Microcap companies can be prone to lumpy revenue performance, following a less linear growth trajectory which rivals an EKG chart. This is especially true if their end-markets have very strong sensitivity to customer cap-ex spending or if they have exposure to government-financed large-scale projects, which come and go. Larger companies can better absorb pockets of market softness and "smooth-out" results via market and product diversification. So how to follow the bouncing ball and pick a good entry point ...

Zacks Investment Research has recently initiated coverage of Geospace Technologies Corporation (GEOS) , assigning a "Neutral" recommendation to the company's shares. This assessment comes amid a mixed outlook for the company, which has been making notable strides in the seismic instruments and equipment space despite industry challenges. Geospace Technologies, headquartered in Houston, TX, is known for designing and manufacturing seismic instruments and equipment primarily for the oil and gas industry. The ...

Financial Data and Key Metrics Changes - For the second quarter of fiscal year 2024, the company reported revenue of $24.3 million, a decrease from $31.4 million in the same period last year, resulting in a net loss of $4.3 million or $0.32 per diluted share compared to a net income of $4.6 million or $0.35 per diluted share in the prior year [40][38][18] - For the six-month period ended March 31, 2024, revenue increased to $74.3 million from $62.5 million last year, with net income of $8.4 million or $0.62 per diluted share compared to $4.5 million or $0.35 per diluted share in the previous year [63][18] Business Line Data and Key Metrics Changes - The oil and gas market segment generated revenue of $10.8 million for the second quarter, down 41% from $18.4 million in the same period last year [6] - The adjacent markets segment reported revenue of $12.2 million, marking the third highest quarterly revenue in the company's history, nearly matching last year's record [4] - Industrial product revenue for the second quarter was $9 million, down from $9.6 million in the prior year, with a six-month revenue of $15.5 million, a 12% decrease compared to the same period in 2023 [21] Market Data and Key Metrics Changes - The emerging markets segment contributed $1.1 million in revenue for the second quarter, significantly up from $191,000 in the same period last year, with six-month revenue of $1.3 million compared to $284,000 in the previous year [46] Company Strategy and Development Direction - The company is focusing on creating a stable revenue source from adjacent markets through expanded product lines, which is seen as less volatile compared to the oil and gas market segment [43] - A stock repurchase program has been authorized for up to $5 million, indicating confidence in the company's valuation and future prospects [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for the second half of the fiscal year, anticipating better utilization of ocean-bottom nodes, which should enhance performance in the oil and gas market segment [4] - The company acknowledged challenges in the rental business due to timing issues and industry-wide capacity constraints, with expectations for improved conditions in the latter half of the year [27][28] Other Important Information - The company maintains a strong balance sheet with no debt and over $51 million in cash and short-term investments [38] - Operating expenses increased by 5% in the second quarter due to higher research and development costs, while decreasing by 4% for the six-month period due to lower personnel costs from workforce reductions [22] Q&A Session Summary Question: Insights on rental business and project timing - Management indicated that while there are projects in the pipeline, significant rental revenue is not expected until the fourth quarter of the fiscal year due to timing and capacity issues [15][25] Question: Future revenue opportunities from Quantum technology - Discussions regarding Quantum technology are ongoing, with potential applications in both energy revenue generation and carbon capture, though specific details remain confidential due to intellectual property concerns [34][39] Question: Timing for contracts to turn into revenue - Management noted that some contracts may take time to convert into revenue, with ongoing discussions in the energy sector expected to yield results in the next fiscal year [55][31]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended March 31, 2024 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from ____ to ____ Commission file number 001-13601 GEOSPACE TECHNOLOGIES CORPORATION (Exact Name of Registrant as Specified in Its Charter) Texas 76-0447780 (State ...

[Financial Highlights & Management Commentary](index=1&type=section&id=Financial%20Highlights%20%26%20Management%20Commentary) [Second Quarter & Six-Month Fiscal 2024 Results](index=1&type=section&id=Second%20Quarter%20%26%20Six-Month%20Fiscal%202024%20Results) Geospace Technologies reported a net loss in Q2 FY2024 with revenue declining to $24.3 million, yet the six-month period showed strong growth to $74.3 million revenue and $8.4 million net income, driven by a significant Q1 equipment sale Q2 FY2024 Financial Performance (Three Months Ended Mar 31, 2024) | Metric | Q2 FY2024 | Q2 FY2023 | | :--- | :--- | :--- | | Revenue | $24.3 million | $31.4 million | | Net Income (Loss) | ($4.3 million) | $4.6 million | | Diluted EPS | ($0.32) | $0.35 | Six-Month FY2024 Financial Performance (Ended Mar 31, 2024) | Metric | Six Months FY2024 | Six Months FY2023 | | :--- | :--- | :--- | | Revenue | $74.3 million | $62.5 million | | Net Income | $8.4 million | $4.5 million | | Diluted EPS | $0.62 | $0.35 | [Management's Comments](index=1&type=section&id=Management%27s%20Comments) Management highlighted that despite a second-quarter net loss due to low utilization of its OBX and Mariner ocean bottom nodes, the company remains on track for full-year profitability, supported by a strong first six months - The Q2 net loss of **$4.3 million** was primarily caused by low utilization of OBX and Mariner ocean bottom nodes, partly because a rental contract was converted into a **$30 million** sale in Q1[5](index=5&type=chunk) - The company maintains a strong balance sheet with no debt and **$51.2 million** in cash and short-term investments as of March 31, 2024[5](index=5&type=chunk) - The Adjacent Markets segment had its third-best quarterly performance, generating **$12.2 million** in revenue, reinforcing the strategy to create a stable revenue source[6](index=6&type=chunk) - The Emerging Markets segment contributed **$1.1 million** in Q2 revenue, largely from a DARPA contract, with ongoing discussions for security and energy monitoring projects[7](index=7&type=chunk) [Segment Performance Analysis](index=2&type=section&id=Segment%20Performance%20Analysis) [Oil and Gas Markets Segment](index=2&type=section&id=Oil%20and%20Gas%20Markets%20Segment) The Oil and Gas Markets segment revenue decreased by 41% year-over-year for the second quarter to $10.8 million, due to lower utilization of the marine OBX rental fleet Oil and Gas Markets Segment Revenue | Period | FY2024 | FY2023 | Change | | :--- | :--- | :--- | :--- | | Three Months | $10.8M | $18.4M | -41% | | Six Months | $50.8M | $38.6M (recalculated) | +32% | - The six-month revenue increase was primarily due to a **$30 million** sale of Mariner™ shallow water ocean bottom nodes in Q1 FY2024[8](index=8&type=chunk) - Management anticipates strong demand and increased utilization of the ocean bottom nodal rental fleet in the second half of fiscal year 2024[8](index=8&type=chunk) [Adjacent Markets Segment](index=2&type=section&id=Adjacent%20Markets%20Segment) The Adjacent Markets segment reported a slight revenue decrease of 4% to $12.2 million for the second quarter and a 6% decrease to $22.1 million for the six-month period Adjacent Markets Segment Revenue | Period | FY2024 | FY2023 | Change | | :--- | :--- | :--- | :--- | | Three Months | $12.2M | $12.7M | -4% | | Six Months | $22.1M | $23.5M | -6% | - The revenue decrease was caused by lower demand for water meter and industrial sensor products[9](index=9&type=chunk) - The decline was partly offset by higher demand for contract manufacturing services and thermal film products[9](index=9&type=chunk) [Emerging Markets Segment](index=2&type=section&id=Emerging%20Markets%20Segment) The Emerging Markets segment generated revenue of $1.1 million in the second quarter and $1.3 million for the six-month period, a significant increase from the prior year Emerging Markets Segment Revenue | Period | FY2024 | FY2023 | Change | | :--- | :--- | :--- | :--- | | Three Months | $1.1M | $0.2M (recalculated) | +483% | | Six Months | $1.3M | $0.3M | +333% | - The revenue increase in both periods is attributed to work performed on a **$1.5 million** government contract[10](index=10&type=chunk) [Financial Position and Corporate Developments](index=2&type=section&id=Financial%20Position%20and%20Corporate%20Developments) [Balance Sheet and Liquidity](index=2&type=section&id=Balance%20Sheet%20and%20Liquidity) As of March 31, 2024, Geospace maintained a strong liquidity position with $51.2 million in cash and short-term investments, no outstanding borrowings, and an available credit line of $11.3 million - The company holds **$51.2 million** in cash and short-term investments with an additional **$11.3 million** available under its credit agreement and no outstanding debt[12](index=12&type=chunk) - For the six months ended March 31, 2024, net cash used in operating activities was **$6.3 million**, while net cash provided by investing activities was **$8.1 million**[11](index=11&type=chunk) - Management anticipates a capital expenditure budget of **$12 million** for fiscal year 2024, including **$7 million** for additions to its rental equipment[12](index=12&type=chunk) [Corporate Announcements](index=2&type=section&id=Corporate%20Announcements) Geospace announced two significant corporate actions: the appointment of Richard Kelley as Executive Vice President and Chief Operating Officer, and the authorization of a stock repurchase program - On April 29, 2024, Richard Kelley was appointed as Executive Vice President and Chief Operating Officer[13](index=13&type=chunk) - The Board of Directors authorized a new stock repurchase program, allowing the company to buy back up to **$5 million** of its common stock[15](index=15&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended March 31, 2024, total revenues were $74.3 million, a significant increase from $62.5 million in the prior-year period Statement of Operations Highlights (Six Months Ended March 31) | Metric (in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenue | $74,302 | $62,479 | | Gross Profit | $28,117 | $23,483 | | Income from Operations | $8,331 | $4,098 | | Net Income | $8,352 | $4,540 | [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2024, the company's total assets were $157.7 million, up from $153.0 million at September 30, 2023, while total liabilities decreased and stockholders' equity increased Balance Sheet Highlights (in thousands) | Metric | March 31, 2024 | September 30, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $20,762 | $18,803 | | Total Current Assets | $92,083 | $75,778 | | Total Assets | $157,698 | $153,042 | | Total Liabilities | $15,504 | $20,326 | | Total Stockholders' Equity | $142,194 | $132,716 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended March 31, 2024, net cash used in operating activities was $6.3 million, while investing activities provided $8.1 million, primarily from the sale of rental equipment Cash Flow Highlights (Six Months Ended March 31, in thousands) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(6,271) | $(5,078) | | Net cash provided by investing activities | $8,096 | $12,154 | | Net cash from financing activities | $0 | $(175) | | Increase in cash and cash equivalents | $1,959 | $6,696 | [Summary of Segment Revenue and Operating Income](index=8&type=section&id=Summary%20of%20Segment%20Revenue%20and%20Operating%20Income) For the six months ended March 31, 2024, the Oil and Gas Markets segment was the primary driver of operating income, contributing $11.4 million, with Adjacent Markets also contributing positively Operating Income (Loss) by Segment (Six Months Ended March 31, in thousands) | Segment | 2024 | 2023 | | :--- | :--- | :--- | | Oil and Gas Markets | $11,428 | $6,582 | | Adjacent Markets | $4,830 | $4,802 | | Emerging Markets | $(1,276) | $(2,220) | | Corporate | $(6,651) | $(5,066) | | **Total Operating Income** | **$8,331** | **$4,098** |

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Q1 FY2024 financial statements show significant improvements in assets, revenue, and net income, with positive operating cash flow [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$167.4 million** by December 31, 2023, primarily due to higher receivables, boosting stockholders' equity Consolidated Balance Sheet Highlights (in thousands) | Account | Dec 31, 2023 (in thousands) | Sep 30, 2023 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $99,993 | $75,778 | | Trade accounts and note receivable, net | $41,969 | $21,373 | | Cash and cash equivalents | $18,907 | $18,803 | | **Total Assets** | **$167,383** | **$153,042** | | **Total Liabilities** | **$21,076** | **$20,326** | | **Total Stockholders' Equity** | **$146,307** | **$132,716** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Total revenue surged to **$50.0 million** in Q1 FY2024, a **60.8% increase**, leading to a net income of **$12.7 million** from a prior-year net loss Statement of Operations Summary (in thousands, except per share data) | Metric | Q1 FY2024 (ended Dec 31, 2023) (in thousands) | Q1 FY2023 (ended Dec 31, 2022) (in thousands) | | :--- | :--- | :--- | | **Total Revenue** | **$50,032** | **$31,109** | | Gross Profit | $22,236 | $10,534 | | Income (loss) from operations | $12,837 | $(279) | | **Net Income (loss)** | **$12,679** | **$(97)** | | Diluted EPS | $0.94 | $(0.01) | - Product revenue more than doubled to **$43.7 million** from **$19.5 million** year-over-year, while rental revenue decreased to **$6.3 million** from **$11.6 million**[11](index=11&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was **$2.7 million** in Q1 FY2024, a significant improvement, with cash ending at **$18.9 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended Dec 31, 2023 (in thousands) | Three Months Ended Dec 31, 2022 (in thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $2,652 | $(4,864) | | Net cash provided by (used in) investing activities | $(2,740) | $242 | | Net cash used in financing activities | $0 | $(175) | | **Increase (decrease) in cash** | **$104** | **$(4,754)** | | **Cash and cash equivalents, end of period** | **$18,907** | **$11,355** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, segment performance, and risk factors, highlighting significant Oil and Gas Markets revenue and concentrated customer credit risk - The Oil and Gas Markets segment generated **$39.9 million** in revenue, while the Adjacent Markets segment contributed **$9.8 million** for the quarter ended December 31, 2023[64](index=64&type=chunk) - As of December 31, 2023, two customers represented a significant concentration of credit risk, with combined trade accounts and notes receivable of **$33.6 million** and **$2.4 million**, respectively[66](index=66&type=chunk) - The company's Russian subsidiary (GTE) had a net carrying value of **$5.7 million**, including **$1.8 million** in cash that may be difficult to repatriate due to government restrictions[72](index=72&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=15&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the **60.8%** revenue increase to a **$30.0 million** Mariner™ node sale, while maintaining strong liquidity and addressing industry and geopolitical risks [Consolidated Results of Operations](index=16&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated revenue for Q1 FY2024 increased **60.8%** to **$50.0 million** due to a **$30.0 million** Mariner™ node sale, boosting gross profit and reducing operating expenses - Consolidated revenue for the three months ended December 31, 2023, increased by **$18.9 million** (**60.8%**) year-over-year, largely due to a **$30.0 million** sale of Mariner™ shallow water ocean bottom nodes[108](index=108&type=chunk) - The company does not expect the significant increase in revenue seen in Q1 to continue for the remaining three quarters of fiscal year 2024[108](index=108&type=chunk) - Consolidated operating expenses decreased by **$1.4 million** (**13.1%**) YoY, mainly due to lower personnel costs from a prior-year workforce reduction and reduced R&D expenditures[110](index=110&type=chunk) [Segment Results of Operations](index=16&type=section&id=Segment%20Results%20of%20Operations) Oil and Gas Markets revenue surged **98.1%** to **$39.9 million** due to a major product sale, while Adjacent Markets revenue declined, and Emerging Markets' loss narrowed Segment Revenue and Operating Income (in thousands) | Segment | Revenue Q1 FY24 (in thousands) | Revenue Q1 FY23 (in thousands) | Operating Income (Loss) Q1 FY24 (in thousands) | Operating Income (Loss) Q1 FY23 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Oil and Gas Markets | $39,909 | $20,148 | $14,563 | $2,406 | | Adjacent Markets | $9,815 | $10,822 | $2,034 | $1,747 | | Emerging Markets | $234 | $93 | $(625) | $(1,213) | - Oil and Gas Markets' wireless exploration product revenue increased by **120.9%** YoY, driven by a **$30.0 million** sale of Mariner™ nodes, which replaced a rental contract[113](index=113&type=chunk) - Adjacent Markets' industrial product revenue decreased by **18.8%** due to lower demand for water meter and industrial sensor products[116](index=116&type=chunk) [Liquidity and Capital Resources](index=18&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with **$34.0 million** in cash and investments, supported by positive operating cash flow and available credit - At December 31, 2023, the company had **$34.0 million** in cash and cash equivalents and short-term investments[119](index=119&type=chunk) - The company has a revolving credit facility with **$15 million** maximum availability, with no outstanding borrowings and **$14.9 million** of availability as of December 31, 2023[123](index=123&type=chunk)[124](index=124&type=chunk) - The company expects to receive payment on a **$28.7 million** receivable related to the Mariner™ sale in the second quarter of fiscal year 2024[126](index=126&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=19&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, the company is exempt from detailed market risk disclosures under Regulation S-K - As a smaller reporting company, Geospace Technologies is exempt from providing the market risk disclosures typically required under this item[133](index=133&type=chunk) [Controls and Procedures](index=19&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of December 31, 2023, with no material changes to internal controls - Based on an evaluation as of December 31, 2023, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[135](index=135&type=chunk) - No changes in internal control over financial reporting occurred during the fiscal quarter that have materially affected, or are reasonably likely to materially affect, these controls[136](index=136&type=chunk) [PART II. OTHER INFORMATION](index=20&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Exhibits](index=20&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial data in Inline XBRL format - The exhibits filed with the report include CEO and CFO certifications pursuant to Rule 13a-14(a) and 18 U.S.C. Section 1350[138](index=138&type=chunk)[140](index=140&type=chunk) - Financial statements and notes are provided in Inline Extensible Business Reporting Language (iXBRL) format[140](index=140&type=chunk)

Financial Performance - Consolidated revenue for fiscal year 2023 was $124.5 million, an increase of $35.3 million, or 39.5%, from fiscal year 2022[146] - Consolidated gross profit for fiscal year 2023 was $51.7 million, an increase of $33.6 million, or 186.5%, from fiscal year 2022[147] - Cash generated from operating activities for fiscal year 2023 was $15.6 million, with net income of $12.2 million[158] - Cash and cash equivalents increased by $17.0 million during fiscal year 2023, totaling approximately $33.7 million at year-end[165] Revenue Growth by Market - Revenue from Oil and Gas Markets products for fiscal year 2023 increased $24.9 million, or 50.6%, from fiscal year 2022[151] - Wireless exploration product revenue for fiscal year 2023 increased $20.2 million, or 49.6%, primarily due to increased rental revenue from the OBX rental fleet[151] - Revenue from Adjacent Markets products for fiscal year 2023 increased $9.9 million, or 25.2%, from the prior fiscal year[153] - Revenue from Emerging Markets products for fiscal year 2023 was $1.2 million, compared to $0.7 million from the prior fiscal year[154] - Industrial product revenue increased by $11.2 million, or 43.8%, primarily due to higher demand for water meter products[157] Operating Income and Loss - Operating income associated with Oil and Gas Markets products for fiscal year 2023 was $15.8 million, compared to an operating loss of $(7.5) million from the prior fiscal year[152] - Operating income from Adjacent Markets products for fiscal year 2023 was $11.5 million, an increase of $5.5 million, or 90.8% from the prior fiscal year[153] - Operating loss from Emerging Markets products for fiscal year 2023 was $4.0 million, compared to $9.1 million from the prior fiscal year[155] Future Expectations - The company expects fiscal year 2024 cash investments in the rental fleet to be approximately $9 million and in property, plant, and equipment to be approximately $4 million[159] - Revenue from oil and gas reservoir products is expected to increase slightly in fiscal year 2024 compared to fiscal year 2023[185] - Revenue from Adjacent Markets products is anticipated to increase in fiscal year 2024 due to the acquisition of Aquana and integration of its products[186] - The company expects fiscal year 2024 revenue from Emerging Markets products to increase due to optimism in obtaining new security-related contracts[187] Cost Management and Financial Position - The company implemented a plan to discontinue certain low margin products, expecting annual savings of more than $2 million[141] - The company has no outstanding borrowings under its credit agreement, with a borrowing base availability of $13.1 million[164] - The company is subject to contingent compensation costs related to the acquisition of Aquana, with no maximum limit on potential payments[168] Product Revenue Changes - Imaging product revenue decreased by $1.4 million, or 10.0%, due to lower demand for imaging equipment[157]

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited consolidated financial statements and management's financial analysis [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements show significant financial improvement, transitioning from net loss to net income [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$145.7 million** by June 30, 2023, driven by higher cash and equity growth Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2023 | September 30, 2022 | | :--- | :--- | :--- | | **Total Current Assets** | $76,376 | $59,961 | | **Total Assets** | $145,683 | $135,056 | | **Total Current Liabilities** | $16,127 | $12,627 | | **Total Liabilities** | $16,726 | $13,409 | | **Total Stockholders' Equity** | $128,957 | $121,647 | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The company achieved a significant turnaround, reporting net income for Q3 and nine months ended June 30, 2023 Statement of Operations Summary (in thousands, except per share data) | Metric | Q3 2023 | Q3 2022 | Nine Months 2023 | Nine Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | $32,715 | $20,691 | $95,194 | $63,382 | | **Gross Profit** | $13,979 | $3,651 | $37,462 | $12,163 | | **Income (Loss) from Operations** | $3,146 | $(6,534) | $7,244 | $(15,069) | | **Net Income (Loss)** | $3,228 | $(6,574) | $7,768 | $(14,816) | | **Diluted EPS** | $0.24 | $(0.51) | $0.59 | $(1.14) | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations turned positive, increasing cash and equivalents by **$11.2 million** by June 30, 2023 Cash Flow Summary for Nine Months Ended June 30 (in thousands) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | $3,128 | $(13,281) | | **Net Cash from Investing Activities** | $8,326 | $8,678 | | **Net Cash from Financing Activities** | $(175) | $(1,713) | | **Increase (Decrease) in Cash** | $11,155 | $(6,598) | | **Cash and Cash Equivalents, End of Period** | $27,264 | $7,468 | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, segment performance, debt, and risks including customer concentration and geopolitical events - As of June 30, 2023, the company held **$2.1 million** in cash in its Russian subsidiary, which may be difficult or costly to repatriate due to government-imposed restrictions[24](index=24&type=chunk) Segment Revenue (in thousands) - Nine Months Ended June 30 | Segment | 2023 | 2022 | | :--- | :--- | :--- | | Oil and Gas Markets | $56,239 | $34,317 | | Adjacent Markets | $38,392 | $28,312 | | Emerging Markets | $393 | $571 | - The company has significant customer concentration risk, with two customers accounting for receivables of **$5.9 million** and **$4.7 million**, and revenues of **$25.9 million** and **$9.3 million**, respectively, for the nine months ended June 30, 2023[79](index=79&type=chunk) - The net carrying value of the company's Russian subsidiary (GTE) was **$6.2 million** as of June 30, 2023. The ongoing conflict in Ukraine and related sanctions pose a significant risk to these operations[86](index=86&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses significant revenue and profit growth from increased demand in key segments, supported by strong liquidity [Consolidated Results of Operations](index=21&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated revenue increased by **50.2%** to **$95.2 million**, with gross profit surging **208.0%** Year-over-Year Financial Performance Comparison | Metric | Nine Months 2023 | Nine Months 2022 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $95.2M | $63.4M | +50.2% | | **Gross Profit** | $37.5M | $12.2M | +208.0% | - The increase in revenue was largely due to higher rental revenue from the Oil and Gas Markets segment (increased OBX fleet utilization) and higher demand for industrial products from the Adjacent Markets segment[121](index=121&type=chunk) [Segment Results of Operations](index=21&type=section&id=Segment%20Results%20of%20Operations) Oil and Gas Markets revenue grew **55.6%** due to OBX fleet utilization; Adjacent Markets revenue increased **35.6%** - Oil and Gas Markets revenue for the nine months ended June 30, 2023, increased by **$21.9 million (55.6%)**, primarily due to higher utilization of the OBX rental fleet[127](index=127&type=chunk) - Adjacent Markets revenue for the nine months ended June 30, 2023, increased by **$10.1 million (35.6%)**, driven by higher demand for water meter products[129](index=129&type=chunk)[133](index=133&type=chunk) - The Emerging Markets segment's operating loss decreased by **$0.3 million (9.5%)** for the nine-month period, mainly due to lower personnel costs from a workforce reduction[131](index=131&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity strengthened with **$27.3 million** in cash and a new **$15 million** revolving credit facility - The company had **$27.3 million** in cash and cash equivalents as of June 30, 2023, with no long-term debt outstanding[134](index=134&type=chunk)[140](index=140&type=chunk) - On July 26, 2023, the company entered into a new credit agreement for a revolving credit facility with a maximum availability of **$15 million**, expiring in July 2025[139](index=139&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=22&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, the company is exempt from providing quantitative and qualitative disclosures about market risk - As a smaller reporting company defined by Rule 12b-2 of the Exchange Act, the company is exempt from providing quantitative and qualitative disclosures about market risk[148](index=148&type=chunk) [Item 4. Controls and Procedures](index=23&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal controls - Based on an evaluation as of June 30, 2023, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[150](index=150&type=chunk) - No changes occurred during the fiscal quarter ended June 30, 2023, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[151](index=151&type=chunk) [PART II. OTHER INFORMATION](index=23&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section includes other required information, such as exhibits filed with the report [Item 6. Exhibits](index=23&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including certifications from the CEO and CFO and financial data - The exhibits filed with this report include certifications from the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) and 18 U.S.C. Section 1350[153](index=153&type=chunk)

Geospace Technologies Corporation (NASDAQ:GEOS) Q2 2023 Earnings Conference Call May 12, 2023 10:00 AM ET Company Participants Rick Wheeler - President and Chief Executive Officer Robert Curda - Chief Financial Officer Conference Call Participants Scott Bundy - Moors & Cabot Bill Dezellem - Tieton Capital. Dennis Scannell - Rutabaga Capital Operator Good day and welcome to the Geospace Technologies’ Second Quarter 2023 Earnings Conference Call. Hosting the call today from Geospace is Mr. Rick Wheeler, Presi ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended March 31, 2023 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from ____ to ____ Commission file number 001-13601 GEOSPACE TECHNOLOGIES CORPORATION (Exact Name of Registrant as Specified in Its Charter) Texas 76-0447780 (State ...