What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-02-14 compared with 2024-02-14 · 325 added, 312 removed, 994 unchanged (39% of the section changed)

45 unchanged sentences

Consolidated Balance Sheets

Consolidated Statements of Income (Loss )

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Consolidated Statements of Cash Flows

11 unchanged sentences

(Exhibit 3.1) (2)

Description of Securities (3)

Description of Securities (Exhibit 4.1) (3)

Indenture, dated November 15, 2012, between National Oilwell Varco, Inc.

Bank National Association.

(Exhibit 4.1) (4)

Bank National Association (Exhibit 4.1) (4)

Third Supplemental Indenture, dated November 20, 2012, between National Oilwell Varco, Inc.

Bank National Association.

(Exhibit 4.6) (4)

Bank National Association (Exhibit 4.6) (4)

Fourth Supplemental Indenture, dated November 14, 2019, between National Oilwell Varco, Inc.

1 unchanged sentence

(Exhibit 4.2) (5)

Credit Agreement, dated as of June 27, 2017, among National Oilwell Varco, Inc., the financial institutions signatory thereto, including Wells Fargo Bank, N.A., in its capacity, among others, as Administrative Agent, Co-Lead Arranger and Joint Book Runner (Exhibit 3.1) (6)

Amendment No.

1 to Credit Agreement, dated as of October 30, 2019 (7)

Amendment No.

2 to Credit Agreement, dated as of March 10, 2023 (Exhibit 10.2) (8)

5-Year Credit Agreement, dated as of September 12, 2024, among NOV Inc.

and the financial institutions signatory thereto, including Wells Fargo Bank, National Association, in its capacity, among others, as Administrative Agent, an Arranger and a Joint Book Runner (Exhibit 10.1) (6)

Long-Term Incentive Plan, as amended and restated (7)*

Form of Employee Stock Option Agreement.

(Exhibit 10.1) (10)*

Form of Non-Employee Director Stock Option Agreement.

(Exhibit 10.2) (10)*

Form of Performance-Based Restricted Stock.

(18 Month) Agreement (Exhibit 10.1) (11)*

Form of Performance-Based Restricted Stock.

(36 Month) Agreement (Exhibit 10.2) (11)*

Form of Executive Employment Agreement (Exhibit 10.1) (8)*

Form of Executive Severance Agreement (Exhibit 10.2) (9)*

Form of Restricted Stock Unit Agreement (2022) (Exhibit 10.1) (10)*

Form of Performance Award Agreement (2022) (Exhibit 10.2) (10)*

Form of Executive Employment Agreement.

(Exhibit 10.1) (13)*

Form of Executive Severance Agreement.

(Exhibit 10.2) (14)*

Form of Employee Nonqualified Stock Option Grant Agreement (15)*

Form of Restricted Stock Agreement (15)*

Form of Performance Award Agreement (15)*

Form of Employee Nonqualified Stock Option Grant Agreement (2019) (16)*

Form on Restricted Stock Agreement (2019) (16)*

Form of Performance Award Agreement (2019) (16)*

Form of Performance Award Agreement (2020) (17)*

Form of Performance Award Agreement (2021) (18)*

Form of Employee Nonqualified Stock Option Grant Agreement (2022) (19)*

Form of Restricted Stock Unit Agreement (2022) (19)*

Form of Performance Award Agreement (2022) (19)*

Form of Employee Nonqualified Stock Option Grant Agreement (2022) (Exhibit 10.3) (10)*

Form of Non-Employee Director Restricted Stock Unit Agreement (2022) (Exhibit 10.1) (11)*

Form of Performance Award Agreement (2023) (Exhibit 10.1) (12)*

Form of Restricted Stock Unit Agreement (2024) (Exhibit 10.2) (13)*

Form of Performance Award Agreement (2024) (Exhibit 10.3) (13)*

Form of Employee Nonqualified Stock Option Grant Agreement (2024) (Exhibit 10.4) (13)*

Retirement Policy for Equity Awards (Exhibit 10.1) (14)*

Form of Non-Employee Director Restricted Stock Unit Agreement (2022) (21)*

Form of Indemnification Agreement (Exhibit 10.1) (1) *

Single Premium Guaranteed Annuity Contract Purchase Agreement, dated February 14, 2023.

Single Premium Guaranteed Annuity Contract Purchase Agreement, dated February 14, 2023 (Exhibit 10.1) (15)

Executive Severance Plan and Form of Participation Agreement (16)*

NOV Policy on Insider Trading (16)

Subsidiaries of the Registrant (16)

Consent of Ernst & Young LLP (16)

Power of Attorney.

(included on signature page hereto) (23)

Power of Attorney (included on signature page hereto) (16)

Certification pursuant to Rule 13a-14a and Rule 15d-14(a) of the Securities and Exchange Act, as amended (16)

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(5) Filed as an Exhibit to our Current Report on Form 8-K filed on November 14, 2019.

(6) Filed as an Exhibit to our Current Report on Form 8-K filed on June 28, 2017.

(7) Filed as an Exhibit to our Current Report on Form 8-K filed on November 4, 2019.

(8) Filed as Exhibit to our Quarterly Report on Form 10-Q filed on April 27, 2023.

(6) Filed as an Exhibit to our Current Report on Form 8-K filed on September 12, 2024.

(7) Filed as Appendix I to our Proxy Statement filed on April 8, 2022.

(10) Filed as an Exhibit to our Current Report on Form 8-K filed on February 23, 2006.

(11) Filed as an Exhibit to our Current Report on Form 8-K filed on March 27, 2007.

(12) Filed as an Exhibit to our Current Report on Form 8-K filed on March 27, 2013.

(8) Filed as an Exhibit to our Current Report on Form 8-K filed on December 4, 2023.

(14) Filed as an Exhibit to our Current Report on Form S-K filed on November 21, 2014.

(9) Filed as an Exhibit to our Current Report on Form 8-K filed on November 24, 2014.

(10) Filed as an Exhibit to our Current Report on Form 8-K filed on February 22, 2022.

(16) Filed as an Exhibit to our Quarterly Report on Form 10-Q filed on April 26, 2019.

(11) Filed as an Exhibit to our Quarterly Report on Form 10-Q filed on July 28, 2022.

(12) Filed as an Exhibit to our Quarterly Report on Form 10-Q filed on April 27, 2023.

(13) Filed as an Exhibit to our Quarterly Report on Form 10-Q filed on April 26, 2024.

(19) Filed as an Exhibit to our Current Report on Form 8-K filed on February 22, 2022.

(14) Filed as an Exhibit to our Current Report on Form 8-K filed on July 12, 2022.

(21) Filed as an Exhibit to our Quarterly Report on Form 10-Q filed on July 28, 2022.

(15) Filed as an Exhibit to our Current Report on Form 8-K filed on February 21, 2023.‎

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February 14, 2025

/s/ CHRISTIAN S.

February 14, 2025

/s/ PATRICIA MARTINEZ

February 14, 2025

Patricia Martinez

February 14, 2025

/s/ PATRICIA B.

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Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations.

Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgement and breakdowns resulting from human failures.

Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures.

Internal control over financial reporting also can be circumvented by collusion or improper management override.

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Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s annual report on internal control over financial reporting.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

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We have audited the accompanying consolidated balance sheets of NOV Inc.

(the Company) as of December 31, 2023 and 2022, the related consolidated statements of income (loss), comprehensive income (loss), stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes and financial statement schedule listed in the Index at Item 15(2) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with U.S.

(the Company) as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, cash flows, and stockholders’ equity for each of the three years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15(2) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S.

generally accepted accounting principles.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue recognition under long-term construction contracts

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As discussed in Note 2 to the consolidated financial statements, the Company recognizes revenue over time for certain long-term construction contracts using an input method described as the cost-to-cost approach to determine the extent of progress towards completion of performance obligations.

Under the cost-to-cost approach, the determination of the progress towards completion requires management to prepare estimates of the costs to complete.

For material fixed price contracts, estimates are subject to considerable judgment and could be impacted by such items as changes to the project schedule and the cost of labor and material.

Auditing management’s estimate of the progress towards completion of its projects involved subjectivity as the costs to complete forecasts for fixed price contracts are subject to considerable judgment.

Under the cost-to-cost approach, the determination of the progress towards completion requires management to prepare estimates of the costs to complete, which are subject to considerable judgment and could be impacted by such items as changes to the project schedule and the cost of labor and material.

Auditing management’s estimate of the progress towards completion of its projects involved subjectivity as the costs to complete forecasts are subject to considerable judgment.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s estimate of the progress towards completion of its projects, including key controls related to monitoring projected project costs.

To test the Company’s estimate of the progress towards completion of its projects, we performed audit procedures that included, among others, testing the significant assumptions discussed above to develop the estimated cost to complete and testing the completeness and accuracy of the underlying data.

complete and testing the completeness and accuracy of the underlying data.

To assess management’s estimated costs, we performed audit procedures that included, among others, agreeing the estimates to supporting documentation;

3 unchanged sentences

and performing lookback analyses to historical actual costs to assess management’s ability to estimate.

Measurement of the valuation allowance against deferred tax assets

Description of the Matter

As discussed in Notes 2 and 15 to the consolidated financial statements, a valuation allowance is recognized if the Company determines it is necessary to reduce deferred tax assets to amounts which are more likely than not to be realized.

As of December 31, 2023, the Company had a valuation allowance of $346 million recorded against gross deferred tax assets of $983 million.

During the year, the Company emerged from a three-year cumulative loss position and released $485 million of previously recorded valuation allowance.

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income by jurisdiction during the periods in which those temporary differences become deductible or when carryforwards can be utilized.

Auditing management’s assessment of the realizability of its deferred tax assets involved complex auditor judgment because management’s estimate of projected future taxable income and expected utilization of net operating loss and tax credit carryforwards are based on significant assumptions that may be affected by future market conditions and the Company’s performance.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s controls that address the risks of material misstatement relating to the realizability of deferred tax assets, including controls over management’s scheduling of the future reversal of existing taxable temporary differences and projections of future taxable income.

To test the Company’s assessment of the valuation allowance, we performed audit procedures that included, among others, (i) obtaining an understanding of the Company’s overall tax structure, including any changes in the Company’s tax structure that occurred during the year as well as any changes in tax law that could impact the realizability of the Company’s deferred tax assets;

(ii) utilizing tax resources with appropriate knowledge of jurisdictional laws and regulations;

(iii) testing the Company’s scheduling of the reversal of existing temporary taxable differences, (iv) assessing the reasonableness of management’s projections of future taxable income by jurisdiction, and (v) testing the completeness and accuracy of the underlying data.

/s/ Ernst & Young LLP

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The accompanying notes are an integral part of these statements.

CONSOLIDATED STATEMEN TS OF INCOME (LOSS)

CONSOLIDATED STATEMEN TS OF INCOME

(In millions, except per share data)

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Selling, general and administrative

Operating profit (loss)

Operating profit

Interest and financial costs

Interest income

Equity income (loss) in unconsolidated affiliates

Equity income in unconsolidated affiliates

Other expense, net

Income (loss) before income taxes

Income before income taxes

Provision (benefit) for income taxes

Net income (loss)

Net income (loss) attributable to noncontrolling interests

Net income (loss) attributable to Company

Net income (loss) attributable to Company per share:

Net loss attributable to noncontrolling interests

Net income attributable to Company

Net income attributable to Company per share:

Cash dividends per share

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The accompanying notes are an integral part of these statements.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

Year Ended December 31,

Net income (loss)

Other comprehensive income (loss):

Other comprehensive income:

Currency translation adjustments

Derivative financial instruments, net of tax

Change in derivative financial instruments, net of tax

Change in defined benefit plans, net of tax

Comprehensive income (loss)

Net income (loss) attributable to noncontrolling interests

Comprehensive income (loss) attributable to Company

Comprehensive income

Net loss attributable to noncontrolling interests

Comprehensive income attributable to Company

The accompanying notes are an integral part of these statements.

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Cash flows from operating activities:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash provided (used in) by

Adjustments to reconcile net income to net cash provided (used in) by

operating activities:

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Stock-based compensation

Loss on extinguishment of debt

Equity (income) loss in unconsolidated affiliates

Equity income in unconsolidated affiliates

Dividend from unconsolidated affiliate

Gain on business divestiture

Provision for inventory losses

11 unchanged sentences

Business acquisitions, net of cash acquired

Business divestitures, net of cash disposed

Net cash used in investing activities

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Cash dividends paid

Debt issuance and extinguishment costs

Shares repurchases

Net cash used in financing activities

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Supplemental disclosures of cash flow information:

Cash payments (refunds) during the period for:

Cash payments during the period for:

The accompanying notes are an integral part of these statements.

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Stock-based compensation

Stock issued in acquisition

Withholding taxes

Purchase of equity in non-controlling interest

Balance at December 31, 2022

Other comprehensive loss

Other comprehensive income, net

Cash dividends, $ 0.20 per common share

Transactions with non-controlling interests

Stock-based compensation

Common stock issued

Withholding taxes

Purchase of equity in non-controlling interest

Balance at December 31, 2023

Other comprehensive income, net

Other comprehensive loss

Cash dividends, $ 0.275 per common share

3 unchanged sentences

Withholding taxes

Share repurchases

Balance at December 31, 2024

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The Company evaluates inventory using the best information available at the time to inform our assumptions and estimates about future demand and resulting sales volumes, and records reserves as necessary.

We recorded charges (credits) to inventory reserves of $ 28 million, $ ( 18 ) million, and $ 73 million for the years ended December 31, 2023, 2022, and 2021, respectively, consisting primarily of obsolete and surplus inventories.

We recorded charges (credits) to inventory reserves of $ 31 million, $ 28 million, and $ ( 18 ) million for the years ended December 31, 2024, 2023, and 2022, respectively.

At December 31, 2024 and 2023, inventory reserves totaled $ 286 million and $ 354 million, or 12.9 % and 14.1 % of gross inventory, respectively.

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Acquisitions of businesses are accounted for using the acquisition method of accounting, and the financial statements include the results of the acquired operations from the respective dates of acquisition.

The purchase price of the acquired entities is preliminarily allocated to the net assets acquired and liabilities assumed based on the estimated fair value at the dates of acquisition, with any excess of cost over the fair value of net assets acquired, including intangibles, recognized as goodwill.

The acquisition price of the acquired entities is preliminarily allocated to the net assets acquired and liabilities assumed based on the estimated fair value at the dates of acquisition, with any excess of acquisition price paid over the fair value of net assets acquired, including intangibles, recognized as goodwill.

Subsequent changes to preliminary amounts are made prospectively.

The Company paid cash of $ 22 million, $ 49 million, and $ 52 million for acquisitions for the years ended December 31, 2023, 2022 and 2021 , respectively.

Additionally, the Company paid $ 29 million in stock (consisting of 2 million shares) for acquisitions in 2021.

These acquisitions did not have a material effect on the Company’s operating results, cash flows or financial position.

The Company paid cash of $ 298 million, $ 22 million, and $ 49 million, net of cash acquired, for acquisitions for the years ended December 31, 2024, 2023 and 2022 , respectively.

Foreign Currency

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For all operations, gains or losses from remeasuring foreign currency transactions into the functional currency are included in income.

Net foreign currency transaction losses were $ 84 million, $ 25 million, and $ 16 million for the years ending December 31, 2023, 2022 and 2021 , respectively, and are included in other expenses, net, in the accompanying statement of income (loss).

Net foreign currency transaction losses were $ 19 million, $ 84 million, and $ 25 million for the years ending December 31, 2024, 2023 and 2022 , respectively, and are included in other expenses, net, in the accompanying consolidated statements of income.

Revenue Recognition

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Revenue Recognition under Long-term Construction Contracts

Revenue is recognized over-time for certain long-term construction contracts in the Completion & Production Solutions and Rig Technologies segments.

Revenue is recognized over-time for certain long-term construction contracts in the Energy Equipment segment.

These contracts include custom designs for customer-specific applications that are unique and require significant engineering efforts.

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These long-term construction contracts generally include integrating a complex set of tasks and components into a single project or capability, so they are accounted for as one performance obligation.

Estimating total revenue and cost at completion of long-term construction contracts is complex, subject to many variables and requires significant judgement.

Estimating total revenue and cost at completion of long-term construction contracts is complex, subject to many variables and requires significant judgment.

It is common for our long-term contracts to contain late delivery fees, work performance guarantees, and other provisions that can either increase or decrease the transaction price.

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As of December 31, 2024 , the aggregate amount of the transaction price allocated to remaining performance obligations was $ 4,801 million.

The Company expects to recognize approximately $ 1,491 million in revenue for the remaining performance obligations in 2024 and $ 3,001 million in 2025 and thereafter.

Although numerous factors can affect timing of revenue recognized on performance obligations, such as customer change orders and supplier accelerations or delays, the Company expects to recognize approximately $ 1,630 million in revenue for the remaining performance obligations in 2025 , $ 1,333 million in 2026 , $ 567 million in 2027 , and $ 1,271 million thereafter .

Costs to Obtain and Fulfill a Contract

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Amounts incurred

Currency translation adjustments

Currency translation adjustments and other

Balance at December 31, 2023

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The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect reported and contingent amounts of assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the reporting period.

Such estimates include but are not limited to, estimated losses on accounts receivable, estimated costs and related margins of projects accounted for over time, estimated realizable value on excess and obsolete inventory, contingencies, estimated liabilities for litigation and environmental exposures and liquidated damages, estimated warranty costs, estimates related to pension accounting, estimates related to the fair value of Reporting Units for purposes of assessing goodwill and other indefinite-lived intangible assets for impairment and estimates related to deferred tax assets and liabilities, including valuation allowances on deferred tax assets.

Such estimates include but are not limited to, estimated losses on accounts receivable, estimated costs and related margins of projects accounted for over time, estimated realizable value on excess and obsolete inventory, contingencies, estimated liabilities for litigation and environmental exposures and liquidated damages, estimated warranty costs, estimates related to pension accounting, estimates related to the fair value of reporting units for purposes of assessing goodwill and other indefinite-lived intangible assets for impairment and estimates related to valuation allowances on deferred tax assets.

Actual results could differ from those estimates.

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Where the most likely outcome cannot be estimated, a range of potential losses is established and if no one amount in that range is more likely than others, the low end of the range is accrued.

Such estimates may be based on advice from third parties or on management’s judgement, as appropriate.

Revisions to contingent liabilities are reflected in income in the period in which different facts or information become known or circumstances change that affect the Company’s previous judgements with respect to the likelihood or amount of loss.

Such estimates may be based on advice from third parties or on management’s judgment, as appropriate.

Revisions to contingent liabilities are reflected in income in the period in which different facts or information become known or circumstances change that affect the Company’s previous judgments with respect to the likelihood or amount of loss.

Amounts paid upon the ultimate resolution of contingent liabilities may be materially different from previous estimates and could require adjustments to the estimated reserves to be recognized in the period such new information becomes known.

Net Income (Loss) Attributable to Company Per Share

Net Income Attributable to Company Per Share

The following table sets forth the computation of weighted average basic and diluted shares outstanding (in millions, except per share data):

Year Ended December 31,

Net income (loss) attributable to Company

Net income attributable to Company

Basic—weighted average common shares outstanding

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Diluted outstanding shares

Basic income (loss) attributable to Company per share

Diluted income (loss) attributable to Company per share

Net income attributable to Company per share:

Cash dividends per share

Net income (loss) attributable to Company allocated to participating securities was immaterial for the years ended December 31, 2023, 2022 and 2021 and therefore not excluded from net income (loss) attributable to Company per share calculation.

Net income attributable to Company allocated to participating securities was immaterial for the years ended December 31, 2024, 2023 and 2022 and therefore not excluded from net income attributable to Company per share calculation.

The Company had stock options outstanding that were anti-dilutive totaling 16 million, 18 million, and 20 million at December 31, 2024, 2023 and 2022 , respectively.

Recently Issued Accounting Standards

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848).” Topic 848, as amended, applies only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform.

The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2024.

During the first quarter of 2023, the Company adopted the optional relief guidance provided under Topic 848 after modifying certain debt and derivative instruments to update the reference rate from LIBOR to SOFR.

The adoption of this optional relief did not have a material impact on the consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures” (“ASU 2023-09”), which is intended to improve the transparency and decision usefulness of income tax disclosures.

The amendments in ASU 2023-09 provide for required income tax information primarily through changes to the rate reconciliation and income taxes paid information.

ASU 2023-09 is effective for the Company prospectively to all annual periods beginning after December 15, 2024.

The Company continues to evaluate the impact of this standard on its disclosures.

In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures” (“ASU 2024-03”), which improves the disclosures required for certain expense captions in the Company’s annual and interim consolidated financial statements.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027.

The Company is currently evaluating the impact of this standard on its disclosures.

Recently Adopted Accounting Standards

The Company has adopted ASU 2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), effective retrospectively for the fiscal year ended December 31, 2024 .

ASU 2023-07 improves the disclosures required for operating segments in the Company’s annual and interim consolidated financial statements.

As a result of this adoption, the Company’s segment disclosure now includes significant expense categories and the segment performance metric.

See Note 16 to the Consolidated Financial Statements for the disclosures associated with the adoption of ASU 2023-07.

Derivative Financial Instruments

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Colombian Peso

South Korean Won

Norwegian Krone

Brazilian Real

South African Rand

Singapore Dollar

British Pound Sterling

Canadian Dollar

South Korean Won

Brazilian Real

British Pound Sterling

Cash Flow Hedging Strategy

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The gain or loss on the derivative instrument is recognized in earnings in other income (expense), together with the changes in the hedged nonfunctional monetary accounts.

The amount of loss recognized in other expenses, net was $ 10 million, $ 18 million and $ 9 million for the years ended 2023, 2022 and 2021, respectively.

The amount of gain (loss) recognized in other expenses, net was $ 23 million, $ ( 10 ) million and $ ( 18 ) million for the years ended 2024, 2023 and 2022, respectively.

The Company has the following fair values of its derivative instruments and their balance sheet classifications (in millions):

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Goodwill is identified by segment as follows (in millions):

Wellbore Technologies

Completion & Production Solutions

Rig Technologies

Energy Products and Services

Energy Equipment

Balance at December 31, 2022

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Goodwill acquired during period

Adjustment during the measurement period of assets acquired

Currency translation adjustments and other

Balance at December 31, 2024 (1)

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Amortization expense of identified intangibles is expected to be approximately $ 51 million, $ 49 million, $ 45 million, $ 40 million, and $ 30 million for the next five years.

As of December 31, 2024, we provisionally recorded $ 102 million of amortizable intangible assets that were acquired through several strategic acquisitions made during the year.

The fair value of the assets acquired are preliminary and subject to change until we finalize our accounting for these acquisitions.

The net book values of identified intangible assets are identified by segment as follows (in millions):

Wellbore Technologies

Completion & Production Solutions

Rig Technologies

Energy Products and Services

Energy Equipment

Balance at December 31, 2022

Additions to intangible assets

Adjustment during the measurement period of assets acquired

Currency translation adjustments

Currency translation adjustments and other

Balance at December 31, 2023

Additions to intangible assets

Currency translation adjustments

Intangible assets acquired

Currency translation adjustments and other

Balance at December 31, 2024

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Total identified intangibles

Goodwill represents the excess of cost over the fair value of net assets acquired.

The following table presents intangible assets that were acquired during the year ended December 31, 2024 by major classification (in millions):

Net Book Value

Weighted Average Amortization Period (in years)

December 31, 2024:

Customer relationships

Total identified intangibles

Goodwill represents the excess of acquisition price paid over the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed.

Goodwill and intangibles with indefinite lives are not amortized.

Goodwill is assigned to the reporting units that are expected to benefit from the synergies of a business combination.

The recoverability of goodwill and indefinite-lived intangibles is assessed annually, or more frequently as needed when events or changes have occurred that would suggest an impairment of carrying value, by determining whether the fair values of the applicable reporting units exceed their carrying values.

The impairment analysis compares the reporting unit’s carrying value to the respective fair value.

The recoverability of goodwill and indefinite-lived intangibles is assessed annually, or more frequently whenever events or circumstances indicate they might be impaired.

The Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit or indefinite lived intangible asset is greater than its carrying amount.

If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting or indefinite lived intangible asset is greater than its carrying amount, no further testing is required.

However, if the Company concludes otherwise, then it is required to perform a quantitative assessment.

If and when the Company performs a quantitative assessment, it compares the reporting unit’s carrying value to the respective fair value.

Fair value of the reporting unit is determined using significant unobservable inputs, or level 3 in the fair value hierarchy.

1 unchanged sentence

The discounted cash flow is based on management’s forecast of operating performance for the reporting unit.

The two main assumptions used in measuring goodwill impairment, which bear the risk of change and could impact the Company’s goodwill impairment analysis, include the cash flow from operations from each reporting unit and its weighted average cost of capital.

The starting point for each of the reporting unit’s cash flow from operations is the detailed annual plan or updated forecast.

The two main assumptions used in measuring goodwill impairment, which bear the risk of change and could impact the Company’s goodwill impairment analysis, include the cash flows from operations from each reporting unit and its weighted average cost of capital.

The starting point for each of the reporting unit’s cash flows from operations is the detailed annual plan or updated forecast.

Cash flows beyond the updated forecasted operating plans are estimated using a terminal value calculation, which incorporates historical and forecasted financial cyclical trends for each reporting unit and considered long-term earnings growth rates.

1 unchanged sentence

During times of volatility, significant judgment must be applied to determine whether credit changes are a short-term or long-term trend.

The quantitative analysis for indefinite lived intangible assets is performed similarly using an income approach.

Management reviews finite-lived intangibles for indicators of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

1 unchanged sentence

If the evaluation indicates that the carrying value of the finite-lived intangible asset may not be recoverable, the potential impairment is measured at fair value.

During the fourth quarter of 2023, the Company performed its annual impairment test, as described in ASC Topic 350, as of October 1, 2023.

Based on the Company’s annual impairment test, the calculated fair values for all of the Company’s reporting units with remaining goodwill were in excess of the respective reporting unit’s carrying value.

During the fourth quarter of 2024, the Company performed its annual impairment test, as described in ASC Topic 350, by electing to first perform a qualitative assessment.

Based on the results of the assessment, the Company concluded it was more likely than not that the fair values of each of its reporting units and indefinite lived intangible assets was greater than its carrying value and no further testing was performed.

No impairment of goodwill or indefinite-lived intangible assets was recorded in 2024 or 2023 .

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Components of lease expense were as follows (in millions):

December 31, 2023

December 31, 2022

Year Ended December 31,

Finance lease cost

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Supplemental information related to the Company’s leases is as follows (in millions):

December 31, 2023

December 31, 2022

Other information:

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Principal payments of debt for years subsequent to 2024 are as follows (in millions):

The Company has a revolving credit facility with a borrowing capacity of $ 2.0 billion through October 30, 2024, and a borrowing capacity of $ 1.7 billion from October 31, 2024, to October 30, 2025.

The Company has the right to increase the commitments under this agreement to an aggregate amount of up to $ 3.0 billion upon the consent of only those lenders holding any such increase.

Interest under the multicurrency facility is based upon SOFR, NIBOR or CDOR plus 1.25 % subject to a ratings-based grid or the U.S.

The credit facility contains a financial covenant regarding maximum debt-to-capitalization ratio of 60 %.

On September 12, 2024, the Company entered into a new $ 1.5 billion five-year unsecured revolving credit facility.

This new credit facility replaced the Company’s previous $ 2.0 billion revolving credit facility.

The Company has the right to increase the aggregate commitments under this new agreement to an aggregate amount of up to $ 2.5 billion upon the consent of only those lenders holding any such increase.

Interest under the multicurrency facility is based upon Secured Overnight Financing Rate (SOFR), Euro Interbank Offered Rate (EURIBOR), Sterling Overnight Index Average (SONIA), Canadian Overnight Repo Rate Average (CORRA), or Norwegian Interbank Offered Rate (NIBOR), plus 1.25 % subject to a ratings-based grid or the U.S.

The new credit facility contains a financial covenant establishing a maximum debt-to-capitalization ratio of 60 %.

As of December 31, 2024 , the Company was in compliance with a debt-to-capitalization ratio of 23.8 % and had no outstanding borrowings or letters of credit issued under the facility, resulting in $ 1.5 billion of available funds.

Additionally, a consolidated joint venture of the Company borrowed $ 120 million against a $ 150 million bank line of credit for the construction of a facility in Saudi Arabia.

A consolidated joint venture of the Company borrowed $ 120 million against a $ 150 million bank line of credit for the construction of a facility in Saudi Arabia.

Interest under the bank line of credit is based upon SOFR plus 1.40 %.

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The Company can repay the entire outstanding facility balance without penalty at its sole discretion.

Other debt at December 31, 2023 included $ 33 million of funding provided by minority interest partners of NOV consolidated joint ventures, of which $ 3 million is due in the next twelve months.

Other debt at December 31, 2024 included $ 58 million of amounts owed to current and former minority interest partners of NOV consolidated joint ventures, of which $ 27 million is due in the next twelve months.

The Company had $ 500 million of outstanding letters of credit at December 31, 2024, primarily in the U.S.

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For the years ended December 31, 2024, 2023 and 2022 , expenses for defined-contribution retirement plans were $ 85 million, $ 84 million, and $ 67 million, respectively, and all funding is current.

In 2021, NOV announced and filed for the defined benefit plan in the United States to be settled.

During the year ended December 31, 2023, the Company completed the termination of the plan, resulting in excess plan assets being returned to the Company and an immaterial recognition of non-cash, pre-tax charges from accumulated other comprehensive loss to selling, general and administrative expenses in our consolidated statement of income.

In the third quarter of 2022, the Company offered a new benefit plan providing retiree medical coverage in the United States, and as of December 31, 2023 , approximately 9,000 employees are eligible for this coverage.

During the year ended December 31, 2023, the Company completed the settlement and termination of its defined benefit plan in the United States, resulting in excess plan assets being returned to the Company and an immaterial recognition of non-cash, pre-tax charges from accumulated other comprehensive loss to selling, general and administrative expenses in our consolidated statement of income.

During the year ended December 31, 2022, the Company offered a new benefit plan providing retiree medical coverage in the United States, and as of December 31, 2024 , approximately 9,300 employees are eligible for this coverage.

In addition, approximately 750 U.S.

retirees and/or spouses participate in plans that provide post-retirement healthcare and/or life insurance benefits.

Net periodic benefit income (cost) for our Defined Benefit pension plans aggregated $( 2 ) million, $ 1 million, and $ 3 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The change in benefit obligation, plan assets and the funded status of the defined benefit pension plans in the United States, United Kingdom, Norway, Germany and the Netherlands and defined postretirement plans in the United States, using a measurement date of December 31, 2024 and 2023, is as follows (in millions):

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Exchange rate loss (gain)

Plan amendments

Special Termination Benefits

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Accumulated benefit obligation at end of year

Liabilities associated with the funded status of the defined benefit pension plans are included in the balances of accrued liabilities and other liabilities in the Consolidated Balance Sheet.

Liabilities associated with the funded status of the defined benefit pension plans are included in the balances of accrued liabilities and other liabilities in the accompanying Consolidated Balance Sheets.

Defined Benefit Pension Plans

Net periodic benefit income (cost) for our defined benefit pension plans aggregated $( 3 ) million, $( 2 ) million, and $ 1 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Assumed long-term rates of return on plan assets, discount rates and rates of compensation increases vary for the different plans according to the local economic conditions.

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5.50 % - 5.60 %

4.74 % - 5.20 %

International plans

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Level 3 inputs are unobservable (i.e., supported by little or no market activity).

Level 3 inputs include management’s own judgement about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).

Level 3 inputs include management’s own judgment about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).

The return on assets for Level 3 plan assets are immaterial for all periods presented

Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive income (loss) are as follows (in millions):

The components of accumulated other comprehensive loss are as follows (in millions):

Balance at December 31, 2021

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Cost of revenue

Other expense

Selling, general,

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As a result, currency translation adjustments resulting from the process of translating the entities’ financial statements into the reporting currency are reported in other comprehensive income or (loss).

The Company recorded other comprehensive income (loss) of $ 113 million, $( 30 ) million and $( 34 ) million for the years ended December 31, 2023, 2022 and 2021, respectively.

The Company recorded other comprehensive (loss) income of $( 137 ) million, $ 113 million and $( 30 ) million for the years ended December 31, 2024, 2023 and 2022, respectively.

The effect of changes in the fair values of derivatives designated as cash flow hedges are accumulated in other comprehensive income (loss), net of tax, until the underlying transactions are realized.

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In the United States, these governmental authorities include the U.S.

Department of Labor, the Occupational Safety and Health Administration, the Environmental Protection Agency, the Bureau of Land Management, the Department of Treasury, Office of Foreign Asset Controls, state environmental agencies and many others.

Department of Labor, the Occupational Safety and Health Administration, the Environmental Protection Agency, the Bureau of Land Management, the Department of Treasury, Office of Foreign Assets Control, state environmental agencies and many others.

We are unaware of any material liabilities in connection with our compliance with such laws.

New laws, investigations, regulations and enforcement policies may result in additional, presently unquantifiable, or unknown, costs or liabilities.

New laws, regulations and enforcement policies may result in additional, presently unquantifiable, or unknown, costs or liabilities.

From time to time, the Company is involved in various claims, regulatory agency audits, investigations and legal actions involving a variety of matters.

The Company maintains insurance that covers claims such as third-party personal injuries or property damage arising from risks associated with the business activities of the Company, such as premises liability, product liability, personal injury, marine risk, property damage, and other such insurable losses.

The Company maintains insurance that covers claims such as third-party personal injury or property damage claims arising from risks associated with the business activities of the Company, including premises liability, product liability, marine risk, property damage, and other insurable losses.

The Company carries substantial insurance to cover insurable risks above a self-insured retention.

The Company believes, and the Company’s experience has been, that such insurance has been sufficient to cover any such material risks.

The Company is also a party to claims, threatened and actual litigation, arbitration, and internal investigations of potential regulatory and compliance matters which arise both from legacy businesses that the Company has acquired over many years and from the Company’s current ordinary day-to-day business activities.

These regulatory matters and disputes involve private parties and/or government authorities who may assert a broad spectrum of potential claims against the Company, including employment law claims, collective actions or class action claims under employment laws, intellectual property claims (such as alleged patent infringement, and/or misappropriation of trade secrets by the company), premises liability claims, environmental claims, product liability claims, warranty claims, personal injury claims arising from exposure to or use of allegedly defective products or from activities of the Company, alleged regulatory violations, alleged violations of anti-corruption and anti-bribery, trade, customs or other laws and other commercial and/or regulatory claims seeking recovery for alleged actual or exemplary damages or fines and penalties.

Such claims involve various theories of liability which include negligence, breach of contract, strict liability, product liability, and other theories of liability.

The Company also from time to time may be a party to claims, threatened and actual litigation, arbitration, and internal investigations of potential regulatory and compliance matters which may arise from the Company’s business activities, some of which may not involve insured claims.

The Company believes, and the Company’s experience has been, that such insurance has been sufficient to cover its material risks from operations.

The regulatory matters and disputes which the Company faces may involve private parties and/or government authorities who may assert a broad variety of potential claims against the Company, such as employment law claims, collective actions or class action claims, intellectual property claims (such as alleged patent infringement, and/or misappropriation of trade secrets by the Company), premises liability claims, environmental claims, product liability claims, warranty claims, personal injury claims arising from exposure to or use of allegedly defective products or from activities of the Company, alleged regulatory violations, alleged violations of anti-corruption and anti-bribery, trade, customs or other laws and other commercial and/or regulatory claims seeking recovery for alleged actual or exemplary damages or fines and penalties.

Such claims involve various theories of liability which may include negligence, breach of contract, strict liability, product liability, and others.

For some of these contingent claims and potential liabilities, the Company’s insurance coverage may not apply, or exclusions to coverage or legal impediments may apply.

In such instances, settlement or other resolution of such claims, individually or collectively, could have a material financial or reputational impact on the Company.

As of December 31, 2023, the Company recorded reserves in an amount believed to be sufficient, given the estimated range of potential outcomes, for contingent liabilities believed to be probable.

As of December 31, 2024, in the ordinary course of business, the Company recorded reserves in an amount believed to be sufficient, given the estimated range of potential outcomes, for contingent liabilities believed to be probable.

These reserves include costs currently and reasonably estimated to be incurred for reclamation of a closed barite mine and product liability claims, as well as other circumstances involving material claims.

The Company has assessed the potential for additional losses above the amounts accrued as well as potential losses for matters that are believed to be not probable, but which are reasonably possible.

The Company periodically assesses the potential for losses above the amounts accrued as well as potential losses for matters that are believed to be not probable, but which are reasonably possible.

The Company sets accruals in accordance with GAAP based on its best judgment about the probable results of disputed claims, regulatory enforcement actions, tax and other governmental audits, and other contingencies.

The litigation process, as well as the outcome of regulatory oversight is inherently uncertain, and our best judgment concerning the probable outcome of litigation or regulatory enforcement matters may prove to be incorrect.

The litigation process and the outcome of regulatory oversight is inherently uncertain, and our best judgment concerning the probable outcome of litigation or regulatory enforcement matters may prove to be incorrect.

No assurance can be given as to the outcome of these matters.

The total potential loss on these matters cannot be determined;

however, in our opinion, any ultimate liability, to the extent not otherwise provided for, will not materially affect our financial position, cash flow or results of operations.

however, in our opinion, any ultimate liability, to the extent not otherwise provided for, should not materially affect our financial position, cash flows or results of operations.

These estimated liabilities are based on the Company’s assessment of the nature of these matters, their progress toward resolution, the advice of legal counsel and outside experts as well as management’s experience.

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To settle and end litigation or to avoid litigation, the licensees were provided access to the portfolio of leaching patents owned by the Company in exchange for a royalty payment, as defined in each license agreement.

The license agreements each provide that they terminate on the date of the last to expire of the patents in the licensed portfolio.

The companies agreed to pay the royalties for the right to use the portfolio of patents, whether they used some, all or none of the specific patented claims in any particular patent.

The license agreements provide that they terminate on the date of the last to expire of the patents in the licensed portfolio.

Having obtained the benefit of these licenses for more than a decade, all of the drill bit manufacturer licensees unilaterally stopped making royalty payments even though all of the patents in the portfolio have not expired.

These companies have asserted, among other reasons, that they are entitled to stop making these payments because they have not elected to manufacture products covered by the unexpired

These companies have asserted, among other reasons, that they are entitled to stop making these payments because they claim to not manufacture products covered by the unexpired patents.

Some of these companies stopped making payments after the expiration of what are allegedly the patents in the portfolio that they elected to use.

Others paid for some period of time after that date but have since stopped payment.

The Company believes that failure to pay the royalties is a breach of the license agreements at issue.

Others paid for some period of time after that date but have since stopped making payments.

The Company has sued asserting that failure to pay the royalties is a breach of the license agreements at issue.

The Company is in litigation with most of the licensees seeking a judicial determination that it is entitled to be paid royalties pursuant to the terms of the licenses.

The licensees have responded with a number of alleged defenses and requests for declaratory judgment all focused on avoiding the payments called for under the licenses.

The parties’ legal filings to date can be found in two cases currently pending in the United States District Court for the Southern District of Texas:

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See Note 14 to the Consolidated Financial Statements for discussion of the financial impact of royalties.

The protection of intellectual property is important to the Company’s performance, and as such, an adverse result in the above dispute or any future dispute related to any of our intellectual property could result in materially adverse financial consequences such as a decline in sales of products protected by patents, which could materially and adversely impact our financial performance.

From time-to-time consumers of our products and services or members of our supply chain become involved in litigation, governmental investigations, internal investigations, political or other enforcement matters, or other dispute proceedings.

In such circumstances, such proceedings may adversely impact the ability of consumers of our products, entities providing financial support to such consumers or entities in the supply chain to timely perform their business plans or to timely perform under agreements with us.

The protection of intellectual property is important to the Company’s performance, and as such, an adverse result in disputes related to our intellectual property could result in materially adverse financial consequences such as a decline in sales of products protected by patents, which could materially and adversely impact our financial performance.

From time to time purchasers of our products and services or members of our supply chain or sales chain become involved in litigation, governmental investigations, internal investigations, political or other enforcement matters, or other dispute proceedings.

In such circumstances, such proceedings may adversely impact the ability of purchasers of our products, entities providing financial support to such consumers or entities in the supply chain or sales chain to timely perform their business plans or to timely perform under agreements with us.

We may, from time to time, become involved in these proceedings at substantial cost to the Company.

The Company is exposed to customs and trade regulation risk in the countries in which we do business and countries from which or to which we import or export goods.

The Company is exposed to customs and trade regulation risk, including tariffs, in the countries in which we do business and countries from which, or to which, we import or export goods.

Such trade regulations can be complex and conflicting, as different countries use trade regulation to promote conflicting policy objectives.

Compliance with these laws and regulations presents challenges which could result in future liabilities (for example, when laws conflict between countries).

Compliance with these laws and regulations presents challenges which could result in future liabilities (for example, alleged violation of those laws or when laws conflict between countries).

The Company may face increased tariffs and trade costs, loss of revenue, loss of customers, fines, penalties, increased costs, the need for renegotiation of agreements, and other business disruptions.

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In addition, trade regulations, export controls, and other laws adversely impact our ability to do business in certain countries, e.g., Iran, Syria, Russia, China and Venezuela.

In response to additional sanctions enacted by governments in the European Union, the United States, the United Kingdom, Switzerland, and other countries as a result of active armed conflict in Ukraine, we ceased new investments in Russia and have curtailed our activities there.

In response to additional sanctions enacted by governments in the European Union, the United States, the United Kingdom, Switzerland, and other countries regarding the armed conflict in Ukraine, we ceased new investments in Russia and have curtailed our activities there.

During the third quarter of 2022, we sold our business in Belarus and entered into an agreement to sell our business in Russia.

The sale is subject to various government approvals in Russia and other jurisdictions.

The sale is subject to various government approvals in Russia, the U.S.

The Russian government continues to enact new laws impacting the exit of western companies from Russia, including some instances of expropriation of western businesses.

We may incur additional costs as a result of conditions in Russia if we are unable to complete the transaction to sell our Russian business on the terms of the agreements.

Geopolitical events continue to pose supply chain risks even though the impacts of COVID-19 have largely dissipated .

The Company’s ability to manufacture equipment and perform services could be impaired from such disruptions and the Company could be exposed to liabilities resulting from additional interruption or delay in its ability to perform due to materials shortages, inflationary pressures, and limited manpower.

Geopolitical events continue to pose supply chain and other business risks.

The Company’s ability to manufacture equipment and perform services could be impaired by such disruptions and the Company could be exposed to liabilities resulting from additional interruption or delay in its ability to perform due to factors such as war, materials shortages, inflationary pressures, limited manpower or otherwise.

We may face loss of workers, labor shortages, litigation, fines and/or other adverse consequences resulting from ongoing labor impacts.

The combined impact of supply chain and labor market disruptions along with the inflationary impacts of pandemic monetary and regulatory policies could have material adverse impacts on our financial results.

Disputes may arise regarding application of force majeure and other contract provisions concerning allocation of responsibility among customers, the Company, and suppliers, resulting in material added cost and/or litigation.

The combined impact of supply chain and labor market disruptions along with continuing inflationary impacts, as well as monetary and regulatory policies could have material adverse impacts on our financial results.

Disputes may arise from a variety of causes, including weather impacts, cyber, geopolitical, regulatory or other business risks, sometimes these risks may trigger application of force majeure and other contract provisions concerning allocation of responsibility among customers, the Company, and suppliers, resulting in material added cost and/or litigation.

Our customers may attempt to cancel or delay projects, cancel contracts, or may invoke force majeure clauses.

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$ 50.01 - $ 54.74

The weighted-average remaining contractual term for outstanding and exercisable stock options at December 31, 2024, was 3.41 years and 2.72 years, respectively.

The aggregate intrinsic value of outstanding options as of December 31, 2024, was $ 0 .

The weighted-average fair value of options granted during 2024, 2023 and 2022 , was approximately $ 7.90 , $ 9.75 , and $ 6.28 per share, respectively, as determined using the Black-Scholes option-pricing model.

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Forfeitures are accounted for as they occur.

The following summary presents information regarding outstanding options at December 31, 2023 and changes during 2023 with regard to options under all stock option plans:

Outstanding at December 31, 2022

Outstanding at December 31, 2023

Exercisable at December 31, 2023

At December 31, 2024 , total unrecognized compensation cost related to nonvested stock options was $ 9 million.

2 unchanged sentences

Cash received from option exercises for 2024 was $ 3 million.

Cash received from option exercises was $ 2 million and zero in 2022 and 2021 , respectively.

Cash received from option exercises was $ 4 million and $ 2 million in 2023 and 2022 , respectively.

The actual tax benefit (expense) realized for the tax deductions from share-based compensation was zero in 2024, 2023, and 2022.

8 unchanged sentences

Exercisable at end of year

The Company recognized no expense in 2023, 2022 , or 2021.

The Company recognized no expense related to SARs in 2024, 2023 , or 2022.

There was no liability for cash-settled SARs at December 31, 2024.

14 unchanged sentences

On May 15, 2024 the Company granted 85,950 restricted stock units with a fair value of $ 18.85 per share.

The restricted stock units were granted to non-employee members of the board of directors and vest on the first anniversary of the grant date.

The awards were granted to non-employee members of the board of directors and vest on the first anniversary of the grant date.

On May 13, 2024, the Company granted 2,667 restricted stock units with a fair value of $ 18.76 per share.

On May 30, 2024, the Company granted 13,639 restricted stock units with a fair value of $ 18.33 per share.

The awards were granted to employees and vest in three equal annual installments commencing on the first anniversary of grant date.

The following summary presents information regarding outstanding restricted shares:

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Disaggregation of Revenue

The following tables disaggregate our revenue by destinations, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

The following tables disaggregate our revenue by destinations and revenue streams, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors (in millions).

In the tables below, North America includes only the U.S.

and Canada (in millions):

Year Ended December 31, 2024

Energy Products

and Solutions

North America

International

Intersegment revenue

Year Ended December 31, 2023

Energy Products

and Solutions

North America

International

Intersegment revenue

Year Ended December 31, 2022

Energy Products

and Solutions

North America

International

In the table below, the revenue streams of the Energy Products and Services segment are categorized as services and rentals, sales of shorter-lived capital equipment, and sales of consumable products.

The revenue streams of Energy Equipment are categorized as long-lived capital equipment sales and aftermarket sales and services.

Year Ended December 31,

Energy Products and Services:

Services & rental

Capital equipment

Product sales

Intersegment revenue

Energy Equipment:

Capital equipment

Intersegment revenue

Total consolidated

The Company did no t have any customers with revenues greater than 10 % of total revenue for the years ended December 31, 2024, 2023, or 2022.

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Balance at December 31, 2023

Provision, net

Revenue recognized

3 unchanged sentences

The Company recognizes royalty revenue due under various licenses for the Company’s intellectual property, including for technology related to drill bits.

The Company accrued revenue for drill bit licenses of approximately $ 78 million and $ 80 million for years ended December 31, 2023 and 2022, respectively.

As previously disclosed above, the Company is currently pursuing litigation against certain non-paying licensees, which will impact our ability to collect the receivables timely.

As such, during the fourth quarter of 2023, the Company reclassified the royalty receivables from short-term to long-term, recognizing a non-cash discount charge of approximately $ 25 million to reflect the delayed timing of future cash collection.

As of December 31, 2023, the receivables of $ 72 million, net of related allowances for credit losses of $ 9 million and $ 22 million for the remaining timing related discount, are included in Other Assets on the Consolidated Balance Sheets.

These GAAP adjustments do not impact the amount the Company is entitled to recover on its claims from the licensees in litigation.

The Company recognized revenue for drill bit licenses of approximately $ 67 million, $ 78 million, and $ 80 million for years ended December 31, 2024, 2023, and 2022, respectively.

The Company is currently pursuing litigation against certain non-paying licensees, which will impact our ability to collect the receivables timely.

As such, revenue and the related receivables are recorded at a discount to reflect the delayed timing of future cash collections.

As of December 31, 2024 , the receivables of $ 121 million, net of allowances of $ 26 million for credit losses and $ 14 million for the remaining timing related discount, are included in Other Assets on the Consolidated Balance Sheets.

These allowances do not impact the amount the Company is entitled to recover on its claims from the licensees in litigation.

While we continue to believe it is probable the Company will collect all or substantially all of the consideration to which it is entitled pursuant to the terms of the licensing agreements, the Company will also continue to evaluate the credit quality of the receivables in accordance with the policy described in Note 2.

Also see Note 12 to the Consolidated Financial Statements for discussion of the ongoing litigation.

See Note 12 to the Consolidated Financial Statements for discussion of the ongoing litigation.

Allowance for Credit Losses

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Recoveries collected

Reclass for long-term receivables

Balance at December 31, 2024

The domestic and foreign components of income (loss) before income taxes were as follows (in millions):

The domestic and foreign components of income before income taxes were as follows (in millions):

Year Ended December 31,

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Total current income tax provision

Total deferred income tax provision

Total deferred income tax provision (benefit)

Total income tax provision (benefit)

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Nondeductible expenses

Foreign inclusions, net of foreign tax credits

Foreign inclusions and FDII, net of foreign tax credits

Change in uncertain tax positions

3 unchanged sentences

The effective tax rate for the year ended December 31, 2024 was 23.6 %, compared to ( 60.9 %) for 2023.

For the year-ended 2023 , the effective tax rate was favorably impacted by the release of $ 485 million in valuation allowances in numerous jurisdictions.

During the fourth quarter of 2023, the Company determined it was more likely than not the Company would be able to realize the benefit of a substantial portion of the deferred tax assets in the United States and the majority of its other international jurisdictions.

In reaching this determination, the Company considered the growing trend of profitability over the last three years, particularly in the United States, as well as expectations regarding the generation of future taxable income and the sources of future taxable income.

For the year ended 2024 , the effective tax rate was negatively impacted by increased withholding taxes, nondeductible expenses, and losses in certain jurisdiction with no tax benefit, partially offset by a lower rate of U.S.

tax on global intangible low-taxed income (GILTI) and the deduction of foreign-derived intangible income (FDII) and the release of valuation allowances in certain jurisdictions as a result of improving forecasted taxable income and availability of net operating losses.

During 2023, the Company determined it was more likely than not that the Company would be able to realize the benefit of a substantial portion of the deferred tax assets in the United States and the majority of its other international jurisdictions.

In reaching this determination, the Company considered the growing trend of profitability over the preceding three years, particularly in the United States, as well as expectations regarding the generation of future taxable income and the sources of future taxable income.

As a result of this analysis, the Company recognized a discrete tax benefit related to the release of valuation allowances of $ 299 million in the United States and $ 186 million outside the United States.

The effective tax rate was also favorably impacted by adjustments related to utilization of losses and tax credits for current and prior year tax returns, partially offset by current year losses in certain jurisdictions with no tax benefit.

As of December 31, 2024, the Company continues to maintain a valuation allowance of $ 266 million primarily related to foreign tax credit carryforwards in the United States and deferred tax assets in certain other jurisdictions due to several factors, including specific jurisdictions in which the Company does not project to generate sufficient future taxable income to realize all or a portion of its deferred tax assets specific to that jurisdiction;

2 unchanged sentences

and the timing of expiration of certain tax credit carryforwards.

For the year ended December 31, 2022 the effective tax rate was negatively impacted by losses in certain jurisdictions with no tax benefit, partially offset by favorable adjustments related to the foreign currency translation gains and the utilization of losses and tax credits for prior year tax returns.

Significant components of our deferred tax assets and liabilities were as follows (in millions):

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Total deferred tax liabilities

Net deferred tax asset (liability)

Net deferred tax asset

The valuation allowance decreased by $ 80 million during 2024 .

This decrease is comprised of $ 485 million due to the Company’s evaluation of the realizability of deferred tax assets based on future projections of taxable income, $ 68 million related to utilized NOLs and other timing differences in the United States, $ 8 million related to utilized NOLs in foreign jurisdictions, $ 7 million related to foreign currency exchange rate changes, and $ 6 million related to current year changes in the carrying value of deferred tax assets.

This decrease is comprised of $ 40 million due to the Company’s evaluation of the realizability of deferred tax assets based on future projections of taxable income, $ 24 million related to current year utilization of deferred tax assets, $ 11 million related to the expiration or forfeiture of deferred tax assets, and $ 5 million related to foreign currency exchange rate changes.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):

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Accruals related to prior year domestic and foreign jurisdiction issues resulted in uncertain tax position increases of $ 4 million in 2024.

Resolutions of domestic and foreign jurisdiction audits resulted in a $ 4 million and $ 1 million decrease in uncertain tax provisions for the years ended December 31, 2023 and 2022, respectively.

Substantially all of the unrecognized tax benefits, if ultimately realized, would be recorded as a reduction to income tax expense in the period realized.

14 unchanged sentences

Tax Effected NOL

The Company has $ 277 million of excess foreign tax credits in the United States as of December 31, 2023 , of which $ 145 million, $ 92 million, $ 12 million, $ 11 million, and $ 10 million and $ 7 million will expire in 2027, 2028, 2030, 2031, 2032 and 2033 respectively.

As of December 31, 2023 , the Company has remaining tax-deductible goodwill of $ 70 million, resulting from acquisitions.

The amortization of this goodwill is deductible over various periods ranging up to 8 years.

The Company has $ 239 million of excess foreign tax credits in the United States as of December 31, 2024 , of which $ 116 million, $ 92 million, $ 10 million, $ 10 million, $ 8 million and $ 3 million will expire in 2027, 2028, 2030, 2031, 2032 and 2033 respectively.

Business Segments and Geographic Areas

The Company’s operations are organized into three operating segments:

Wellbore Technologies, Completion & Production Solutions and Rig Technologies.

Wellbore Technologies

The Company’s Wellbore Technologies segment designs, manufactures, rents, and sells a variety of equipment and technologies used to perform drilling operations, and offers services that optimize their performance, including:

solids control and waste management equipment and services, managed pressure drilling, drilling fluids, premium drillpipe, wired pipe, drilling optimization services, tubular inspection and coating services, instrumentation, downhole tools, and drill bits.

Wellbore Technologies focuses on oil and gas companies and supports drilling contractors, oilfield service companies, and oilfield equipment rental companies.

Demand for the segment’s products and services depends on the level of oilfield drilling activity by oil and gas companies, drilling contractors, and oilfield service companies.

Completion & Production Solutions

The Company’s Completion & Production Solutions segment integrates technologies for well completions and oil and gas production.

The segment designs, manufactures, and integrates technologies for well completions, oil and gas production, and industrial markets.

This includes equipment and technologies needed for hydraulic fracture stimulation, including pressure pumping trucks, blenders, sanders, hydration units, injection units, flowline, and manifolds;

The Company is comprised of 17 business units to provide products and services to the energy industry.

Each of the business units is managed by a business unit president, recognizes revenue, incurs expenses, and has discrete financial information readily available.

The business units are aggregated into our 2 reportable segments, Energy Products and Services, and Energy Equipment, based on the products and services provided, customer base, and operating environment.

The reportable segments are led by Segment Presidents, who are responsible for oversight of the business units’ strategy and performance.

The Segment Presidents report directly to the CEO and provide monthly operating and financial updates.

The CEO has final authority over resource allocation decisions and performance assessment for the Company.

Consequently, the CEO has been identified as the CODM.

The CODM regularly receives information directly from the Segment Presidents as well as the business units.

However, for decision-making purposes related to the assessment of performance and allocation of resources, the CODM uses financial information at the segment level.

The CODM regularly reviews Operating Profit for each segment to assess performance and for resource allocation decisions in the annual budgeting process and in the quarterly performance review processes.

Energy Products and Services

The Company’s Energy Products and Services segment primarily designs, manufactures, rents, and sells products and equipment used in drilling, intervention, completion, and production activities.

Products include drill bits, downhole tools, premium drill pipe, drilling fluids, managed pressure drilling, integral and weld-on connectors for conductor strings and surface casing, completion tools, and artificial lift systems.

The segment also designs, manufactures, and delivers high-end composite pipe, tanks, and structures engineered to solve both corrosion and weight challenges in a wide variety of applications, including oil and gas, chemical, industrial, wastewater, fuel handling, marine and offshore, and rare earth mineral extraction.

In addition to product and equipment sales, the segment provides services, software, and digital solutions to improve drilling and completion operational performance.

Services include tubular inspection and coating, solids control, waste management, and managed pressure drilling.

Software and digital solutions offered include drilling and completion optimization and remote monitoring (via downhole and surface instrumentation), wired drill pipe services, software controls and applications, and data management and analytics services at the edge and in the cloud.

Energy Products and Services serves oil and gas companies, drilling contractors, oilfield service companies, oilfield equipment rental companies and developers of geothermal energy.

Demand for the segment’s products and services primarily depends on the level of oilfield drilling activity by oil and gas companies, drilling contractors, and oilfield service companies.

Demand for the segment’s composite solutions serving applications outside of oil and gas are driven by industrial activity, infrastructure spend, and population growth.

Energy Equipment

The Company’s Energy Equipment segment manufactures and supports the capital equipment and integrated systems needed for oil and gas exploration and production, both onshore and offshore, as well as for other marine-based, industrial and renewable energy markets.

The segment designs, manufactures, and integrates technologies for drilling and producing oil and gas wells.

This includes equipment and technologies needed for drilling, including land rigs, offshore drilling equipment packages, drilling rig components, and software control systems that mechanize and automate the drilling process and rig functionality;

hydraulic fracture stimulation, including pressure pumping trucks, blenders, sanders, hydration units, injection units, flowline, and manifolds;

well intervention, including coiled tubing units, coiled tubing, and wireline units and tools;

cementing products for pumping, mixing, transport, and storage;

onshore production, including fluid processing, composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems;

and offshore production, including integrated production systems and subsea production technologies.

Completion & Production Solutions supports service companies and oil and gas companies.

Demand for the segment’s products depends on the level of oilfield completions and workover activity by oilfield service companies and drilling contractors, and capital spending plans by oil and gas companies and oilfield service companies.

The segment also designs and manufactures equipment for industrial markets.

This includes specialized, technology-driven progressive cavity pumps and mixers for a wide breadth of industrial end markets with high failure costs, premium pole products to support connectivity, lighting, and power for municipal and residential applications including 5G, smart-city infrastructure, roads and highways, and energy-grid modernization.

Demand for these products is driven by general industrial activity and infrastructure spend.

Rig Technologies

The Company’s Rig Technologies segment manufactures and supports the capital equipment and integrated systems needed to drill oil and gas wells on land and offshore as well as other marine-based markets, including offshore wind vessels.

The segment designs, manufactures and sells land rigs, offshore drilling equipment packages, including installation and commissioning services, and drilling rig components that mechanize and automate the drilling process and rig functionality.

Equipment and technologies the segment provides to customers include:

substructures, derricks, and masts;

jacking systems;

pipe lifting, racking, rotating, and assembly systems;

fluid transfer technologies, such as mud pumps;

pressure control equipment, including blowout preventers;

power transmission systems, including drives and generators;

rig instrumentation and control systems;

mooring, anchor, and deck handling machinery;

major equipment components for offshore wind construction vessels;

and pipelay and construction systems.

The segment also provides spare parts, repair, and rentals as well as comprehensive remote equipment monitoring, technical support, field service, and customer training through an extensive network of aftermarket service and repair facilities strategically located in major areas of drilling operations around the world.

Rig Technologies supports land and offshore drillers.

Demand for the segment’s products depends on drilling contractors’ and oil and gas companies’ capital spending plans, specifically capital expenditures on rig construction and refurbishment;

and secondarily on the overall level of oilfield drilling activity, which drives demand for spare parts, service, and repair for the segment’s large installed base of equipment.

The segment also designs and builds equipment for wind turbine installation companies, where demand is dependent on global investment into offshore wind energy developments.

Geographic Areas:

The following table presents consolidated revenues by country based on sales destination of the products or services (in millions):

onshore production, including fluid processing, and surface transfer as well as progressive cavity pumps;

offshore production, including integrated production systems and subsea production technologies;

and aftermarket support of these technologies, providing spare parts, service, and repair.

Energy Equipment primarily serves contract drillers, oilfield service companies, and oil and gas companies.

Demand for the segment’s products primarily depends on capital spending plans by drilling contractors, service companies, and oil and gas companies, and secondarily on the overall level of oilfield drilling, completions, and workover activity which drives demand for equipment, spare parts, service, and repair for the segment’s large installed base of equipment.

The segment also serves marine and offshore markets, where it designs and builds equipment for wind turbine installation and cable lay vessels, and offers heavy lift cranes and jacking systems;

industrial markets, where the segment provides pumps and mixers for a wide breadth of industrial end markets;

and other energy transition markets, where it is applying its gas processing expertise to provide solutions that aid in wind power development, hydrogen production and carbon sequestration.

The following table presents financial data by business segment (in millions):

Year Ended December 31,

United States

United Kingdom

United Arab Emirates

Other Countries

The following table presents net property, plant and equipment by country based on the location (in millions):

United States

United Kingdom

United Arab Emirates

Other Countries

Business Segments:

The following table presents selected financial data by business segment (in millions):

Wellbore Technologies

Completion & Production Solutions

Rig Technologies

Eliminations and

corporate (1)

December 31, 2023

Operating profit (2)

Capital expenditures

Depreciation and amortization

December 31, 2022

Operating profit (2)

Capital expenditures

Energy Products and Services

Energy Equipment

Eliminations and corporate costs (1)

Energy Products and Services

Energy Equipment

Eliminations and corporate costs (1)

Energy Products and Services

Energy Equipment

Eliminations and corporate costs (1)

Revenue from external customers

Intersegment revenue

Total revenue

Cost of revenue (2)

Selling, general, and administrative (2)

Depreciation and amortization

December 31, 2021

(Gain)/loss on sales of fixed assets

Operating profit

Reconciliation to income before income taxes:

Interest and financial costs

Interest income

Equity income (loss) in unconsolidated affiliates

Other expenses, net

Income before income taxes

Other segment information:

Capital expenditures

Depreciation and amortization

Investment in unconsolidated affiliates

(1) Sales from one segment to another generally are priced at estimated equivalent commercial selling prices;

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Corporate assets consist primarily of cash and fixed assets.

(2) Segment operating profit for 2023 includes charges, net of related credits, for:

voluntary early retirement program (VERP) (Wellbore Technologies $ 19 million;

Completion & Production Solutions $ 18 million;

and, Rig Technologies $ 11 million);

non-cash discount charge on royalty receivables (Wellbore Technologies $ 25 million);

credits related to gains on sales of previously reserved inventory (Completion & Production Solutions $( 2 ) million;

and, Rig Technologies $( 18 ) million);

credit related to release of an earnout accrual (Rig Technologies $ 25 million);

and severance and other restructuring costs (Completion & Production Solutions $ 10 million;

and, Rig Technologies $ 1 million).

Segment operating profit for 2022 includes charges, net of related credits, for:

Russia impairment and other charges (Wellbore Technologies $ 60 million;

Completion & Production Solutions $ 39 million;

and, Rig Technologies $ 24 million);

credits related to gains on sales of previously reserved inventory (Completion & Production Solutions $( 8 ) million;

and, Rig Technologies $( 27 ) million);

and severance and other restructuring costs (Completion & Production Solutions $ 5 million;

and, Rig Technologies $ 3 million).

(2) Included in cost of revenue and selling, general, and administrative expenses are pre-tax charges (credits) within Other Items of $( 109 ) million, $ 51 million, and $ 114 million, for the years ended December 31, 2024, 2023, and 2022, respectively.

Other Items included in cost of revenue for 2024 includes a credit related to a gain on business divestiture (Energy Equipment $ 130 million);

credits related to gains on sales of previously reserved inventory (Energy Equipment $ 3 million);

charges related to severance and other restructuring costs (Energy Products and Services $ 8 million and Energy Equipment $ 15 million), and a credit related to Russia impairment (Energy Products and Services $ 1 million).

Other Items included in selling, general, and administrative expenses for 2023 includes charges related to voluntary early retirement program (VERP) (Energy Products and Services $ 29 million and Energy Equipment $ 19 million);

credit related to release of an earnout accrual (Energy Equipment $ 25 million);

charges related to severance and other restructure costs (Energy Equipment $ 10 million).

Other items included in cost of revenue for 2023 include a non-cash discount charge on royalty receivables (Energy Products and Services $ 25 million);

credits related to gains on sales of previously reserved inventory (Energy Products and Services $ 1 million and Energy Equipment $ 19 million);

charges related to severance and other restructuring costs (Energy Equipment $ 1 million).

Other Items included in selling, general, and administrative expenses for 2022 include Russia impairment and other charges (Energy Products and Services $ 11 million and Energy Equipment $ 40 million).

Other items included in cost of revenue for 2022 include Russia impairment and other charges (Energy Products and Services $ 60 million and Energy Equipment $ 12 million);

charges related to severance and other restructuring costs (Energy Products and Services $ 2 million and Energy Equipment $ 6 million);

and credits related to gains on sales of previously reserved inventory (Energy Products and Services $ 1 million and Energy Equipment $ 34 million).

Geographic Areas:

The following table presents consolidated revenues by country based on sales destination of the products or service (in millions):

Year Ended December 31,

United States

Other Countries

The following table presents net property, plant and equipment by country based on the location (in millions):

United States

Other Countries

Impairment and Other Items

We recorded $ 51 million in other items for the year ended December 31, 2023, of which $ 52 million related to charges related to the VERP, $ 25 million related to a non-cash discount charge on royalty receivables, offset by credits related to the release of an earnout accrual of $ 25 million, and credits related to gains on sales of previously reserved inventory of $ 20 million.

We recorded a net credit of $ 109 million in other items for the year ended December 31, 2024, of which $ 130 million related to a gain from the divestiture of its Pole Products business, offset by charges related to severance, facility closure and other restructuring costs of $ 21 million.

The other items are reported in “Cost of revenue” ($( 110 ) million for the year ended December 31, 2024) and “Selling, general and administrative” ($ 1 million for the year ended December 31, 2024) in our Consolidated Statements of Income.

We recorded $ 51 million in other items for the year ended December 31, 2023, of which $ 52 million related to charges related to VERP, $ 25 million related to a non-cash discount charge on royalty receivables, offset by credits related to the release of an earnout accrual of $ 25 million, and credits related to gains on sales of previously reserved inventory of $ 20 million.

The other items are reported in “Cost of revenue” ($ 10 million for the year ended December 31, 2023) and “Selling, general and administrative” ($ 41 million for the year ended December 31, 2023) in our Consolidated Statements of Income .

We recorded $ 114 million in other items for the year ended December 31, 2022, of which $ 127 million relates to impairments for Russia and Belarus.

The other items are reported in "Cost of revenue" ($ 63 million for the year ended December 31, 2022) and "Selling, general and administrative" ($ 51 million for the year ended December 31, 2022) in our Consolidated Statement of Income (Loss).

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Further, during the third quarter of 2022, the Company sold its business in Belarus and committed to a plan to sell its businesses in Russia.

The sale is subject to government approval under Russian law.

We expect to complete the sale of our Russian entities within the next 12 months, subject to regulatory approval.

For the years ended December 31, 2023 and 2022, all our Russian assets and liabilities were classified as held for sale and reported in “Prepaid and Other Current Assets” and “Accrued Liabilities”, respectively, in our Consolidated Balance Sheet.

We recorded $ 114 million in other items for the year ended December 31, 2022, of which $ 127 million relates to impairments for Russia and Belarus.

Subsequent Event

In an effort to drive further operational and financial efficiencies, the Company announced plans to consolidate its operational structure into two segments, Energy Equipment and Energy Products and Services.

NOV’s new operational structure became effective January 1, 2024.

The Company plans to begin reporting the new segment information beginning in the first quarter of 2024.

Subsequent to year end, NOV completed the acquisition of Extract, a leading provider of artificial lift technologies and services.

Extract’s reputation for market-leading customer service and focus on maximizing run-time of electric submersible pumps has established the company as a key partner for operators looking to maximize the economic returns of their assets.

The sale is subject to various government approvals in Russia and other jurisdictions.

For the years ended December 31, 2024 and 2023, all our Russian assets and liabilities were classified as held for sale and reported in “Prepaid and other current assets” and “Accrued liabilities”, respectively, in our Consolidated Balance Sheets.

Acquisitions and Divestitures

For the year ended December 31, 2024, our Energy Products and Services segment made three strategic acquisitions to enhance and expand our existing portfolio for a total consideration of $ 291 million, net of cash acquired.

One of the three acquisitions was a company owned by White Deer Energy, a middle market private equity fund focused on energy investments.

As the transaction involved a related party at the time it was entered into (i.e., directors Ben A.

Guill and Eric L.

Mattson both had an investment interest in certain White Deer Energy funds), the acquisition was approved by the disinterested members of the Company’s Board of Directors.

As of December 31, 2024 , we provisionally recorded $ 171 million of goodwill and amortizable intangible assets, $ 64 million of PP&E, including financing and operating lease right of use assets, $ 92 million of net working capital, $ 18 million of finance and operating lease liabilities, and $ 18 million in other liabilities.

The fair values of the assets acquired and liabilities assumed are preliminary and subject to change until we finalize our accounting for these acquisitions.

On April 9, 2024, NOV completed the divestiture of its Pole Products business.

Pole Products is a leading manufacturer of premium spun-cast concrete and tapered steel poles for diverse applications.

We recorded a gain of $ 130 million, which is included as a reduction of Cost of Revenue on the Consolidated Statements of Income.

During the second quarter, the Company purchased the remaining noncontrolling interest in Keystone Tower Systems (KTS) for total consideration of $ 30 million.

Share Repurchase Program

On April 25, 2024, the Company established a share repurchase program for up to $ 1 billion of the currently outstanding shares of the Company’s common stock over a period of 36 months.

Under the share repurchase program, the Company may repurchase shares from time to time through open market purchases, in privately negotiated transactions or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, in accordance with applicable securities laws and other restrictions, including Rule 10b-18.

The timing and total amount of any stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices and other considerations.

The Company intends to fund the repurchases using its available U.S.

cash balances, which may involve the repatriation of foreign earnings not indefinitely reinvested.

However, depending on U.S cash balances, the Company may choose to borrow against its revolving credit facility or issue new debt to finance the repurchases.

As shares are repurchased, they are constructively retired and returned to an unissued state.

During the three months ended December 31, 2024 , the Company repurchased 7.5 million shares of common stock under the program for an aggregate amount of $ 112 million.

During the year ended December, 31, 2024 , the Company repurchased 14.2 million shares of common stock under the program for an aggregate amount of $ 229 million.

VALUATION AND QUALIFYING ACCOUNTS

4 unchanged sentences

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-K

Item 9A. Controls and Procedures