Acquisition and Growth Strategy - NRG Energy's anticipated acquisition of the LSP Portfolio may not be completed in a timely manner or at all, which poses a risk to the company's growth strategy [7]. - NRG's ability to realize expected benefits from the integration of the LSP Portfolio may be impacted by the timely completion of the acquisition [7]. - The Company entered into a definitive agreement to acquire a power portfolio from LS Power for $6.4 billion in cash and 24.25 million shares of common stock, expected to close in Q1 2026 [55]. - The acquisition will also involve assuming approximately $3.2 billion of debt, with funding expected from newly-issued debt and cash on hand [55]. - A commitment letter for a 364-day Senior Secured Bridge Facility of up to $4.4 billion was established to fund part of the cash consideration for the acquisition [56]. - The Company acquired six power generation facilities in Texas, adding 738 MW of natural gas-fired assets for $560 million, enhancing its integrated supply strategy [58]. Financial Performance - Revenue for Q3 2025 was $7,635 million, a 5.7% increase from $7,223 million in Q3 2024 [15]. - Operating income for Q3 2025 was $414 million, compared to a loss of $812 million in Q3 2024 [15]. - Net income for Q3 2025 was $152 million, a significant recovery from a net loss of $767 million in Q3 2024 [17]. - Cash provided by operating activities for the nine months ended September 30, 2025, was $1,790 million, up from $1,354 million in the same period of 2024 [24]. - Total revenue from contracts with customers for Q3 2025 was $7,503 million, compared to $7,282 million in Q3 2024, reflecting a 3.0% increase [50]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $1,548 million, up from $1,470 million in the same period of 2024 [15]. Assets and Liabilities - Total assets as of September 30, 2025, were $23,971 million, slightly down from $24,022 million at the end of 2024 [20]. - Total liabilities increased to $22,001 million as of September 30, 2025, compared to $21,544 million at the end of 2024 [21]. - The company reported a basic income per share of $0.70 for Q3 2025, compared to a loss of $3.79 per share in Q3 2024 [15]. - Cash and cash equivalents decreased to $732 million as of September 30, 2025, from $966 million at the end of 2024 [20]. - The company reported deferred revenues of approximately $1.6 billion as of September 30, 2025, compared to $1.5 billion as of December 31, 2024 [53]. Shareholder Returns and Equity - NRG Energy's common stock dividends declared were $0.44 per share for each quarter ended September 30, June 30, and March 31, 2025 [25]. - The company is actively repurchasing shares under a $3.7 billion program initiated in 2023, with an additional $3.0 billion authorized on October 16, 2025, to be executed through 2028 [125]. - Total share repurchases under the $3.7 billion authorization reached 43,328,079 shares, with an average price of $73.26 per share, totaling $3,175 million [126]. - The annual dividend was increased to $1.76 per share from $1.63, with a quarterly dividend of $0.44 declared for the three months ended September 30, 2025 [128]. - The company targets an annual dividend growth rate of 7%-9% per share in subsequent years, with an increase to $1.90 per share beginning in the first quarter of 2026 [128]. Operational Efficiency and Risk Management - The company reported a significant focus on increasing cash from operations through operational efficiencies and asset strategy, aiming to reduce costs and generate revenues [9]. - NRG's operational risks include price volatility in fuel and electricity, which can impact financial performance [7]. - The company is focused on integrating and realizing cost savings from acquired businesses, which is essential for achieving intended financial results [9]. - NRG's strategy includes addressing climate change challenges while capitalizing on business opportunities in the energy sector [9]. - The company faces potential operational and reputational risks related to the use of AI and compliance with evolving regulations [7]. Legal and Regulatory Matters - NRG is involved in various legal proceedings, including environmental lawsuits related to groundwater contamination, which have been ongoing since 2012 [154]. - The NYSPSC issued a follow-up order on September 23, 2025, alleging non-compliance with regulatory requirements, which could lead to potential fines and other consequences [168]. - NRG is subject to increasingly stringent environmental regulations, which may require additional emissions controls and could materially affect its financial position [169]. - The company has established an adequate accrual for legal matters, including regulatory and environmental issues, based on current information [152]. - The company intends to vigorously defend against various consumer lawsuits and regulatory challenges, asserting that it has complied with applicable laws [157].

Financial Performance - Gross written premiums for Q3 2025 reached $606.5 million, a 51.6% increase from $400.0 million in Q3 2024[112] - Net written premiums for the nine months ended September 30, 2025, were $1.12 billion, up 32% from $852.6 million in the same period of 2024[112] - The company reported a net income of $45.9 million for Q3 2025, compared to $36.7 million in Q3 2024, reflecting a 25.5% year-over-year growth[112] - Adjusted operating income for Q3 2025 was $44.0 million, up from $29.4 million in Q3 2024, representing a 49.5% increase[113] - Net written premiums for Q3 2025 were $441.2 million, up 64.4% from $268.3 million in Q3 2024, with a year-to-date increase of 31.8% to $1,123.7 million compared to $852.6 million in the same period of 2024[120] - Net earned premiums for Q3 2025 increased by 30.5% to $351.8 million from $269.6 million in Q3 2024, with a year-to-date increase of 24.1% to $947.7 million compared to $763.5 million in the same period of 2024[121] Underwriting Performance - The loss and LAE ratio improved to 60.8% in Q3 2025 from 63.3% in Q3 2024, indicating better underwriting performance[112] - The combined ratio for the nine months ended September 30, 2025, was 89.6%, an improvement from 90.9% in the same period of 2024[112] - Total losses and LAE for Q3 2025 were $213.8 million, representing 60.8% of net earned premiums, an improvement from 63.3% in Q3 2024[123] - The expense ratio for Q3 2025 improved to 28.4% from 28.9% in Q3 2024, driven by earnings leverage despite higher acquisition costs[125] - Non-cat loss and LAE ratios improved by 0.4 points in Q3 2025 compared to Q3 2024, reflecting a favorable business mix shift[124] Investment Performance - Net investment income for Q3 2025 was $22.2 million, an increase of $2.6 million compared to $19.5 million in Q3 2024, attributed to higher income from the fixed income portfolio[127] - The investment portfolio's carrying value as of September 30, 2025, was $2.39 billion, up from $1.99 billion at the end of 2024, with fixed income representing 75.8% of the total portfolio[130] - As of September 30, 2025, the total fixed income portfolio was $1,815,216 thousand, an increase of 37.7% from $1,318,708 thousand at December 31, 2024[131] - The weighted average credit rating of the available-for-sale fixed income portfolio decreased from "AA-" in 2024 to "A+" in 2025[132] - The fair value of AAA-rated securities decreased from $483,099 thousand (37.3%) in 2024 to $311,740 thousand (17.3%) in 2025[132] Acquisition and Corporate Actions - The company announced an acquisition of Apollo Group Holdings Limited for $555.0 million, expected to close in Q1 2026[109] - The company recognized $3.1 million in acquisition-related expenses associated with the pending acquisition of Apollo[109] - The company approved a share repurchase program of up to $50.0 million in October 2024, with no shares repurchased as of September 30, 2025[150] Financial Strength and Ratings - The company has a financial strength rating of "A" (Excellent) with a stable outlook from A.M. Best Company[111] - A.M. Best affirmed the company's financial strength rating of A (Excellent) with a stable outlook on August 14, 2025[155] Cash Flow and Debt Management - Cash provided by operating activities increased to $356,308 thousand in the nine months ended September 30, 2025, compared to $283,216 thousand in the same period of 2024[139] - The ratio of total debt to total capitalization decreased from 13.1% at December 31, 2024, to 11.1% at September 30, 2025[149] - The company had $43.0 million outstanding under the Revolving Credit Facility as of September 30, 2025, with $107.0 million of undrawn capacity[144] Tax and Retention Metrics - The effective tax rate for the three months ended September 30, 2025, was 24.2%, up from 21.7% in the same period of 2024, primarily due to non-deductible acquisition expenses[136] - The net retention on a written basis for the three months ended September 30, 2025, was 72.7%, compared to 67.1% for the same period in 2024[153] Specialty Programs - Specialty programs saw a significant increase in gross written premiums, rising by 52.1% to $82.8 million in Q3 2025 compared to $54.4 million in Q3 2024[119] - Agriculture and credit (re)insurance gross written premiums surged by 886.3% to $168.1 million in Q3 2025 from $17.0 million in Q3 2024[119]

Financial Performance - Net income for the three and nine months ended September 30, 2025, totaled $16.3 million and $44.0 million, respectively, compared to $10.9 million and $32.4 million for the same periods in 2024, representing an increase of 49.54% and 35.68%[158]. - Net income for the nine months ended September 30, 2025, was $43,963 thousand, a 36.1% increase from $32,354 thousand in 2024[166]. - Basic earnings per common share increased to $0.77 for the three months ended September 30, 2025, compared to $0.52 in 2024, reflecting a growth of 48.1%[166]. Asset Growth - Total assets were $4.6 billion at September 30, 2025, reflecting a $588.5 million, or 14.52%, increase compared to $4.1 billion at December 31, 2024[159]. - Total assets increased to $4,641,770 thousand as of September 30, 2025, from $4,053,278 thousand at the end of 2024, reflecting a growth of 14.5%[161]. - Total loans held for investment rose to $3.9 billion at September 30, 2025, an increase of $354.6 million, or 10.04%, from $3.5 billion at December 31, 2024[159]. Deposits - Total deposits increased by $545.4 million, or 15.33%, from $3.6 billion at December 31, 2024, to $4.1 billion at September 30, 2025[159]. - Non-interest-bearing deposits increased by $136.5 million in the first nine months of 2025 to $1.1 billion, representing 25.81% of total deposits at September 30, 2025[159]. - Total deposits grew to $4,103,438 thousand as of September 30, 2025, from $3,557,994 thousand in 2024, marking an increase of 15.4%[161]. Loan Portfolio - The average balance of loans increased by $477.8 million, or 14.25%, during the three months ended September 30, 2025, contributing to the rise in interest income[171]. - Total loans held for investment grossed $3.9 billion, with consumer and other loans making up 7.15% of the total[218]. - Commercial real estate loans accounted for 80.86% of total loans, amounting to $3.1 billion as of September 30, 2025, up from 80.75% or $2.9 billion at December 31, 2024[218]. Interest Income and Margin - Net interest income for the three months ended September 30, 2025, increased by $9.0 million, or 29.49%, compared to the same period in 2024, reaching $39,348 thousand[166]. - The net interest margin improved to 3.56% and 3.52% for the three and nine months ended September 30, 2025, compared to 3.37% and 3.30% for the same periods in 2024[159]. - Total interest income for the three months ended September 30, 2025, was $64.8 million, and $207.0 million for the year ended December 31, 2024[318]. Non-Interest Income - Non-interest income rose to $1,966 thousand for the three months ended September 30, 2025, up from $1,381 thousand in 2024, marking an increase of 42.3%[166]. - Non-interest income for the nine months ended September 30, 2025, totaled $5.1 million, a 7.27% increase from $4.8 million in the same period of 2024[185]. - Loan-related fees increased by 32.70% to $1.6 million for the nine months ended September 30, 2025, compared to $1.2 million in 2024[185]. Expenses - Total non-interest expense for the nine months ended September 30, 2025, was $47.4 million, an increase of 18.36% from $40.0 million in 2024[198]. - Salaries and employee benefits for the nine months ended September 30, 2025, increased by 18.89% to $27.8 million from $23.3 million in 2024[198]. - The provision for income taxes for the nine months ended September 30, 2025, was $16.8 million, up from $13.0 million in 2024, reflecting an increase in pre-tax income[205]. Capital and Ratios - The total risk-based capital ratio for the Company was 13.59% at September 30, 2025, compared to 13.99% at December 31, 2024, remaining above well-capitalized regulatory thresholds[159]. - As of September 30, 2025, Bancorp's total capital to risk-weighted assets ratio was 13.59%, exceeding the required minimum of 8.00%[305]. - The allowance for credit losses to total loans held for investment was 1.08% as of September 30, 2025, slightly up from 1.07% in 2024, indicating stable asset quality[161]. Risk Management - The company has implemented strong risk management practices, including annual evaluations of income property loans and semi-annual stress testing[227]. - The company has established internal concentration limits for commercial real estate loans by sector, with all loan sectors remaining within established limits as of September 30, 2025[226]. - Nonperforming loans consist of non-accrual loans and loans contractually past due by 90 days or more, impacting the overall asset quality assessment[238]. Liquidity - Total liquidity was approximately $2.3 billion as of September 30, 2025, which includes cash and cash equivalents and unused borrowing capacity[288]. - Cash and cash equivalents increased to $580.4 million as of September 30, 2025, up $228.1 million from $352.3 million at December 31, 2024[209]. - Cash inflows from deposits amounted to $545.4 million during the nine months ended September 30, 2025[280]. Dividends - The board of directors declared a cash dividend of $0.20 per share on July 17, 2025[159]. - The Company paid dividends totaling $4.3 million during the three months ended September 30, 2025, with an expected quarterly dividend rate of $0.20 per share[291][292].

Financial Performance - For the three months ended September 30, 2025, the company originated $41.7 billion in loans, an increase of $2.2 billion, or 5.6%, from $39.5 billion in the same period of 2024[129]. - The net income for the three months ended September 30, 2025, was $12.1 million, a decrease of $19.9 million compared to $31.9 million for the same period in 2024[129]. - Adjusted EBITDA for the three months ended September 30, 2025, was $211.1 million, compared to $107.2 million for the same period in 2024[129]. - For the nine months ended September 30, 2025, the company originated $113.8 billion in loans, an increase of $13.1 billion, or 13.0%, from $100.8 billion in the same period of 2024[131]. - The net income for the nine months ended September 30, 2025, was $79.5 million, a decrease of $209.2 million compared to $288.8 million for the same period in 2024[131]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $464.6 million, compared to $341.8 million for the same period in 2024[131]. - Total revenue for Q3 2025 was $843,252,000, a 13.1% increase from $745,598,000 in Q3 2024[136]. - Loan production income for Q3 2025 reached $542,144,000, up 16.5% from $465,548,000 in Q3 2024[139]. - Total loan production income for the nine months ended September 30, 2025 was $1,294,777,000, a 15.4% increase from $1,121,611,000 in the same period of 2024[145]. Loan Origination and Sales - 93% of loans originated in the three months ended September 30, 2025, were sold to Fannie Mae or Freddie Mac, or transferred to Ginnie Mae pools[122]. - The company retains the MSRs associated with the majority of its production but intends to opportunistically sell MSRs depending on market conditions[123]. - The company focuses exclusively on the wholesale channel, which aligns its interests with clients and enhances customer service[124]. - Total loan origination volume for Q3 2025 was $41,742,070,000, a 5.6% increase from $39,536,046,000 in Q3 2024[141]. - Loan origination fees increased by approximately $17,764,000 for Q3 2025, reflecting a 13.2% rise from Q3 2024[139]. - The weighted average loan to value ratio for originated loans was 81.90% for the three months ended September 30, 2025, with a weighted average FICO score of 736[239]. Income and Expenses - Loan servicing income for Q3 2025 was $169.0 million, an increase of $34.3 million or 25.4% compared to $134.8 million in Q3 2024[147]. - Servicing costs for Q3 2025 increased by $8.9 million to $33.9 million, a rise of 35.7% from $25.0 million in Q3 2024[148]. - For the nine months ended September 30, 2025, loan servicing income was $538.3 million, up $75.0 million or 16.2% from $463.4 million in the same period of 2024[149]. - Net interest income for Q3 2025 was $51.8 million, an increase of $16.1 million or 45.0% from $35.7 million in Q3 2024[152]. - Other costs for Q3 2025 totaled $384.6 million, an increase of $56.5 million or 17.2% compared to $328.0 million in Q3 2024[164]. - Salaries, commissions, and benefits for Q3 2025 increased by $41.3 million or 22.8% to $222.8 million, driven by an increase in team member count[164]. Cash Flow and Liquidity - Net cash used in operating activities decreased to $2.75 billion for the nine months ended September 30, 2025, compared to $5.70 billion for the same period in 2024[214]. - Net cash provided by investing activities was $2.10 billion for the nine months ended September 30, 2025, down from $2.58 billion in 2024[215]. - Net cash provided by financing activities was $1.02 billion for the nine months ended September 30, 2025, compared to $3.26 billion for the same period in 2024[217]. - As of September 30, 2025, cash and cash equivalents totaled $870.70 million, an increase from $636.33 million at the end of September 2024[213]. - The company believes its cash on hand and liquidity sources will be sufficient to maintain operations and fund loan originations for the next twelve months[177]. Risk Management - The company is exposed to counterparty risk from financing facilities and interest rate risk hedging activities, which could lead to financial loss if a counterparty defaults[240]. - The company manages counterparty risk by selecting financially strong counterparties and spreading risk among multiple entities[240]. - The company executes trading agreements with material trading partners to limit overall counterparty exposure through margin requirements[241]. - Master netting agreements are in place, allowing the company to offset amounts due to and from the same counterparty[241]. - The company mitigates financing risk by ensuring sufficient borrowing capacity with well-established counterparties[242]. - Long-term relationships with counterparties are fostered to meet the company's funding needs[242]. Debt and Financing - UWM issued $1.0 billion in aggregate principal amount of senior unsecured notes due March 15, 2031, with a 6.25% interest rate[196]. - As of September 30, 2025, UWM had $87.1 million outstanding under sale and repurchase agreements collateralized by retained investment securities[210]. - The weighted average interest rate for borrowings under MSR facilities was 7.17% for the three months ended September 30, 2025, down from 8.14% in 2024[206]. - UWM entered into a Loan and Security Agreement with Citibank, providing up to $1.5 billion of uncommitted borrowing capacity for mortgage servicing rights[200]. - The total uncommitted borrowing capacity of the Conventional MSR Facility and warehouse facility was increased to $2.0 billion as of June 27, 2024[202]. - As of September 30, 2025, the total advanced against warehouse facilities was $9.78 billion, with $900 million of these line amounts committed[186][187]. Dividends and Commitments - The Board declared a dividend of $0.10 per share of Class A common stock for an aggregate amount of $23.4 million, paid on October 9, 2025[219]. - As of September 30, 2025, the total interest rate lock commitments were $17.16 billion for fixed rate and $590.68 million for variable rate[225]. - Commitments to sell loans amounted to $3.66 billion, while forward commitments to sell mortgage-backed securities were $18.84 billion as of September 30, 2025[225].

Financial Performance - Total revenues for Q3 2025 were $1,263 million, a decrease of 3.2% compared to $1,305 million in Q3 2024[184]. - The net loss attributable to common stockholders for Q3 2025 was $2 million, compared to a net income of $84 million in Q3 2024[184]. - Total revenues for the nine months ended September 30, 2025, increased by $69 million (2%) to $3,709 million compared to $3,640 million for the same period in 2024[186]. - The company reported a net loss attributable to common stockholders of $(155) million in Q3 2025, compared to $(136) million in Q3 2024[240]. - The company reported net income attributable to common stockholders of $123 million for the nine months ended September 30, 2025[280]. Vacation Ownership Sales - Vacation ownership product sales decreased to $358 million in Q3 2025 from $387 million in Q3 2024, reflecting a decline of 7.5%[184]. - Total contract sales for Vacation Ownership decreased by $21 million (4%) to $442 million in Q3 2025 compared to $463 million in Q3 2024[185]. - Sale of vacation ownership products decreased to $358 million in Q3 2025, down 8% from $387 million in Q3 2024[204]. - Contract sales for the third quarter of 2025 were $439 million, a decrease of 4% compared to $459 million in Q3 2024[204]. - Sale of vacation ownership products for the first three quarters of 2025 increased by 3% to $1,083 million compared to $1,048 million in the same period of 2024[209]. Operational Efficiency and Cost Management - The company expects to achieve annualized benefits of $150 million to $200 million from its Strategic Business Operations initiatives by the end of 2026[178]. - Annual cost savings of approximately $20 million are expected from the reorganization of corporate overhead in human resources and finance[179]. - The company is focused on modernizing processes and systems to drive operational efficiencies and revenue growth[178]. - Modernization expenses amounted to $51 million in Q3 2025, with a total of $94 million for the first three quarters, reflecting significant investment in operational efficiencies[243][244]. Revenue and Profit Margins - Adjusted EBITDA for Q3 2025 was $170 million, a decrease of $30 million (15%) compared to $200 million in Q3 2024[194]. - The Adjusted EBITDA margin for Q3 2025 was 20.9%, down 3.2 percentage points from 24.1% in Q3 2024[194]. - The segment adjusted EBITDA margin for Vacation Ownership was 26.1% for Q3 2025, down from 30.2% in Q3 2024, a decline of 4.1 percentage points[203]. - The average revenue per member declined by $1.02 (3%) to $37.91 in Q3 2025 from $38.93 in Q3 2024[185]. Financing and Debt Management - Financing revenue increased to $90 million in Q3 2025, up from $87 million in Q3 2024, representing a growth of 3.4%[184]. - The company had a corporate debt to Adjusted EBITDA ratio of 4.1 as of September 30, 2025, exceeding the targeted range of 2.5 to 3.0[258]. - The company issued $575 million in senior unsecured notes during the third quarter of 2025, receiving net proceeds of $567 million[266]. - Total material cash requirements amount to $8,038 million, with $4,085 million attributed to debt obligations[277]. Member Engagement and Active Membership - The average revenue per member for the Interval Network is a key metric for measuring member engagement[183]. - Total active members at the end of the period decreased by 46, or 3%, to 1,499,000 in Q3 2025 from 1,545,000 in Q3 2024[185]. Tax and Valuation Adjustments - The effective tax rate for Q3 2025 was impacted by a $25 million increase in valuation allowances, with a provision for income taxes of $(3) million compared to $(34) million in Q3 2024[249][250]. - For the nine months ended September 30, 2025, there was a $25 million increase in tax adjustments due to changes in valuation allowances, partially offset by $13 million in tax benefits from restructuring activities[253]. Other Financial Metrics - The company recorded litigation charges of $3 million in Q3 2025, up from $2 million in Q3 2024[201]. - The company recorded a non-cash impairment charge of $31 million in the third quarter of 2025 related to completed vacation ownership units and land[226]. - The company recorded a $2 million impairment related to an operating lease during the first three quarters of 2025[238]. - The company recorded $2 million of foreign currency translation gains in Q3 2025, while the first three quarters saw $23 million in such gains[247][248].

Revenue and Production - Crude oil, NGL, and natural gas revenues for the nine months ended September 30, 2025, increased due to the Arrangement with Enerplus, which expanded operations primarily in the Williston Basin[134] - Production volumes averaged 280,857 Boepd (55% oil), including crude oil volumes of 155,698 Bopd in the third quarter of 2025[135] - Crude oil revenues increased by $31.9 million to $910.8 million for the three months ended September 30, 2025, primarily due to higher realized prices and production volumes sold[138] - NGL revenues decreased by $3.7 million to $24.8 million for the three months ended September 30, 2025, mainly due to lower realized prices[140] - Natural gas revenues decreased by $11.6 million to $31.2 million for the three months ended September 30, 2025, primarily due to lower realized prices and production volumes sold[141] - For the nine months ended September 30, 2025, crude oil revenues increased by $145.0 million to $2,745.9 million, with $491.4 million attributed to expanded operations[143] - Natural gas revenues increased by $103.0 million to $159.9 million for the nine months ended September 30, 2025, with $69.0 million attributed to expanded operations[145] Financial Performance - Net cash provided by operating activities was $559.0 million, and net income was $130.1 million in the third quarter of 2025[135] - Net cash provided by operating activities for the nine months ended September 30, 2025, was $1,635.7 million, an increase of $104.9 million compared to the same period in 2024[184] - The effective tax rate was 131.3% for the nine months ended September 30, 2025, significantly impacted by a goodwill impairment charge[168] Expenses and Costs - E&P and other capital expenditures (excluding capitalized interest) were $333.7 million in the third quarter of 2025[135] - Lease operating expenses ("LOE") were $9.62 per Boe in the third quarter of 2025[135] - Total operating expenses for the nine months ended September 30, 2025, were $3,606.7 million, an increase from $2,975.4 million in the prior year[147] - Lease operating expenses decreased by $8.4 million to $248.6 million for the three months ended September 30, 2025, due to reduced workover activity[148] - Purchased oil and gas expenses increased by $109.2 million to $340.9 million for the three months ended September 30, 2025, due to higher volumes and prices[149] - Production taxes increased by $10.5 million to $79.5 million for the three months ended September 30, 2025, with a production tax rate of 8.2%, up from 7.3% in the previous quarter[150] - General and administrative expenses decreased by $10.7 million to $21.9 million for the three months ended September 30, 2025, primarily due to lower corporate and merger-related costs[151] - Lease operating expenses increased by $155.7 million to $738.6 million for the nine months ended September 30, 2025, driven by expanded operations and increased workover costs[156] - Gathering, processing, and transportation expenses rose by $26.0 million to $220.5 million for the nine months ended September 30, 2025, primarily due to expanded operations[157] - Purchased oil and gas expenses decreased by $337.7 million to $684.1 million for the nine months ended September 30, 2025, attributed to lower crude oil prices and volumes[158] - Production taxes decreased by $21.3 million to $223.1 million for the nine months ended September 30, 2025, with a production tax rate of 7.4%, down from 8.8% in the previous year[159] - Depreciation, depletion, and amortization expenses increased by $344.7 million to $1,101.7 million for the nine months ended September 30, 2025, due to higher production volumes and depletion rates[160] Capital Expenditures and Financing - Issued $750.0 million 6.000% senior unsecured notes due October 1, 2030, in September 2025[135] - Completed the 2025 Williston Basin Acquisition for total cash consideration of $542.2 million, funded by proceeds from the issuance of senior notes and cash on hand[131] - The company incurred capital expenditures of $1,044.8 million for the development of oil and gas properties during the nine months ended September 30, 2025[187] - Total capital expenditures for the nine months ended September 30, 2025, were approximately $1,044.8 million, primarily for oil and gas property development[187] - Capital expenditures for the nine months ended September 30, 2025, totaled $1,075.8 million, with $1,042.9 million allocated to exploration and production (E&P) activities[189] - The company issued the 2030 Senior Notes resulting in net proceeds of $739.6 million, which were used for the Williston Basin Acquisition and general corporate purposes[180] - The company recorded deferred financing costs of $10.4 million in connection with the issuance of the 2030 Senior Notes[180] Shareholder Returns - Paid a base cash dividend of $1.30 per share on September 8, 2025, and declared another dividend of the same amount payable on December 5, 2025[135] - A base cash dividend of $1.30 per share was declared on November 4, 2025, payable on December 5, 2025[190] - The company repurchased 3,388,561 shares of common stock at a weighted average price of $104.61 per share, totaling $354.5 million during the nine months ended September 30, 2025[193] - The share repurchase program authorized in August 2025 allows for up to $1.0 billion in common stock repurchases, replacing a previous $750 million program[193] - During the nine months ended September 30, 2025, the company repurchased 3,388,561 shares at an average price of $104.61 per share, costing a total of $354.5 million[193] - As of September 30, 2025, there was $962.2 million remaining under the $1.0 billion share repurchase program[193] - Future dividend payments will depend on the company's earnings, financial condition, and other relevant considerations[192] Liquidity and Financial Position - As of September 30, 2025, the company had $2,597.1 million in liquidity, including $1,967.9 million in unused borrowing capacity under the Credit Facility[169] - As of September 30, 2025, the company had a senior secured revolving credit facility with a borrowing base of $2.75 billion and unused borrowing capacity of $1,967.9 million[178] - The company maintained compliance with the financial covenants under the Credit Facility as of September 30, 2025[178] - The company has commodity derivative contracts covering 3,128 MBbls of crude oil and 12,420,000 MMBtu of natural gas production for 2025[176] - The company recorded merger-related costs of $8.1 million during the nine months ended September 30, 2025, primarily related to severance and legal services[174] - The company had estimated future commitments under contracts of $464.0 million as of September 30, 2025[177] Accounting and Compliance - There have been no material changes in critical accounting policies and estimates from the previous annual report[196]

Revenue Performance - As of September 30, 2025, the total revenue was $303.6 million, a 2.5% increase from $295.1 million in the same quarter of 2024[20] - Revenue from SaaS and related solutions for the quarter ended September 30, 2025, was $275.0 million, up from $263.7 million in Q3 2024, representing a growth of 4.9%[20] - Revenue for the quarter ended September 30, 2025, was $303.615 million, a 2.5% increase from $295.143 million in the same quarter of 2024[39] - The Americas accounted for 85% of total revenue in Q3 2025, down from 88% in Q3 2024[20] - The Broadband/Cable/Satellite vertical contributed 51% of total revenue in Q3 2025, consistent with the same period in 2024[22] Financial Position - Cash and cash equivalents as of September 30, 2025, included $15.2 million held in institutional money market funds[30] - The company had $1.8 million in restricted cash as of September 30, 2025, compared to $1.7 million at the end of 2024[25] - The carrying value of the 2023 Convertible Notes was $425.0 million, with a fair value of $472.6 million as of September 30, 2025[31] - Long-term debt as of September 30, 2025, was $538.606 million, slightly up from $530.997 million at the end of 2024[43] - The company has a $600 million revolving loan facility under the 2025 Credit Agreement, with $125 million drawn as of September 30, 2025[43] - As of September 30, 2025, cash and cash equivalents were $158.4 million, down from $161.8 million as of December 31, 2024[177] Expenses and Profitability - Total cost of revenue for the quarter was $155.717 million, up from $147.843 million year-over-year, resulting in a gross profit of $147.898 million[39] - Research and development expenses for the quarter were $39.631 million, a decrease of 2.1% compared to $40.498 million in the prior year[39] - Segment net income for the quarter was $20.483 million, compared to $19.088 million in the same quarter of 2024, reflecting a 7.3% increase[39] - Total amortization expense for other intangible assets for the nine months ended September 30, 2025, was $20.1 million, compared to $18.8 million in the same period of 2024[41] - The estimated total amortization expense for the fiscal year 2025 is projected to be $26.9 million[41] Acquisitions and Restructuring - The company acquired iCheckGateway.com, LLC for $17.6 million in cash on June 3, 2024, with potential future earn-out payments of up to $15.0 million tied to performance-based goals[58][59] - The company recorded restructuring and reorganization charges of $17.5 million for the nine months ended September 30, 2025, compared to $12.0 million for the same period in 2024, reflecting a significant increase in restructuring activities[62] - The company reduced its global workforce by approximately 270 employees, incurring $11.9 million in charges related to involuntary terminations as part of cost efficiency actions[64] Shareholder Returns - The company repurchased approximately 703,000 shares of common stock for $44.2 million during the nine months ended September 30, 2025, at a weighted-average price of $62.92 per share[77] - The total remaining value of shares available for repurchase under the Stock Repurchase Program was $93.7 million as of September 30, 2025[78] - The quarterly cash dividend approved in Q3 2025 was $0.32 per share, totaling $9.1 million, compared to $0.30 per share and $8.8 million in Q3 2024[80] - Total dividends declared for the nine months ended September 30, 2025, were $27.7 million, up from $26.4 million in the same period of 2024[80] Other Financial Metrics - Goodwill increased to $323.909 million as of September 30, 2025, from $316.041 million at the beginning of the year, due to foreign currency exchange rate changes[40] - Total other intangible assets amounted to $366.403 million as of September 30, 2025, with a net carrying value of $54.188 million after accumulated amortization[40] - The company has accrued $10.3 million related to future earn-out payments from the acquisition of DGIT Systems Pty Ltd, with an earn-out period extending through December 31, 2026[61] - As of September 30, 2025, the company had performance guarantees totaling $3.9 million, including $0.2 million in standby letters of credit[68] - The company had $1.8 million of restricted assets used to collateralize guarantees as of September 30, 2025[67] Strategic Developments - The One Big Beautiful Bill Act ("OBBBA") enacted on July 4, 2025, is not expected to materially affect the company's effective tax rate[32] - The company extended its agreement with Ensono, Inc. for outsourced computing services through December 31, 2032, and accelerated the mainframe hardware refresh expected to be completed in Q1 2026[66] - A merger agreement was entered into with NEC Corporation, with CSG continuing as a wholly owned subsidiary of NEC[84] - Each share of CSG common stock will be converted into $80.70 in cash upon the effective time of the merger[85] Currency Exposure - Approximately 88% of the company's revenue was generated in U.S. dollars during the nine months ended September 30, 2025[181]

Revenue Growth - Total revenue for the three months ended September 30, 2025, increased by $5.9 million, or 15.4%, to $44.2 million compared to $38.3 million in the same period of 2024[129] - Life Sciences Services revenue rose by $3.3 million, or 15.9%, from $20.9 million to $24.3 million for the three months ended September 30, 2025[131] - Commercial Cell & Gene Therapy revenue included in BioLogistics Solutions revenue was $7.4 million for the three months ended September 30, 2025, representing a 21.7% year-over-year increase from $6.1 million[131] - Life Sciences Products revenue increased by $2.6 million, or 14.9%, from $17.4 million to $20.0 million for the three months ended September 30, 2025, compared to the same period in 2024[132] - Life Sciences Services revenue increased by $10.9 million, or 18.0%, from $60.6 million to $71.5 million for the nine months ended September 30, 2025, compared to the same period in 2024[147] - Total revenue increased by $15.4 million, or 13.4%, from $115.3 million to $130.7 million for the nine months ended September 30, 2025, compared to the same period in 2024[146] - Life Sciences Products revenue increased by $4.5 million, or 8.2%, from $54.7 million to $59.2 million for the nine months ended September 30, 2025, compared to the same period in 2024[149] Financial Performance - Gross margin for the three months ended September 30, 2025, was $21.3 million, a 22.3% increase from $17.4 million in the same period of 2024[129] - Gross margin for the three months ended September 30, 2025, was 48.2% of total revenue, up from 45.5% for the same period in 2024[133] - Gross margin for Life Sciences Products revenue was 46.4% for the three months ended September 30, 2025, compared to 42.1% for the same period in 2024[135] - Net loss attributable to common stockholders was $8.9 million for the three months ended September 30, 2025, compared to a loss of $1.2 million in the same period of 2024, representing a 648.4% increase in loss[129] - Loss from continuing operations improved by $62.1 million, or 70.9%, for the nine months ended September 30, 2025, compared to the same period in 2024[146] - Adjusted EBITDA from continuing operations was a loss of $4.4 million for the nine months ended September 30, 2025, compared to a loss of $14.9 million for the same period in 2024[169] Costs and Expenses - Total cost of revenue increased by $2.0 million, or 9.7%, from $20.9 million to $22.9 million for the three months ended September 30, 2025[129] - Engineering and development expenses increased by $0.4 million, or 8.8%, for the three months ended September 30, 2025, compared to the same period in 2024[137] - SG&A expenses decreased by $6.2 million, or 7.6%, as compared to the same period in 2024[154] - Investment income decreased by $2.0 million, or 23.9%, for the nine months ended September 30, 2025, compared to the same period in 2024[146] - Investment income decreased by $2.0 million for the nine months ended September 30, 2025, compared to the prior year[156] Strategic Developments - The divestiture of the CRYOPDP business to DHL for $133.0 million was completed on June 11, 2025, enhancing the company's growth strategy in the EMEA and APAC regions[127] - The company anticipates that inflationary pressures could affect future financial performance if cost increases cannot be offset by price increases and productivity gains[128] - The company expects to continue incurring operating losses in the near term while investing in new supply chain initiatives and geographic expansion[170] Cash and Investments - As of September 30, 2025, the company had cash and cash equivalents of $255.8 million and working capital of $454.1 million[170] - Net cash provided by investing activities was $250.3 million during the nine months ended September 30, 2025, primarily due to the sale of CRYOPDP[175] - Net cash used in financing activities totaled $18.9 million during the nine months ended September 30, 2025, due to repayments and stock repurchases[176] - The company repurchased 1,111,614 shares of common stock for an aggregate purchase price of $8.0 million during the nine months ended September 30, 2025[182] - The estimated fair value of the 2026 Senior Notes was $174.5 million as of September 30, 2025[185] Foreign Exchange and International Business - International business revenue accounted for 18% of consolidated revenue, increasing by $0.4 million compared to the same period last year due to foreign exchange fluctuations[186] - As of September 30, 2025, foreign-denominated cash and cash equivalents totaled $25.2 million, with potential declines of $1.3 million, $2.5 million, and $5.0 million under 5%, 10%, and 20% adverse foreign exchange changes, respectively[187] - Short-term intercompany loan balances are exposed to foreign exchange risk, with potential losses of $0.9 million, $1.8 million, and $3.6 million under 5%, 10%, and 20% adverse foreign exchange changes, respectively[188] Clinical Trials - The company supported 745 clinical trials globally as of September 30, 2025, with 83 in Phase 3, an increase of 54 trials from 691 at the same date in 2024[131] Impairment Loss - The company recorded an impairment loss of $63.8 million related to goodwill for the MVE Biological Solutions reporting unit as of June 30, 2024[156] Discontinued Operations - Revenue from discontinued operations decreased by $21.4 million, or 39.9%, from $53.5 million to $32.2 million for the nine months ended September 30, 2025[163]

Operations and Revenue - As of September 30, 2025, Target Hospitality Corp. operates 29 communities across the US and Canada, with an additional 2 communities not owned or leased by the company[143]. - The Workforce Housing Contract with Lithium Nevada is expected to generate approximately $166.5 million in revenue over its initial term, with $102.4 million of committed minimum revenue[144]. - The DIPC Contract is anticipated to provide over $246 million in revenue over its five-year term, with a ramp-up period completed as of September 30, 2025[148]. - The Data Center Community Contract is expected to generate approximately $43 million of committed minimum revenue over its initial term through September 2027[149]. - Total revenue for the three months ended September 30, 2025, was $99.4 million, a 4% increase from $95.2 million in the same period of 2024[184]. - Total revenue for the nine months ended September 30, 2025, was $230.9 million, a decrease of 24% from $302.6 million in the same period of 2024[199]. - Revenue for the Government segment fell by 68% to $57.1 million for the nine months ended September 30, 2025, compared to $180.9 million in 2024[228]. - WHS segment revenue increased to $36.8 million in Q3 2025, compared to $0 in Q3 2024, marking a 100% increase[223]. Financial Performance - The company reported a net loss of approximately $(0.8) million for the three months ended September 30, 2025, compared to a net income of approximately $20.1 million for the same period in 2024[158]. - Adjusted EBITDA for the three months ended September 30, 2025, was $21.5 million, representing a decrease of 57% compared to the same period in 2024[158]. - Net income attributable to Target Hospitality Corp. common stockholders was a loss of $795,000 for the three months ended September 30, 2025, compared to a net income of $19.99 million in 2024[184]. - Operating loss for the nine months ended September 30, 2025, was $17.9 million, compared to an operating income of $88.0 million in the same period of 2024, reflecting a 120% decrease[199]. - Net loss attributable to Target Hospitality Corp. common stockholders was $22.2 million for the nine months ended September 30, 2025, compared to a net income of $58.8 million in the same period of 2024, marking a 138% decline[199]. - Adjusted gross profit for the nine months ended September 30, 2025, was $77.2 million, down from $184.8 million in 2024[276]. Cash Flow and Expenses - Cash flows from operations for the nine months ended September 30, 2025, were approximately $68.4 million, a decrease of 44% compared to $121.1 million for the same period in 2024[150]. - Net cash provided by operating activities decreased to $68.4 million for the nine months ended September 30, 2025, down from $121.1 million in 2024, a decline of approximately 43.5%[241]. - Net cash used in financing activities increased to $187.5 million for the nine months ended September 30, 2025, compared to $23.9 million in 2024, primarily due to the redemption of the 2025 Senior Secured Notes[246]. - Interest expense, net significantly decreased to $0.5 million for the three months ended September 30, 2025, from $3.8 million in the same period of 2024, mainly due to the early redemption of the 2025 Senior Secured Notes[195]. - Interest expense, net for the nine months ended September 30, 2025, was $5.7 million, down 55% from $12.7 million in the same period of 2024, primarily due to the early redemption of the 2025 Senior Secured Notes[211]. - Selling, general and administrative expenses decreased to $12.9 million for the three months ended September 30, 2025, down from $13.3 million in the same period of 2024, primarily due to a $1.9 million reduction in transaction fees[192]. Contracts and Customer Base - For the nine months ended September 30, 2025, three major customers accounted for 50% of revenues, with the largest customer contributing 24%[253]. - The company had one major supplier representing 15% of goods purchased for the nine months ended September 30, 2025, down from 20% in the same period of 2024[255]. Capital Expenditures and Investments - Capital expenditures for the nine months ended September 30, 2025, totaled approximately $56.2 million, with $41.1 million attributed to growth in the WHS segment[240]. - The company plans to fund its cash requirements primarily through existing liquidity sources, focusing on operating activities and working capital[251]. Other Financial Metrics - The company incurred approximately $1.3 million in short-term costs to mobilize assets for the new Data Center Community Contract[225]. - The company recognizes revenue using the percentage of completion method, which may be affected by various factors including weather and labor costs[262]. - Discretionary cash flows for the nine months ended September 30, 2025, were $61,345,000, compared to $103,141,000 in 2024[277]. - The company had $0 of outstanding floating-rate obligations under its credit facility as of September 30, 2025, indicating no exposure to increased interest expense from floating rates[279].

Revenue Performance - Revenue from services in Q3 2025 decreased by 9.9% year-over-year to $935.0 million, with declines in ETM and SET segments, partially offset by growth in the Education segment [149]. - Year-to-date revenue from services increased by 1.9% to $3,201.7 million, primarily driven by the acquisition of MRP [155]. - In the ETM segment, revenue decreased by 13.1% in Q3 2025, primarily due to a 16.4% drop in staffing services [164]. - The SET segment experienced a 9.0% decline in revenue, largely due to reduced demand from U.S. federal government contractors [165]. - Education segment revenue increased by 0.9% in Q3 2025, driven by improved fill rates [166]. Profitability and Expenses - Gross profit decreased by 12.5% to $194.0 million, with a gross profit rate of 20.8%, down 60 basis points from the previous year [151]. - Gross profit for the Enterprise Talent Management (ETM) segment decreased by 15.4% to $96.7 million in Q3 2025, compared to $114.4 million in Q3 2024 [172]. - The Science, Engineering & Technology (SET) segment's gross profit decreased by 11.8% to $77.2 million in Q3 2025, influenced by changes in business mix and higher employee-related costs [174]. - The Education segment's gross profit increased by 2.0% to $20.1 million in Q3 2025, driven by higher revenue volume and lower employee-related costs [175]. - Consolidated total gross profit decreased by 12.5% to $194.0 million in Q3 2025, while year-to-date gross profit increased by 2.3% to $656.0 million [180]. - Total SG&A expenses decreased by 11.2% to $194.4 million, reflecting effective expense management and integration efforts [152]. - SG&A expenses for ETM decreased by 9.2% to $87.6 million in Q3 2025, primarily due to lower employee-related costs [180]. - The SET segment's SG&A expenses decreased by 15.3% to $57.6 million in Q3 2025, attributed to expense management actions [181]. - The Education segment's SG&A expenses increased by 6.3% to $24.5 million in Q3 2025, reflecting costs to support revenue growth [182]. - The company reported a goodwill impairment charge of $102.0 million in Q3 2025, significantly impacting earnings from operations [149]. - ETM reported a profit of $9.1 million in Q3 2025, a decrease of 48.9% compared to $18.0 million in Q3 2024 [186]. Tax and Cash Flow - Income tax expense for Q3 2025 was $46.4 million, compared to a tax benefit of $2.6 million in Q3 2024, primarily due to valuation allowances and impairment charges [154]. - The company's cash, cash equivalents, and restricted cash totaled $35.4 million at the end of Q3 2025, down from $45.6 million at year-end 2024 [196]. - The company believes its cash flow from operations and available liquidity will be sufficient to meet anticipated cash requirements while maintaining adequate liquidity for normal operations [208]. Debt and Liquidity - The debt-to-total capital ratio improved to 9.1% at the end of Q3 2025, compared to 16.2% at year-end 2024, indicating a stronger capital structure [201]. - As of the end of Q3 2025, the company had $150.0 million available on its revolving credit facility and $89.0 million available on its securitization facility [207]. - The securitization facility had $118.4 million in long-term borrowings and $42.6 million in standby letters of credit related to workers' compensation [207]. - The company has additional unsecured, uncommitted short-term local credit facilities totaling $3.1 million, with no borrowings under these facilities as of Q3 2025 [209]. Risk Management - The company entered into a $50.0 million 12-month interest rate swap and a $50.0 million 18-month interest rate swap, locking in fixed rates of 4.772% and 4.468% respectively [218]. - The company has not identified specific plans to repatriate a majority of its international cash balances as of Q3 2025 [206]. - The company continues to provide MSP, RPO, and Functional Service Provider solutions in the EMEA region following the sale of its EMEA staffing operations in Q1 2024 [206]. - The company monitors the credit ratings of its banking partners regularly, assessing the risk of banks not honoring commitments as insignificant [210]. - There have been no significant changes to the company's exposure management and procedures regarding market risk, foreign currency risk, and interest rate risk during Q3 2025 [216]. - The company is exposed to foreign currency risk primarily related to its foreign subsidiaries, with local cash flows generally unaffected by changes in foreign currency rates [217].