STOCK TITAN

National Energy Services declares first $0.10 dividend

NESR declared its first quarterly dividend of $0.10 per ordinary share and authorized up to $50.0 million in share repurchases.

Available on EDGAR Accepted by SEC EDGAR Learn about SEC filing dates
(Moderate)

Sentiment and the balance of points

Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.

Form Type
10-Q

Rhea-AI Filing Summary

National Energy Services Reunited Corp. (NESR) reported third-quarter revenue of $504.7 million and net income of $34.3 million, versus $295.3 million and $17.7 million a year earlier. Nine-month revenue was $1,430.1 million and net income was $102.2 million, versus $925.8 million and $43.3 million; operating cash flow was $201.5 million, compared with $125.7 million.

At September 30, 2026, cash and cash equivalents were $106.8 million, outstanding borrowings were $267.3 million, and available borrowing capacity was $39.5 million, versus $146.9 million at December 31, 2025. NESR received proceeds on October 5, 2026, under a $55.0 million Term Facilities Agreement with HSBC Bank plc. It matures March 31, 2027, bears 0% stated interest through maturity, and has an extension mechanism raising stated interest to 9% per annum. The agreement includes a 9.5% original issue discount ($5.2 million) and financing fees.

On November 6, 2026, the board declared its first quarterly cash dividend of $0.10 per ordinary share, payable December 10, 2026, to shareholders of record December 3, 2026. The capital-return program also authorizes repurchases of up to $50.0 million, subject to market conditions, legal requirements, and liquidity considerations.

3 points · 0 major

How this balance works

Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.

It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.

Rhea-AI Sentiment measures something else, the tone of the wording.

0 major · 1 point

How the balance works

Positive

  • Moderate pointThird-quarter revenue: $504.7 million versus $295.3 million in 2025.
  • Moderate pointThird-quarter net income: $34.3 million versus $17.7 million in 2025.
  • Moderate pointNine-month operating cash flow: $201.5 million versus $125.7 million in 2025.

Negative

  • Moderate pointAvailable borrowing capacity: $39.5 million at September 30, 2026; $146.9 million at December 31, 2025.

Filing Explained

The 10-Q adds a committed spending obligation: at September 30, 2026, NESR reported $61.8 million of capital-expenditure commitments, with substantially all expected to be settled in 2026 and 2027—not merely considered as future investment.

Third-quarter revenue $504.7 million Three months ended September 30, 2026; compared with $295.3 million for the three months ended September 30, 2025
Third-quarter net income $34.3 million Three months ended September 30, 2026; compared with $17.7 million for the three months ended September 30, 2025
Nine-month revenue $1,430.1 million Nine months ended September 30, 2026; compared with $925.8 million for the nine months ended September 30, 2025
Nine-month net income $102.2 million Nine months ended September 30, 2026; compared with $43.3 million for the nine months ended September 30, 2025
Operating cash flow $201.5 million Nine months ended September 30, 2026; compared with $125.7 million for the nine months ended September 30, 2025
Available borrowing capacity $39.5 million As of September 30, 2026; $146.9 million as of December 31, 2025
Term Facilities Agreement $55.0 million Proceeds received October 5, 2026
Cash dividend per ordinary share $0.10 Declared November 6, 2026; payable December 10, 2026, to shareholders of record December 3, 2026
original issue discount financial
"a 9.5% original issue discount ($5.2 million)"
Original issue discount (OID) is the difference between a debt security’s face value and the lower price at which it is first sold, treated as additional interest that accrues over the life of the instrument. For investors it matters because OID raises the effective yield and changes taxable income and the holding’s cost basis over time — think of buying a $100 voucher for $90 and recognizing the $10 gain as earned interest as the voucher approaches maturity.
debt service coverage ratio financial
"minimum debt service coverage ratio greater than 1.25:1"
Debt service coverage ratio measures how many times a company's available cash flow can pay its scheduled debt payments (interest plus principal). Think of it like checking how many months of take-home pay it would take to cover your mortgage and loan bills; a higher number means a bigger cushion against missed payments. Investors use it to gauge credit risk, the likelihood of default, and whether a company can afford dividends or new borrowing.
financial standby letter of credit financial
"issuance of a financial standby letter of credit"
measurement alternative financial
"investment accounted for under the measurement alternative prescribed by Accounting Standards Codification 321"

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were NESR's third-quarter 2026 revenue and net income?

NESR's revenue was $504.7 million and net income was $34.3 million for the three months ended September 30, 2026. The comparable 2025 figures were $295.3 million and $17.7 million, respectively.

What are the terms of NESR's $55.0 million term facility?

NESR received proceeds on October 5, 2026, under a $55.0 million Term Facilities Agreement with HSBC Bank plc. It matures March 31, 2027, has 0% stated interest through maturity, a 9.5% original issue discount ($5.2 million), and an extension mechanism that raises stated interest to 9% per annum. Covenants are tested quarterly on a rolling twelve-month basis: maximum consolidated leverage of 2.00:1, debt service coverage greater than 1.25:1, and interest coverage of 4.00:1.

When is NESR's $0.10 dividend payable?

The board declared a cash dividend of $0.10 per ordinary share on November 6, 2026, payable December 10, 2026, to shareholders of record December 3, 2026. Because it was declared after September 30, 2026, no related liability was recognized on the September 30 balance sheet.

How large is NESR's amended HSBC trade finance facility?

An amendment on September 28, 2026, increased the aggregate credit limit from $40.0 million to $58.0 million, including an additional $18.0 million uncommitted facility for a financial standby letter of credit. The added facility is secured by an $18.0 million time deposit and carries a 1.60% annual commission, with a maximum tenor of 12 months. As of September 30, 2026, approximately $27.4 million was utilized and approximately $30.6 million remained available, subject to sublimits and HSBC approval.

What does NESR's capital-return program authorize?

The program authorizes repurchases of up to $50.0 million of ordinary shares through open-market transactions, privately negotiated transactions, or otherwise, at prevailing market prices and subject to market conditions, applicable legal requirements, and liquidity considerations. NESR expects to fund dividends and repurchases through existing cash and operating cash flows.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark one)

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2026

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

 

Commission File Number: 001-38091

 

NATIONAL ENERGY SERVICES REUNITED CORP.

(Exact name of registrant as specified in its charter)

 

British Virgin Islands   82-4881231

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

777 Post Oak Blvd., Suite 730, Houston, Texas   77056
(Address of principal executive offices)   (Zip Code)

 

+1 (832) 925-3777

Registrant’s telephone number, including area code

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Ordinary shares, no par value per share   NESR   The Nasdaq Capital Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐   Accelerated filer ☒
Non-accelerated filer ☐   Smaller reporting company ☐
    Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

 

As of September 30, 2026, the registrant had 102,123,175 ordinary shares outstanding.

 

 

 

 

 

 

NATIONAL ENERGY SERVICES REUNITED CORP.

FORM 10-Q

 

TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION 3
ITEM 1. FINANCIAL STATEMENTS 3
  CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) 3
  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) 4
  CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) 5
  CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED) 6
  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) 7
  NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 8
  1. BASIS OF PRESENTATION 8
  2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 8
  3. ACCOUNTS RECEIVABLE, NET 9
  4. SERVICE INVENTORIES 9
  5. PROPERTY, PLANT, AND EQUIPMENT, NET 10
  6. DEBT 10
  7. INCOME TAXES 12
  8. COMMITMENTS AND CONTINGENCIES 12
  9. EARNINGS PER SHARE 13
  10. REPORTABLE SEGMENTS 14
  11. SUBSEQUENT EVENTS 16
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 17
  EXECUTIVE OVERVIEW 17
  RESULTS OF OPERATIONS 18
  LIQUIDITY AND CAPITAL RESOURCES 20
  CRITICAL ACCOUNTING POLICIES AND ESTIMATES 22
  CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 22
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 23
ITEM 4. CONTROLS AND PROCEDURES 23
PART II - OTHER INFORMATION 24
ITEM 1. LEGAL PROCEEDINGS 24
ITEM 1A. RISK FACTORS 24
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 24
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 24
ITEM 4. MINE SAFETY DISCLOSURES 24
ITEM 5. OTHER INFORMATION 24
ITEM 6. EXHIBITS 25
SIGNATURES 26
Exhibit 10.1  
Exhibit 31.1  
Exhibit 31.2  
Exhibit 32.1  
Exhibit 32.2  

 

2
 

 

PART I – FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In US$ thousands, except share data)

 

Description  September 30, 2026   December 31, 2025 
         
Assets          
Current assets          
Cash and cash equivalents  $106,843    124,797 
Accounts receivable, net (Note 3)   262,659    178,020 
Unbilled revenue   221,279    121,186 
Service inventories (Note 4)   148,228    94,834 
Prepaid assets   26,177    13,237 
Retention withholdings   41,658    33,125 
Other receivables   53,572    54,511 
Other current assets   13,105    10,664 
Total current assets   873,521    630,374 
Non-current assets          
Property, plant and equipment, net (Note 5)   561,630    465,454 
Intangible assets, net   34,178    47,086 
Goodwill   645,095    645,095 
Operating lease right-of-use assets   24,993    20,300 
Other assets   44,201    43,210 
Total assets  $2,183,618   $1,851,519 
           
Liabilities and equity          
Liabilities          
Accounts payable and accrued expenses   666,612    421,064 
Current installments of long-term debt (Note 6)   64,500    64,500 
Short-term borrowings (Note 6)   58,922    54,250 
Income taxes payable (Note 7)   36,047    25,092 
Other taxes payable   6,810    12,351 
Operating lease liabilities   2,074    2,948 
Other current liabilities   27,294    24,715 
Total current liabilities   862,259    604,920 
           
Long-term debt (Note 6)   143,871    191,378 
Deferred tax liabilities   660    1,691 
Employee benefit liabilities   39,771    36,321 
Non-current operating lease liabilities   22,670    18,447 
Other liabilities   34,272    30,846 
Total liabilities   1,103,503    883,603 
           
Commitments and contingencies (Note 8)   -    - 
           
Equity          
Preferred shares, no par value; unlimited shares authorized; none issued and outstanding at September 30, 2026, and December 31, 2025, respectively   -    - 
Ordinary shares and additional paid-in capital, no par value; unlimited shares authorized; 102,123,175 and 100,787,173 shares issued and outstanding at September 30, 2026, and December 31, 2025, respectively   912,872    902,845 
Retained income   167,174    65,002 
Accumulated other comprehensive income   69    69 
Total equity   1,080,115    967,916 
Total liabilities and equity  $2,183,618   $1,851,519 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

3
 

 

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In US$ thousands, except share data and per share amounts)

 

Description  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
  

For the three-month

period ended

  

For the nine-month

period ended

 
Description  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
                 
Revenues  $504,725   $295,315   $1,430,063   $925,785 
Cost of services   (435,771)   (259,955)   (1,227,986)   (809,086)
Gross profit   68,954    35,360    202,077    116,699 
Selling, general and administrative expenses (excluding Amortization)   (12,573)   (11,061)   (35,694)   (34,981)
Amortization   (3,872)   (4,693)   (12,998)   (14,080)
Operating income   52,509    19,606    153,385    67,638 
Interest expense, net   (6,706)   (8,128)   (20,287)   (24,974)
Other (expense) / income, net   (2,761)   759    (197)   2,758 
Income before income tax   43,042    12,237    132,901    45,422 
Income tax (expense) / benefit   (8,714)   5,500    (30,729)   (2,093)
Net income  $34,328   $17,737   $102,172   $43,329 
                     
Weighted average shares outstanding (Note 9):                    
Basic   101,490,792    100,356,020    101,050,794    97,656,777 
Diluted   103,385,626    100,724,290    103,193,761    97,951,178 
                     
Earnings per share (Note 9):                    
Basic  $0.34   $0.18   $1.01   $0.44 
Diluted  $0.33   $0.18   $0.99   $0.44 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

4
 

 

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(In US$ thousands)

 

Description  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
  

For the three-month

period ended

  

For the nine-month

period ended

 
Description  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
                 
Net income  $34,328   $17,737   $102,172   $43,329 
Other comprehensive income, net of tax   -    -    -    - 
Foreign currency translation adjustments   -    -    -    - 
Total comprehensive income, net of tax  $34,328   $17,737   $102,172   $43,329 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

5
 

 

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED)

(In US$ thousands, except share data)

 

      

Ordinary

Shares

             
       and Additional  

Accumulated

Other

         
   Ordinary   Paid-in   Comprehensive   Retained   Total 
Description  Shares   Capital   Income   Income   Equity 
                     
Balance at December 31, 2025   100,787,173   $902,845   $        69   $65,002   $967,916 
Share-based compensation expense   -    8,910    -    -    8,910 
Issuance of equity-classified restricted share units   1,286,001    -    -    -    - 
Settlement of liability-classified share-based compensation   50,001    964    -    -    964 
Other   -    153    -    -    153 
Net income   -    -    -    102,172    102,172 
Balance at September 30, 2026   102,123,175   $912,872   $69   $167,174   $1,080,115 

 

      

Ordinary

Shares

             
      

and Additional

  

Accumulated

Other

         
   Ordinary   Paid-in   Comprehensive   Retained   Total 
Description  Shares   Capital   Income   Income   Equity 
                     
Balance at December 31, 2024   96,045,856   $894,293   $      69   $13,870   $908,232 
Share-based compensation expense   -    5,747    -    -    5,747 
Issuance of equity-classified restricted share units   1,088,331    -    -    -    - 
Settlement of liability-classified share-based compensation   100,001    601    -    -    601 
Warrant exchange and associated transaction costs   3,543,571    (1,258)   -    -    (1,258)
Net income   -    -    -    43,329    43,329 
Balance at September 30, 2025   100,777,759   $899,383   $69   $57,199   $956,651 

 

      

Ordinary

Shares

             
       and Additional  

Accumulated

Other

         
   Ordinary   Paid-in   Comprehensive   Retained   Total 
Description  Shares   Capital   Income   Income   Equity 
                     
Balance at June 30, 2026   100,851,754   $909,130   $         69   $132,846   $1,042,045 
Share-based compensation expense   -    3,738    -    -    3,738 
Issuance of equity-classified restricted share units   1,271,421    -    -    -    - 
Other   -    4    -    -    4 
Net income   -    -    -    34,328    34,328 
Balance at September 30, 2026   102,123,175   $912,872   $69   $167,174   $1,080,115 

 

      

Ordinary

Shares

             
      

and Additional

  

Accumulated

Other

         
   Ordinary   Paid-in   Comprehensive   Retained   Total 
Description  Shares   Capital   Income  

Income

   Equity 
                     
Balance at June 30, 2025   96,452,967   $897,373   $       69   $39,462   $936,904 
Share-based compensation expense   -    2,169    -    -    2,169 
Issuance of equity-classified restricted share units   781,221    -    -    -    - 
Warrant exchange and associated transaction costs   3,543,571    (159)   -    -    (159)
Net income   -    -    -    17,737    17,737 
Balance at September 30, 2025   100,777,759   $899,383   $69   $57,199   $956,651 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

6
 

 

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In US$ thousands)

 

Description  September 30, 2026   September 30, 2025 
   For the nine-month period ended 
Description  September 30, 2026   September 30, 2025 
Cash flows from operating activities:          
Net income  $102,172   $43,329 
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   106,966    106,480 
Share-based compensation expense   8,910    5,747 
(Gain) on disposal of assets   (2,506)   (4,271)
Non-cash interest expense   597    983 
Deferred tax expense (benefit)   2,928    (1,497)
Allowance for doubtful receivables and unbilled revenue   2,945    694
Charges on obsolete service inventories   3,141    1,161 
Impairments and other charges   2,850    1,492 
Other operating activities, net   104    399 
Changes in operating assets and liabilities:          
(Increase) decrease in accounts receivable   (87,207)   (56,198)
(Increase) decrease in unbilled revenue   (100,093)   (14,600)
(Increase) decrease in retention withholdings   (8,533)   12,491 
(Increase) decrease in inventories   (56,536)   (2,161)
(Increase) decrease in prepaid assets   (12,940)   (6,532)
(Increase) decrease in other current assets   5,077    (17,771)
(Increase) decrease in other long-term assets and liabilities   5,045    (1,105)
Increase (decrease) in accounts payable and accrued expenses   224,882    63,923 
Increase (decrease) in other current liabilities   3,735    (6,912)
Net cash provided by operating activities   201,537    125,652 
           
Cash flows from investing activities:          
Capital expenditures   (152,819)   (100,620)
IPM investments (Note 2)   -    - 
Proceeds from disposal of assets   2,229    2,086 
Other investing activities   (4,333)   (8,250)
Net cash used in investing activities   (154,923)   (106,784)
           
Cash flows from financing activities:          
Proceeds from long-term debt   -    - 
Repayments of long-term debt   (48,375)   (52,610)
Proceeds from short-term borrowings   73,349    75,711 
Repayments of short-term borrowings   (68,626)   (74,217)
Payments on capital leases   (4,026)   (2,778)
Payments on seller-provided financing for capital expenditures   (5,228)   (1,650)
Other financing activities, net   -    (1,597)
Net cash used in financing activities   (52,906)   (57,141)
           
Effect of exchange rate changes on cash   -    - 
Net increase (decrease) in cash, cash equivalents, and restricted cash   (6,292)   (38,273)
Cash, cash equivalents, and restricted cash, beginning of period   132,696    107,956 
Cash, cash equivalents, and restricted cash, end of period (Note 2)  $126,404   $69,683 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

7
 

 

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

 

1. BASIS OF PRESENTATION

 

The accompanying condensed consolidated financial statements of National Energy Services Reunited Corp. (the “Company,” “NESR,” “we,” “our,” “us,” or similar terms) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

 

In the opinion of NESR management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included in the accompanying financial statements. All intercompany transactions and balances have been eliminated in consolidation. All amounts are shown in thousands ($000s) of U.S. dollars, except as noted.

 

Operating results for the three-month and nine-month periods ended September 30, 2026, are not necessarily indicative of the results that may be expected for the full year ending December 31, 2026. The balance sheet as of December 31, 2025 has been derived from NESR’s audited financial statements for the year then ended.

 

For further information, refer to the Consolidated Financial Statements and related notes included in NESR’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission on March 6, 2026.

 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Cash, cash equivalents, and restricted cash

 

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Condensed Consolidated Balance Sheets to the amounts shown in the Condensed Consolidated Statements of Cash Flows (in US$ thousands):

   

   September 30, 2026   December 31, 2025 
   As of 
   September 30, 2026   December 31, 2025 
         
Cash and cash equivalents  $106,843   $124,797 
Restricted cash – current   12,507    6,260 
Restricted cash – non-current   7,054    1,639 
Cash, cash equivalents, and restricted cash  $126,404   $132,696 

 

Supplemental cash flow information

 

Non-cash transactions were as follows:

 

  ● Purchases of property, plant, and equipment in Accounts payable of $54.3 million, $37.8 million, and $26.1 million at September 30, 2026, December 31, 2025, and September 30, 2025, respectively, are not included under “Capital expenditures” within the Condensed Consolidated Statements of Cash Flows.
  ● Purchases of property, plant, and equipment using seller-provided installment financing of $8.0 million, $2.1 million, and $0.0 (zero) million, at September 30, 2026, December 31, 2025, and September 30, 2025, respectively, in Accounts payable are not included under “Payments on seller-provided financing for capital expenditures” within the Condensed Consolidated Statements of Cash Flows.
  ● Purchases of property, plant, and equipment in Other current liabilities and Other liabilities of $5.1 million and $3.1 million at September 30, 2026, respectively, $1.8 million and $0.3 million at December 31, 2025, respectively, and $2.8 million and $0.3 million at September 30, 2025, respectively, are not included under “Payments on capital leases” within the Condensed Consolidated Statements of Cash Flows.

 

Production Management Assets

 

The Company’s Integrated Production Management (“IPM”) projects are focused on developing and managing production on behalf of the Company’s customers under long-term agreements. Under these arrangements, the Company contributes its own services and products and, in certain cases, cash, toward the customer’s field development activities and operations. Although in certain arrangements the Company is paid for a portion of the services or products it provides, generally the Company will not be paid at the time of providing its services or upon delivery of its products. Instead, the Company is compensated based on cash flow generated by cash from the customer’s wells. Revenues from IPM arrangements, which are recognized as the related production is achieved, represented 0.0% (zero), 0.1%, 0.0% (zero), and 0.5% of the Company’s Revenues for the three-month period ended September 30, 2026, three-month period ended September 30, 2025, nine-month period ended September 30, 2026, and nine-month period ended September 30, 2025, respectively.

 

8
 

 

The Company capitalizes its cash investments in a project as well as the direct costs associated with providing services or products for which the Company will be compensated when the related production is achieved. These capitalized investments are amortized to the Condensed Consolidated Statements of Operations as the related production is achieved based on the units of production method, whereby each unit produced is assigned a pro-rata portion of the unamortized costs based on estimated total production, resulting in a matching of revenue with the applicable costs. Amortization expense relating to these capitalized investments was $0.0 (zero) million, $0.8 million, $0.0 (zero) million, and $4.9 million for the three-month period ended September 30, 2026, three-month period ended September 30, 2025, nine-month period ended September 30, 2026, and nine-month period ended September 30, 2025, respectively.

 

The unamortized portion of the Company’s investments in IPM projects was $0.0 (zero) million and $0.0 (zero) million at September 30, 2026, and December 31, 2025, respectively.

 

At September 30, 2026, and September 30, 2025, the Company assessed whether the unamortized costs associated with these investments exceed the present value of future cash flows from the projects, and recorded an impairment charge to Cost of Services of $0.0 (zero) million, $0.0 (zero) million, $0.0 (zero) million, and $1.5 million for the three-month period ended September 30, 2026, three-month period ended September 30, 2025, nine-month period ended September 30, 2026, and nine-month period ended September 30, 2025, respectively.

 

Recently issued accounting standards not yet adopted

 

On November 4, 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (the “ASU”), which requires disaggregated disclosure of income statement expenses for public business entities (“PBEs”). The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU 2024-03 is effective for all PBEs for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently reviewing the impact of the adoption on the condensed consolidated financial statements.

 

All new accounting pronouncements that have been issued but not yet effective are currently being evaluated and, at this time, are not expected to have a material impact on our financial position or results of operations.

 

3. ACCOUNTS RECEIVABLE, NET

 

The following table summarizes the accounts receivable of the Company as of the period end dates set forth below (in US$ thousands):

  

   September 30, 2026   December 31, 2025 
   As of 
   September 30, 2026   December 31, 2025 
Trade receivables  $278,865   $191,792 
Less: allowance for credit losses   (16,206)   (13,772)
Total  $262,659   $178,020 

 

Trade receivables relate to the sale of services, for which credit is extended based on the Company’s evaluation of the customer’s creditworthiness. The movement in the allowance for credit losses is as follows (in US$ thousands):

  

                 
  

For the three-month

period ended

  

For the nine-month

period ended

 
   September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
                 
Allowance for credit losses at beginning of period  $(15,278)  $(13,908)  $(13,772)  $(15,206)
(Increase) decrease to allowance for the period   (1,161)   (1,476)   (2,945)   (694)
Write-off of credit losses   233    848    511    1,364 
Reclassifications   -    (2,228)   -    (2,228)
Allowance for credit losses at end of period  $(16,206)  $(16,764)  $(16,206)  $(16,764)

 

4. SERVICE INVENTORIES

 

The following table summarizes the service inventories for the period end dates as set forth below (in US$ thousands):

  

   September 30, 2026   December 31, 2025 
         
Spare parts and consumables  $81,959   $59,469 
Chemicals   66,269    35,365 
Total  $148,228   $94,834 

 

9
 

 

5. PROPERTY, PLANT, AND EQUIPMENT, NET

 

Property, plant and equipment, net of accumulated depreciation, of the Company consists of the following as of the period end dates set forth below (in US$ thousands):

  

  

Estimated

Useful Lives

(in years)

  September 30, 2026   December 31, 2025 
      As of 
  

Estimated

Useful Lives

(in years)

  September 30, 2026   December 31, 2025 
Buildings and leasehold improvements  5 to 25  $58,857   $56,937 
Drilling rigs, plant and equipment  1 to 15   932,315    818,147 
Office equipment (furniture and fixtures) and tools  3 to 10   15,510    14,785 
Vehicles and cranes  5 to 10   8,008    9,364 
Less: Accumulated depreciation      (567,229)   (522,072)
Land      11,664    11,664 
Capital work in progress      102,505    76,629 
Total     $561,630   $465,454 

 

The Company recorded depreciation expense of $33.2 million, $29.0 million, $94.0 million and $87.8 million for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively, within Cost of Services in the Condensed Consolidated Statements of Operations.

 

6. DEBT

 

Long-term debt

 

The Company’s long-term debt obligations consist of the following (in US$ thousands):

  

   September 30, 2026   December 31, 2025 
         
Secured Term Loan  $209,625   $258,000 
Secured Revolving Credit Facility   -    - 
Less: unamortized debt issuance costs   (1,254)   (2,122)
Total loans and borrowings   208,371    255,878 
Less: current installments   (64,500)   (64,500)
Long-term debt, net of unamortized debt issuance costs and excluding current installments  $143,871   $191,378 

 

2021 Secured Facilities Agreement

 

On November 4, 2021, the Company entered into an $860 million Secured Facilities Agreement (the “2021 Secured Facilities Agreement”). At inception, the 2021 Secured Facilities Agreement consisted of a $430 million term loan due by November 4, 2027 (the “Secured Term Loan”), an $80.0 million revolving credit facility due by November 4, 2025 (the “Secured Revolving Credit Facility”), and a $350 million working capital facility that renews annually or bi-annually by mutual agreement between the lenders and the Company. The Secured Revolving Credit Facility was extended from November 4, 2025, to February 4, 2026, by mutual agreement of the Company and its lenders. Following February 4, 2026, the Company did not extend its Secured Revolving Credit Facility, as operating cash flow, together with available cash and cash equivalents, is sufficient to support working capital, capital expenditures, and debt repayment obligations.

 

10
 

 

Borrowings under the Secured Term Loan incur, and prior borrowings under the Secured Revolving Credit Facility incurred, interest based on the secured overnight financing rate (“SOFR”) for U.S. dollar-denominated borrowings or the Saudi Arabian Interbank Offered Rate (“SAIBOR”) for Saudi Arabian Riyal borrowings plus 2.6% to 3.0% per annum, varying based on the Company’s Net Debt / EBITDA ratio as defined in the 2021 Secured Facilities Agreement. As of September 30, 2026, and December 31, 2025, this resulted in interest rates of 6.51% and 7.13%, respectively, for U.S. dollar-denominated borrowings, and interest rates of 7.46% and 7.61%, respectively, for Saudi Arabian Riyal borrowings. As of September 30, 2026, and December 31, 2025, the Company had drawn $209.6 million and $258.0 million, respectively, of the Secured Term Loan, and $0.0 (zero) million and $0.0 (zero) million, respectively, of the Secured Revolving Credit Facility. Additionally, as of September 30, 2026, and December 31, 2025, the Company had $0.0 (zero) million and $59.2 million, respectively, available to be drawn under the Secured Revolving Credit Facility.

 

The 2021 Secured Facilities Agreement also includes a working capital facility (the “Working Capital Facility”) of $278.4 million and $325.0 million as of September 30, 2026, and December 31, 2025, respectively, for issuance of letters of guarantee, letters of credit and refinancing letters of credit into debt over a period of no more than two years, which carries an interest rate equal to SOFR for U.S. dollar-denominated borrowings, or SAIBOR for Saudi Arabian Riyal borrowings, for the applicable interest period, plus a margin of 1.25% to 1.5% per annum. As of September 30, 2026, and December 31, 2025, this resulted in interest rates of 5.16% and 7.13%, respectively, for U.S. dollar-denominated borrowings, and interest rates of 6.37% and 7.61%, respectively, for Saudi Arabian Riyal borrowings. The Working Capital Facility requires the payment of a commitment fee each quarter. The commitment fee is computed at the rate of 0.3125% (25% of the margin) on the facility lender’s available commitment for the relevant quarter. The Working Capital Facility decreased by $46.6 million during the nine-month period ended September 30, 2026, due to the scheduled expiration of one tranche of availability within the lender syndicate as partially offset by new commitments. As of September 30, 2026, and December 31, 2025, the Company had utilized $273.9 million and $243.8 million, respectively, under this Working Capital Facility and the balance of $4.5 million and $81.2 million, respectively, was available to the Company.

 

The 2021 Secured Facilities Agreement includes covenants that specify maximum leverage (Net Debt / EBITDA) up to 3.50, minimum debt service coverage ratio (Cash Flow / Debt Service) of at least 1.25, and interest coverage (EBITDA / Interest) of at least 4.00. As of September 30, 2026, and December 31, 2025, the Company was in compliance with all financial and non-financial covenants under the 2021 Secured Facilities Agreement.

 

Trade Finance Facilities Agreement

 

On September 1, 2026, a subsidiary of the Company entered into a $40.0 million trade finance facilities agreement (the “Trade Finance Facilities Agreement”) with HSBC Bank Middle East Limited (“HSBC”). The agreement provides the Company with access to various trade finance instruments, including bank guarantees, standby letters of credit, documentary credits, and short-term import and export financing facilities. The facilities are generally available through November 30, 2026, with certain instruments subject to separate contractual tenors. The facilities are uncommitted and subject to HSBC’s ongoing review and right to reduce, cancel, or withdraw availability.

 

The Trade Finance Facilities Agreement provides for variable interest rates on applicable U.S. dollar-denominated borrowings based on Term SOFR plus contractual margins ranging from 1.50% to 1.65% per annum. Bank guarantees are subject to annual commissions generally ranging from 1.45% to 1.75%, depending on the type and tenor of the guarantee, while documentary credits are subject to commissions ranging from 0.85% to 0.90% per annum. In addition, the Company paid an arrangement fee of $88,000 and is subject to applicable administrative fees and other charges in accordance with HSBC’s standard tariff. The agreement contains customary affirmative and negative covenants, including financial reporting requirements, notification obligations, and restrictions relating to pledged collateral.

 

On September 28, 2026, the Trade Finance Facilities Agreement was amended to increase the aggregate credit limit from $40.0 million to $58.0 million through the addition of an $18.0 million uncommitted trade finance facility for the issuance of a financial standby letter of credit (“SBLC”). The additional facility is to be secured by an $18.0 million time deposit pledged in favor of HSBC and carries an annual commission of 1.60%, with a maximum tenor of 12 months.

 

As of September 30, 2026, the Company had utilized approximately $27.4 million under the Trade Finance Facilities Agreement, with approximately $30.6 million of remaining availability, subject to applicable sublimits and HSBC approval requirements.

 

On October 1, 2026, HSBC issued an irrevocable SBLC in the amount of $18.0 million to support the Company’s obligations associated with outstanding letters of guarantee. The SBLC is scheduled to expire on December 30, 2026, unless released earlier. The Company provided an $18.0 million pledged time deposit on October 5, 2026, which earns interest income while serving as collateral for the SBLC.

 

The Trade Finance Facilities Agreement contains customary affirmative and negative covenants, including financial reporting requirements, notification obligations relating to material changes in the Company’s business and operations, and restrictions on the use and disposition of pledged collateral. The agreements do not contain financial maintenance covenants based on leverage, interest coverage, or other financial ratios. As of September 30, 2026, the Company was in compliance with all affirmative and negative covenants under the Trade Finance Facilities Agreement.

 

$55.0 Million Term Facilities Agreement

 

On September 30, 2026, the Company entered into a $55.0 million Term Facilities Agreement (the “Term Facilities Agreement”) with HSBC Bank plc (“HSBC plc”), supported by guarantees and security provided by NESR and certain subsidiaries. The facility matures on March 31, 2027, and bears 0% stated interest through the original maturity date, subject to an extension mechanism under which the stated interest rate increases to 9% per annum.

 

The financing includes a 9.5% original issue discount ($5.2 million), together with lender, agency, security-agent and transaction fees. The financing package also includes a Saudi-law guarantee and indemnity from one of the Company’s subsidiaries in Saudi Arabia, a Saudi promissory note supporting the obligations, and security arrangements in certain jurisdictions. NESR granted HSBC plc specified rights of first refusal and matching rights for future refinancing transactions and agreed to undertake a credit-rating process. The Term Facilities Agreement is intended to provide near-term liquidity while NESR pursues longer-term refinancing of this facility and other existing indebtedness.

 

Although the agreement was executed on September 30, 2026, the loan proceeds were not received until October 5, 2026. Accordingly, no borrowings under the facility were outstanding as of September 30, 2026, and the funding represents a subsequent event for the third quarter of 2026. Despite the initial 0% stated interest rate, the original issue discount and applicable financing costs will result in an effective interest rate above 0%, with the related interest expense recognized over the term of the facility.

 

The Term Facilities Agreement includes financial covenants requiring the Company to maintain a maximum consolidated leverage ratio of 2.00:1, a minimum debt service coverage ratio greater than 1.25:1, and a minimum interest coverage ratio of 4.00:1. These covenants are tested quarterly on a rolling twelve-month basis. The agreement also contains customary non-financial covenants, including restrictions on additional indebtedness, liens, asset disposals, acquisitions, dividends and certain other corporate activities, subject to specified exceptions. As of September 30, 2026, the Company was in compliance with all affirmative and negative covenants under the Term Facilities Agreement.

 

2026 Secured Facilities Agreement

 

In October 2026, the Company, together with certain of its subsidiaries, entered into a new syndicated credit facilities agreement (the “2026 Secured Facilities Agreement”) with a consortium of financial institutions led by HSBC Bank Middle East Limited. The agreement provides for approximately $298.1 million in term loan facilities, a $5.0 million committed revolving credit facility, and $444.0 million in uncommitted working capital facilities, representing aggregate financing arrangements of approximately $747.1 million. The agreement also provides for up to $152.9 million in additional incremental facilities, subject to certain conditions.

 

The 2026 Secured Facilities Agreement has an overall term of three years, with scheduled term loan principal repayments commencing in April 2027. The facilities are intended to refinance existing indebtedness and provide additional financial flexibility to support the Company’s working capital requirements, capital expenditures, acquisitions and general corporate purposes. The agreement contains customary financial covenants, guarantees, security arrangements and other terms and conditions.

 

11
 

 

Short-term debt

 

The Company’s short-term debt obligations consist of the following (in US$ thousands):

  

  

September 30, 2026

  

December 31, 2025

 
         
Other short-term borrowings from working capital facilities  $58,922   $54,250 
Less: unamortized debt issuance costs   -    - 
Short-term debt, excluding current installments of long-term debt  $58,922   $54,250 

 

Short-term borrowings primarily consist of financing for capital equipment and inventory purchases.

 

Other debt information

 

Scheduled principal payments of long-term debt for periods subsequent to September 30, 2026, are as follows (in US$ thousands):

  

      
2026  $16,125 
2027   193,500 
2028   - 
2029   - 
2030   - 
Total long-term debt  $209,625 

 

 

7. INCOME TAXES

 

NESR is a holding company incorporated in the British Virgin Islands (“BVI”), which imposes a 0% statutory corporate income tax rate on income generated outside the jurisdiction. NESR’s subsidiaries operate across multiple tax jurisdictions in the MENA region, where statutory tax rates generally range from 0% to 35%. However, the adoption of Domestic Minimum Top-Up Taxes (DMTT) under the OECD Pillar Two framework has, in many cases, resulted in effective tax rates exceeding local statutory minimums.

 

The Company recorded income tax expense of $8.7 million with an effective tax rate of 20.2% for the three-month period ended September 30, 2026, income tax (benefit) expense of ($5.5) million with an effective tax rate of negative 44.9% for the three-month period ended September 30, 2025, $30.7 million with an effective tax rate of 23.1% for the nine-month period ended September 30, 2026 and $2.1 million with an effective tax rate of 4.6% for the nine-month period ended September 30, 2025, in the Condensed Consolidated Statements of Operations.

 

The recognition of an income tax benefit for the three-month period ended September 30, 2025, despite positive income before income tax, primarily reflects adjustments to the Company’s uncertain tax positions and unrecognized tax benefits totaling $9.2 million on a net basis. These adjustments were non-recurring in nature and do not indicate any change in the Company’s underlying profitability and/or statutory tax obligations in its taxable jurisdictions. Excluding these discrete items, the effective tax rates for the three- and nine-month periods ended September 30, 2025, were 29.9% and 24.8%, respectively.

 

8. COMMITMENTS AND CONTINGENCIES

 

Capital expenditure commitments

 

The Company was committed to incur capital expenditures of $61.8 million and $45.6 million at September 30, 2026, and December 31, 2025, respectively. Substantially all of the commitments outstanding as of September 30, 2026, are expected to be settled during 2026 and 2027.

 

Off Balance Sheet Arrangements

 

The Company evaluates its obligations under these arrangements and recognizes liabilities when a loss is probable and reasonably estimable. Management does not expect these off-balance-sheet arrangements to have a material effect on the Company’s condensed consolidated financial statements.

 

Letters of Credit

 

The Company had outstanding letters of credit issued under the 2021 Secured Facilities Agreement totaling $7.4 million and $6.6 million as of September 30, 2026 and December 31, 2025, respectively.

 

Bank Guarantees

 

In the ordinary course of business, the Company enters into various off-balance-sheet guarantee arrangements with customers, vendors, and other counterparties, including bid bonds, performance bonds, and other bank-issued guarantees. These arrangements totaled $241.1 million and $187.1 million as of September 30, 2026, and December 31, 2025, respectively. In addition, the Company had outstanding cash margin guarantees totaling $15.9 million and $14.9 million as of the respective dates, of which $15.9 million and $7.5 million, respectively, were secured by restricted cash deposits. The majority of the Company’s bank guarantees are issued pursuant to the terms of the 2021 Secured Facilities Agreement.

 

Other Guarantee Arrangements

 

Separately, the Company maintains off-balance-sheet guarantee arrangements through a non-financial intermediary in Kuwait, primarily consisting of bid and performance bonds issued in the ordinary course of business. The Company pays contractual margins of 3.50% per annum on other guarantee arrangements. These arrangements totaled $33.2 million and $14.7 million as of September 30, 2026, and December 31, 2025, respectively. In addition, the Company had outstanding cash margin guarantees totaling $7.7 million and $3.5 million as of the respective dates, of which $3.7 million and $0.4 million, respectively, were secured by restricted cash deposits.

 

Legal proceedings

 

In the first quarter of 2024, the Company lost control (i.e., ceased to be the primary beneficiary) of a subsidiary in Qatar following a judgment from a lawsuit concerning the ownership and historical profits of this entity. Neither the deconsolidation event nor any potential losses associated with these historical profits were deemed material to the Company’s financial position or results of operations. Subsequent to the judgment, the plaintiff initiated similar actions against other unrelated Company entities in both Qatar and the United Arab Emirates. Based on the advice of legal counsel in each jurisdiction, the Company believes it has strong grounds to defend its positions in both jurisdictions; however, the ultimate outcome of these proceedings cannot be determined at this time. The Company currently estimates that a loss in the range of $1.2 million to $11.8 million (43.1 million Qatari Riyals), for which it is jointly and severally liable with a co-defendant, could be incurred in connection with these matters.

 

Additionally, the Company is involved in certain legal proceedings which arise in the ordinary course of business and the outcomes of which are currently subject to uncertainties and therefore the probability of a loss, if any, being sustained and an estimate of the amount of any loss are difficult to ascertain. Consequently, it is not possible to make a reasonable estimate of the expected financial effect, if any, that will result from ultimate resolution of these disputes. The Company is contesting these claims/disputes and the Company’s management currently believes that it is not required to recognize a provision because they are not probable or reasonably estimable and any impacts are not expected to have a material impact on the Company’s business, financial condition, results of operations, or liquidity.

 

12
 

 

9. EARNINGS PER SHARE

 

The following tables provide a reconciliation of the data used in the calculation of basic and diluted ordinary shares outstanding for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively.

  

Date  Transaction Detail  Change in Shares  

Three-month

period ended

September 30,

2026,

Weighted Average

Ordinary Shares

Outstanding  

 
July 1, 2026  Beginning Balance        100,851,754 
July 13, 2026  Equity-classified Restricted Stock Issuance   333    286 
August 11, 2026  Equity-classified Restricted Stock Issuance   500    272 
August 14, 2026  Equity-classified Restricted Stock Issuance   1,245,091    636,078 
August 17, 2026  Equity-classified Restricted Stock Issuance   666    319 
August 27, 2026  Equity-classified Restricted Stock Issuance   2,165    800 
September 11, 2026  Equity-classified Restricted Stock Issuance   333    69 
September 25, 2026  Equity-classified Restricted Stock Issuance   22,333    1,214 
July 13, 2026  Equity-classified Restricted Stock Issuance   333    96 
August 11, 2026  Equity-classified Restricted Stock Issuance   500    92 
August 14, 2026  Equity-classified Restricted Stock Issuance   1,245,091    214,358 
August 17, 2026  Equity-classified Restricted Stock Issuance   666    107 
August 27, 2026  Equity-classified Restricted Stock Issuance   2,165    270 
September 11, 2026  Equity-classified Restricted Stock Issuance   333    23 
September 25, 2026  Equity-classified Restricted Stock Issuance   22,333    409 
September 30, 2026  Ending Balance        101,490,792 

 

Date  Transaction Detail  Change in Shares  

Three-month

period ended

September 30, 2025,

Weighted Average

Ordinary Shares

Outstanding

 
July 1, 2025  Beginning Balance        96,452,967 
July 1, 2025  Warrant exchange   3,543,571    3,505,054 
August 14, 2025  Equity-classified Restricted Stock Issuance   777,245    397,071 
September 5, 2025  Equity-classified Restricted Stock Issuance   1,977    537 
September 12, 2025  Equity-classified Restricted Stock Issuance   1,999    391 
September 30, 2025  Ending Balance        100,356,020 

 

Date  Transaction Detail  Change in Shares  

Nine-month

period ended

September 30, 2026,

Weighted Average

Ordinary Shares

Outstanding

 
January 1, 2026  Beginning Balance        100,787,173 
January 15, 2026  Equity-classified Restricted Stock Issuance   833    787 
January 30, 2026  Equity-classified Restricted Stock Issuance   7,332    6,526 
February 25, 2026  Equity-classified Restricted Stock Issuance   1,666    1,324 
March 13, 2026  Equity-classified Restricted Stock Issuance   250    36,814 
March 13, 2026  Settlement of liability-classified share-based compensation   50,001    184 
April, 10, 2026  Equity-classified Restricted Stock Issuance   3,000    1,901 
May 20, 2026  Equity-classified Restricted Stock Issuance   1,499    730 
July 13, 2026  Equity-classified Restricted Stock Issuance   333    96 
August 11, 2026  Equity-classified Restricted Stock Issuance   500    92 
August 14, 2026  Equity-classified Restricted Stock Issuance   1,245,091    214,358 
August 17, 2026  Equity-classified Restricted Stock Issuance   666    107 
August 27, 2026  Equity-classified Restricted Stock Issuance   2,165    270 
September 11, 2026  Equity-classified Restricted Stock Issuance   333    23 
September 25, 2026  Equity-classified Restricted Stock Issuance   22,333    409 
September 30, 2026  Ending Balance        101,050,794 

 

Date  Transaction Detail  Change in Shares  

Nine-month

period ended

September 30, 2025,

Weighted Average

Ordinary Shares

Outstanding

 
January 1, 2025  Beginning Balance        96,045,856 
January 6, 2025  Settlement of liability-classified share-based compensation   61,353    60,005 
February 17, 2025  Equity-classified Restricted Stock Issuance   666    549 
February 27, 2025  Equity-classified Restricted Stock Issuance   1,000    788 
March 17, 2025  Equity-classified Restricted Stock Issuance   12,430    8,970 
March 18, 2025  Equity-classified Restricted Stock Issuance   231,661    166,321 
April 22, 2025  Settlement of liability-classified share-based compensation   100,001    58,975 
July 1, 2025  Warrant exchange   3,543,571    1,181,190 
August 14, 2025  Equity-classified Restricted Stock Issuance   777,245    133,811 
September 5, 2025  Equity-classified Restricted Stock Issuance   1,977    181 
September 12, 2025  Equity-classified Restricted Stock Issuance   1,999    131 
September 30, 2025  Ending Balance        97,656,777 

 

13
 

 

 

The following tables provide the computation of basic and diluted earnings per share (“EPS”) for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively (in US$ thousands, except share data and per share amounts):

  

   For the three-month period ended 
   September 30, 2026   September 30, 2025 
  

Net income

to Ordinary

Shareholders

  

Weighted-

average

ordinary

shares

outstanding

   EPS  

Net income

to Ordinary

Shareholders

  

Weighted-

average

ordinary

shares

outstanding

   EPS 
                         
Basic EPS - ordinary shares  $34,328    101,490,792   $0.34   $17,737    100,356,020   $0.18 
Restricted stock units   -    1,894,834    -    -    368,270    - 
Antidilution sequencing - subtotal   34,328    103,385,626    0.33    17,737    100,724,290    0.18 
35,540,380 warrants @ $5.75 per half share   -    -    -    -    -    - 
Diluted EPS - ordinary shares  $34,328    103,385,626   $0.33   $17,737    100,724,290   $0.18 

 

   For the nine-month period ended 
   September 30, 2026   September 30, 2025 
  

Net income

to Ordinary

Shareholders

  

Weighted-

average

ordinary

shares

outstanding

   EPS  

Net income

to Ordinary

Shareholders

  

Weighted-

average

ordinary

shares

outstanding

   EPS 
                         
Basic EPS - ordinary shares  $102,172    101,050,794   $1.01   $43,329    97,656,777   $0.44 
Restricted stock units   -    2,142,967    -    -    294,401    - 
Antidilution sequencing - subtotal   102,172    103,193,761    0.99    43,329    97,951,178    0.44 
35,540,380 warrants @ $5.75 per half share   -    -    -    -    -    - 
Diluted EPS - ordinary shares  $102,172    103,193,761   $0.99   $43,329    97,951,178   $0.44 

 

The Company excluded 792,574, 2,359,397, 790,143 and 2,267,131 weighted-average restricted stock units from dilutive ordinary shares for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively, as they were assumed to be repurchased due to the impact of unrecognized share-based compensation cost.

 

10. REPORTABLE SEGMENTS

 

The Company determines its operating segments using the management approach, under which its Chief Executive Officer, as the Company’s chief operating decision maker, regularly reviews financial information to allocate resources and assess performance. The Company has identified two reportable segments, Production Services and Drilling and Evaluation Services, which provide a range of oilfield services to oil and natural gas customers across the well lifecycle. Segment performance is evaluated primarily based on revenue and segment operating income (loss), excluding corporate-level expenses such as overhead, share-based compensation, and transaction-related costs. The Company’s operations are primarily located in the MENA region.

 

The CODM uses segment revenue and segment operating income (loss) to assess segment performance and make resource allocation decisions. These decisions include the allocation of capital expenditures, equipment, personnel and other operational resources among the Company’s reportable segments. In making these decisions, the CODM considers each segment’s historical and expected financial performance, customer demand, market conditions, operational requirements and anticipated returns on investment. Resources are allocated with the objective of supporting operational requirements, pursuing growth opportunities and optimizing the Company’s overall financial performance.

 

14
 

  

Revenue from operations

 

(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
   For the three-month
period ended
   For the nine-month
period ended
 
(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Reportable Segment:                    
Production Services  $312,951   $174,443   $883,728   $567,591 
Drilling and Evaluation Services   191,774    120,872    546,335    358,194 
Total external revenue  $504,725   $295,315   $1,430,063   $925,785 

 

Long-lived assets

 

(in US$ thousands)  September 30, 2026   December 31, 2025 
   As of 
(in US$ thousands)  September 30, 2026   December 31, 2025 
Reportable Segment:          
Production Services  $288,837   $222,306 
Drilling and Evaluation Services   211,984    186,738 
Total Reportable Segments   500,821    409,044 
Unallocated assets   60,809    56,410 
Total long-lived assets  $561,630   $465,454 

 

Unallocated assets mainly comprise buildings and leasehold improvements in the countries which support both segments in the normal course of business.

 

Total segment operating income

 

(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
   For the three-month
period ended
   For the nine-month
period ended
 
(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Reportable Segment:                    
Production Services  $42,623   $15,578   $135,592   $58,303 
Drilling and Evaluation Services   27,682    16,267    67,567    53,128 
Total Reportable Segments   70,305    31,845    203,159    111,431 
Unallocated expenses   (17,796)   (12,239)   (49,774)   (43,793)
Total operating income   52,509    19,606    153,385    67,638 
Interest expense, net   (6,706)   (8,128)   (20,287)   (24,974)
Other (expense) / income, net   (2,761)   759    (197)   2,758 
Income before income tax  $43,042   $12,237   $132,901   $45,422 

 

Unallocated expenses for the three-month and nine-month periods ended September 30, 2026, and September 30, 2025, respectively, mainly include corporate selling, general, and administrative expenses (inclusive of amortization), offset in small part by a portion of these costs that are allocated to the reportable segments. As described elsewhere, corporate selling, general, and administrative expenses are primarily comprised of payroll and compensation costs for headquarters’ employees, professional and legal expenses relating to audit firms, consulting firms and legal counsel, and depreciation charges on headquarters’ offices and leasehold improvements.

 

15
 

 

Significant segment expenses, which represent the difference between segment revenue and pre-tax segment income, consist of the following:

  

(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
   For the three-month
period ended
   For the nine-month
period ended
 
(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Production Services:                    
Compensation  $56,359   $44,792   $161,428   $138,864 
Cost of products, materials, and supplies   116,311    48,861    322,874    167,327 
Transport and rental   48,141    27,430    125,804    85,079 
Depreciation and amortization   18,236    18,382    52,177    58,430 
Other   31,281    19,400    85,853    59,588 
Total  $270,328   $158,865   $748,136   $509,288 

 

(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
   For the three-month
period ended
   For the nine-month
period ended
 
(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Drilling and Evaluation Services                    
Compensation  $50,374   $37,943   $147,780   $110,448 
Cost of products, materials, and supplies   28,901    16,722    80,774    52,088 
Transport and rental   48,298    24,155    143,843    69,471 
Depreciation and amortization   14,995    11,779    42,133    34,830 
Other   21,524    14,006    64,238    38,229 
Total  $164,092   $104,605   $478,768   $305,066 

 

Other segment expenses include mobilization, occupancy, professional, and other costs.

 

Revenue by geographic area

  

(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
   For the three-month
period ended
   For the nine-month
period ended
 
(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Geographic Area:                    
Domestic (BVI)  $-   $-   $-   $- 
MENA   501,557    293,644    1,422,681    919,801 
Rest of World   3,168    1,671    7,382    5,984 
Total revenue  $504,725   $295,315   $1,430,063   $925,785 

 

Long-lived assets by geographic area

 

(in US$ thousands)  September 30, 2026   December 31, 2025 
   As of 
(in US$ thousands)  September 30, 2026   December 31, 2025 
Geographic Area:          
Domestic (BVI)  $-   $- 
MENA   

554,868

    457,124 
Rest of World   

6,762

    8,330 
Total long-lived assets  $561,630    $465,454 

 

11. SUBSEQUENT EVENTS

 

Declaration of Cash Dividend

 

On November 6, 2026, the Company’s Board of Directors declared a cash dividend of $0.10 per ordinary share, payable on December 10, 2026, to shareholders of record as of December 3, 2026. As the dividend was declared subsequent to September 30, 2026, no liability related to the dividend was recognized in the Company’s condensed consolidated balance sheet as of September 30, 2026.

16
 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q (“Quarterly Report”). In addition, such analysis should be read in conjunction with the audited condensed consolidated financial statements, the related notes, and the other information included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Annual Report”). The following discussion and analysis contain forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. Please read “Cautionary Note Regarding Forward-Looking Statements” below.

 

National Energy Services Reunited Corp. (the “Company,” “NESR,” “we,” “our,” “us” or similar terms) is one of the largest oilfield services providers in the Middle East and North Africa (“MENA”) region. The Company’s business consists primarily of upstream and midstream oilfield services with oil and natural gas companies as customers. NESR’s revenues are primarily derived by providing production services (“Production Services”) such as hydraulic fracturing, coiled tubing, stimulation and pumping, cementing, nitrogen services, filtration services, pipelines and industrial services, production assurance, artificial lift services, completions and integrated production management. NESR also provides drilling and evaluation services (“Drilling and Evaluation Services”) such as rigs and integrated services, fishing and downhole tools, thru-tubing intervention, tubular running services, directional drilling, drilling and completion fluids, pressure control, well testing services, wireline logging services, and slickline services. NESR has significant operations throughout the MENA region including Saudi Arabia, Oman, Kuwait, United Arab Emirates, Iraq, Algeria, Egypt and Libya.

 

EXECUTIVE OVERVIEW

 

Drivers of Our Financial Condition and Results of Operations

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, the conflict involving the United States, Israel and Iran, and the associated volatility in Brent crude oil prices, have not had a material adverse impact on our results of operations or financial condition. Demand for our services has remained resilient, supported in large part by continued customer investment in Saudi Arabia, including the Jafurah unconventional field, as well as sustained activity in certain of our other operating locations. However, the duration, scope and ultimate trajectory of the conflict remain uncertain, and any de-escalation or further escalation of the conflict, as well as related sanctions, supply disruptions or other geopolitical developments, could materially affect commodity prices, customer capital spending, and our results of operations and financial condition in future periods. For a full discussion of the drivers of our financial condition and results of operations, see the section entitled “Drivers of Our Financial Condition and Results of Operations” in Part II, Item 7 of our 2025 Annual Report.

 

Key Performance Indicators

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, there have been no material changes regarding our key performance indicators. The following table shows rig count (Source: Baker Hughes Published Rig Count Data) and oil prices (Source: U.S. Energy Information Administration - Brent – Europe) as of the dates indicated. For a full discussion of our key performance indicators, see the section entitled “Key Performance Indicators” in Part II, Item 7 of our 2025 Annual Report.

 

   As of 
   September 30, 2026   December 31, 2025 
Rig count:          
MENA   508    565 
Rest of World – outside of North America   614    500 
Total International Rig Count   1,122    1,065 
           
Brent Crude (per barrel)  $115.91   $61.35 

 

17
 

 

RESULTS OF OPERATIONS

 

We operate our business through two operating segments and report our results of operations through two reporting segments, Production Services and Drilling and Evaluation Services, which aggregate services performed during distinct stages of a typical life-cycle of an oil well.

 

Production Services. Our Production Services segment includes the results of operations from services that are generally offered and performed during the production stage of a well’s lifecycle. These services mainly include hydraulic fracturing, coiled tubing, stimulation and pumping, cementing, nitrogen services, filtration services, pipelines and industrial services, production assurance, artificial lift services, completions and integrated production management. Our Production Services accounted for 62%, 59%, 62%, and 61% of our revenues for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively.

 

Drilling and Evaluation Services. Our Drilling and Evaluation Services segment includes the results of operations from services that are generally offered and performed during pre-production stages of a well’s lifecycle and related mainly to the operation of oil rigs. The services mainly include rigs and integrated services, fishing and downhole tools, thru-tubing intervention, tubular running services, directional drilling, drilling and completion fluids, pressure control, well testing services, wireline logging services and slickline services. Our Drilling and Evaluation Services accounted for 38%, 41%, 38%, and 39%, of our revenues for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively.

 

For a full discussion of our reportable segments, see the section entitled “Business” in Part I, Item 1 of our 2025 Annual Report.

 

Key Components of Revenues and Expenses

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, there have been no material changes to our key components of revenues and expenses. See the section entitled “Key Components of Revenues and Expenses” in Part II, Item 7 of our 2025 Annual Report for more information.

 

2026 compared to 2025

 

The following table presents our Condensed Consolidated Statements of Operations (Unaudited) data for the periods indicated (in US$ thousands):

 

   For the three-month
period ended
   For the nine-month
period ended
 
Description  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
                 
Revenues  $504,725   $295,315   $1,430,063   $925,785 
Cost of services   (435,771)   (259,955)   (1,227,986    (809,086)
Gross profit   68,954    35,360    202,077    116,699 
Selling, general and administrative expenses (excluding Amortization)   (12,573)   (11,061)   (35,694    (34,981)
Amortization   (3,872)   (4,693)   (12,998    (14,080)
Operating income   52,509    19,606    153,385    67,638 
Interest expense, net   (6,706)   (8,128)   (20,287    (24,974)
Other (expense) / income, net   (2,761)   759    (197)   2,758 
Income before income tax   43,042    12,237    132,901    45,422 
Income tax (expense) / benefit   (8,714)   5,500    (30,729)   (2,093)
Net income  $34,328   $17,737   $102,172   $43,329 

 

Revenue. Revenue was $504.7 million for the three-month period ended September 30, 2026, compared to $295.3 million for the three-month period ended September 30, 2025, and $1,430.1 million for the nine-month period ended September 30, 2026, compared to $925.8 million for the nine-month period ended September 30, 2025.

 

The table below presents our revenue by segment for the periods indicated (in US$ thousands):

 

   For the three-month
period ended
   For the nine-month
period ended
 
   September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Reportable Segment:                    
Production Services  $312,951   $174,443   $883,728   $567,591 
Drilling and Evaluation Services   191,774    120,872    546,335    358,194 
Total revenue  $504,725   $295,315   $1,430,063   $925,785 

 

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Production Services revenue was $313.0 million for the three-month period ended September 30, 2026, compared to $174.4 million for the three-month period ended September 30, 2025, and $883.7 million for the nine-month period ended September 30, 2026, compared to $567.6 million for the nine-month period ended September 30, 2025. The change in revenue was primarily due to increased hydraulic fracturing stages in Saudi Arabia.

 

Drilling and Evaluation Services revenue was $191.8 million for the three-month period ended September 30, 2026, compared to $120.9 million for the three-month period ended September 30, 2025, and $546.3 million for the nine-month period ended September 30, 2026, compared to $358.2 million for the nine-month period ended September 30, 2025. The change in revenue was primarily due to increased well testing and to a lesser extent, wireline logging activity in Saudi Arabia.

 

Cost of services. Cost of services was $435.8 million for the three-month period ended September 30, 2026, compared to $260.0 million for the three-month period ended September 30, 2025, and $1,228.0 million for the nine-month period ended September 30, 2026, compared to $809.1 million for the nine-month period ended September 30, 2025. Cost of services as a percentage of total revenue was 86.3%, 88.8%, 85.9% and 87.4% for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively. The change in cost of services as a percentage of total revenue is mainly due to increased activity levels in the period ended September 30, 2026, as compared to the prior year period, reflecting improved cost absorption as revenue scaled. Cost of services included depreciation expense of $33.2 million, $29.0 million, $94.0 million and $87.8 million for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively.

 

Gross profit. Gross profit was $69.0 million for the three-month period ended September 30, 2026, compared to $35.4 million for the three-month period ended September 30, 2025, and $202.1 million for the nine-month period ended September 30, 2026, compared to $116.7 million for the nine-month period ended September 30, 2025. Gross profit as a percentage of total revenue was 13.7%, 12.0%, 14.1% and 12.6% for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively. The change in trend is described under “Revenue” and “Cost of services.”

 

SG&A expense. Selling, general, and administrative (“SG&A”) expense, which represents costs associated with managing and supporting our operations, was $12.6 million for the three-month period ended September 30, 2026, compared to $11.1 million for the three-month period ended September 30, 2025, and $35.7 million for the nine-month period ended September 30, 2026, compared to $35.0 million for the nine-month period ended September 30, 2025. The increases in SG&A expense for the three and nine months ended September 30, 2026, compared to the corresponding periods in 2025, were primarily attributable to higher share-based compensation expense associated with awards granted in 2026. These increases were partially offset by lower costs associated with the remediation of the Company’s previously identified material weakness in internal control over financial reporting, which was fully remediated as of June 30, 2025. SG&A expense as a percentage of total revenue was 2.5%, 3.7%, 2.5% and 3.8% for the three-month period ended September 30, 2026, the three-month period ended September 30, 2025, the nine-month period ended September 30, 2026, and the nine-month period ended September 30, 2025, respectively. SG&A expense as a percentage of total revenue decreased in 2026 as compared to 2025 due to a significant increase in overall activity levels for the Company.

 

Amortization expense. Amortization expense was $3.9 million for the three-month period ended September 30, 2026, compared to $4.7 million for the three-month period ended September 30, 2025, and $13.0 million for the nine-month period ended September 30, 2026, compared to $14.1 million for the nine-month period ended September 30, 2025. Amortization expense is driven mainly by acquired intangible assets resulting from acquisitions.

 

Interest expense, net. Interest expense, net, was $6.7 million for the three-month period ended September 30, 2026, compared to $8.1 million for the three-month period ended September 30, 2025, and $20.3 million for the nine-month period ended September 30, 2026, compared to $25.0 million for the nine-month period ended September 30, 2025. Interest expense, net, decreased period-over-period, due to lower debt levels during 2026 as compared to 2025.

 

Other (expense) / income, net. Other (expense) / income, net, was ($2.8) million for the three-month period ended September 30, 2026, compared to $0.8 million for the three-month period ended September 30, 2025, and ($0.2) million for the nine-month period ended September 30, 2026, compared to $2.8 million for the nine-month period ended September 30, 2025. The period-over-period fluctuation in Other (expense) / income, net, was primarily attributable to a $2.9 million charge recognized during the third quarter of 2026 related to an investment accounted for under the measurement alternative prescribed by Accounting Standards Codification 321, Investments—Equity Securities.

 

Income tax expense. Income tax expense was $8.7 million for the three-month period ended September 30, 2026, compared to income tax (benefit) of $(5.5) million for the three-month period ended September 30, 2025, and income tax expense of $30.7 million for the nine-month period ended September 30, 2026, compared to income tax expense of $2.1 million for the nine-month period ended September 30, 2025. The recognition of an income tax benefit for the three-month period ended September 30, 2025, despite positive income before income tax, primarily reflects adjustments to the Company’s uncertain tax positions and unrecognized tax benefits totaling $9.2 million on a net basis. See Note 7, Income Taxes, to our condensed consolidated interim financial statements included in Part 1, Item 1, “Financial Statements (Unaudited)” of this Quarterly Report.

 

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Net income. Net income was $34.3 million for the three-month period ended September 30, 2026, compared to $17.7 million for the three-month period ended September 30, 2025, and $102.2 million for the nine-month period ended September 30, 2026, compared to $43.3 million for the nine-month period ended September 30, 2025.

 

Supplemental Segment Operating Income Discussion

 

   For the three-month
period ended
   For the nine-month
period ended
 
(in US$ thousands)  September 30, 2026   September 30, 2025   September 30, 2026   September 30, 2025 
Reportable Segment:                    
Production Services  $

42,623

   $15,578   $135,592   $58,303 
Drilling and Evaluation Services   27,682    16,267    67,567    53,128 

 

Production Services operating income was $42.6 million for the three-month period ended September 30, 2026, compared to $15.6 million for the three-month period ended September 30, 2025, and $135.6 million for the nine-month period ended September 30, 2026, compared to $58.3 million for the nine-month period ended September 30, 2025. The change in supplemental segment operating income was primarily due to increased hydraulic fracturing stages in Saudi Arabia with a significant portion of incremental revenue translating into segment operating income.

 

Drilling and Evaluation operating income was $27.7 million for the three-month period ended September 30, 2026, compared to $16.3 million for the three-month period ended September 30, 2025, and $67.6 million for the nine-month period ended September 30, 2026, compared to $53.1 million for the nine-month period ended September 30, 2025. The change in supplemental segment operating income was primarily due to additional well testing, and to a lesser extent, wireline logging, activity in Saudi Arabia with a share of incremental revenue contributing to segment operating income.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Our objective in financing our business is to maintain sufficient liquidity, adequate financial resources and financial flexibility to fund the requirements of our business. We had cash and cash equivalents of $106.8 million as of September 30, 2026, and $124.8 million as of December 31, 2025. Our outstanding borrowings were $267.3 million as of September 30, 2026, and $310.1 million as of December 31, 2025. Current available borrowing capacity totaled $39.5 million and $146.9 million, as of September 30, 2026, and December 31, 2025, respectively. Borrowing capacity decreased in the nine-month period ended September 30, 2026, reflecting the Company’s decision not to extend its $59.2 million Secured Revolving Credit Facility beyond February 4, 2026, given sufficient operating cash flow and liquidity, as well as a $46.6 million reduction in the Working Capital Facility following the scheduled expiration of one tranche of availability within the lender syndicate as partially offset by new commitments. In October 2026, the Company announced the funding of the 2026 Secured Facilities Agreement and $55.0 Million Term Facilities Agreement, see Note 6, Debt, to the condensed consolidated financial statements included in Part 1, Item 1, “Financial Statements,” of this Quarterly Report. We believe that our cash on hand, cash flows generated from operations, and liquidity available through our credit facilities will provide sufficient liquidity to manage our global cash needs. See “Capital Requirements” below.

 

Cash Flows

 

Cash flows provided by (used in) each type of activity were as follows for the periods presented (in US$ thousands):

 

   For the nine-month period ended 
   September 30, 2026   September 30, 2025 
         
Cash provided by (used in):          
Operating Activities  $201,537   $125,652 
Investing Activities   (154,923)   (106,784)
Financing Activities   (52,906)   (57,141)
Effect of exchange rate changes on cash   -    - 
Net change in cash, cash equivalents, and restricted cash  $(6,292)  $(38,273)

 

20
 

 

Operating Activities

 

Cash flows provided by operating activities were $201.5 million for the nine-month period ended September 30, 2026, compared to cash flows provided by operating activities of $125.7 million for the nine-month period ended September 30, 2025. The difference between periods was primarily driven by higher net income.

 

Investing Activities

 

Cash flows used in investing activities were $154.9 million for the nine-month period ended September 30, 2026, compared to cash flows used in investing activities of $106.8 million for the nine-month period ended September 30, 2025. The difference between periods was primarily due to higher cash paid for capital expenditures period-over-period to support growth in our operations. Our principal recurring investing activity is the funding of capital expenditures to ensure that we have the appropriate levels and types of machinery and equipment in place to generate revenue from operations.

 

Financing Activities

 

Cash flows used in financing activities were $52.9 million for the nine-month period ended September 30, 2026, compared to cash flows used in financing activities of $57.1 million for the nine-month period ended September 30, 2025. The difference between periods was primarily attributable to lower short-term borrowings.

 

Credit Facilities

 

Our principal credit facilities and instruments outstanding or available as of September 30, 2026, are discussed in Note 6, Debt, to the condensed consolidated financial statements included in Part 1, Item 1, “Financial Statements,” of this Quarterly Report.

 

Capital Requirements

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, there have been no material changes to our capital requirements. See the section entitled “Capital Requirements” in Part II, Item 7 of our 2025 Annual Report for more information.

 

Off-Balance Sheet Arrangements

 

Our off-balance sheet arrangements, including letters of credit and guarantees, are discussed in Note 8, Commitments and Contingencies, to the condensed consolidated financial statements included in Part 1, Item 1, “Financial Statements,” of this Quarterly Report.

 

Contractual Obligations and Commitments

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, there have been no material changes to our contractual obligations. See the section entitled “Contractual Obligations and Commitments” in Part II, Item 7 of our 2025 Annual Report for more information. Subsequent to September 30, 2026, the Company entered into new contractual obligations and commitments which are discussed in Note 6, Debt, to the condensed consolidated financial statements included in Part 1, Item 1, “Financial Statements,” of this Quarterly Report.

 

Other Factors Affecting Liquidity

 

Shelf registration statement. On May 26, 2026, the Company filed a shelf registration statement on Form S-3 with the SEC that automatically became effective the same day. The shelf registration statement gives the Company the ability to sell the ordinary shares from time to time in one or more offerings. The specific terms, including the amount, of any ordinary shares to be sold in any such offering, if it does occur, would be described in supplemental filings with the SEC. The shelf registration statement currently provides flexibility for strategic opportunities, financing initiatives, and other corporate purposes. The shelf registration statement will expire in 2029.

 

Capital expenditure commitments. The Company was committed to incur capital expenditures of $61.8 million and $45.6 million at September 30, 2026, and December 31, 2025, respectively. Substantially all of the commitments outstanding as of September 30, 2026, are expected to be settled during 2026 and 2027.

 

Capital return program. In May 2026, the Company approved a capital return program consisting of (i) a quarterly cash dividend, anticipated to commence in the fourth quarter of 2026, at an expected rate of $0.10 per ordinary share, and (ii) authorization for the repurchase of up to $50.0 million of the Company’s ordinary shares from time to time through open market transactions, privately negotiated transactions, or otherwise, at prevailing market prices and subject to market conditions, applicable legal requirements, and liquidity considerations. On November 6, 2026, the Company’s Board of Directors declared its first quarterly cash dividend of $0.10 per ordinary share, payable on December 10, 2026, to shareholders of record as of December 3, 2026. We expect to fund dividends and share repurchases through a combination of existing cash on hand and cash flows generated from operations. These capital allocation activities will be evaluated in the context of our overall liquidity position, operating requirements and strategic priorities.

 

21
 

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, there have been no material changes to other factors affecting our liquidity except as described above. See the section entitled “Other Factors Affecting Liquidity” in Part II, Item 7 of our 2025 Annual Report for more information.

 

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

 

As of the end of the three-month and nine-month periods covered by this Quarterly Report, there have been no material changes to our critical accounting policies and estimates. See the section entitled “Critical Accounting Policies and Estimates” in Part II, Item 7 of our 2025 Annual Report for more information.

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report contains forward-looking statements (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Any and all statements contained in this Quarterly Report that are not statements of historical fact may be deemed forward-looking statements. Terms such as “may,” “might,” “would,” “should,” “could,” “project,” “estimate,” “predict,” “potential,” “strategy,” “anticipate,” “attempt,” “develop,” “plan,” “help,” “believe,” “continue,” “intend,” “expect,” “future,” and terms of similar import (including the negative of any of these terms) may identify forward-looking statements. However, not all forward-looking statements may contain one or more of these identifying terms. Forward-looking statements in this Quarterly Report may include, without limitation, the plans and objectives of management for future operations, projections of income or loss, earnings or loss per share, capital expenditures, dividends, capital structure or other financial items, our future financial performance, including any such statement contained in a discussion and analysis of financial condition by management or in the results of operations included pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), expansion plans and opportunities, completion and integration of acquisitions and the assumptions underlying or relating to any such statement.

 

The forward-looking statements are not meant to predict or guarantee actual results, performance, events or circumstances and may not be realized because they are based upon our current projections, plans, objectives, beliefs, expectations, estimates and assumptions and are subject to a number of risks and uncertainties and other influences, many of which we have no control over, including the impact of the extent of any material weakness or significant deficiencies in our internal control over financial reporting. Actual results and the timing of certain events and circumstances may differ materially from those described by the forward-looking statements as a result of these risks and uncertainties. Factors that may influence or contribute to the accuracy of the forward-looking statements or cause actual results to differ materially from expected or desired results may include, without limitation:

 

  ● Changing commodity prices, market volatility and other market trends that affect our customers’ demand for our services;
     
  ● Public health crises and other catastrophic events;
     
  ● The level of capital spending by our customers;
     
  ● Political, market, financial and regulatory risks, including those related to the geographic concentration of our operations and customers;
     
  ● Our operations, including maintenance, upgrades and refurbishment of our assets, may require significant capital expenditures, which may or may not be available to us;
     
  ● Operating hazards inherent in our industry and the ability to secure sufficient indemnities and insurance;
     
  ● Our ability to successfully integrate acquisitions;
     
  ● Conditions in the Middle East, including current uncertainty and instability resulting from the conflict between the United States, Israel and Iran, as well as other regional hostilities that could adversely affect our business; and
     
  ● Other risks and uncertainties set forth in Part II, Item 1A, “Risk Factors,” included in Part I, Item 1A “Risk Factors,” in our 2025 Annual Report.

 

Readers are cautioned not to place undue reliance on forward-looking statements because of the risks and uncertainties related to them and to the risk factors. The Company disclaims any obligation to update the forward-looking statements contained in this Quarterly Report to reflect any new information or future events or circumstances or otherwise, except as required by law. Readers should read this Quarterly Report in conjunction with other documents which the Company may file or furnish from time to time with the SEC.

 

22
 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

See the section entitled “Quantitative and Qualitative Disclosures about Market Risk” in Part II, Item 7A of our 2025 Annual Report on Form 10-K for more information. Our exposure to market risk has not changed materially since December 31, 2025.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

 

No changes in our internal control over financial reporting occurred during the quarter ended September 30, 2026, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

23
 

 

PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

Information regarding Item 1 is discussed in Note 8, Commitments and Contingencies, to the condensed consolidated financial statements included in Part 1, Item 1, “Financial Statements,” of this Quarterly Report.

 

ITEM 1A. RISK FACTORS

 

As of September 30, 2026, there have been no material changes in risk factors previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

During the period covered by this Quarterly Report, we had no mine safety violations or other regulatory matters required to be disclosed pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K.

 

ITEM 5. OTHER INFORMATION

 

Except as previously disclosed, during the three months ended September 30, 2026, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

 

24
 

 

ITEM 6. EXHIBITS

 

No.   Description of Exhibit
3.1   Memorandum and Articles of Association, as amended and restated (incorporated herein by reference to Exhibit 99.2 to the Company’s Periodic Report on Form 6-K (File No. 001-38091) filed on May 21, 2024).
4.1   Specimen Ordinary Share Certificate (incorporated herein by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1/A (File No. 333-217006) filed on April 25, 2017).
4.2   Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated herein by reference to Exhibit 2.5 to the Company’s Annual Report on Form 20-F (File No. 001-38091) filed on December 29, 2023).
4.3   Relationship Agreement, dated June 5, 2018, by and between the Company, NESR Holdings Limited and Hana Investments Co. WLL (incorporated herein by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K (File No. 001-38091) filed on June 12, 2018).
4.4   Registration Rights Agreement, dated June 5, 2018, by and between the Company and Hana Investments Co. WLL (incorporated herein by reference to Exhibit 10.15 to the Company’s Current Report on Form 8-K (File No. 001-38091) filed on June 12, 2018).
4.5   Relationship Agreement, dated June 6, 2018, by and between the Company and AL Nowais Investments LLC (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File No. 001-38091) filed on June 12, 2018).
4.6   Amended and Restated Registration Rights Agreement, dated June 6, 2018, by and among the Company, NESR Holdings Ltd., Al Nowais Investments LLC, and NESR SPV Limited (incorporated herein by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K (File No. 001-38091) filed on June 12, 2018).
4.8   Registration Rights Agreement dated June 6, 2018 by and between the Company and SV3 Holdings PTE LTD (incorporated herein by reference to Exhibit 10.20 to the Company’s Current Report on Form 8-K (File No. 001-38091) filed on June 12, 2018).
10.1*   Form of Restricted Stock Unit Award Agreement
10.2   National Energy Services Reunited Corp. Amended and Restated 2018 Long Term Incentive Plan (incorporated herein by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-8 (File No. 333-280902) filed on July 19, 2024).
31.1*   Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer.
31.2*   Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer.
32.1**   Certificate of Chief Executive Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
32.2**   Certificate of Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
101.INS*   XBRL Instance Document.
101.SCH*   XBRL Taxonomy Extension Schema Document.
101.CAL*   XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*   XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*   XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*   XBRL Taxonomy Extension Presentation Linkbase Document.
104*   Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101)

 

* Filed herewith.

** Furnished herewith.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  NATIONAL ENERGY SERVICES REUNITED CORP.
     
Date: November 9, 2026   /s/ Sherif Foda
  Name: Sherif Foda
  Title: Chief Executive Officer
    (Principal Executive Officer)

 

Date: November 9, 2026   /s/ Stefan Angeli
  Name: Stefan Angeli
  Title: Chief Financial Officer
    (Principal Financial and Accounting Officer)

 

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