Forum Energy Technologies (NYSE:FET) raised its full-year 2026 outlook after reporting higher third-quarter revenue, earnings and free cash flow, citing market-share gains, international growth and contributions from its product portfolio.
President and Chief Executive Officer Neal Lux said the company generated sequential and year-over-year growth in revenue, EBITDA, net income and free cash flow during the quarter. He said the performance, combined with healthy backlog levels and execution through the first nine months of the year, supported higher annual guidance.
Forum now expects 2026 revenue of $900 million to $920 million, EBITDA of $123 million to $129 million, adjusted net income of $52 million to $58 million, and free cash flow of $66 million to $71 million. At the midpoint of the ranges, Lux said revenue would rise 15% from 2025, while EBITDA would increase 46% and net income would climb 639%.
Third-Quarter Results
Chief Financial Officer Lyle Williams said third-quarter consolidated revenue increased 5% sequentially to $237 million, reaching the midpoint of the company’s guidance range. EBITDA rose 14% to $36 million, while EBITDA margin expanded 120 basis points to just over 15%. Net income increased 33% to $18 million.
On a year-over-year basis, EBITDA increased 56%, Williams said, while net income rose nearly fivefold. Orders totaled $244 million, producing a book-to-bill ratio of 103%. Orders have exceeded revenue in six of the past seven quarters, according to the company.
Williams cited four primary contributors to year-over-year performance: growth in drilling products, delivery of subsea backlog, continued Canadian oil sands activity and broader international revenue growth.
- Drilling and completion revenue increased 6% sequentially to $147 million, with increases across all four product lines. Segment EBITDA rose 28% to about $21 million, and margins expanded 240 basis points to 14%.
- Artificial lift and downhole revenue increased 3% to $90 million, helped by the acquisition of Premiere Torque Rings and demand for sand-control, flow-control and valve products. Segment EBITDA was about $21 million, roughly flat, as higher freight and tariff costs offset revenue gains.
- International revenue increased 31% year-to-date compared with the prior year, while international revenue per rig rose 26% year-over-year.
The company recorded several third-quarter adjusting items, including a $3 million charge and $500,000 in legal fees related to a previously disclosed litigation matter; about $1 million associated with subleasing a manufacturing facility that was closed earlier in the year; and roughly $1 million in transaction fees tied to the Premiere acquisition.
International Markets and Product Opportunities
Lux said Forum’s international strategy centers on applying technologies developed in U.S. unconventional basins to other markets. He said revenue in the Middle East increased 32%, despite ongoing regional volatility, and that the company had not experienced meaningful order cancellations related to the conflict.
The company manufactures locally and maintains distribution and sales offices in Saudi Arabia and the United Arab Emirates, Lux said. Its Middle East sales are primarily product sales, including radiators for fracturing equipment, pumps, coil tubing and wireline cable.
Forum also identified Venezuela and Argentina as developing opportunities. Lux said the company has delivered coil tubing, pressure-control equipment and Coiled Line Pipe into Venezuela, but is taking a cautious approach to credit and country risk. The company generally ships products to U.S. companies and receives payment in U.S. dollars, he said.
In Argentina, Forum sees demand potential as operators apply North American shale technologies to unconventional development. Lux said the company’s quench-and-temper coil tubing and greaseless wireline cables can support drilling and completion operations.
Forum also highlighted new applications in hydraulic fracturing, Canadian oil sands and power generation for data centers. The company recently received its first order for a high-tensile-strength tube used in perforating-gun housings, a consumable product that Lux said expands its addressable market by about $200 million. In data-center power generation, the company is pursuing stationary cooling opportunities and has several advanced-stage requests for quotations, according to Lux.
Acquisition and Capital Allocation
During the quarter, Forum completed its acquisition of Premiere Torque Rings, which supplies products used in well construction and casing operations. Total guaranteed consideration was $33 million, consisting of $16 million in common stock, $12 million in cash and $5 million in deferred cash consideration.
Williams said the transaction was completed at roughly four times EBITDA, implying an approximately $8 million annual EBITDA run rate. The acquisition closed midway through the third quarter, and Williams said investors could expect about $1 million of additional sequential contribution in the fourth quarter.
Lux said Premiere Torque Rings has shared customers and cross-selling opportunities with Forum’s downhole business. While the acquired company is primarily U.S.-focused, Williams said it also has existing operations in Latin America and the Middle East.
Forum generated $30 million of third-quarter free cash flow, above its guidance range, aided in part by $10 million of working-capital cash flow pulled forward from the fourth quarter. The company reduced net debt to $97 million. Williams corrected an earlier statement during the call, saying net debt declined by $18 million during the quarter rather than $13 million.
The company repurchased about $1.4 million of shares in the quarter at an average price of $0.51 per share. Since initiating its current repurchase program in 2025, Forum has repurchased 1.6 million shares, representing about 13% of the then-outstanding share count, Williams said.
Fourth-Quarter and 2027 Outlook
For the fourth quarter, Forum expects revenue of $230 million to $250 million, EBITDA of $33 million to $39 million, net income of $15 million to $21 million and free cash flow of $25 million to $30 million. At the midpoint, the revenue and EBITDA outlook would represent year-over-year increases of about 19% and 59%, respectively.
Williams said the company expects to recognize a one-time incremental stock-based compensation charge of about $5 million in the fourth quarter after modifying approximately 128,000 outstanding equity awards to allow cash settlement and electing to settle another 15,000 awards in cash.
Looking toward 2027, Lux said it remains early in the customer budgeting process, but higher commodity prices and public forecasts from large service companies point to mid- to high-single-digit activity growth. He said longer laterals and more completion stages could increase demand for Forum’s consumable products.
Forum’s longer-term FET 2030 plan calls for doubling revenue, quadrupling EBITDA and tripling free cash flow from 2025 levels. Lux said the company expects international markets to represent an increasing share of its growth, particularly as it works to raise revenue per international rig.
About Forum Energy Technologies (NYSE:FET)
Forum Energy Technologies, Inc (NYSE:FET) is a global manufacturer of oilfield and industrial equipment serving the exploration, development and production segments of the energy industry. The company designs and supplies products used in drilling, well completion, production and subsea operations.
Forum’s product offerings include drilling and downhole tools, drilling motors, wireline and well-intervention equipment, pressure-control systems, hydraulic-fracturing and stimulation equipment, artificial-lift products, and subsea remotely operated vehicle systems.
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