Forum Energy Technologies Q2 Earnings Call Highlights

Forum Energy Technologies exceeded second-quarter guidance: Revenue rose 8% sequentially to $226 million, adjusted EBITDA increased 39% to $32 million, and adjusted net income climbed 148% to $14 million.

Orders totaled $236 million, resulting in a 104% book-to-bill ratio.

Both operating segments expanded margins on stronger demand, favorable product mix, restructuring and cost reductions.

Drilling and Completions revenue grew 10%, while Artificial Lift and Downhole revenue increased 6% and approached a 25% EBITDA margin.

The company raised its 2026 outlook to $870 million-$910 million in revenue, $115 million-$125 million in adjusted EBITDA and $57 million-$77 million in free cash flow.

Free cash flow was $10 million in the quarter, and net leverage improved to 1.1 times as net debt fell to $115 million.

Forum Energy Technologies NYSE: FET reported second-quarter results that exceeded its guidance, citing market-share gains, higher-margin product mix, cost actions and execution across its operating segments.

The company also raised its full-year 2026 outlook for revenue, EBITDA, net income and free cash flow.

Revenue rose 8% sequentially to $226 million in the second quarter, while adjusted EBITDA increased 39% to $32 million and adjusted net income increased 148% to $14 million, according to Chief Financial Officer Lyle Williams.

Quarterly orders totaled $236 million, producing a book-to-bill ratio of 104%.

Orders have exceeded revenue in five of the past six quarters, Williams said.

“Revenue, EBITDA, and net income all exceeded the high end of guidance as our Beat the Market strategy continued to deliver,” Williams said.

Segment performance and margin expansion Forum said both operating segments contributed to its quarterly performance.

Drilling and Completions revenue increased 10% to $139 million, driven by demand for coiled tubing products, wireline cables and capital equipment, including Iron Roughnecks and radiators.

Segment EBITDA rose 29% to about $16 million, while its EBITDA margin expanded 180 basis points to 12%.

Artificial Lift and Downhole revenue increased 6% to $87 million, fueled by demand for sand and flow-control products, artificial-lift products and casing hardware.

EBITDA for the segment increased 30% to approximately $22 million, and its EBITDA margin approached 25%.

Williams said the segment’s favorable product mix generated an incremental EBITDA margin of 95%, as higher sales of high-value downhole products were partly offset by lower shipments of mechanical production equipment due to shipment timing.

Management identified three principal contributors to the company’s performance: continued growth in Canadian oil sands markets, a turnaround in drilling products after operational restructuring and cost reductions, and the conversion of subsea backlog into revenue through deliveries of remotely operated vehicle systems, aftermarket products and related technologies.

CEO Neal Lux said stronger North American completions supported frack utilization and demand for the company’s wireline, coiled tubing and downhole offerings.

The company also cited robust Canadian oil sands activity.

Outside North America, activity was affected by conflict in the Middle East, although Lux said investment in offshore and unconventional developments remained strong.

International products and growth initiatives Lux said Forum is pursuing growth through technology development, geographic expansion and market-share gains.

Since launching its Beat the Market strategy in 2022, the company has increased revenue per global rig by 34%, he said.

Among its international initiatives, Forum said field trials of its SandGuard ar...