Cactus, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND MEZZANINE EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND MEZZANINE EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(in thousands, except per share data, or as otherwise indicated)

1. Preparation of Interim Financial Statements and Other Items

Basis of Presentation

The financial statements presented in this report represent the consolidation of Cactus, Inc. (“Cactus Inc.”) and its subsidiaries (the “Company”), including Cactus Companies, LLC (“Cactus Companies”). Cactus Inc. is a holding company whose only material asset is an equity interest consisting of units representing limited liability company interests in Cactus Companies (“CC Units”). Cactus Inc. is the sole managing member of Cactus Companies and operates and controls all of the business and affairs of Cactus Companies and conducts its business through Cactus Companies and its subsidiaries. As a result, Cactus Inc. consolidates the financial results of Cactus Companies and its subsidiaries and reports a non-controlling interest related to the portion of CC Units not owned by Cactus Inc., which reduces net income attributable to holders of Cactus Inc.’s Class A common stock, par value $0.01 per share (“Class A common stock”). Except as otherwise indicated or required by the context, all references to “Cactus,” “we,” “us” and “our” refer to Cactus Inc. and its consolidated subsidiaries.

On February 28, 2023, Cactus Inc. through one of its subsidiaries, completed the acquisition of the FlexSteel business through a merger (the “Merger”) with HighRidge Resources, Inc. and its subsidiaries (“HighRidge”). On February 27, 2023, in order to facilitate the Merger with HighRidge, an internal reorganization was completed in which Cactus Companies acquired all of the outstanding units representing ownership interests in Cactus Wellhead, LLC (“Cactus LLC”), the operating subsidiary of Cactus Inc. (the “CC Reorganization”). The purpose of the Merger was to effect the acquisition of the operations of FlexSteel Holdings, Inc. and its subsidiaries. FlexSteel Holdings, Inc. was a wholly-owned subsidiary of HighRidge prior to the Merger and was converted into a limited liability company, contributed from HighRidge to Cactus Companies as part of the CC Reorganization and is now named FlexSteel Holdings, LLC (“FlexSteel”).

Cactus International Joint Venture with Baker Hughes

On January 1, 2026 (the “Closing Date”), Baker Hughes Holdings LLC ("Baker Hughes Holdings") and certain of its affiliates sold 65% of the limited liability company membership interests ("Membership Interests") in Baker Hughes Pressure Control LLC (the "Joint Venture" or "Cactus International"), which holds Baker Hughes Company's remaining surface pressure control business (the "Acquired Business") to Cactus UK Holding Limited (the “Cactus Member”), a subsidiary of Cactus Companies, for a cash purchase price of $344.5 million, subject to certain working capital, cash, debt, capital expenditure and other customary adjustments (the "Baker Hughes Transaction").

For so long as Baker Hughes Pressure Control Holdings LLC (the "Baker Member") continues to hold Membership Interests, the Cactus Member shall cause the Joint Venture to operate its business generally in the ordinary course. Certain actions of the Board of Directors of the Joint Venture require the affirmative vote of at leastone director appointed by the Baker Member. Baker Hughes Company ("Baker Hughes Company") and the Company have specific non-compete restrictions with respect to surface pressure control applications in certain countries, and the members of the Joint Venture are subject to certain transfer restrictions with respect to the Membership Interests.

From and after the second anniversary of the Closing Date, the Baker Member has the right to sell to either the Joint Venture or the Cactus Member, and the Cactus Member has the right to purchase or cause the Joint Venture to purchase, all of the Membership Interests held directly or indirectly by Baker Hughes Company. The purchase price will be based on a value of the Joint Venture using a multiple ofsix times its trailing twelve month ("TTM") Adjusted EBITDA (as defined and calculated pursuant to the Amended and Restated Limited Liability Company Agreement of the Joint Venture, entered into on the Closing Date by the Joint Venture, the Cactus Member, the Baker Member, Cactus Inc. and Baker Hughes Company (the "Joint Venture LLC Agreement")), subject to a maximum valuation of $660.0 million, and if the Cactus Member elects to purchase or cause the Joint Venture to purchase the Membership Interests, a minimum valuation of $530.0 million applies. If the Baker Member exercises its right to sell, there is no minimum valuation. In connection with the Baker Hughes Transaction, Cactus Companies is obligated to pay Baker Hughes Holdings $10.0 million subject to contractual adjustments on the first anniversary of the Closing Date and $14.5 million at such time as Baker Hughes Company ceases to be a member of the Joint Venture.

Following the transactions described above, the Company currently operates intwo business segments: Pressure Control, which includes the legacy Cactus Wellhead business and the Cactus International business, and Spoolable Technologies, which includes the FlexSteel business.

The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, these consolidated financial statements do not include all information or notes required by generally accepted accounting principles for annual financial statements and should be read together with our Annual Report on Form 10-K for the year ended December 31, 2025.

The consolidated financial statements include all adjustments, which are of a normal recurring nature, unless otherwise disclosed, necessary for a fair statement of the consolidated financial statements for the interim periods. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year.

Investments in Unconsolidated Affiliates

In November 2023, the Company entered into an agreement to invest in a Vietnam forging manufacturing facility for an ownership percentage of 40%. In January 2025, the Company provided an initial capital contribution of $6.0 million. In late 2025 the parties decided not to proceed with the development of the facility and are in the process of liquidating the assets and returning the capital to the respective parties. The investment in a company in which Cactus does not have a controlling financial interest, but over which it has significant influence, is accounted for using the equity method. The Company's share of the after-tax earnings of the equity method investment was recorded in field service and other revenue in the consolidated statements of income.

Restricted Cash

Restricted cash represents amounts that are not available for general corporate use because they are subject to contractual or legal restrictions. Consistent with U.S. GAAP, the Company presents restricted cash separately from cash and cash equivalents on the consolidated balance sheets and includes restricted cash in the reconciliation of beginning and ending cash, cash equivalents, and restricted cash in the consolidated statements of cash flows.

As of December 31, 2025, the Company had $371.0 million of restricted cash held in an escrow account in connection with the then-pending acquisition of Baker Hughes Pressure Control LP. Under the terms of the purchase agreement, these funds were required to be placed in escrow and were restricted from use for any purpose other than funding the acquisition consideration at closing. The escrowed funds were released on January 1, 2026, the acquisition closing date, at which point the restriction lapsed and the cash was released to certain affiliates of Baker Hughes Company.

The restricted cash balance is classified as a current asset, as the restriction was scheduled to be released within one year of the balance sheet date.

The following table provides a reconciliation of the amounts presented in the consolidated balance sheets to the total amounts shown in the consolidated statements of cash flows:

Use of Estimates

In preparing our consolidated financial statements in conformity with GAAP, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with a high degree of precision from available data, or is not otherwise capable of being readily calculated based on accepted methodologies. In some cases, these estimates are particularly difficult to determine, and we must exercise significant judgment. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our consolidated financial statements.

Recent Accounting Pronouncements

Standards Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement- Reporting Comprehensive Income- Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The new standard would require public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.

In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-Use Software. This standard update modernizes the capitalization criteria for internal-use software, eliminating references to project stages and instead requiring that projects meet completion probability criteria before costs can be capitalized. This guidance is effective for annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of these amendments but does not anticipate that adoption will have a material impact on the Company's results of operations or financial position.

2. Cactus International Acquisition

On June 2, 2025, Cactus Companies, a subsidiary of Cactus, Inc., entered into a Framework Agreement (the “Framework Agreement”) with Baker Hughes Holdings and Baker Hughes Pressure Control LLC, each of which at such time was an indirect subsidiary of Baker Hughes Company, pursuant to which the Company agreed to acquire Baker Hughes Company’s surface pressure control business.

Prior to the Closing Date, Baker Hughes Holdings effected certain restructuring transactions on the terms and subject to the conditions set forth in the Framework Agreement (the “Restructuring Transactions”), as a result the Joint Venture and certain of its subsidiaries came to own the Business Assets and Business Liabilities (each as defined in the Framework Agreement). As part of the Restructuring Transactions, the Joint Venture converted from a Texas limited partnership to a Delaware limited liability company.

On the Closing Date, Baker Hughes Holdings and certain of its affiliates sold 65% of the Membership Interests to the Cactus Member, a subsidiary of Cactus Companies, for a cash purchase price of $344.5 million (on a debt-free, and, except as noted below, cash-free basis), subject to certain working capital, cash, debt, capital expenditure and other customary adjustments after the Closing Date (the “Purchase Price”). The Joint Venture was to retain minimum cash of $70.0 million (the “Minimum Cash Amount”). In order to compensate Baker Hughes Holdings for the Minimum Cash Amount, Cactus Companies (i) paid Baker Hughes Holdings 65% of the Minimum Cash Amount, or $45.5 million, on the Closing Date, and (ii) will pay Baker Hughes Holdings 35% of the Minimum Cash Amount, or $24.5 million, as follows: $10.0 million, subject to contractual adjustments on the first anniversary of the Closing Date, and $14.5 million at such time as Baker Hughes Company ceases to be a member, directly or indirectly, of the Joint Venture.

The acquisition was completed to expand the Company’s surface pressure control operational capabilities and broaden its geographic footprint. The acquired business complements the Company’s existing pressure control offerings through additional product capabilities, manufacturing capacity, geographic markets and customer relationships.

The acquisition is being accounted for using the acquisition method of accounting, with Cactus being treated as the accounting acquirer. Under the acquisition method of accounting, the assets and liabilities were recorded at their respective fair values as of the date of the completion of the acquisition. The transaction was treated as a purchase of partnership units for United States federal income tax purposes. In connection with the acquisition, we incurred approximately $6.7 million of transaction costs for the nine months ended September 30, 2026 required to effect the transaction and incurred an additional $1.1 million in costs related to the reporting of and accounting for the transaction. These fees primarily related to legal, accounting and consulting fees and are included in selling, general and administrative (“SG&A”) expenses in the statements of income.

Purchase Price Consideration

The estimated purchase price consideration is $362.0 million and is summarized as follows:

(1)The cash consideration was funded utilizing cash on hand.

(2) The total cash consideration transferred is subject to potential working capital and capital expenditure adjustments.

(3) Represents the estimated fair value of our deferred consideration payment of $10.0 million, subject to contractual adjustments, discounted at present value and payable to the Seller on the first anniversary of the Transaction Date.

Preliminary Purchase Price Allocation

The following table summarizes the preliminary allocation of the purchase price to the identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, after measurement period adjustments:

Assets acquired and liabilities assumed in connection with the acquisition were recorded at their estimated fair values. Estimated fair values were determined by management, based in part on an independent valuation performed by third-party valuation specialists. The valuation methods used to determine the estimated fair value of intangible assets included the excess earnings approach for customer relationships, which values the relationships on a standalone basis by estimating the excess earnings that are driven by owning the customer relationship via a framework that deducts direct and indirect costs. Backlog is a representation of what a buyer would pay to assume the open customer orders on hand. Several significant assumptions and estimates were involved in the application of these valuation methods, including revenues from equipment sales and services, costs to produce, tax rates, capital spending, discount rates, attrition rates and working capital changes. The cash flow forecasts are based solely on facts and circumstances that existed or were reasonably knowable as of the acquisition date. Identifiable intangible assets with finite lives are subject to amortization over their estimated useful lives.

The fair values determined for accounts receivable, accounts payable and most other current assets and liabilities, other than inventory, were approximately equivalent to the carrying value due to their short-term nature. The gross contractual amounts receivable acquired totaled $242.9 million, of which management estimates $2.6 million will be uncollectible. Acquired inventories are comprised of raw materials, work-in-progress and finished goods. The preliminary fair value of finished goods was calculated as the estimated selling price, less costs of the selling effort and a reasonable profit allowance relating to the selling effort. The preliminary fair value of work-in-progress was calculated as the estimated selling price, less costs to complete, less costs of the selling effort and a reasonable profit allowance on completion and selling costs. The preliminary fair value of raw materials was determined based on replacement cost which approximates historical carrying value. The preliminary fair value of identifiable fixed assets was calculated using a combination of valuation approaches, but primarily consisted of the cost approach which adjusts estimates of replacement cost for the age, condition and utility of the associated assets. The acquisition includes a deferred payment component and a put option and call option for the remaining equity interest. The net put/call was valued at $146.7 million using a Monte Carlo simulation in a risk-neutral framework. The fair value of the remaining non-controlling interest of 35% after the acquisition was determined using the implied enterprise value based on the purchase price. Due to the redeemable nature of the arrangement, both the fair value of the option and the redeemable non-controlling interest are classified within Mezzanine Equity.

Other non-controlling interests acquired were valued at $19.6 million using the non-controlling interest of the acquired subsidiary’s fair value measured using discounted cash flows under the income approach.

Goodwill is calculated as the excess of the purchase price over the estimated fair value of net assets acquired and liabilities assumed, and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Among the factors that contributed to a purchase price in excess of the estimated fair value of the net tangible and intangible assets acquired were the acquisition of an assembled workforce, market expansion opportunities and other benefits that we believe will result from the combined operations. Goodwill was further increased by the deferred tax liability associated with the fair market value in excess of the tax basis acquired. The goodwill associated with this transaction has been allocated to our Pressure Control segment.

Due to the timing of the completion of the acquisition, the purchase price and related allocation are preliminary and could be revised as a result of adjustments made to the purchase price, additional information obtained regarding assets acquired and liabilities assumed, and revisions of preliminary estimates of fair values including, but not limited to, certain tangible assets acquired and liabilities assumed, contractual relationships, intangible assets, certain working capital items, deferred income taxes and residual goodwill. These changes to the purchase price allocation could be significant. The purchase price allocation will be finalized within the measurement period of up to one year from the acquisition date.

From the Closing Date through September 30, 2026, Cactus International contributed revenue of $405.5 million and net income of $3.4 million to the Company's unaudited condensed consolidated results of operations.

Intangible assets acquired consist of customer relationships, developed technologies and backlog. The Company amortizes finite-lived intangible assets on a straight-line basis over their respective useful lives. The following table presents the details of identifiable intangible assets acquired and the respective estimated useful lives:

Pro forma financial information

The pro forma financial information below represents the combined results of operations for the three and nine months ended September 30, 2025, as if the acquisition had occurred as of January 1, 2025. There is no pro forma information included for the three and nine months ended September 30, 2026, because the Company’s actual financial results for such period fully reflect the acquisition. The unaudited pro forma combined financial information includes, where applicable, adjustments for additional amortization expense related to the fair value step-up of intangible assets, additional inventory fair value step-up expense, additional depreciation expense associated with adjusting property and equipment to fair value, changes to align accounting policies and associated tax-related impacts of adjustments. These pro forma adjustments are based on available information as of the date hereof and upon assumptions that we believe are reasonable to reflect the impact of the acquisition on our historical financial information on a supplemental pro forma basis. The unaudited pro forma financial information is presented for informational purposes only and is neither indicative of the results of operations that would have occurred if the acquisition had taken place at the beginning of the period presented nor indicative of future operating results.

Subsequent measurement of Mezzanine Equity

Although the non-controlling interest in the Joint Venture classified as Mezzanine Equity is not currently redeemable, redemption is considered probable; therefore, the Company elected Method 2 under ASC 480 and remeasures the Mezzanine Equity to its estimated redemption value each reporting period, with subsequent changes reflected directly in retained earnings. The redemption price is determined in accordance with the terms of the Framework Agreement and is calculated by applying a specified multiple to EBITDA. For additional information, see “Note 14 – Earnings per Share”.

Measurement Period Adjustments

During the second and third quarter of 2026, management recorded certain measurement period adjustments to the preliminary purchase price allocation, which were the result of additional analysis performed, and information identified based on facts and circumstances that existed as of the acquisition date. The most significant of these adjustments are described below.

The Company has recorded a measurement period adjustment to increase the warranty liability previously recorded by $44.4 million as an increase to accrued liabilities. The warranty liability adjustment is based on management's conclusion that a liability for warranty-related costs should have been recognized prior to the acquisition date in accordance with ASC 450, Contingencies. In addition, the Company recorded income tax-related adjustments of $18.9 million related to a decrease in the deferred tax liability and an increase to tax indemnity receivable of $11.4 million in the opening balance sheet as of the acquisition date, with a corresponding net increase to goodwill. The deferred tax liability and tax indemnification receivable adjustments are based on further information becoming available during the measurement period and the impacts of pretax accounting changes. Both adjustments result from facts and circumstances that existed at the acquisition date and were subsequently identified by management within the measurement period. The Company also recorded adjustments to the fair values of property, plant, and equipment, inventories assumed, and accrued expenses based on additional analysis performed in the measurement period through the nine months ended September 30, 2026.

These adjustments represent revisions of the preliminary purchase price allocation and were recorded as if the accounting had been completed at the acquisition date. As such, the adjustments did not result in a material impact to the Company’s previously reported results of operations.

As noted above, the cash purchase price of the Baker Hughes Transaction is subject to certain working capital, cash, debt, capital expenditure and other customary adjustments, which could mitigate potential future impacts on the Company’s cash flow associated with these measurement period adjustments.

Management will continue to evaluate warranty and tax-related information obtained subsequent to the acquisition; however, any changes in estimates related to post-acquisition events or circumstances will be recognized in the period incurred in accordance with the Company’s accounting policies for warranty obligations and deferred taxes. No amortizable tax goodwill was created in the acquisition.

3. Accounts Receivable and Allowance for Credit Losses

We extend credit to customers in the normal course of business. Our customers are predominantly oil and gas exploration and production companies located in the U.S. and the Middle East. Our receivables are short-term in nature and typically due in 30 to 60 days after the billing for the product that has been delivered or the services that have been provided to the customer. We typically do not accrue interest on delinquent receivables. Accounts receivable includes both amounts billed and currently due from customers, as well as unbilled amounts resulting from accrued revenue associated with products delivered and services performed for which billings have not yet been submitted to the customers. Total unbilled revenue included in accounts receivable as of September 30, 2026 and December 31, 2025 was $152.8 million and $39.4 million, respectively.

We maintain an allowance for credit losses to provide for the amount of billed receivables we believe to be at risk of loss. In our determination of the allowance for credit losses, we pool receivables with similar risk characteristics based on customer size, credit ratings, payment history, bankruptcy status and other factors known to us, and then apply an expected credit loss percentage. The expected credit loss percentage is determined using historical loss data, adjusted for current conditions and forecasts of future economic conditions. Accounts deemed uncollectible are applied against the allowance for credit losses. The following is a roll-forward of our allowance for credit losses.

4. Inventories

Inventories are stated at the lower of cost or net realizable value. Cost is generally determined using standard cost, which approximates average cost. Costs include an application of related material, direct labor, duties, tariffs, freight and overhead costs. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Reserves are made for excess and obsolete items based on a range of factors, including age, usage and technological or market changes that may impact demand for those products. Inventories consist of the following:

5. Property and Equipment, net

Property and equipment are stated at cost. We manufacture or construct most of our Pressure Control rental equipment assets. During the manufacture of these assets, they are reflected as construction in progress until complete. Property and equipment consist of the following:

6. Goodwill and Other Intangible Assets

Goodwill represents the excess of purchase price paid over the fair value of the net assets of acquired businesses. Goodwill is not amortized, but we perform an annual goodwill impairment test on December 31, and more frequently if events and circumstances indicate that the asset might be impaired. The change in carrying value of goodwill allocated to our reportable segments during the nine months ended September 30, 2026 was as follows:

The following table presents the detail of acquired intangible assets:

All intangible assets are amortized over their estimated useful lives. The weighted average amortization period for identifiable intangible assets acquired as of September 30, 2026 is 9.1 years. Amortization expense recognized during three and nine months ended September 30, 2026 was $13.6 million and $40.7 million, respectively, and was recorded in selling, general and administrative expenses in the consolidated statements of income. Estimated future amortization expense is as follows:

7. Debt

We hadno bank debt outstanding as of September 30, 2026 and December 31, 2025. As of September 30, 2026, we had $14.7 million in letters of credit outstanding, $1.5 million of which reduced the borrowing capacity under our Amended and Restated Credit Agreement. The Amended and Restated Credit Agreement was originally entered into on February 28, 2023, by and among Cactus Companies, as borrower, certain subsidiaries of Cactus Companies from time to time party thereto, as guarantors, the lenders party thereto and JPMorgan Chase Bank, N.A., as lender, administrative agent, issuing bank and swingline lender (as amended from time to time, the “Amended ABL Credit Facility”). We were in compliance with all covenants under the Amended ABL Credit Facility as of September 30, 2026.

The Amended ABL Credit Facility was amended in December 2025. The amendment established a delayed‑draw term loan facility (the “Term Loan Facility”) and extended the maturity to December 1, 2030. The amendment provided for a Term Loan Facility of up to the lesser of $100.0 million and 85% of the appraised value of eligible machinery and equipment, which could be drawn in up totwo advances during thesix months following December 1, 2025. In June 2026, the Company further amended the Amended ABL Credit Facility to extend the maturity of the Term Loan Facility, with limitations on the scope of use of funds, to December 31, 2026. The Term Loan Facility was undrawn as of September 30, 2026 and December 31, 2025. Any amounts drawn will mature three years from the initial funding date and bear interest, at the borrower’s option, at ABR or SOFR‑based rates plus applicable margins. The unused portion of the Term Loan Facility is subject to a 0.05% monthly unused line fee.

The Amended ABL Credit Facility requires compliance with a maximum leverage ratio of 2.50 to 1.00 for so long as the Term Loan Facility is outstanding or available. Until the Term Loan Facility is repaid or terminated without being drawn, the collateral for the ABL Credit Facility was expanded to include certain equipment and intellectual property of Cactus Companies and its subsidiaries that are guarantors.

The Amended ABL Credit Facility provides up to $225.0 million in revolving commitments, of which $100.0 million is available for the issuance of letters of credit. Subject to certain terms and conditions set forth in the Amended ABL Credit Facility, Cactus Companies may request additional revolving commitments in an amount not to exceed $50.0 million, for a total of up to $275.0 million in revolving commitments. The maximum amount that Cactus Companies may borrow under the Amended ABL Credit Facility is subject to a borrowing base, which is based on a percentage of eligible accounts receivable and eligible inventory, subject to reserves and other adjustments.

Borrowings under the Amended ABL Credit Facility bear interest at Cactus Companies’ option at either (i) the Alternate Base Rate (as defined therein) (“ABR”), or (ii) the Adjusted Term SOFR Rate (as defined therein) (“Term Benchmark”), plus, in each case, an applicable margin. Letters of credit issued under the Amended ABL Credit Facility accrue fees at a rate equal to the applicable margin for Term Benchmark borrowings, plus a fronting fee. The applicable margin for revolving loan borrowings ranges from 0.0% to 0.5% per annum for revolving loan ABR borrowings and 1.25% to 1.75% per annum for revolving loan Term Benchmark borrowings and, in each case, is based on the average quarterly availability of the revolving loan commitment under the Amended ABL Credit Facility for the immediately preceding fiscal quarter. If no amount is outstanding on the Term Loan Facility and the Leverage Ratio (as defined in the Amended ABL Credit Facility) is below 1.50 to 1.00, the applicable margin will be reduced by 0.25%. The unused portion of revolving commitment under the Amended ABL Credit Facility is subject to a commitment fee of 0.25% per annum. At September 30, 2026 and December 31, 2025, although there wereno borrowings outstanding, the applicable margin on our Term Benchmark borrowings was 1.00%, plus the base rate of one, three or six month SOFR plus 0.10%, subject to a floor rate.

In July 2026, Cactus Companies, and Baker Hughes Oilfield Equipment Manufacturing – Sole Proprietorship L.L.C., a 65% owned indirect subsidiary of Cactus Companies that is organized in the UAE (“Cactus UAE”), entered into a Facilities Agreement (the “Facilities Agreement”) with Commercial Bank of Dubai PSC, as lender (“CBD”), Cactus UAE as borrower, and Cactus Companies as guarantor.

The Facilities Agreement provides Cactus UAE with a $75.0 million secured credit facility, with sublimits of (x) $40.0 million for revolving credit borrowings, (y) $35.0 million for bank guarantees, bid bonds, performance bonds and similar obligations, and (z) $10.0 million for letters of credit (with a $35.0 million aggregate limit on the amount of bank guarantees, bid bonds, performance bonds, similar obligations and letters of credit). The credit facility established by the Facilities Agreement is scheduled to terminate on February 28, 2027, but CBD may elect to extend the facility for successive 12-month periods in its sole discretion. The obligations of Cactus UAE under the Facilities Agreement are guaranteed by Cactus Companies and secured by a lien on the accounts receivable and certain other personal property assets of Cactus UAE. The Facility Agreement will be used for working capital and general corporate purposes of Cactus International LLC and its subsidiaries (including Cactus UAE), a group of 65% owned subsidiaries of the Company that hold Baker Hughes Company’s former surface pressure control business.

Revolving credit borrowings under the Facility Agreement will accrue interest at the applicable reference rate set forth in the Facilities Agreement plus 1.85% per annum. Cactus UAE will pay fees to CBD in the amount of (x)0.75% per annum for letters of credit issued under the Facility Agreement, (y)0.75% per annum for bank guarantees, bid bonds, performance bonds and similar obligations issued under the Facility Agreement to beneficiaries located in the UAE, and (z)1.00% per annum for bank guarantees, bid bonds, performance bonds and similar obligations issued under the Facility Agreement to beneficiaries located outside the UAE.

The Facilities Agreement contains customary events of default and various covenants and restrictive provisions that limit the ability of Cactus UAE and, in certain provisions, Cactus Companies, to, among other things, incur additional indebtedness and create liens, make investments or loans, merge or consolidate with other companies if not the surviving entity, sell assets, make certain restricted payments and distributions, and engage in transactions with affiliates. The Facilities Agreement also requires Cactus Companies to (x) maintain a leverage ratio no greater than 2.50 to 1.00 based on a ratio of total indebtedness to EBITDA (as defined in the Amended ABL Credit Facility) and (y) during a Cash Dominion Activation Period (as defined in the Amended ABL Credit Facility), maintain a minimum Fixed Charge Coverage Ratio (as defined in the Amended ABL Credit Facility) of 1.00 to 1.00.

As a result of the Cactus International acquisition, as of September 30, 2026 we have indemnified Baker Hughes for $13.9 million of contingent liabilities associated with letters of credit in support of Cactus International operations, which do not reduce the borrowing capacity under our Amended ABL Credit Facility.

8. Revenue

The majority of our revenues are derived from contracts for fixed consideration, or in the case of rentals, generally for a fixed charge per day while the equipment is in use by the customer, plus repair costs. Product sales generally do not include right of return or other significant post-delivery obligations. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Revenues are recognized when we satisfy a performance obligation by transferring control of the promised goods or providing services to our customers at a point in time, in an amount specified in the contract with our customer which reflects the consideration to which we expect to be entitled in exchange for those goods or services. The majority of our contracts with customers contain a single performance obligation to provide agreed upon products or services. For contracts with multiple performance obligations, we allocate revenue to each performance obligation based on its relative standalone selling price. We do not assess whether promised goods or services are performance obligations if they are immaterial in the context of the contract with the customer. We typically do not incur any material costs of obtaining contracts.

We do not adjust the amount of consideration per the contract for the effects of a significant financing component when we expect, at contract inception, that the period between the transfer of a promised good or service to a customer and when the customer pays for that good or service will generally be one year or less, which is in substantially all cases. Payment terms and conditions vary, although terms generally include a requirement of payment within 30 to 60 days of invoicing. Revenues are recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. We treat shipping and handling associated with outbound freight as a fulfillment cost instead of as a separate performance obligation. We recognize the cost for the associated shipping and handling when incurred as an expense in cost of sales.

We disaggregate revenue into three categories: product revenues, rental revenues and field service and other revenues. Upon completing the Acquisition, we have worldwide sales, with the majority of our revenues being generated in the U.S. and Middle East, with smaller contributions to sales being generated in Australia, Canada, and other international markets. The following table presents our revenues disaggregated by category:

Remaining Performance Obligations

As of September 30, 2026, the aggregate amount of the transaction price allocated to the unsatisfied (or partially unsatisfied) performance obligations was $615.6 million. As of September 30, 2026, the Company expects to recognize revenue of approximately 74%,84% and 90% of the total remaining performance obligations within 1,2, and 3 years, respectively, and the remaining thereafter. Contract modifications could affect both the timing to complete, as well as the amount to be received as the Company fulfills the related remaining performance obligations.

9. Tax Receivable Agreement (“TRA”)

In connection with our initial public offering (“IPO”) in February 2018, we entered into the TRA which generally provides for payment by Cactus Inc. to certain direct and indirect owners of Cactus LLC (after the CC Reorganization, Cactus Companies) of 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax that Cactus Inc. actually realizes, or is deemed to realize in certain circumstances. Cactus Inc. retains the benefit of the remaining 15% of these net cash savings.

The TRA liability is calculated by determining the tax basis subject to the TRA (“tax basis”) and applying a blended tax rate to the basis differences and calculating the resulting iterative impact. The blended tax rate consists of the U.S. federal income tax rate and an assumed combined state and local income tax rate driven by the apportionment factors applicable to each state. Subsequent changes to the measurement of the TRA liability are recognized in the statements of income as a component of other expense, net. As of September 30, 2026, the total liability from the TRA was $272.9 million with $21.3 million reflected in current liabilities based on the expected timing of our next payments. The payments under the TRA will not be conditional on a holder of rights under the TRA having a continued ownership interest in either Cactus Companies or Cactus Inc.

The term of the TRA commenced upon completion of our IPO and will continue until all tax benefits that are subject to the TRA have been utilized or expired, unless we exercise our right to terminate the TRA. If we elect to terminate the TRA early (or it is terminated early due to certain mergers, asset sales, other forms of business combinations or other changes of control), our obligations under the TRA would accelerate and we would be required to make an immediate payment equal to the present value of the anticipated future payments to be made by us under the TRA, and such payment is expected to be substantial. The calculation of anticipated future payments is based upon certain assumptions and deemed events set forth in the TRA, including the assumptions that (i) we have sufficient taxable income to fully utilize the tax benefits covered by the TRA and (ii) any CC Units (other than those held by Cactus Inc.) outstanding on the termination date are deemed to be redeemed on the termination date. Any early termination payment may be made significantly in advance of the actual realization, if any, of the future tax benefits to which the termination payment relates.

We may elect to defer payments due under the TRA if we do not have available cash to satisfy our payment obligations under the TRA. Any such deferred payments under the TRA generally will accrue interest from the due date for such payment until the payment date.

10. Equity

As of September 30, 2026, Cactus Inc. owned 87.5% of Cactus Companies as compared to 86.3% of Cactus Companies as of December 31, 2025. As of September 30, 2026, Cactus Inc. had outstanding 70.1 million shares of Class A common stock (representing 87.5% of the total voting power) and 10.1 million shares of Class B common stock (representing 12.5% of the total voting power).

Redemptions of CC Units

As part of the CC Reorganization in connection with the acquisition of FlexSteel, Cactus Companies acquired all of the outstanding units representing limited liability company interests of Cactus LLC (“CW Units”) in exchange for an equal number of CC Units issued to each of the previous owners of CW Units other than Cactus Inc. In connection with the CC Reorganization, Cactus Inc. and the owners of CC Units entered into the Amended and Restated Limited Liability Company Operating Agreement of Cactus Companies (the “Cactus Companies LLC Agreement”). Pursuant to the Cactus Companies LLC Agreement, holders of CC Units are entitled to redeem their CC Units, which results in additional Class A common stock outstanding. Since our IPO in February 2018, an aggregate of 50.5 million CC Units (including CW Units prior to the CC Reorganization) and a corresponding number of shares of Class B common stock have been redeemed in exchange for shares of Class A common stock.

During the nine months ended September 30, 2026 and 2025,0.9 million and 0.4 million CC Units, respectively together with a corresponding number of shares of Class B common stock, were redeemed in exchange for Class A common stock in accordance with the Cactus Companies LLC Agreement.

Dividends

Aggregate cash dividends of $0.43 and $0.40 per share of Class A common stock were declared during the nine months ended September 30, 2026 and 2025, totaling $30.6 million and $28.0 million, respectively. Cash dividends paid during the nine months ended September 30, 2026 and 2025 totaled $30.5 million and $27.8 million, respectively. Dividends accrue on unvested equity-based awards on the date of record and are paid upon vesting. Dividends are not paid to our Class B common stockholders; however, a corresponding distribution up to the same amount per share as our Class A common stockholders is paid to the owners of CC Units other than Cactus Inc. for any dividends declared on our Class A common stock. See further discussion of the distributions below under “Member Distributions.”

Share Repurchase Program

On June 6, 2023, our board of directors authorized the Company to repurchase shares of its Class A common stock for an aggregate purchase price of up to $150 million. Under our share repurchase program, shares may be repurchased from time to time in open market transactions or block trades, in privately negotiated transactions or any other method permitted under U.S. securities laws, rules and regulations. The repurchase program does not obligate the Company to purchase any particular amount of shares, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion. During the nine months ended September 30, 2026, the Company did not repurchase shares of Class A common stock under the share repurchase program. As of September 30, 2026, $146.3 million remained authorized for future repurchases of Class A common stock under the program.

Member Distributions

Distributions made by Cactus Companies are generally required to be made pro rata among all its members. For the nine months ended September 30, 2026, Cactus Companies distributed $46.2 million to Cactus Inc. to fund its dividend payment and made pro rata distributions to the other members totaling $6.9 million over the same period. During the nine months ended September 30, 2025, Cactus Companies distributed $62.3 million to Cactus Inc. to fund its dividend and estimated tax payments and made pro rata distributions to the other members totaling $10.3 million.

Limitation of Members’ Liability

Under the terms of the Cactus Companies LLC Agreement, the members of Cactus Companies are not obligated for debt, liabilities, contracts or other obligations of Cactus Companies. Profits and losses are allocated to members as defined in the Cactus Companies LLC Agreement.

11. Commitments and Contingencies

Due to the nature of our business, we are, from time to time, involved in routine litigation or subject to disputes or claims related to our business activities, including workers’ compensation claims and employment related disputes.

A range of total possible losses for all litigation matters cannot be reasonably estimated. Based on our consideration of all relevant facts and circumstances, we do not expect the ultimate outcome of currently pending lawsuits or claims against us, other than as discussed below, will have a material adverse effect on our financial position, results of operations or cash flows, however, there can be no assurance as to the ultimate outcome of these matters. With respect to the litigation described below, if there was an adverse outcome, there could be a material impact on our business, financial condition and results of operations. Litigation is subject to inherent uncertainties and management's view may change in the future. Therefore, there can be no assurance as to the ultimate outcome of any dispute or claim.

On August 20, 2021, Cactus filed a complaint against Cameron International Corporation (“Cameron”) in the U.S. District Court for the Southern District of Texas, Civil Action No.: 4:21-cv-02720-ASH, seeking a declaratory judgment that Cactus frac operations do not infringe certain Cameron patents and that such patents are invalid. In response to that action, Cameron has asserted infringement of certain of those patents by Cactus’ SafeLink® frac flow system and is seeking past royalties and other damages related to the alleged infringement. The parties have been unable to reach an amicable settlement. The jury trial, originally scheduled on June 9, 2025, was delayed, and no new trial date has been set. At this time, we are not able to predict the outcome of these claims.

12. Fair Value Measurements

Authoritative guidance on fair value measurements provides a framework for measuring fair value and establishes a fair value hierarchy that prioritizes the inputs used to measure fair value, giving the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 inputs), observable inputs other than quoted prices in active markets (Level 2 inputs) and the lowest priority to unobservable inputs (Level 3 inputs).

The carrying value of cash and cash equivalents, receivables, accounts payable and accrued expenses approximates fair value based on the short-term nature of these accounts.

13. Segment Reporting

We operate intwo business segments that offer different products and services and correspond to the manner in which the Company's Chief Executive Officer (the chief operating decision maker or "CODM") reviews and evaluates operating performance to make decisions about resources to be allocated to each segment.

Our reporting segments are:

•Pressure Control – engaged in the design, manufacture, sale, installation, service and associated rental of wellhead and pressure control equipment utilized during the drilling, completion and production phases of oil and gas wells.

•Spoolable Technologies – engaged in the design, manufacture, sale, installation, service and associated rental of onshore spoolable pipe technologies utilized for production, gathering and takeaway transportation of oil, gas or other liquids.

Financial information by business segment for the three and nine months ended September 30, 2026 and 2025 is summarized below.

(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.

(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.

(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.

(2) For each reportable segment, the 'Selling, general, administrative expenses and other' line items category includes: salaries and wages, stock based compensation amortization expense, depreciation expense, professional fees, rent expense, and other miscellaneous items.

Assets are not reported to the CODM on a segment basis as it is not a meaningful measure used to run the business.

14. Earnings per Share

Basic earnings per share of Class A common stock is calculated by dividing the net income attributable to Cactus Inc. during the period by the weighted average number of shares of Class A common stock outstanding during the same period. Diluted earnings per share of Class A common stock is calculated by dividing the net income attributable to Cactus Inc. during that period by the weighted average number of common shares outstanding, assuming all potentially dilutive shares were issued.

We use the if-converted method to determine the potential dilutive effect of outstanding CC Units and corresponding shares of outstanding Class B common stock. We use the treasury stock method to determine the potential dilutive effect of unvested stock-based compensation awards assuming that the proceeds will be used to purchase shares of Class A common stock. For our unvested performance stock units, we first apply the criteria for contingently issuable shares before determining the potential dilutive effect using the treasury stock method.

The following table summarizes the basic and diluted earnings per share calculations:

(1)Diluted earnings per share does not reflect any incremental shares related to redeemable equity, as such instruments are not participating securities and do not give rise to potentially dilutive common shares. However, the accretion of redeemable equity to its redemption value is treated as a deemed dividend and reduces net income available to common shareholders in the calculation of both basic and diluted earnings per share. Accordingly, the impact of redeemable equity on earnings per share is limited to this income allocation adjustment, with no effect on the weighted-average shares outstanding.

(2)For the nine months ended September 30, 2026, the Company's net income reflects the accretion of redeemable non-controlling interest to its redemption value as of the reporting date. Diluted earnings per share for the nine months ended September 30, 2026 excludes 10.6 million weighted average shares of Class B common stock, as the effect would be anti-dilutive. Diluted earnings per share for the three and nine months ended September 30, 2025 excludes 11.2 million and 11.3 million weighted average shares of Class B common stock, as the effect would be anti-dilutive.

15. Contract Liabilities

Contract liabilities include deferred income primarily on long-term contracts to construct technically complex equipment, long-term product maintenance or extended warranty arrangements and progress collections, which reflects billings in excess of revenue. Contract liabilities consist of the following:

Revenue recognized during the three months ended September 30, 2026 and 2025 that was included in the contract liabilities at the beginning of the period was $17.9 million and $3.5 million, respectively and $1.7 million and $1.9 million of revenue recognized during the nine months ended September 30, 2026 and 2025, respectively, was included in the contract liabilities at the beginning of the period.