NATURAL GAS SERVICES GROUP INC

4. Trade Accounts Receivable

The following table summarizes our trade accounts receivable from customers as of the dates presented:

Our trade accounts receivable consist of customer obligations due under normal trade terms for (i) operating leases for the use of our compressor equipment, (ii) the sale of compressor parts, other equipment and rebuild services and (iii) the performance of aftermarket services.

Major Customers and Concentration of Credit Risk

Rental revenue and sales from Occidental Permian, LTD. (“Oxy”) and Devon Energy Corporation (“Devon”) in the nine months ended September 30, 2026 and 2025 amounted to 59 percent of revenue for both periods on a combined basis. No other single customer accounted for more than 10 percent of our revenues during these periods. Likewise, Oxy’s and Devon’s accounts receivable balances amounted to 50 percent and 62 percent of our accounts receivable on a combined basis as of September 30, 2026, and December 31, 2025, respectively. No other customers amounted to more than 10 percent of our accounts receivable as of these dates.

Provision for Credit Losses

The following table summarizes the changes in our provision for credit losses for the nine months and annual periods ended as presented, respectively:

Management believes that the provision is adequate; however, actual write-offs may exceed the recorded provision. The substantial write-off of the provision for credit losses during the year ended December 31, 2025, reflects certain aged receivables that were no longer deemed collectible.