original expected duration of one year or less, for which the Company has elected the practical expedient under ASC 606. The Company expects to recognize approximately $ 17.4 million of the remaining performance obligations over the next twelve months , with the remainder recognized thereafter, generally over the remaining contract terms, which extend up to three years . Actual timing of revenue recognition may vary due to changes in project scope, execution schedules, or other factors. 4. Inventories The Company's significant components of inventory at March 31, 2026 and December 31, 2025 were as follows (in thousands): March 31, 2026 December 31, 2025 Raw materials and parts $ 90,738 $ 95,617 Work in process 24,722 26,001 Finished goods 143,485 140,822 Total inventories 258,945 262,440 Less: inventory reserve ( 22,533 ) ( 23,020 ) Inventories, net $ 236,412 $ 239,420 10 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, 2025 to March 31, 2026, were as follows (in thousands): Artificial Lift and Downhole Goodwill, December 31, 2025 $ 64,667 Impact on non-U.S. local currency translation ( 888 ) Goodwill, March 31, 2026 $ 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 March 31, 2026 and December 31, 2025, respectively (in thousands): March 31, 2026 Gross Carrying Amount Accumulated Amortization Net Intangibles Amortization Period (In Years) Customer relationships $ 214,684 $ ( 141,502 ) $ 73,182 3 - 15 Patents and technology 29,984 ( 20,605 ) 9,379 10 - 19 Trade names and other 27,911 ( 22,510 ) 5,401 3 - 19 Total intangible assets $ 272,579 $ ( 184,617 ) $ 87,962 December 31, 2025 Gross Carrying Amount Accumulated Amortization Net Intangibles Amortization Period (In Years) Customer relationships $ 216,559 $ ( 138,510 ) $ 78,049 3 - 15 Patents and technology 30,122 ( 20,241 ) 9,881 10 - 19 Trade names and other 28,040 ( 22,333 ) 5,707 3 - 19 Total intangible assets $ 274,721 $ ( 181,084 ) $ 93,637 Intangible assets with definite lives are tested for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. 11 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 6. Debt Debt as of March 31, 2026 and December 31, 2025 consisted of the following (in thousands): March 31, 2026 December 31, 2025 2029 Bonds $ 100,000 $ 100,000 Credit Facility 55,053 37,282 Other debt 3,751 4,008 Long-term debt, principal amount 158,804 141,290 Debt issuance cost ( 5,084 ) ( 5,362 ) Long-term debt, carrying value 153,720 135,928 Less: current portion ( 1,383 ) ( 1,407 ) Long-term debt, net of current portion $ 152,337 $ 134,521 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 (the “Bond Terms”), between the Company and Nordic Trustee AS, as bond trustee and security agent (the “Bond Trustee”). In May 2025, the 2029 Bonds were listed on the Euronext ABM exchange. 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 present and future 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 March 31, 2026, 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 In February 2026, we amended our senior secured revolving credit facility (“Credit Facility”) to (i) extend the scheduled maturity date from September 8, 2028 to February 4, 2031, (ii) revise the interest rate margin over Secured Overnight Financing Rate (“SOFR”) applicable to outstanding loans, previously ranging from 2.25 % to 2.75 % determined based on the Company’s total net leverage ratio, to instead range from 2.00 % to 2.50 %, determined based on excess availability under the Credit Facility and (iii) increase the U.S. letter of credit sublimit from $ 70.0 million to $ 100.0 million . The Canadian letter of credit sublimit remains at $ 10.0 million U.S. dollar. 12 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) Following such amendment, the Credit Facility matures on the earliest of (a) February 4, 2031 and (b) the date that is 91 days prior to the maturity of the 2029 Bonds or any notes issued to refinance the 2029 Bonds (which will not apply if the 2029 Bonds or any such refinancing notes 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 $ 100.0 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 U.S. dollar 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 . 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 March 31, 2026, our total borrowing base was $ 149.0 million, of which amount $ 55.1 million was drawn and $ 40.3 million was used as security for outstanding letters of credit, resulting in remaining availability of $ 53.6 million. Borrowings under the U.S. Line bear interest at a rate equal to, at our option, either (a) SOFR, subject to a floor of 0.00 %, plus a margin of 2.00 % to 2.50 %, or (b) a base rate plus a margin of 1.00 % to 1.50 %, in each case based upon the Company's excess availability under the Credit Facility. 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 2.00 % to 2.50 %, or (b) a base rate plus a margin of 1.00 % to 1.50 %, in each case based upon the Company's excess availability under the Credit Facility. 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 6.39 % and 7.55 % for the three months ended March 31, 2026 and 2025, 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. Subject to customary exceptions, all obligations under the Credit Facility are further guaranteed by our subsidiaries organized or domiciled under the laws of the United Kingdom or any territory or county thereof and secured by certain assets of such subsidiaries. In certain circumstances, obligations under the Credit Facility may be required to be guaranteed by and secured by the assets of our subsidiaries organized or domiciled under the laws of Germany or any territory or county thereof. 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 13 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 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 March 31, 2026, the Company was in compliance with all of its Credit Facility financial covenants. 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 $ 40.3 million and $ 36.2 million in total outstanding letters of credit as of March 31, 2026 and December 31, 2025, 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 months ended March 31, 2026 and 2025, the Company recorded a tax expense of $ 2.9 million and $ 3.8 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 2026. 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. As of March 31, 2026, 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, Singapore and China. As a result, we have certain valuation allowances against our deferred tax assets as of March 31, 2026. 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 benefits from enhanced tax deductions related to interest, depreciation, and research and development expenses, partially offset by changes in U.S. taxation of foreign earnings. 8. Fair Value Measurements The Company had $ 55.1 million and $ 100.0 million borrowings outstanding under the Credit Facility and 2029 Bonds as of March 31, 2026, 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. 14 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 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, 2026, the fair value and the carrying value of our 2029 Bonds approximated $ 105.2 million and $ 94.9 million, respectively. At December 31, 2025, the fair value and the carrying value of our 2029 Bonds approximated $ 103.5 million and $ 94.6 million, respectively. There were no other significant outstanding financial instruments as of March 31, 2026 and December 31, 2025 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, 2026. 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 March 31, 2026 Drilling and Completions Artificial Lift and Downhole Total Revenue from external customers $ 126,602 $ 82,098 $ 208,700 Intersegment revenue 137 — 137 Segment revenue 126,739 82,098 208,837 Elimination of intersegment revenue ( 137 ) Total consolidated revenue 208,700 Less: Cost of sales 96,550 51,296 147,846 Selling, general and administrative expenses 21,280 19,218 40,498 Segment operating income $ 8,909 $ 11,584 $ 20,493 15 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) Three Months Ended March 31, 2025 Drilling and Completions Artificial Lift and Downhole Total Revenue from external customers $ 115,483 $ 77,796 $ 193,279 Intersegment revenue 86 — 86 Segment revenue 115,569 77,796 193,365 Elimination of intersegment revenue ( 86 ) Total consolidated revenue 193,279 Less: Cost of sales 84,354 50,650 135,004 Selling, general and administrative expenses 21,836 19,849 41,685 Segment operating income $ 9,379 $ 7,297 $ 16,676 A reconciliation of segment operating income to income before income taxes is as follows (in thousands): Three Months Ended March 31, 2026 2025 Segment operating income $ 20,493 $ 16,676 Less: Other corporate expenses 9,510 7,698 Transaction expenses 148 51 Loss (gain) on disposal of assets and other ( 170 ) 123 Interest expense 4,141 4,983 Foreign exchange gains and other, net ( 523 ) ( 1,068 ) Income before income taxes $ 7,387 $ 4,889 A summary of consolidated assets by reportable segment is as follows (in thousands): March 31, 2026 December 31, 2025 Drilling and Completions $ 393,251 $ 385,401 Artificial Lift and Downhole 353,218 353,505 Corporate 16,596 13,549 Total assets $ 763,065 $ 752,455 Corporate assets primarily include cash, certain prepaid assets and deferred loan costs. 16 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 March 31, 2026 2025 Drilling $ 32,730 $ 32,113 Subsea 35,495 22,140 Stimulation and Intervention 33,047 37,428 Coiled Tubing 25,467 23,888 Downhole 50,559 47,668 Production Equipment 18,750 19,059 Valve Solutions 12,789 11,069 Eliminations ( 137 ) ( 86 ) Total revenue $ 208,700 $ 193,279 The following table presents our revenues disaggregated by geography (in thousands): Three Months Ended March 31, 2026 2025 United States $ 93,138 $ 103,903 Canada 42,918 31,437 Europe & Africa 29,008 19,788 Middle East 19,045 19,645 Asia-Pacific 12,964 10,443 Latin America 11,627 8,063 Total revenue $ 208,700 $ 193,279 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 March 31, 2026 and December 31, 2025, 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 11 of the notes to the consolidated financial statements included in Item 8 of the Company’s 2025 Annual Report on Form 10-K filed with the SEC on February 27, 2026. 17 Table of Contents Forum Energy Technologies, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Continued) (Unaudited) 11. Earnings Per Share The calculation of basic and diluted earnings per share for each period presented was as follows (dollars and shares in thousands, except per share amounts): Three Months Ended March 31, 2026 2025 Net income $ 4,492 $ 1,122 Weighted average shares outstanding - basic 11,214 12,303 Dilutive effect of stock options and restricted stock 427 265 Weighted average shares outstanding - diluted 11,641 12,568 Earnings per share Basic $ 0.40 $ 0.09 Diluted $ 0.39 $ 0.09 For the three months ended March 31, 2026 and 2025, the diluted earnings per share excludes approximately 67 thousand and 9 thousand shares, respectively, because they were anti-dilutive. 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 three months ended March 31, 2026, the Company granted 63,463 time-based restricted stock units to employees that vest ratably over three years . Also, during the three months ended March 31, 2026, the Company granted 14,239 time-based restricted stock and 7,668 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, 2026, the Company granted 31,735 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, 2026 through December 31, 2026, January 1, 2026 through December 31, 2027 and January 1, 2026 through December 31, 2028, 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, 2026, the Company granted 60,704 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's earnings before interest, taxes, depreciation and amortization expense over the performance period between January 1, 2026 through December 31, 2028. The performance restricted stock units may settle for between 0 % and 200 % of the target units granted. 18