Earnings Analysis November 1, 2026

Forum Energy Technologies Inc ($FET) Q3 2026 Earnings Analysis: Adjusted EPS of $1.51 Beats Estimates · Annual Guidance Raised

Earnings Report

Revenue: $236.81 million (up 21% YoY, beating the $233.35 million estimate) ✅ Beat

EPS (Earnings Per Share): $1.51 (up 24.3% compared to the $1.22 estimate) ✅ Beat

Guidance: Raised + Annual revenue $900 million–$920 million, Adjusted EBITDA $123 million–$129 million

Stock Reaction: After-hours +0.00% ($84.94, as of 10-31 05:01 KST)

Highlights

Adjusted EPS of $1.51: Surpassed the $1.22 estimate by 24%

Free Cash Flow of $30.33 million: Exceeded the upper end of guidance, bringing net leverage down to 0.9x

Backlog of $243.78 million: Secured new orders equivalent to 103% of a single quarter's revenue

The axis of growth is not limited to a single US shale location. International revenue for the first nine months of this year increased by 31% year-over-year, and all four product lines in the drilling and completion segment grew. The company also completed the acquisition of Premiere Torque Rings in the third quarter.

Misses

GAAP EPS of $0.93: $0.58 lower than the adjusted EPS

Stagnant Adjusted EBITDA in Artificial Lift and Downhole: Freight and tariff costs offset revenue growth

$5 million one-time expense in Q4: GAAP profit will decrease due to the cash settlement of stock-based compensation

Third-quarter adjustment items include a disclosed $3 million litigation settlement and $500,000 in related legal fees, as well as $1 million in sublease costs for closed facilities. Adjusted EPS is calculated by excluding these items.

What Management Said

CEO Neal Lux explained that the annual outlook was raised amid improving demand and market conditions. The company stated that if the midpoint of the Q4 guidance is annualized, revenue and adjusted EBITDA would increase by 5% and 14%, respectively, in 2027.

Market Reaction and Future Key Points

After the announcement, the after-hours stock price remained flat at $84.94. It was numerically confirmed that the midpoint of the Q4 adjusted EBITDA guidance is at the $36 million level, the same as Q3.

A key point to watch is where Q4 revenue will land within the $230 million to $250 million range.

It must be confirmed whether freight and tariff burdens in the artificial lift and downhole segments will continue to weigh on adjusted EBITDA in Q4.

A key observation point is whether Premier Torc Rings contributes approximately $2 million per quarter in Q4.

Earnings Call Key Summary

We have summarized the key points from the $FET earnings call.

[Bullish] Growth continues next year: If the next quarter's outlook is annualized, it implies that both revenue and profit will increase next year. Management is confident they can perform even better. Why UST viewed this as bullish: Growth is visible even when annualizing the outlook. "Looking at Forum Energy Technologies alone, when annualizing the midpoint of the Q4 guidance, revenue and EBITDA increase by 5% and 14% respectively in 2027, and I believe we can continue at that level or higher." (Forum Energy Technologies CEO)

[Bearish] Freight and tariffs are a drag: Even though revenue increased, the burden of transportation costs and tariffs offset that growth. This means there is a period where revenue growth does not translate directly into profit. Why UST viewed this as bearish: Freight and tariffs ate into the increased revenue. "EBITDA was $21 million, almost flat, because the revenue increase was offset by increased transportation and tariff costs." (Forum Energy Technologies CFO)

[Neutral] Pulling forward cash: Through effective cash management, money to be received in the next quarter was pulled forward to this quarter. This means cash flow for the next quarter may appear lighter. Why UST viewed this as neutral: Because next quarter's cash was pulled forward. "In Q3, through effective working capital management, we pulled forward $10 million of Q4 cash flow." (Forum Energy Technologies CFO)

[Bearish] Persistent Middle East risk: Management acknowledged that since they have factories and sales hubs in the Middle East, business could be shaken if the geopolitical situation worsens. However, they stated there have been no major order cancellations so far. Why UST viewed this as bearish: Local production and sales hubs could be destabilized. "Dan, those risks are always present and we are concerned about them. We are always worried that the situation could change, as we have local production facilities and distribution/sales offices in Saudi Arabia and the United Arab Emirates." (Forum Energy Technologies CEO)