Forum Energy Technologies(FET) - 2025 Q3 - Quarterly Results

Financial Performance - Third quarter 2025 revenue was $196 million, a 2% decrease sequentially, with a net loss of $21 million or $1.76 per diluted share[2][4] - Adjusted net income for the quarter was $3 million, approximately $0.27 per diluted share, after accounting for $22 million in asset impairments and restructuring costs[4] - Adjusted EBITDA for the quarter was $23 million, reflecting a 13% increase sequentially[4] - Total revenue for the three months ended September 30, 2025, was $196,231,000, a decrease of 5.6% compared to $207,806,000 for the same period in 2024[23] - EBITDA for the total company was $1,748,000 for the three months ended September 30, 2025, significantly lower than $11,133,000 for the same period in 2024[23] - The operating margin for the total company was -3.1% for the three months ended September 30, 2025, compared to 4.3% in the same period of 2024[23] - Total revenue for the nine months ended September 30, 2025, was $589,274,000, a decrease of 4.3% from $615,407,000 in the same period of 2024[25] - The total EBITDA margin for the nine months ended September 30, 2025, was 8.2%, compared to 7.4% in the same period of 2024[25] - The net income (loss) for the nine months ended September 30, 2025, was $(11,732,000), an improvement from $(31,826,000) for the same period in 2024[31] Revenue Segments - The Drilling and Completions segment generated revenue of $117 million, remaining flat sequentially, with a book-to-bill ratio of 129%[6] - The Artificial Lift and Downhole segment reported revenue of $79 million, a 4% decrease, with a book-to-bill ratio of 112%[7] - Revenue from the Artificial Lift and Downhole segment was $78,981,000 for the three months ended September 30, 2025, down from $84,226,000 in the same period of 2024[23] - Drilling revenue was $32,234,000, representing 16.4% of total revenue, down from $35,741,000 (17.2%) in the prior year[44] - Subsea revenue increased to $23,582,000, accounting for 12.0% of total revenue, compared to $20,903,000 (10.1%) in the same quarter last year[44] - Stimulation and Intervention revenue was $34,271,000, or 17.5% of total revenue, down from $38,037,000 (18.3%) year-over-year[44] - Downhole revenue was $48,073,000, making up 24.5% of total revenue, compared to $50,562,000 (24.3%) in the same quarter last year[44] - Production Equipment revenue increased to $18,647,000, representing 9.5% of total revenue, up from $17,968,000 (8.6%) year-over-year[44] - Valve Solutions revenue decreased to $12,261,000, accounting for 6.2% of total revenue, down from $15,696,000 (7.6%) in the prior year[44] Orders and Backlog - The company reported a book-to-bill ratio of 122% with orders totaling $240 million, marking the highest backlog in over ten years[4] - Total orders for the three months ended September 30, 2025, reached $239,990,000, representing an increase of 16.5% from $205,839,000 in the prior year[27] - The book-to-bill ratio for total orders was 1.22 for the three months ended September 30, 2025, indicating improving market demand compared to 0.99 in the same period last year[27] - Backlog increased by 21% due to strong bookings in offshore and international markets, with anticipated market share gains expected to provide a tailwind in 2026[5] Cash Flow and Capital Management - Free cash flow for the quarter was $28 million, and the full year 2025 free cash flow guidance was raised to between $70 million and $80 million[3][4] - The company achieved a year-end net leverage ratio of 1.3 times ahead of schedule, having repurchased 8% of its outstanding shares year-to-date[6] - The company achieved free cash flow before acquisitions of $28,126,000 for the three months ended September 30, 2025, compared to $24,493,000 for the same period in 2024[38] - The free cash flow yield as of October 29, 2025, was 20%, calculated using the midpoint of $75 million of guided full-year free cash flow[38] - The company incurred restructuring and other costs of $1,501,000 for the three months ended September 30, 2025, compared to $342,000 for the same period in 2024[29] - The company reported capital expenditures for property and equipment of $(1,392,000) for the three months ended September 30, 2025[38] - The company recognized a gain on sale-leaseback transactions of $(4,279,000) for the three months ended September 30, 2025[29] Operational Efficiency - The company accelerated cost savings efforts, extending the annualized target by 50% to $15 million[5] - The trailing twelve months adjusted EBITDA was $85,936,000, indicating the company's operational performance[42] - The company continues to focus on market expansion and new product development strategies to enhance revenue streams[44]