OIL STATES INTERNATIONAL, INC

Previous wording

The average spot price of WTI crude oil declined 10% in the second quarter of 2025 following to the imposition of broad-based trade tariffs by the United States on imported goods and the announcement by OPEC+ of plans to increase crude oil production. These actions have led to ongoing uncertainty regarding the broad future effect of reciprocal trade tariff increases on the global economy as well as the future demand for and supply of crude oil, and negatively impacted the demand for and pricing of our products and services in the U.S. land-based market during the second quarter of 2025.

Current wording

The third quarter 2025 average spot price of WTI crude oil declined 8% from the first quarter 2025 average following the imposition of broad-based trade tariffs by the United States on imported goods and increased crude oil production by OPEC+. These actions have led to ongoing uncertainty regarding the future effect of reciprocal and other trade tariffs on the global economy as well as the future demand for and supply of crude oil, which has negatively impacted the demand for and pricing of our products and services provided to the U.S. land-based market during recent quarters.

Previous wording

The ultimate magnitude and duration of the trade conflict and increased crude oil production by OPEC+, and the related impacts on crude oil prices and the global economy, remain uncertain. While it is difficult for management to assess or predict with precision the broad future effect of these events on the global economy, the energy industry or the Company, management expects that it may adversely affect demand for our products and services, particularly in the United States, over the balance of 2025 and possibly beyond.

Current wording

The ultimate magnitude and duration of the trade conflict and increased crude oil production by OPEC+, and the related impacts on crude oil prices and the global economy, remain uncertain. While it is difficult for management to assess or predict with precision the broad future effect of these events on the global economy, the energy industry or the Company, management expects that it will continue to adversely affect demand for our products and services, particularly in the United States, over the balance of 2025 and possibly beyond.

Previous wording

We have implemented certain initiatives to optimize our operations and reduce future costs. These actions include: the consolidation, relocation and exit of certain operating locations; the exit of certain service offerings; reductions in our U.S. workforce as well as the realignment in 2024 of operations within two of our reportable segments. We also incurred legal costs associated with patent defense. As a result of these events, actions and assessments, our reported pre-tax results for the six months ended June 30, 2024 included $10.0 million in non-cash goodwill impairment charges as well as $6.9 million of facility consolidation and exit, patent defense and other charges. During the first six months of 2025, we made the strategic decision to exit three additional service facilities, continued the exit of facilities closed in 2024 and further reduced headcount, incurring $4.6 million of associated pre-tax charges.

Current wording

We have implemented certain initiatives to optimize our operations and reduce future costs. These actions include: the consolidation, relocation and exit of certain operating locations; the exit of certain service offerings; reductions in our U.S. workforce as well as the realignment in 2024 of operations within two of our reportable segments. We also incurred legal costs associated with patent defense. As a result of these events, actions and assessments, our reported pre-tax results for the nine months ended September 30, 2024 included $23.4 million in non-cash goodwill, intangible and operating lease asset impairment charges as well as $11.8 million of facility consolidation and exit, patent defense and other charges. During the first nine months of 2025, we made the strategic decision to exit three additional service facilities, continued the exit of facilities closed in 2024 and further reduced headcount, incurring $8.1 million of associated pre-tax charges.

Previous wording

During the first six months of 2025, we sold facilities, equipment and inventory for net proceeds of $12.6 million. Additionally, during the first six months of 2025, we purchased $14.8 million principal amount of our 4.75% convertible senior notes due 2026 (the “2026 Notes”) and $12.0 million of our common stock.

Current wording

During the first nine months of 2025, we sold facilities, equipment and inventory for net proceeds of $13.8 million. Additionally, during the first nine months of 2025, we purchased $20.8 million principal amount of our 4.75% convertible senior notes due 2026 (the “2026 Notes”) and $16.2 million of our common stock.

Previous wording

On July 4, 2025, the United States enacted tax reform legislation through the OBBBA, which resulted in changes to U.S. tax and related law, including certain key federal income tax provisions applicable to multinational companies such as Oil States. These include, among others: the reinstatement of 100% bonus depreciation election for investments in qualifying property; the immediate deduction of domestic research and development expenditures; and manufacturing tax incentives related to goods sold outside the United States.

Current wording

On July 4, 2025, the United States enacted tax reform legislation through the OBBBA, which resulted in changes to U.S. tax and related law, including certain key federal income tax provisions applicable to multinational companies such as ours. These include, among others: the reinstatement of 100% bonus depreciation election for investments in qualifying property; the immediate deduction of domestic research and development expenditures; and manufacturing tax incentives related to goods sold outside the United States.

Previous wording

On July 28, 2025, we amended our asset-based revolving credit facility to increase advance rates, lower interest charges and plan for the retirement of all 2026 Notes that remain outstanding at maturity in April of 2026.

Current wording

On July 28, 2025, we amended our asset-based revolving credit facility (the “ABL Facility”) to reduce the facility size to $100.0 million, increase borrowing availability, lower interest charges and plan for the retirement of all 2026 Notes that remain outstanding at maturity in April of 2026.

Previous wording

Current and expected future pricing for WTI crude oil and natural gas and inflationary cost increases, along with expectations regarding the regulatory environment in the regions in which we operate, are factors that will continue to influence our customers’ willingness to invest capital in their businesses. Expectations for the longer-term price for Brent crude oil will continue to influence our customers’ spending related to global offshore and international drilling and development and, thus, a significant portion of the activity of our Offshore Manufactured Products segment.

Current wording

Current and expected future pricing for WTI crude oil and natural gas, inflationary and tariff-driven cost increases, and expectations regarding the regulatory environment in the regions in which we operate are factors that will continue to influence our customers’ willingness to invest capital in their businesses. Expectations for the longer-term price for Brent crude oil will continue to influence our customers’ spending related to global offshore and international drilling and development and, thus, a significant portion of the activity of our Offshore Manufactured Products segment.

Previous wording

Crude oil and natural gas prices and levels of demand for crude oil and natural gas are likely to remain highly volatile due to numerous factors, including: geopolitical conflicts in Europe and the Middle East, along with associated international tensions; the moderate perceived risk of a global economic recession; the levels of domestic or international crude oil and natural gas production; changes in governmental rules and regulations; sanctions; tariffs; the willingness of operators to invest capital in the exploration for and development of resources; use of alternative fuels; improved vehicle fuel efficiency; timing of capital investments in alternative energy sources; a more sustained movement to electric vehicles; and the potential for ongoing supply/demand imbalances.

Current wording

Crude oil and natural gas prices and levels of demand for crude oil and natural gas are likely to remain highly volatile due to numerous factors, including: geopolitical conflicts in Europe and the Middle East, along with associated international tensions; the moderate perceived risk of a global economic recession; the levels of domestic or international crude oil and natural gas production; technological advancements; consolidation of oil and gas producers; changes in governmental rules and regulations; sanctions; tariffs; the willingness of operators to invest capital in the exploration for and development of resources; use of alternative fuels; improved vehicle fuel efficiency; timing of capital investments in alternative energy sources; a more sustained movement to electric vehicles; and the potential for ongoing supply/demand imbalances.

Previous wording

Our Offshore Manufactured Products segment provides technology-driven, highly-engineered products and services for offshore oil and natural gas production systems and facilities globally, as well as certain products and services to the offshore drilling and completion markets. This segment is particularly influenced by global spending on deepwater drilling and production, which is primarily driven by our customers’ longer-term commodity demand forecasts and outlook for crude oil and natural gas prices. Approximately 90% of Offshore Manufactured Products segment sales in the first six months of 2025 were driven by our customers’ capital spending for products and services used in exploratory and developmental drilling, greenfield offshore production infrastructure, and subsea pipeline tie-in and repair system applications, along with upgraded equipment for existing offshore drilling rigs and other vessels (referred to herein as “project-driven products and services”). Deepwater oil and gas development projects typically involve significant capital investments and multi-year development plans. Such projects are generally undertaken by larger exploration, field development and production companies (primarily international oil companies and state-run national oil companies) using relatively conservative crude oil and natural gas pricing assumptions. Given the long lead times associated with field development, we believe some of these deepwater projects, once approved for development, are generally less susceptible to change based on short-term fluctuations in the price of crude oil and natural gas. Deepwater oil and gas development projects may also be impacted by federal legislative and regulatory actions, including the OBBBA, signed into law in July 2025. The OBBBA mandates that the Bureau of Ocean Energy Management conduct at least two offshore lease sales annually, of a minimum of 80 million acres (if available), in the Central and Western Gulf of America Planning Areas for the next 15 years, beginning in August 2025. This segment also produces a variety of products for use in industrial, military and other applications outside the traditional energy industry. Additionally, we are investing in research and product development (and have been awarded select contracts and are bidding on additional projects) to facilitate the development of alternative energy sources, including offshore wind and deep-sea mineral gathering opportunities.

Current wording

Our Offshore Manufactured Products segment provides technology-driven, highly-engineered products and services for offshore oil and natural gas production systems and facilities globally, as well as certain products and services to the offshore drilling and completion markets. This segment is particularly influenced by global spending on deepwater drilling and production, which is primarily driven by our customers’ longer-term commodity demand forecasts and outlook for crude oil and natural gas prices. Approximately 90% of Offshore Manufactured Products segment sales in the first nine months of 2025 were driven by our customers’ capital spending for products and services used in exploratory and developmental drilling, greenfield offshore production infrastructure, and subsea pipeline tie-in and repair system applications, along with upgraded equipment for existing offshore drilling rigs and other vessels (referred to herein as “project-driven products and services”). Deepwater oil and gas development projects typically involve significant capital investments and multi-year development plans. Such projects are generally undertaken by larger exploration, field development and production companies (primarily international oil companies and state-run national oil companies) using relatively conservative crude oil and natural gas pricing assumptions. Given the long lead times associated with field development, we believe some of these deepwater projects, once approved for development, are generally less susceptible to change based on short-term fluctuations in the price of crude oil and natural gas. Deepwater oil and gas development projects may also be impacted by federal legislative and regulatory actions, including the OBBBA, which mandates that the Bureau of Ocean Energy Management conduct at least two offshore lease sales annually, of a minimum of 80 million acres (if available), in the Central and Western Gulf of America Planning Areas for the next 15 years. This segment also produces a variety of products for use in military, industrial and other applications outside the traditional energy industry. Additionally, we are investing in research and product development (and have been awarded select contracts and are bidding on additional projects) to facilitate the development of alternative energy sources, including offshore wind and deep-sea mineral gathering opportunities.

Previous wording

Backlog reported by our Offshore Manufactured Products segment increased to $363 million as of June 30, 2025 from $311 million as of December 31, 2024. Bookings totaled $112 million in the second quarter of 2025, yielding a quarterly book-to-bill ratio of 1.1x (1.2x year-to-date). The following table sets forth backlog as of the dates indicated (in millions).

Current wording

Backlog reported by our Offshore Manufactured Products segment increased to $399 million as of September 30, 2025 from $311 million as of December 31, 2024. Bookings totaled $145 million in the third quarter of 2025, yielding a quarterly book-to-bill ratio of 1.3x (1.3x year-to-date). The following table sets forth backlog as of the dates indicated (in millions).

Previous wording

Demand for our completion-related products and services within our Completion and Production Services and Downhole Technologies segments is highly correlated to changes in the total number of wells drilled in the United States, total footage drilled, the number of drilled wells that are completed and changes in the drilling rig count. The following table sets forth a summary of the U.S. drilling rig count, as measured by Baker Hughes Company, as of and for the periods indicated.

Current wording

Demand for our completion-related products and services within our Completion and Production Services and Downhole Technologies segments is highly correlated to changes in the total number of wells drilled in the United States, total footage drilled, the number of drilled wells that are completed and changes in the completion (“frac”) count. The following table sets forth a summary of the U.S. drilling rig count, as measured by Baker Hughes Company, as of and for the periods indicated.

Previous wording

The U.S. energy industry is primarily focused on crude oil and liquids-rich exploration and development activities in U.S. shale plays utilizing horizontal drilling and completion techniques. As of June 30, 2025, oil-directed drilling accounted for 79% of the total U.S. rig count – with the balance largely natural gas related.

Current wording

The U.S. energy industry is primarily focused on crude oil and liquids-rich exploration and development activities in U.S. shale plays utilizing horizontal drilling and completion techniques. As of September 30, 2025, oil-directed drilling accounted for 77% of the total U.S. rig count – with the balance largely natural gas related.

Previous wording

We use a variety of domestically produced and imported raw materials and component products, including steel, in the manufacture of our products. In the first quarter of 2025, the United States imposed new or additional tariffs on a variety of imported raw materials and products, including steel and aluminum. In response to the U.S. tariffs on steel and aluminum, the European Union and several other countries, including Canada and China, have threatened and/or imposed retaliatory tariffs. In addition, in response to Russia’s invasion of Ukraine, governments in the European Union, the United States, the United Kingdom, Switzerland and other countries have enacted sanctions against Russia and Russian interests. Subsequently, the U.S. government announced additional tariffs on goods imported into the United States, including steel and other metal products. The effect of these sanctions and tariffs and the application and interpretation of existing trade agreements and customs, anti-dumping and countervailing duty regulations continue to evolve, and we continue to monitor these matters. While many of these tariffs are currently deferred, we cannot predict with certainty the impact of any new or increased tariffs, or the impact of any retaliatory tariffs, if we encounter difficulty in procuring these raw materials and component products, or if the prices we have to pay for these products increase and we are unable to pass corresponding cost increases on to our customers, our financial position, cash flows and results of operations could be adversely affected. Furthermore, uncertainty with respect to potential costs in the drilling and completion of oil and gas wells could cause our customers to delay or cancel planned projects which, if this occurred, would adversely affect our financial position, cash flows and results of operations.

Current wording

We cannot predict with certainty the duration of tariffs currently in place, the impact of any new or increased tariffs, or the impact of any retaliatory tariffs. If we encounter difficulty in procuring these raw materials and component products, or if the prices we pay for these products remain at current levels or increase and we are unable to pass corresponding cost increases on to our customers, our financial position, cash flows and results of operations would be adversely affected. Furthermore, uncertainty with respect to potential costs in the drilling and completion of oil and gas wells could cause our customers to delay or cancel planned projects which, if this occurred, would adversely affect our financial position, cash flows and results of operations.

Previous wording

The following summarizes our consolidated results of operations for the three and six months ended June 30, 2025 and 2024 (in thousands, except per share amounts):

Current wording

The following summarizes our consolidated results of operations for the three and nine months ended September 30, 2025 and 2024 (in thousands, except per share amounts):

Previous wording

We manage and measure our business performance in three operating segments: Offshore Manufactured Products, Completion and Production Services and Downhole Technologies. Supplemental financial information by operating segment for the three and six months ended June 30, 2025 and 2024 is summarized below (in thousands):

Current wording

We manage and measure our business performance in three operating segments: Offshore Manufactured Products, Completion and Production Services and Downhole Technologies. Supplemental financial information by operating segment for the three and nine months ended September 30, 2025 and 2024 is summarized below (in thousands):

Previous wording

(1)During the three and six months ended June 30, 2025, we recognized charges of $0.3 million within the Offshore Manufactured Products segment, associated primarily with the consolidation and relocation of certain manufacturing and service locations. During the three and six months ended June 30, 2024, the segment incurred facility consolidation charges of $1.5 million and $3.0 million, respectively, associated primarily with the segment’s consolidation and relocation of a manufacturing and service location.

Current wording

(1)During the three and nine months ended September 30, 2025, we recognized charges of $0.6 million and $0.8 million, respectively, within the Offshore Manufactured Products segment, associated primarily with the consolidation and relocation of certain manufacturing and service locations. During the three and nine months ended September 30, 2024, the segment incurred facility consolidation charges of $0.4 million and $3.4 million, respectively, associated primarily with the segment’s consolidation and relocation of a manufacturing and service location.

Previous wording

(2)During the three and six months ended June 30, 2025, we recognized charges of $2.2 million and $3.1 million, respectively, within the Completion and Production Services segment, associated primarily with the exit of service locations. During the three and six months ended June 30, 2024, the segment incurred charges of $2.9 million and $3.9 million, respectively, associated primarily with the consolidation and exit of certain underperforming service locations and the defense of certain patents.

Current wording

(2)During the three and nine months ended September 30, 2025, we recognized charges of $2.7 million and $5.8 million, respectively, within the Completion and Production Services segment, associated primarily with the exit of service locations. During the three and nine months ended September 30, 2024, the Completion and Production Services segment recognized charges of $17.2 million and $21.1 million, respectively, associated primarily with the exit of its flowback and well testing service offering, the consolidation and exit of certain underperforming service locations, and the defense of certain patents.

Previous wording

(3)During the three and six months ended June 30, 2025, we recognized charges of $1.2 million within the Downhole Technologies segment, associated primarily with the exit of a leased facility. During the six months ended June 30, 2024, the segment incurred a $10.0 million non-cash impairment charge related to goodwill reassigned to the business in connection with the realignment of operations between segments.

Current wording

(3)During the nine months ended September 30, 2025, we recognized charges of $1.2 million within the Downhole Technologies segment, associated primarily with the exit of a leased facility. During the three and nine months ended September 30, 2024, the Downhole Technologies segment recognized charges of $0.6 million associated primarily with the exit of an underperforming location. Additionally, during the nine months ended September 30, 2024, the segment incurred a $10.0 million non-cash impairment charge related to goodwill reassigned to the business in connection with the realignment of operations between segments.

Previous wording

For further discussion of charges recognized during the three and six months ended June 30, 2025 and 2024, see Note 2, “Asset Impairments and Other Charges and Credits,” to the Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for additional discussion.

Current wording

For further discussion of charges recognized during the three and nine months ended September 30, 2025 and 2024, see Note 2, “Asset Impairments and Other Charges and Credits,” to the Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for additional discussion.

Previous wording

We reported net income for the three months ended June 30, 2025 of $2.8 million, or $0.05 per share. The reported second quarter net income included charges of $3.7 million ($2.9 million after tax, or $0.05 per share) associated primarily with the exit of U.S. land-based facilities and personnel reductions, partially offset by non-cash gains of $0.4 million ($0.3 million after-tax, or $0.01 per share) associated with debt extinguishment. These results compare to net income for the three months ended June 30, 2024 of $1.3 million, or $0.02 per share, which included facility consolidation and other charges of $4.4 million ($3.5 million after-tax, or $0.06 per share), partially offset by non-cash gains of $0.5 million ($0.4 million after-tax, or $0.01 per share) associated with debt extinguishment.

Current wording

We reported net income for the three months ended September 30, 2025 of $1.9 million, or $0.03 per share. The reported third quarter net income included charges of $3.6 million ($2.8 million after tax, or $0.05 per share) associated primarily with the exit of U.S. land-based facilities and personnel reductions. These results compare to a net loss for the three months ended September 30, 2024 of $14.3 million, or $0.23 per share, which included charges of $18.2 million ($17.0 million after tax, or $0.27 per share) associated with the restructuring of certain of its U.S. land-based operations, facility consolidations and closures, patent defense and personnel reductions.

Previous wording

Our results of operations for the second quarter of 2025 reflect the impact of management’s decision to exit certain underperforming locations and service offerings in the United States, as well as the effect of a reduction by operators in U.S. land-based activity levels due to lower crude oil prices and competitive market conditions. These impacts were partially offset by stronger offshore and international project activity, supported by backlog growth over recent quarters.

Current wording

Our results of operations for the third quarter of 2025 reflect the impact of management’s decisions to exit certain underperforming locations and service offerings in the United States, as well as the effect of a reduction by operators in U.S. land-based activity levels due to lower crude oil prices, competitive market conditions and increased U.S. tariffs. These impacts were partially offset by stronger offshore and international project activity, supported by backlog growth over recent quarters.

Previous wording

Revenues. Consolidated total revenues in the second quarter of 2025 decreased $21.0 million, or 11%, from the second quarter of 2024 due primarily to our exit of underperforming service offerings and locations and lower U.S. land-based activity levels. Excluding the impact of exited operations, which generated $12.8 million of revenues in the second quarter of 2024, consolidated revenues decreased $8.2 million, or 5%, year-over-year.

Current wording

Revenues. Consolidated total revenues in the third quarter of 2025 decreased $9.2 million, or 5%, from the third quarter of 2024 due primarily to our exit of underperforming service offerings and locations over the past 15 months and lower U.S. land-based activity levels. Excluding the impact of exited operations, consolidated revenues increased $7.2 million, or 5%, year-over-year.

Previous wording

Consolidated product revenues in the second quarter of 2025 decreased $1.2 million, or 1%, from the second quarter of 2024, with the impact of reduced U.S. customer demand for completion and perforating products substantially offset by higher customer demand for project-driven products. Consolidated service revenues in the second quarter of 2025 decreased $19.7 million, or 25%, from the second quarter of 2024. This decrease was concentrated in the United States – driven by our exit of certain underperforming service offerings and locations and an industry-wide reduction in land-based activity levels.

Current wording

Consolidated product revenues in the third quarter of 2025 increased $5.7 million, or 6%, from the third quarter of 2024, with the impact of higher customer demand for project-driven products partially offset by reduced U.S. customer demand for completion and perforating products. Consolidated service revenues in the third quarter of 2025 decreased $14.9 million, or 20%, from the third quarter of 2024. This decline was concentrated in the United States – driven by our exit of certain underperforming service offerings and locations and an industry-wide reduction in land-based activity levels.

Previous wording

Cost of Revenues (exclusive of Depreciation and Amortization Expense). Our consolidated total cost of revenues (exclusive of depreciation and amortization expense) in the second quarter of 2025 decreased $16.7 million, or 12%, compared to the level reported in the second quarter of 2024.

Current wording

Cost of Revenues (exclusive of Depreciation and Amortization Expense). Our consolidated total cost of revenues (exclusive of depreciation and amortization expense) in the third quarter of 2025 decreased $7.9 million, or 6%, compared to the level reported in the third quarter of 2024.

Previous wording

Consolidated product costs in the second quarter of 2025 increased $1.4 million, or 2%, from the second quarter of 2024 driven primarily by a shift in product sales mix. Consolidated service costs in the second quarter of 2025 decreased $18.1 million, or 30%, from the second quarter of 2024, due to lower revenue levels and strategic actions implemented in our U.S. land operations to improve reported results.

Current wording

Consolidated product costs in the third quarter of 2025 increased $6.4 million, or 8%, from the third quarter of 2024 driven primarily by higher project-driven sales volumes, lower fixed cost coverage in our U.S. manufacturing operations and increased tariff costs. Consolidated service costs in the third quarter of 2025 decreased $14.3 million, or 25%, from the third quarter of 2024, due to lower revenue levels and strategic actions implemented in our U.S. land-focused operations to improve reported results.

Previous wording

Selling, General and Administrative Expense. Selling, general and administrative expense was $23.0 million in the second quarter of 2025. This compares to an expense of $26.4 million in the second quarter of 2024, which included $1.0 million of costs associated with enforcing certain of our patents. Excluding these patent litigation costs, selling, general and administrative costs decreased $2.4 million, or 10%, from the second quarter of 2024, due primarily to lower incentive-based compensation, marketing and bad debt expenses.

Current wording

Selling, General and Administrative Expense. Selling, general and administrative expense was $20.8 million in the third quarter of 2025. This compares to an expense of $22.8 million in the third quarter of 2024, which included $1.3 million of costs associated with enforcing certain of our patents. Excluding these patent litigation costs, selling, general and administrative costs decreased $0.7 million, or 3%, from the third quarter of 2024, with the impact of lower professional fees and bad debt expense partially offset by higher incentive-based compensation expense.

Previous wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $2.8 million, or 19%, in the second quarter of 2025 compared to the prior-year quarter. Note 10, “Segments and Related Information,” to our Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q presents depreciation and amortization expense by segment.

Current wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $1.5 million, or 11%, in the third quarter of 2025 compared to the prior-year quarter. Note 10, “Segments and Related Information,” to the Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q presents depreciation and amortization expense by segment.

Previous wording

Impairment of Operating Lease Assets. In the second quarter of 2025, management continued its restructuring efforts to reduce costs in its U.S. land-based operations. As a result of these decisions, our Completion and Productions Services and Downhole Technologies segments recognized non-cash impairment charges totaling $1.4 million in connection with its exit of leased locations. See Note 2, “Asset Impairments and Other Charges and Credits,” to the Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for additional discussion.

Current wording

Impairments of Operating Lease Assets. In the third quarter of 2024, management made strategic decisions to exit five leased service locations within our Completion and Production Services segment and one within our Downhole Technologies segment. As a result of these decisions, our Completion and Production Services and Downhole Technologies segments recognized non-cash impairment charges totaling $2.6 million to reduce the carrying amount of the related operating lease assets. See Note 2, “Asset Impairments and Other Charges and Credits,” to the Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for additional discussion.

Previous wording

Operating Income. Our consolidated operating income was $5.3 million in the second quarter of 2025, which included $1.4 million in non-cash operating lease impairment charges as well as charges totaling $2.3 million associated with facility consolidations and exits and other management actions. This compares to second quarter 2024 consolidated operating income of $2.0 million, which included facility consolidation and other charges of $4.4 million. Excluding these charges, operating income increased by $2.5 million year-over-year, driven primarily by growth in offshore and international activity and actions taken to improve U.S. land-based operating results.

Current wording

Operating Income (Loss). Our consolidated operating income was $4.7 million in the third quarter of 2025, which included $3.6 million in charges associated with facility consolidations and exits and other management actions. This compares to third quarter 2024 consolidated operating loss of $11.0 million, which included $13.4 million in non-cash intangible and operating lease asset impairment charges and $4.8 million of facility consolidation and other charges. Excluding these charges, operating income increased by $1.1 million year-over-year, with the impact of the decline in revenue and increased tariffs offset by actions taken to improve U.S. land-based operating results and lower depreciation and amortization expense.

Previous wording

Interest Expense, Net. Net interest expense totaled $1.7 million in the second quarter of 2025, which compares to $2.1 million in the same period of 2024. Interest expense as a percentage of total debt outstanding was approximately 7% in the second quarters of 2025 and 2024.

Current wording

Interest Expense, Net. Net interest expense totaled $1.8 million in the third quarter of 2025, which compares to $1.8 million in the same period of 2024. Interest expense as a percentage of total debt outstanding was approximately 7% in the third quarters of 2025 and 2024.

Previous wording

Income Tax. Income tax benefit (provision) for the three months ended June 30, 2025 and 2024 was calculated using a discrete approach. This methodology was used because changes in our results of operations and non-deductible expenses can materially impact the estimated annual effective tax rate. For the three months ended June 30, 2025, our income tax provision was $1.4 million, which included the impact of valuation allowance adjustments for deferred tax assets, certain discrete tax items and other non-deductible expenses, on pre-tax income of $4.2 million. This compares to an income tax benefit of $0.7 million, which included the impact of favorable changes in valuation allowances recorded against deferred tax assets and certain non-deductible expenses, on pre-tax income of $0.6 million for the three months ended June 30, 2024.

Current wording

Income Tax. Income tax provision for the three months ended September 30, 2025 and 2024 was calculated using a discrete approach. This methodology was used because changes in our results of operations and non-deductible expenses can materially impact the estimated annual effective tax rate. For the three months ended September 30, 2025, our income tax provision was $1.4 million, which included the impact of valuation allowance adjustments recorded against deferred tax assets, certain discrete tax items and other non-deductible expenses, on pre-tax income of $3.3 million. This compares to an income tax provision of $2.2 million, which included the impact of changes in valuation allowances recorded against deferred tax assets and certain non-deductible expenses, on a pre-tax loss of $12.1 million for the three months ended September 30, 2024.

Previous wording

Other Comprehensive Income (Loss). Reported comprehensive income (loss) is the sum of reported net income and other comprehensive income (loss). Other comprehensive income was $9.1 million in the second quarter of 2025 compared to other comprehensive loss of $3.2 million in the second quarter of 2024 due to fluctuations in currency exchange rates compared to the U.S. dollar which are used to translate certain of the international operations of our operating segments. For the three months ended June 30, 2025 and 2024, currency translation adjustments recognized as a component of other comprehensive income (loss) were primarily attributable to the United Kingdom and Brazil. During the second quarter of 2025, the exchange rate for the British pound and the Brazilian real strengthened compared to the U.S. dollar. In the second quarter of 2024, the exchange rates for the British pound was flat while the Brazilian real weakened compared to the U.S. dollar.

Current wording

Other Comprehensive Income (Loss). Reported comprehensive income (loss) is the sum of reported net income (loss) and other comprehensive income (loss). Other comprehensive loss was $1.3 million in the third quarter of 2025 compared to other comprehensive income of $9.6 million in the third quarter of 2024 due to fluctuations in currency exchange rates compared to the U.S. dollar which are used to translate certain of the international operations of our operating segments. For the three months ended September 30, 2025 and 2024, currency translation adjustments recognized as a component of other comprehensive income (loss) were primarily attributable to the United Kingdom and Brazil. During the third quarter of 2025, the exchange rate for the British pound weakened compared to the U.S. dollar while the Brazilian real strengthened compared to the U.S. dollar. In the third quarter of 2024, the exchange rates for the British pound and the Brazilian real strengthened compared to the U.S. dollar.

Previous wording

Revenues. Our Offshore Manufactured Products segment revenues increased $5.0 million, or 5%, in the second quarter of 2025 compared to the second quarter of 2024 due to increased international and offshore project-driven product revenue, supported by backlog growth over recent quarters.

Current wording

Revenues. Our Offshore Manufactured Products segment revenues increased $6.4 million, or 6%, in the third quarter of 2025 compared to the third quarter of 2024 due to increased international and offshore project-driven product revenue, supported by backlog growth over recent quarters.

Previous wording

Operating Income. Our Offshore Manufactured Products segment reported operating income of $17.0 million in the second quarter of 2025, which included $0.3 million in facility consolidation and relocation charges. This compares to operating income in the second quarter of 2024 of $14.4 million, which included $1.5 million in facility consolidation charges. Excluding these charges, operating income increased $1.4 million year-over-year.

Current wording

Operating Income. Our Offshore Manufactured Products segment reported operating income of $17.6 million in the third quarter of 2025, which included $0.6 million in facility consolidation and relocation charges. This compares to operating income in the third quarter of 2024 of $19.3 million, which included $0.4 million in facility consolidation and other charges. Excluding these charges, operating income declined $1.5 million year-over-year driven primarily by a shift in product and service mix and a gain of $1.0 million recognized on the sale of property and equipment in the prior-year period.

Previous wording

Backlog. Backlog in our Offshore Manufactured Products segment totaled $363 million as of June 30, 2025, with second quarter 2025 bookings of $112 million and a quarterly book-to-bill ratio of 1.1x.

Current wording

Backlog. Backlog in our Offshore Manufactured Products segment totaled $399 million as of September 30, 2025, with third quarter 2025 bookings of $145 million and a quarterly book-to-bill ratio of 1.3x.

Previous wording

Revenues. Our Completion and Production Services segment revenues decreased $17.0 million, or 37%, in the second quarter of 2025 compared to the prior-year period, driven by the exit of underperforming service offerings and facilities and lower U.S. land-based activity levels. Excluding the impact of exited operations, which generated $12.8 million of revenues in the second quarter of 2024, revenues declined $4.2 million, or 13%, year-over-year – driven primarily by the industry-wide reduction in U.S. land completion-related activity.

Current wording

Revenues. Our Completion and Production Services segment revenues decreased $12.6 million, or 31%, in the third quarter of 2025 compared to the prior-year period, driven by the exit of underperforming service offerings and facilities over the past 15 months and lower U.S. land-based activity levels. Excluding the impact of exited operations, revenues increased $3.8 million, or 16%, year-over-year – driven primarily by higher customer activity levels in the Gulf of America and the Rocky Mountains.

Previous wording

Operating Income (Loss). Our Completion and Production Services segment reported operating income of $1.9 million in the second quarter of 2025, which included charges totaling $2.2 million associated primarily with the exit of service locations. This compares to an operating loss of $0.5 million in the second quarter of 2024, which included charges totaling $2.9 million associated with facility consolidations and exits, and the defense of patents. Excluding these charges, the Completion and Production Services segment’s operating results improved $1.7 million from the prior-year period, supported by the segment’s U.S. land-based restructuring efforts and gains recognized on the sales of idle facilities.

Current wording

Operating Income (Loss). Our Completion and Production Services segment reported operating income of $0.9 million in the third quarter of 2025, which included charges totaling $2.7 million associated primarily with the exit of service locations and personnel reductions. This compares to an operating loss of $18.3 million in the third quarter of 2024, which included charges totaling $17.2 million associated with facility consolidations and exits, the defense of patents and other management actions. Excluding these charges, the Completion and Production Services segment’s operating results improved $4.7 million from the prior-year period, primarily reflective of the segment’s U.S. land-based restructuring efforts.

Previous wording

Revenues. Our Downhole Technologies segment revenues decreased $9.0 million, or 23%, in the second quarter of 2025 from the prior-year period, driven primarily by lower U.S. customer activity levels.

Current wording

Revenues. Our Downhole Technologies segment revenues decreased $3.0 million, or 9%, in the third quarter of 2025 from the prior-year period, driven primarily by lower U.S. customer activity levels.

Previous wording

Operating Loss. Our Downhole Technologies segment reported an operating loss of $4.0 million in the second quarter of 2025, which included charges totaling $1.2 million primarily associated with the exit of a leased facility. This compares to an operating loss of $1.1 million in the second quarter of 2024. Excluding charges, the Downhole Technologies operating results declined $1.6 million year-over-year, driven by the decline in revenues.

Current wording

Operating Loss. Our Downhole Technologies segment reported an operating loss of $4.7 million in the third quarter of 2025. This compares to an operating loss of $3.7 million in the third quarter of 2024, which included charges totaling $1.2 million associated with the exit of a facility, personnel reductions and a customer bankruptcy. Excluding charges, the Downhole Technologies operating results declined $2.2 million year-over-year, driven by the decline in revenues, lower manufacturing volumes and increased tariff costs.

Previous wording

Operating Loss. Corporate expenses decreased $1.0 million, or 10%, in the second quarter of 2025 from the prior-year period due primarily to lower performance-based incentive expense.

Current wording

Operating Loss. Corporate expenses increased $0.7 million, or 8%, in the third quarter of 2025 from the prior-year period due primarily to higher incentive-based compensation expense, as well as $0.3 million of severance charges in the third quarter of 2025.