Fidelity National Information Services, Inc. (FIS) Earnings

Management highlights

### Core Financial Performance Summary - Q2 2026 total revenue grew 8% to $226 million, adjusted EBITDA increased 39% to $32 million, and adjusted net income increased 148% to $14 million, exceeding the high end of prior guidance - Total orders reached $236 million, resulting in an overall book-to-bill ratio of 104%, marking the fifth quarter of orders exceeding revenue in the last six quarters - Generated $10 million in free cash flow; net debt fell to $115 million, and the net leverage ratio improved from 1.4x to 1.1x based on trailing 12-month EBITDA of $100 million - Total liquidity at quarter-end was $96 million; $8 million in shares were repurchased in H1 2026, with $42 million returned to shareholders over the past two years ### Strategic Progress (FET 2030 Vision) - The company's "Beat the Market" strategy (launched 2022) has delivered a 34% increase in revenue per global rig, with consistent market share gains driven by differentiated technology and commercial execution - Management projects that long-term fundamentals (growing global energy demand, energy security priorities post-Middle East conflict, and need to offset production declines) will expand the company's addressable market by more than 50% over the next five years, creating a clear path to double revenue by 2030 - Key operational and innovation milestones achieved in Q2: - Sandgard artificial lift protection solution is progressing through field trials with a major global oil company in the Middle East, after successful adoption in the U.S. - Following regulatory approval, the company has delivered large volumes of coil tubing strings to Venezuela, with growing follow-on demand for pressure control and Coiled Line Pipe products - Substantial aftermarket orders were received for the Unity remote ROV operations software platform, covering both FET and competitor systems, creating a new growth avenue for the subsea segment - Two major milestones hit for heat transfer products: a new high-temperature frac product (for harsh Middle East environments) received its first order from a major service company, and the new stationary cooling solution for power generation/data centers also secured its initial commercial order ### Geographic Expansion Highlights - North America: Stronger completions activity lifted frac utilization, driving demand for wireline, coiled tubing, and downhole products; activity in Canadian oil sands remained robust - International: Overall regional activity was impacted by the Middle East conflict, but investment in offshore and unconventional developments stayed strong, with the company delivering consistent international revenue growth from technology aligned with customer efficiency priorities

Guidance

- Full year 2026 guidance was meaningfully raised from prior levels: management now expects total revenue of $870–$910 million, adjusted EBITDA of $115–$125 million, adjusted net income of $42–$52 million, and full-year free cash flow of $57–$77 million. At these levels, full-year revenue would grow 13% year-over-year, and EBITDA would grow 40% year-over-year, with an incremental margin of 34%. - Q3 2026 guidance: Total revenue of $225–$245 million, adjusted EBITDA of $31–$37 million, adjusted net income of $12–$18 million, and Q3 free cash flow of $15–$25 million. At the midpoint, this represents ~20% year-over-year revenue growth and ~48% year-over-year EBITDA growth. - Management expects broad stable industry activity in H2 2026, with modest improvement in select regions, and projects that energy security priorities have accelerated some activity that was previously expected for later years, leading to a slight uptick in 2026 activity versus the prior flat outlook.

Segment performance

Forum Energy Technologies has two operating segments for Q2 2026: 1. Drilling and completions: Revenue increased 10% sequentially to $139 million, contributing 61.5% of total company revenue. Segment EBITDA increased 29% to ~$16 million, with an EBITDA margin of 12% (expanded 180 basis points sequentially). Quarter-end book-to-bill ratio was 104%. Growth was driven by higher demand for coiled tubing products, wireline cables, and capital equipment including iron roughnecks and radiators. 2. Artificial lift and downhole: Revenue increased 6% sequentially to $87 million, contributing 38.5% of total company revenue. Segment EBITDA increased 30% to ~$22 million, with an EBITDA margin expanded to nearly 25%. Quarter-end book-to-bill ratio was 105%. Growth was driven by high demand for sand and flow control products, artificial lift products, and casing hardware, with favorable product mix driving a 95% incremental EBITDA margin, partially offset by lower shipments of mechanical production equipment.

Risks & headwinds

- Ongoing Middle East conflict currently impacts regional activity levels, and a lasting resolution is required for the full projected growth in the region to be realized. - A large sudden increase in U.S. fracking fleet demand could extend component lead times, though the company notes it has built flexible supply chain capacity to adapt to demand surges.

Analyst Q&A

• Q: What drove Q2 performance that exceeded the top end of prior guidance, and is there a geographic shift in revenue trends?

  A: Management confirmed they already expected improved results in Q2 after raising guidance prior to the quarter. The primary outperformance driver was strong execution by the subsea team converting large backlog into revenue. Geographic growth remains broad-based: completions activity is up in North America, Canada oil sands has been a particularly strong growth driver, and the company continues to deliver revenue in the Middle East despite ongoing regional conflict.

• Q: Margin expansion was larger than expected from just operating leverage alone. What factors drove the stronger-than-expected margin lift, and is it sustainable?

  A: Three factors contributed to the strong margin result: 1) operating leverage from higher revenue throughput, which delivers disproportionate margin gains for a manufacturing business; 2) locked-in cost reduction initiatives completed in Q1 2026, which delivered a sustainable sequential margin improvement; 3) favorable product mix, with strong growth in high-margin high-value downhole products offset by temporarily lower shipments of lower-margin production equipment. Management notes the gains are sustainable: cost savings are permanent, continued growth will deliver further operating leverage, and ongoing share gains in targeted high-margin product lines will support continued strong margins.

• Q: Most of the projected 50% addressable market growth through 2030 is expected to come from which geographies?

  A: Currently, the company generates over $700,000 in annual revenue per rig in the U.S., versus only ~$300,000 per rig internationally. Most growth will come from exporting U.S.-developed unconventional oil and gas technologies to high-growth international markets, primarily the Middle East and Latin America. North America remains a core market, but international expansion will drive the majority of long-term revenue share growth.

• Q: How much of current revenue growth comes from market share gains versus overall industry activity growth? When will Middle East opportunities start contributing meaningfully to growth?

  A: A large portion of current revenue growth comes from market share gains, as global rig count has been essentially flat year-to-date. Modest overall activity growth is expected, but share gains will remain the primary growth driver. For the Middle East, the company still generates ~10-11% of total revenue there despite the conflict, but full realization of projected growth will likely occur after the conflict resolves and regional activity normalizes, when local national oil companies are expected to expand activity and adopt U.S.-proven efficiency technologies that FET supplies.