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Core Insights - Oil States International (OIS) reported Q2 2025 earnings, highlighting a shift towards offshore and international projects to mitigate declines in U.S. land-based activities [1][4] - Adjusted diluted EPS was $0.09, surpassing Wall Street estimates, while GAAP revenue was $165.4 million, falling short of the expected $170.7 million [1][2] Financial Performance - Q2 2025 adjusted diluted EPS (non-GAAP) was $0.09, a 28.6% increase from $0.07 in Q2 2024 [2] - GAAP revenue decreased by 11.3% year-over-year from $186.4 million in Q2 2024 to $165.4 million in Q2 2025 [2] - Adjusted EBITDA was reported at $21.1 million, reflecting a 100% decline year-over-year [2] - Free cash flow dropped 45.6% from $14.9 million in Q2 2024 to $8.1 million in Q2 2025 [2] Business Segments Performance - The Offshore Manufactured Products segment saw a 5% year-over-year revenue increase to $106.6 million, driven by international and offshore activity [5] - Completion and Production Services revenue fell 37% year-over-year to $29.4 million, despite improved adjusted EBITDA margin to 28% [6] - Downhole Technologies faced a 61% decline in adjusted segment EBITDA, resulting in an operating loss of $4 million due to supply chain issues and weak demand [6] Strategic Focus - The company is focusing on long-term offshore projects that are less sensitive to oil price fluctuations, while addressing challenges in U.S. land operations through restructuring and cost management [4][7] - Offshore and international revenue accounted for 72% of total sales in Q2 2025, up from approximately 63.7% in Q2 2024 [7] Cost Management and Investments - Restructuring costs totaled $3.7 million, with $2.2 million related to Completion and Production Services [8] - Capital expenditures reached $10.3 million, including investments in a new facility in Batam, Indonesia, aimed at supporting offshore expansion [9] Innovation and Recognition - The company received an industry award for its Low Impact Workover Package, showcasing its commitment to developing advanced products [10] Outlook - Full-year 2025 revenue guidance is set between $700 million and $735 million, with EBITDA guidance of $88 million to $93 million [11] - The record backlog and strong international bookings provide some assurance for revenue stability, but ongoing U.S. market weakness may impact future outlook [11][12]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ____________________ FORM 10-Q ____________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 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: 001-16337 OIL STATES INTERNATIONAL, INC. (Exact name of registrant as specified in its ch ...

Financial Data and Key Metrics Changes - The company generated revenues of $165 million and adjusted consolidated EBITDA of $21 million in the second quarter [14] - Net income totaled $3 million or $0.05 per share, with adjusted net income at $5 million or $0.09 per share after excluding certain charges [14] - Cash flow from operations grew 61% sequentially, generating $15 million in the second quarter [11][15] Business Line Data and Key Metrics Changes - Offshore Manufactured Products segment revenues increased 15% sequentially to $107 million, with adjusted segment EBITDA rising 18% [8][14] - Completion and Production Services segment revenues declined 15% to $29 million, while adjusted segment EBITDA was $8 million [10][15] - Downhole Technologies segment generated revenues of $29 million with adjusted segment EBITDA of $1 million, impacted by impairment charges [15] Market Data and Key Metrics Changes - 72% of consolidated revenues were generated from offshore and international projects, reflecting a strategic shift towards these markets [5] - U.S. Land drilling and completion activity saw significant declines, with rig count down 8% and frac spread count down 14% from the previous quarter [6] Company Strategy and Development Direction - The company is focused on optimizing U.S. Land operations while expanding international project-driven revenues [5] - Strategic decisions included exiting three additional land-based facilities and reducing the U.S. Land workforce [10] - The company aims to leverage technology and innovation to drive growth, as evidenced by recent awards for engineering excellence [12] Management's Comments on Operating Environment and Future Outlook - Management noted resilience in offshore and international markets despite geopolitical instability and lower crude oil prices [4] - The company maintains full-year EBITDA guidance between $88 million to $93 million, while revenue guidance is updated to $685 million to $700 million due to U.S. Land operations streamlining [20] - Strong demand for offshore and international products is expected to continue, with a backlog at a decade-high level [18] Other Important Information - Backlog increased to $363 million, with robust bookings of $112 million, yielding a quarterly book ratio of 1.1 times [9] - Capital expenditures in the second quarter were elevated due to ongoing construction of a new manufacturing facility in Indonesia [12] Q&A Session Summary Question: Offshore market outlook and project timing - Management indicated that their projects are more focused on production infrastructure rather than discretionary investments, which are less affected by short-term macroeconomic issues [26] Question: Impact of tariffs on operations - Management anticipates modest cost increases primarily in the downhole segment due to tariffs, but overall impact is expected to be manageable [28] Question: Free cash flow outlook and capital expenditures - Capital expenditures are guided to be around $30 million, with expectations of continued asset sales to offset costs [31][33] Question: Revenue mix and U.S. Land operations - Management clarified that the U.S. Land business is a smaller portion of their overall revenue mix, with ongoing restructuring efforts to improve margins [38][40] Question: Full-year revenue and EBITDA guidance - Management confirmed a step-up in revenues and EBITDA in the fourth quarter, primarily driven by the Offshore Manufactured Products segment [58] Question: Future order flow and offshore activity - Management expressed optimism for continued strong order flow and backlog growth, with expectations for increased offshore activity in 2026 [66]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) Oil States International reported Q2 2025 net income of **$2.8 million** on **$165.4 million** revenue, with offshore strength and sequential Adjusted EBITDA growth offsetting U.S. land challenges [Consolidated Financial Highlights](index=1&type=section&id=Consolidated%20Financial%20Highlights) Oil States International, Inc. reported Q2 2025 net income of **$2.8 million** on revenues of **$165.4 million**, showing sequential revenue growth but a year-over-year decline, with Adjusted EBITDA increasing sequentially due to strong Offshore Manufactured Products performance Consolidated Financial Highlights Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Q2 2024 (Thousands) | Sequential Change (%) | Year-over-Year Change (%) | | :-------------------------------- | :------------------ | :------------------ | :------------------ | :-------------------- | :---------------------- | | Revenues | $165,406 | $159,938 | $186,383 | 3% | (11)% | | Operating income | $5,277 | $5,639 | $2,045 | (6)% | 158% | | Net income | $2,811 | $3,158 | $1,301 | (11)% | 116% | | Adjusted net income | $5,401 | $3,892 | $4,391 | 39% | 23% | | Adjusted EBITDA | $21,089 | $18,732 | $21,306 | 13% | (1)% | - Net income for Q2 2025 was **$3 million**, or **$0.05 per share**[4](index=4&type=chunk) - Consolidated revenues of **$165 million** rose **3%** sequentially, primarily due to strength in the Offshore Manufactured Products segment[4](index=4&type=chunk) - Generated cash flows from operations of **$15 million**[4](index=4&type=chunk) [CEO Commentary](index=2&type=section&id=CEO%20Commentary) CEO Cindy B. Taylor highlighted continued strength in international and offshore activity, driving sequential revenue and Adjusted Segment EBITDA growth in Offshore Manufactured Products, while U.S. land-based segments faced challenges from reduced activity and ongoing restructuring efforts - Consolidated results were driven by continued strength in international and offshore activity, supported by backlog growth[6](index=6&type=chunk) - Offshore Manufactured Products segment revenues increased **15%** sequentially to **$107 million**, with Adjusted Segment EBITDA up **18%**[6](index=6&type=chunk) - Operating results for Completion and Production Services and Downhole Technologies segments were challenged by an industry-wide reduction in U.S. land completion-related activity, with combined revenues and Adjusted EBITDA declining **13%** and **12%** sequentially, respectively[7](index=7&type=chunk) - U.S. land-focused restructuring efforts continued, resulting in the U.S. land-driven revenue mix declining from **36%** in Q2 2024 to **28%** in Q2 2025[8](index=8&type=chunk) - Cash flow generated was used to fund capital expenditures, reduce debt, and repurchase stock, including strategic investments in a new manufacturing facility in Batam, Indonesia, and low-impact rental riser equipment[10](index=10&type=chunk) [Business Segment Results](index=2&type=section&id=Business%20Segment%20Results) The company's Q2 2025 business segment results show strong sequential growth in Offshore Manufactured Products, contrasting with declines in U.S. land-based segments due to reduced activity and restructuring efforts [Offshore Manufactured Products](index=2&type=section&id=Offshore%20Manufactured%20Products) The Offshore Manufactured Products segment demonstrated strong sequential growth in Q2 2025, with increased revenues, operating income, and Adjusted Segment EBITDA, reaching its highest backlog level since September 2015 Offshore Manufactured Products Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Sequential Change (%) | | :------------------------ | :------------------ | :------------------ | :-------------------- | | Revenues | $106,586 | $92,596 | 15% | | Operating income | $16,989 | $14,276 | 19% | | Adjusted Segment EBITDA | $21,105 | $17,926 | 18% | | Adjusted Segment EBITDA margin | 20% | 19% | 1 p.p. | | Bookings | $112,000 | N/A | N/A | | Backlog (as of June 30, 2025) | $363,000 | N/A | N/A | | Quarterly book-to-bill ratio | 1.1x | N/A | N/A | | Year-to-date book-to-bill ratio | 1.2x | N/A | N/A | - Backlog of **$363 million** as of June 30, 2025, is the highest level since September 2015[12](index=12&type=chunk) [Completion and Production Services](index=2&type=section&id=Completion%20and%20Production%20Services) The Completion and Production Services segment experienced sequential declines in revenues, operating income, and Adjusted Segment EBITDA in Q2 2025, primarily due to reduced U.S. land activity and ongoing restructuring efforts, including facility consolidations and workforce reductions Completion and Production Services Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Sequential Change (%) | | :------------------------ | :------------------ | :------------------ | :-------------------- | | Revenues | $29,424 | $34,519 | (15)% | | Operating income | $1,877 | $3,503 | (46)% | | Adjusted Segment EBITDA | $8,254 | $8,801 | (6)% | | Adjusted Segment EBITDA margin | 28% | 25% | 3 p.p. | - The segment recorded **$2.2 million** in non-cash lease impairment and other downsizing charges during Q2 2025 as part of ongoing U.S. land-based business restructuring[14](index=14&type=chunk) [Downhole Technologies](index=3&type=section&id=Downhole%20Technologies) The Downhole Technologies segment reported sequential declines in revenues and Adjusted Segment EBITDA, along with an increased operating loss in Q2 2025, impacted by reduced U.S. land activity and charges related to facility exits Downhole Technologies Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Sequential Change (%) | | :------------------------ | :------------------ | :------------------ | :-------------------- | | Revenues | $29,396 | $32,823 | (10)% | | Operating loss | $(3,992) | $(2,124) | (88)% | | Adjusted Segment EBITDA | $1,220 | $1,905 | (36)% | - The segment recorded **$1.2 million** in non-cash operating lease impairment and severance charges during Q2 2025, primarily associated with the exit of a leased facility[15](index=15&type=chunk) [Corporate](index=3&type=section&id=Corporate) Corporate operating expenses for Q2 2025 totaled **$9.6 million**, showing a sequential decrease Corporate Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Sequential Change (%) | | :-------------------- | :------------------ | :------------------ | :-------------------- | | Corporate Operating Expenses | $9,597 | $10,016 | 4% | | Corporate Adjusted Segment EBITDA | $(9,490) | $(9,900) | 4% | [Financial Performance Details](index=3&type=section&id=Financial%20Performance%20Details) Q2 2025 financial performance details include **$1.7 million** net interest expense, **$15.0 million** operating cash flow, **$8.1 million** free cash flow, and **$53.9 million** cash on-hand, with debt reduction and ABL facility amendments [Interest Expense, Net](index=3&type=section&id=Interest%20Expense,%20Net) Net interest expense for Q2 2025 was **$1.7 million**, including non-cash amortization of deferred debt issuance costs Interest Expense, Net Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Q2 2024 (Thousands) | | :-------------------- | :------------------ | :------------------ | :------------------ | | Net Interest Expense | $1,692 | $1,578 | $2,061 | | Non-cash amortization | $300 | N/A | N/A | [Cash Flows](index=3&type=section&id=Cash%20Flows) The company generated **$15.0 million** in cash flows from operations and **$8.1 million** in free cash flows during Q2 2025, utilizing cash for debt reduction through convertible senior notes purchases and common stock repurchases Cash Flows Table | Metric | Q2 2025 (Thousands) | Q1 2025 (Thousands) | Q2 2024 (Thousands) | | :------------------------------------------ | :------------------ | :------------------ | :------------------ | | Net cash flows provided by operating activities | $14,995 | $9,295 | $10,242 | | Free cash flow | $8,114 | $9,322 | $14,909 | | Purchases of convertible senior notes | $14,800 | N/A | N/A | | Repurchases of common stock | $6,700 | N/A | N/A | - Purchased **$14.8 million** principal amount of **4.75%** convertible senior notes at **97%** of par[18](index=18&type=chunk) - Repurchased **$6.7 million** of common stock, representing **2.3%** of shares outstanding as of March 31, 2025[18](index=18&type=chunk) [Financial Condition](index=3&type=section&id=Financial%20Condition) Cash on-hand totaled **$53.9 million** at June 30, 2025, with no outstanding borrowings under the ABL Facility, which was amended in July 2025 to increase borrowing availability, lower interest charges, and plan for the retirement of remaining Convertible Notes Financial Condition Table | Metric | June 30, 2025 (Thousands) | December 31, 2024 (Thousands) | | :-------------------- | :------------------------ | :---------------------------- | | Cash and cash equivalents | $53,858 | $65,363 | | Current portion of long-term debt | $108,813 | $633 | | Long-term debt | $1,916 | $124,654 | - No borrowings were outstanding under the Company's asset-based revolving credit facility (ABL Facility) at June 30, 2025[19](index=19&type=chunk) - The ABL Facility was amended on July 28, 2025, to provide additional borrowing availability, lower interest charges, and plan for the retirement of remaining Convertible Notes at maturity in April 2026[19](index=19&type=chunk) [Company Information & Disclosures](index=3&type=section&id=Company%20Information%20%26%20Disclosures) This section provides details on Oil States' **2025 Meritorious Engineering Award**, Q2 earnings call, company overview, and cautionary language regarding forward-looking statements [Industry Award](index=3&type=section&id=Industry%20Award) Oil States was recognized by Hart Energy with the **2025 Meritorious Engineering Award** for its Low Impact Workover Package (LIWP), which enhances plug and abandonment operations and safeguards aging wells using field-proven technologies - Recipient of the Hart Energy **2025 Meritorious Engineering Award** for the Low Impact Workover Package™ (LIWP)[4](index=4&type=chunk)[20](index=20&type=chunk) - The LIWP integrates lower riser package and emergency disconnect package technologies to create a tether-free, streamlined system for well intervention and decommissioning[20](index=20&type=chunk) [Conference Call Information](index=4&type=section&id=Conference%20Call%20Information) Details for the Q2 2025 earnings conference call, including date, time, webcast access, and dial-in information, were provided for stakeholders - The conference call was scheduled for July 31, 2025, at 9:00 a.m. Central Daylight Time[21](index=21&type=chunk) - Access to the webcast and replay is available on the Company's website at www.ir.oilstatesintl.com[21](index=21&type=chunk) [About Oil States](index=4&type=section&id=About%20Oil%20States) Oil States International, Inc. is a global provider of manufactured products and services to the energy, industrial, and military sectors, headquartered in Houston, Texas, and publicly traded on the NYSE under the symbol "**OIS**" - Oil States International, Inc. is a global provider of manufactured products and services to customers in the energy, industrial, and military sectors[22](index=22&type=chunk) - The Company's manufactured products include highly engineered capital equipment and consumable products[22](index=22&type=chunk) - Headquartered in Houston, Texas, with manufacturing and service facilities globally, and traded on the NYSE under "**OIS**"[22](index=22&type=chunk) [Cautionary Language Concerning Forward-Looking Statements](index=4&type=section&id=Cautionary%20Language%20Concerning%20Forward-Looking%20Statements) The report includes cautionary language regarding forward-looking statements, emphasizing that such statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations, and the company undertakes no obligation to update them - Forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially[24](index=24&type=chunk) - Risks include changes in tariffs, oil and natural gas supply/demand/prices, exploration activity, global economic conditions, geopolitical conflicts, customer financial health, OPEC+ actions, supply chain disruptions, environmental matters, customer consolidation, and access to capital[24](index=24&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, and the Company undertakes no obligation to update them[24](index=24&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements present the company's Q2 2025 operational results, financial position, and cash flow activities for the three and six months ended June 30, 2025 [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) The Consolidated Statements of Operations provide a detailed breakdown of revenues, costs, and expenses, leading to net income (loss) for the three and six months ended June 30, 2025, compared to prior periods Consolidated Statements of Operations Table | (In Thousands, Except Per Share Amounts) | Three Months Ended June 30, 2025 | Three Months Ended March 31, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :-------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenues: | | | | | | | Products | $107,342 | $100,551 | $108,579 | $207,893 | $202,908 | | Services | $58,064 | $59,387 | $77,804 | $117,451 | $150,737 | | Total Revenues | $165,406 | $159,938 | $186,383 | $325,344 | $353,645 | | Operating income (loss) | $5,277 | $5,639 | $2,045 | $10,916 | $(9,132) | | Net income (loss) | $2,811 | $3,158 | $1,301 | $5,969 | $(12,073) | | Diluted Net income (loss) per share | $0.05 | $0.05 | $0.02 | $0.10 | $(0.19) | [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) The Consolidated Balance Sheets present the company's financial position as of June 30, 2025, compared to December 31, 2024, detailing assets, liabilities, and stockholders' equity Consolidated Balance Sheets Table | (In Thousands) | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | ASSETS | | | | Total current assets | $487,654 | $498,226 | | Property, plant, and equipment, net | $273,674 | $266,871 | | Total assets | $993,745 | $1,005,108 | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | Total current liabilities | $260,451 | $157,703 | | Long-term debt | $1,916 | $124,654 | | Total liabilities | $303,107 | $324,454 | | Total stockholders' equity | $690,638 | $680,654 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The Consolidated Statements of Cash Flows outline the cash generated from or used in operating, investing, and financing activities for the six months ended June 30, 2025, compared to the same period in 2024 Consolidated Statements of Cash Flows Table | (In Thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash flows provided by (used in) operating activities | $24,290 | $(1,118) | | Net cash flows used in investing activities | $(6,916) | $(3,198) | | Net cash flows used in financing activities | $(29,110) | $(17,236) | | Net change in cash and cash equivalents | $(11,505) | $(21,923) | | Cash and cash equivalents, end of period | $53,858 | $25,188 | [Segment Data](index=9&type=section&id=Segment%20Data) The Segment Data provides a detailed breakdown of revenues and operating income (loss) for each business segment: Offshore Manufactured Products, Completion and Production Services, and Downhole Technologies, for the three and six months ended June 30, 2025, and comparable prior periods Segment Data Table | (In Thousands) | Q2 2025 Revenues | Q1 2025 Revenues | Q2 2024 Revenues | Q2 2025 Operating Income (Loss) | Q1 2025 Operating Income (Loss) | Q2 2024 Operating Income (Loss) | | :-------------------------------- | :--------------- | :--------------- | :--------------- | :------------------------------ | :------------------------------ | :------------------------------ | | Offshore Manufactured Products | $106,586 | $92,596 | $101,556 | $16,989 | $14,276 | $14,357 | | Completion and Production Services | $29,424 | $34,519 | $46,421 | $1,877 | $3,503 | $(535) | | Downhole Technologies | $29,396 | $32,823 | $38,406 | $(3,992) | $(2,124) | $(1,141) | | Corporate | N/A | N/A | N/A | $(9,597) | $(10,016) | $(10,636) | | Total | $165,406 | $159,938 | $186,383 | $5,277 | $5,639 | $2,045 | - Offshore Manufactured Products operating income for Q2 2025 included **$0.3 million** in charges related to facility consolidation and relocation[32](index=32&type=chunk) - Completion and Production Services operating income (loss) for Q2 2025 included **$2.2 million** in costs associated with consolidation and exit of underperforming service offerings and locations[33](index=33&type=chunk) - Downhole Technologies operating loss for Q2 2025 included **$1.2 million** in costs primarily associated with the exit of a leased facility[34](index=34&type=chunk) [Reconciliations of GAAP to Non-GAAP Financial Information](index=10&type=section&id=Reconciliations%20of%20GAAP%20to%20Non-GAAP%20Financial%20Information) This section provides reconciliations of GAAP to non-GAAP financial measures, including Adjusted EBITDA, Adjusted Segment EBITDA, Adjusted Net Income, and Free Cash Flow, for enhanced performance analysis [Adjusted EBITDA](index=10&type=section&id=Adjusted%20EBITDA) This section reconciles GAAP net income (loss) to Adjusted EBITDA, a non-GAAP measure used by management to assess debt servicing ability, fund capital expenditures, and compare operating performance, by adding back interest, taxes, depreciation, amortization, impairments, and certain charges, while subtracting gains on extinguishment of convertible notes Adjusted EBITDA Table | (In Thousands) | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------ | :------ | :------ | :------ | :------- | :------- | | Net income (loss) | $2,811 | $3,158 | $1,301 | $5,969 | $(12,073) | | Interest expense, net | $1,692 | $1,578 | $2,061 | $3,270 | $4,162 | | Income tax provision (benefit) | $1,410 | $1,041 | $(665) | $2,451 | $(641) | | Depreciation and amortization expense | $11,898 | $12,025 | $14,698 | $23,923 | $28,893 | | Impairments of operating lease assets | $1,358 | — | — | $1,358 | — | | Facility consolidation/closure and other charges | $2,301 | $930 | $4,426 | $3,231 | $6,935 | | Gains on extinguishment of 4.75% convertible senior notes | $(381) | — | $(515) | $(381) | $(515) | | Adjusted EBITDA | $21,089 | $18,732 | $21,306 | $39,821 | $36,761 | - Adjusted EBITDA increased **13%** sequentially from Q1 2025 to Q2 2025[3](index=3&type=chunk) - Adjusted EBITDA is a non-GAAP measure providing useful information for debt servicing, capital expenditures, and comparing operating performance[36](index=36&type=chunk) [Adjusted Segment EBITDA](index=11&type=section&id=Adjusted%20Segment%20EBITDA) This reconciliation details Adjusted Segment EBITDA for each business segment, a non-GAAP measure derived from operating income (loss) by adjusting for other income/expense, depreciation, amortization, impairments, and specific charges, providing a clearer view of segment-level operational profitability Adjusted Segment EBITDA Table | (In Thousands) | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------ | :------- | :------- | | Offshore Manufactured Products: | | | | | | | Operating income | $16,989 | $14,276 | $14,357 | $31,265 | $24,960 | | Adjusted Segment EBITDA | $21,105 | $17,926 | $20,131 | $39,031 | $35,931 | | Completion and Production Services: | | | | | | | Operating income (loss) | $1,877 | $3,503 | $(535) | $5,380 | $(954) | | Adjusted Segment EBITDA | $8,254 | $8,801 | $8,548 | $17,055 | $15,141 | | Downhole Technologies: | | | | | | | Operating loss | $(3,992) | $(2,124) | $(1,141) | $(6,116) | $(13,220) | | Adjusted Segment EBITDA | $1,220 | $1,905 | $3,114 | $3,125 | $5,305 | | Corporate: | | | | | | | Operating loss | $(9,597) | $(10,016) | $(10,636) | $(19,613) | $(19,918) | | Adjusted Segment EBITDA | $(9,490) | $(9,900) | $(10,487) | $(19,390) | $(19,616) | - Offshore Manufactured Products Adjusted Segment EBITDA increased **18%** sequentially[6](index=6&type=chunk) - Completion and Production Services and Downhole Technologies combined Adjusted EBITDA declined **12%** sequentially[7](index=7&type=chunk) [Adjusted Net Income (Loss), Excluding Charges and Credits](index=12&type=section&id=Adjusted%20Net%20Income%20(Loss),%20Excluding%20Charges%20and%20Credits) This reconciliation presents Adjusted Net Income (Loss) and Adjusted Diluted Net Income Per Share, excluding specific charges and credits, to provide a clearer view of the company's underlying operating performance by removing the impact of non-recurring or non-operational items Adjusted Net Income (Loss), Excluding Charges and Credits Table | (In Thousands, Except Per Share Amounts) | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------------ | :------ | :------ | :------ | :------- | :------- | | Net income (loss) | $2,811 | $3,158 | $1,301 | $5,969 | $(12,073) | | Impairments of operating lease assets | $1,358 | — | — | $1,358 | — | | Facility consolidation/closure and other charges | $2,301 | $930 | $4,426 | $3,231 | $6,935 | | Gains on extinguishment of 4.75% convertible senior notes | $(381) | — | $(515) | $(381) | $(515) | | Total adjustments, net of taxes | $2,590 | $734 | $3,090 | $3,324 | $14,591 | | Adjusted net income, excluding charges and credits | $5,401 | $3,892 | $4,391 | $9,293 | $2,518 | | Adjusted diluted net income per share, excluding charges and credits | $0.09 | $0.06 | $0.07 | $0.16 | $0.04 | - Adjusted net income totaled **$5 million**, or **$0.09 per share**, excluding restructuring charges and credits[4](index=4&type=chunk) - Adjusted net income, excluding charges and credits, is a non-GAAP measure used to compare operating performance across periods[41](index=41&type=chunk) [Free Cash Flow](index=13&type=section&id=Free%20Cash%20Flow) This section reconciles net cash flows provided by operating activities to Free Cash Flow, a non-GAAP measure, by adjusting for capital expenditures and proceeds from asset dispositions, providing insight into the cash available for debt reduction, share repurchases, or other discretionary uses Free Cash Flow Table | (In Thousands) | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------ | :------ | :------ | :------ | :------- | :------- | | Net cash flows provided by (used in) operating activities | $14,995 | $9,295 | $10,242 | $24,290 | $(1,118) | | Less: Capital expenditures | $(10,322) | $(9,158) | $(5,789) | $(19,480) | $(15,881) | | Plus: Proceeds from disposition of property and equipment | $2,532 | $1,685 | $177 | $4,217 | $2,472 | | Proceeds from disposition of assets held for sale | $909 | $7,500 | $10,279 | $8,409 | $10,279 | | Free cash flow | $8,114 | $9,322 | $14,909 | $17,436 | $(4,248) | - Generated **$8.1 million** of free cash flows in Q2 2025[18](index=18&type=chunk) - Free cash flow is a non-GAAP measure that helps assess the cash available after capital expenditures[44](index=44&type=chunk)

Company Overview and Strategy - Oil States is a technology-focused manufacturing and energy services company advancing affordable and reliable energy[5] - The company is focused on supporting traditional oil and gas customers while enabling pathways toward a lower carbon, multi-source energy mix[5] - Approximately 55% of Oil States' revenues are derived from international and offshore markets[20] Financial Performance and Outlook - In 2023, Oil States' consolidated revenues totaled $782 million and Adjusted Segment EBITDA was $128 million[13] - The company generated $31 million in free cash flow in 2023[96] - As of December 31, 2023, the Offshore/Manufactured Products segment backlog totaled $333 million[28] Segment Highlights - Offshore EPC investment for 2023 totaled $38.3 billion, with significant spending in the Middle East (36%) and Latin America (26%)[23] - U S shale market represented 75% of 2023 segment revenues for Downhole Technologies[14] - Well Site Services has over 31,500 stages now successfully completed[41] Technology and Innovation - Oil States has over 50 renewables projects globally since 2009[67] - The company's ActiveHub platform provides remote monitoring and control of assets across the well site[50] - Oil States' Merlin Deepsea Mineral Riser System received OTC's Spotlight on New Technology® award in May 2021[75]

Industry Overview - The Zacks Oil and Gas - Mechanical and Equipment industry provides essential oilfield equipment, including production machinery, pumps, and drilling appliances, to exploration and production companies, which is closely tied to upstream energy expenditures [3] - The industry is currently facing challenges due to rising oil production that may exceed yearly demand growth, leading to a potential decline in prices and reduced demand for drilling and production equipment [1][4] Future Outlook - The U.S. Energy Information Administration (EIA) projects West Texas Intermediate Spot Average prices to be $61.81 per barrel in 2025 and $55.24 per barrel in 2026, significantly lower than the $76.60 per barrel price for 2024, which is expected to discourage exploration and production activities [4] - Exploration and production companies are becoming more conservative in capital spending, prioritizing capital returns over increased production spending, which is likely to further diminish demand for drilling and production equipment [5] Industry Performance - The Zacks Oil and Gas - Mechanical and Equipment industry has a Zacks Industry Rank of 206, placing it in the bottom 16% of over 250 Zacks industries, indicating gloomy near-term prospects [7][8] - Over the past year, the industry has declined by 3.9%, outperforming the broader Zacks Oil - Energy sector's decline of 4.6% but lagging behind the S&P 500's increase of 10.8% [9] Valuation Metrics - The industry is currently trading at an EV/EBITDA ratio of 5.66X, lower than the S&P 500's 16.39X but higher than the sector's 4.59X [11] - Historically, the industry has traded as high as 43.82X and as low as 1.11X over the past five years, with a median of 10.37X [11] Company Insights - Natural Gas Services Group, Inc. (NGS) is benefiting from increased demand for compression equipment due to higher exports of Liquefied Natural Gas (LNG) [14] - Solaris Energy Infrastructure, Inc. (SEI) has maintained stable activity levels despite lower oil prices, with a 25% increase in system activity in the first quarter [18] - Oil States International, Inc. (OIS) is experiencing growth from international customers, particularly in deep ocean extraction, with new orders exceeding deliveries by 1.5 times in the last quarter [20]

Financial Performance - Revenues for Q1 2025 were $159,938, a decrease of 4.0% from $167,262 in Q1 2024, with product revenues increasing by 6.0% to $100,551, while service revenues decreased by 18.6% to $59,387[13]. - Net income for Q1 2025 was $3,158, compared to a net loss of $13,374 in Q1 2024, marking a significant turnaround[14]. - Operating income improved to $5,639 in Q1 2025 from a loss of $11,177 in Q1 2024, indicating better operational efficiency[13]. - Cash flows from operating activities were $9,295 in Q1 2025, a recovery from cash used of $11,360 in Q1 2024[22]. - The company reported comprehensive income of $8,697 in Q1 2025, compared to a comprehensive loss of $16,401 in Q1 2024, driven by positive currency translation adjustments[14]. - The company reported a net increase in contract assets of $7.8 million for Q1 2025, primarily due to $20.6 million in revenue recognized during the period[36]. - The company’s income tax expense for the three months ended March 31, 2025, was $1.0 million, compared to $24 thousand for the same period in 2024[58]. - The company’s capital expenditures for the three months ended March 31, 2025, amounted to $9.2 million[66]. - Consolidated total revenues for the first three months of 2025 decreased by $7.3 million, or 4%, compared to the same period in 2024, primarily due to the exit of underperforming service offerings which generated $16.8 million in revenues in Q1 2024[108]. - Net income for the first three months of 2025 was $3.2 million, or $0.05 per share, compared to a net loss of $13.4 million, or $0.21 per share, in Q1 2024, which included a non-cash goodwill impairment charge of $10.0 million[106]. Assets and Liabilities - Total assets decreased to $990,735 as of March 31, 2025, from $1,005,108 at the end of 2024, reflecting a reduction in overall asset base[17]. - As of March 31, 2025, total accounts receivable was $186.3 million, a decrease from $197 million as of December 31, 2024, with an allowance for doubtful accounts of 1%[34]. - Total long-term debt as of March 31, 2025, was $124.7 million, slightly up from $124.7 million as of December 31, 2024[41]. - The company’s deferred revenue (contract liabilities) decreased by $1.5 million to $50.9 million as of March 31, 2025[35]. - The company’s inventories increased to $255.1 million as of March 31, 2025, compared to $253.8 million as of December 31, 2024[37]. - The company had $123.5 million principal amount of 2026 Notes outstanding as of March 31, 2025, with a maturity date of April 1, 2026[135]. - Total debt represented 15% of the combined total debt and stockholders' equity as of March 31, 2025, down from 16% as of December 31, 2024[144]. Shareholder Activities - The weighted average number of common shares outstanding decreased to 60,167 in Q1 2025 from 62,503 in Q1 2024, reflecting share repurchase activities[13]. - The company purchased 1.0 million shares of common stock at a total cost of $5.3 million during the three months ended March 31, 2025, leaving $36.0 million remaining under the current share repurchase authorization[54]. - The company repurchased $5.3 million of common stock during Q1 2025, leaving $36.0 million remaining under the share repurchase authorization[139]. - A total of 1,493,961 shares were purchased from January 1 through March 31, 2025, at an average price of $5.19 per share[160]. - The Board of Directors authorized a $50 million share repurchase program, with $14 million utilized as of March 31, 2025[161]. Operational Efficiency - The company incurred $12,025 in depreciation and amortization expenses in Q1 2025, down from $14,195 in Q1 2024, suggesting a reduction in asset depreciation[13]. - The company’s amortization expense for Q1 2025 was $3.8 million, down from $4.3 million in Q1 2024[40]. - Selling, general and administrative expenses for the quarter were $22.496 million, with $9.129 million attributed to corporate expenses[68]. - Corporate expenses increased by $0.7 million, or 8%, in Q1 2025 compared to Q1 2024, primarily due to higher performance-based incentive compensation costs[126]. - The Downhole Technologies segment reported an operating loss of $2.1 million in Q1 2025, an improvement from a $12.1 million loss in Q1 2024, which included a $10.0 million goodwill impairment charge[125]. Market Conditions and Future Outlook - Management expects that the trade conflict and increased crude oil production could adversely affect demand for the company's products and services, particularly in the United States, over the balance of 2025[84]. - The company expects continued volatility in crude oil and natural gas prices due to geopolitical conflicts and economic conditions, which may impact customer capital investment decisions[88]. - The average price of Brent crude oil for the quarter ended March 31, 2024, was $82.92 per barrel, while WTI crude averaged $77.50 per barrel[82]. - The spot price of WTI crude oil declined approximately 20% in April 2025 due to trade tariffs and OPEC+ plans to increase production, raising uncertainties about future demand[83]. Strategic Investments - The company is investing in research and product development for alternative energy sources, including offshore wind and deep-sea mineral gathering opportunities[92]. - The company expects to invest approximately $25 million in capital expenditures during 2025, funded by available cash and internally generated funds[133].

Financial Data and Key Metrics Changes - The company reported revenues of $160 million for Q1 2025, meeting the guidance range of $160 million to $170 million, with adjusted EBITDA of $19 million, exceeding the expected range of $17.5 million to $18.5 million [4][11] - Adjusted net income totaled $4 million, or $0.06 per share, after excluding facility exit charges of $1 million [11] - Cash flow from operations was $9 million, reversing the historical trend of negative cash flow in Q1 due to seasonal working capital [5][12] Business Line Data and Key Metrics Changes - Offshore Manufactured Products segment generated revenues of $93 million with an adjusted EBITDA of $18 million, resulting in an adjusted EBITDA margin of 19%, down from 23% in the previous quarter [11][12] - Completion and Production Services segment reported revenues of $35 million and adjusted EBITDA of $9 million, with an adjusted EBITDA margin of 25%, significantly up from 12% in the fourth quarter [11][12] - Downhole Technologies segment generated revenues of $33 million with adjusted EBITDA of $2 million [12] Market Data and Key Metrics Changes - The company experienced strong demand in international and offshore regions, leading to bookings of $136 million and the highest backlog since September 2015, with a book-to-bill ratio of 1.5 times for the quarter [5][14] - Despite economic volatility and potential tariff impacts, the company anticipates that the majority of its backlog, which consists of projects outside the U.S., will remain largely unaffected [14][16] Company Strategy and Development Direction - The company plans to focus on organic growth opportunities, research and development, debt repayment, and share repurchases to drive value for customers and stockholders [16] - Strategic actions have been implemented to mitigate potential negative impacts from tariffs, including optimizing the supply chain and adjusting pricing to customers [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for offshore and international products, despite potential pressures from domestic market conditions and crude oil prices [14][16] - The company expects strong free cash flow generation for the full year, with cash flow from operations projected to range between $65 million and $75 million [13][16] Other Important Information - The company plans to be opportunistic regarding share repurchases due to low stock prices and aims to maintain a robust free cash flow yield [16][32] - The anticipated impact of tariffs on costs is estimated to be in the range of 5% to 10% higher, particularly affecting the Downhole Technologies segment [38] Q&A Session Summary Question: Insights on bookings and backlog - Management noted that long-term development drilling programs are less affected by short-term commodity price fluctuations, indicating confidence in ongoing projects [20][21] Question: Sequential improvement in Completion and Production Services - Management highlighted that the recovery in Gulf operations and cost reduction efforts contributed to improved margins, with expectations for continued positive performance [25][28] Question: Balance sheet and capital allocation strategy - Management confirmed a focus on aggressive share repurchases and debt reduction, given the current low stock price and upcoming debt maturity [30][32] Question: Impact of tariffs on costs - Management indicated that the tariff impacts are expected to be minimal, with similar cost increases anticipated across competitors in the Downhole Technologies segment [38][40]

Financial Data and Key Metrics Changes - The company reported revenues of $160 million for Q1 2025, meeting the guidance range of $160 million to $170 million, with adjusted EBITDA of $19 million, exceeding the expected range of $17.5 million to $18.5 million [5][13] - Adjusted net income totaled $4 million, or $0.06 per share, after excluding facility exit charges of $1 million [13] - Cash flow from operations was $9 million, reversing the historical trend of negative cash flow in Q1 due to seasonal working capital [6][13] Business Line Data and Key Metrics Changes - Offshore Manufactured Products segment generated revenues of $93 million with an adjusted EBITDA of $18 million, resulting in an adjusted EBITDA margin of 19%, down from 23% in the previous quarter [13][14] - Completion and Production Services segment reported revenues of $35 million and adjusted EBITDA of $9 million, with an adjusted EBITDA margin of 25%, significantly up from 12% in the fourth quarter [13][14] - Downhole Technologies segment generated revenues of $33 million with adjusted EBITDA of $2 million [14] Market Data and Key Metrics Changes - The company experienced strong demand in international and offshore regions, leading to bookings of $136 million and the highest backlog since September 2015, with a book-to-bill ratio of 1.5 times [6][17] - Despite concerns over tariffs and potential economic impacts, the company anticipates that operations outside the U.S. will remain largely unaffected [9][12] Company Strategy and Development Direction - The company plans to focus on organic growth opportunities, research and development, debt repayment, and share repurchases to drive value for shareholders [18] - Strategic actions have been implemented to mitigate potential negative impacts from tariffs, including optimizing the supply chain and adjusting pricing [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for offshore and international products, despite potential pressures from domestic market conditions and crude oil prices [17] - The company maintained its full-year revenue guidance of $700 million to $735 million and EBITDA guidance of $88 million to $93 million, citing strong bookings and improved margins [18] Other Important Information - The company generated $9 million from the monetization of equipment and inventory, which was used for capital expenditures and share repurchases [6][14] - Planned capital expenditures for the year are expected to total $25 million, with a significant portion allocated to the new facility in Batam, Indonesia [14][15] Q&A Session Summary Question: Insights on bookings and backlog - Management noted that long-cycle projects, particularly in development drilling, are less affected by short-term commodity price fluctuations, indicating a stable outlook for ongoing projects [21][22] Question: Impact of Gulf operations on margins - Management confirmed that Gulf operations were a major driver of margin improvement, with expectations for continued positive activity in the region [27][30] Question: Share repurchase strategy amidst low stock prices - The company plans to be aggressive in share repurchases given the current low stock price, while also considering debt reduction as a priority [31][34] Question: Potential tariff impacts on costs - Management indicated that tariff impacts are expected to be minimal, with potential cost increases in the Downhole Technologies segment being manageable through price adjustments [40][42]