Helmerich & Payne HP Form 10-Q filing Q3 FY2026

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

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

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

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

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

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

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

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HELMERICH & PAYNE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 NATURE OF OPERATIONS

Helmerich & Payne, Inc. (“H&P,” which, together with its subsidiaries, is identified as the “Company,” “we,” “us,” or “our,” except where stated or the context requires otherwise) through its operating subsidiaries provides performance-driven drilling solutions and technologies that are intended to make hydrocarbon recovery safer and more economical for oil and gas exploration and production companies.

Our Segments

During the nine months ended June 30, 2026, we announced the rebranding of our Kenera business unit to BENTEC™. The BENTEC™ name, already recognized in the market, will now represent all products and services previously associated with Kenera and its sub-brands.

Our North America Solutions operations are primarily located in Texas, but also traditionally operate in other states, depending on demand. Our International Solutions operations are conducted in major international oil and gas markets, primarily in the Middle East and Latin America. Our Offshore Solutions operations consist of asset-light offshore management contracts and contracted rig platforms located in U.S. federal waters, the North Sea and Norwegian Sea off the coast of Norway, the Caspian Sea and other international waters. Our "Other" operations is primarily comprised of our BENTEC™ manufacturing and engineering activities and our wholly-owned captive insurance companies. Refer to Note 12—Business Segments and Geographic Information for further details on our reportable segments.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, RELATED RISKS AND UNCERTAINTIES

Interim Financial Information

The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) pertaining to interim financial information. Accordingly, these interim financial statements do not include all information or footnote disclosures required by U.S. GAAP for complete financial statements and, therefore, should be read in conjunction with the Consolidated Financial Statements and notes thereto in our 2025 Annual Report on Form 10-K and other current filings with the SEC. In the opinion of management, all adjustments, consisting of those of a normal recurring nature, necessary to present fairly the results of the periods presented have been included. The results of operations for the interim periods presented may not necessarily be indicative of the results to be expected for the full year.

Principles of Consolidation

The Unaudited Condensed Consolidated Financial Statements include the accounts of H&P and its domestic and foreign subsidiaries. Consolidation of a subsidiary begins when the Company gains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income, expenses and other comprehensive income or loss of a subsidiary acquired or disposed of during the fiscal year are included in the Unaudited Condensed Consolidated Statements of Operations and Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) from the date the Company gains control until the date when the Company ceases to control the subsidiary. The equity attributable to non-controlling interests in subsidiaries is shown separately in the accompanying Unaudited Condensed Consolidated Balance Sheets. All intercompany accounts and transactions have been eliminated upon consolidation.

Cash, Cash Equivalents, and Restricted Cash

Cash and cash equivalents include cash on hand, demand deposits with banks and all highly liquid investments with original maturities of three months or less. Our cash, cash equivalents and short-term investments are subject to potential credit risk, and certain of our cash accounts carry balances greater than the federally insured limits.

As of June 30, 2026 and September 30, 2025, restricted cash was $34.9 million and $29.1 million, respectively. Of the total at June 30, 2026 and September 30, 2025, $33.6 million and $27.4 million, respectively, represents the amount management has elected to restrict for the purpose of potential insurance claims in our wholly-owned captive insurance companies. Additionally, of the total at September 30, 2024, $1.2 billion represents net proceeds from senior notes issued in fiscal year 2024 to finance the purchase price of the entire issued share capital (the "Acquisition") of KCA Deutag International Limited ("KCA Deutag") and to repay certain of KCA Deutag's outstanding indebtedness. These proceeds were subsequently used during the fiscal year ended September 30, 2025 to fund the Acquisition. The restricted amounts are primarily invested in short-term money market securities.

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Cash, cash equivalents, and restricted cash are reflected on the Unaudited Condensed Consolidated Balance Sheets as follows:

Recently Issued Accounting Updates

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates ("ASUs") to the FASB Accounting Standards Codification ("ASC"). We consider the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable, immaterial, or already adopted by the Company.

The following table provides a brief description of recent accounting pronouncements and our analysis of the effects on our financial statements:

• Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters

• Standards that are not yet adopted as of June 30, 2026

• ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures This ASU enhances income tax disclosure requirements. Under the ASU, public business entities must annually (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate). Specific categories that must be included in the reconciliation for each annual reporting period are specified in the amendment. This update is effective for annual periods beginning after December 15, 2024. Early adoption of the amendments is permitted. Upon adoption, the amendments shall be applied on a prospective basis. Retrospective application is permitted. September 30, 2026 We plan to adopt this ASU, as required, during fiscal year 2026, with the first disclosure enhancements reflected in our fiscal year 2026 Form 10-K. We are currently evaluating the impact this ASU will have on our disclosures.

• ASU No. 2024-03, Income Statement -- Reporting Comprehensive Income -- Expense Disaggregation Disclosure (Subtopic 220-40) This ASU enhances disclosure requirements for certain costs and expenses. The amendments in this update enhance annual and interim disclosure requirements, certain liability-related expenses, expense reimbursements related to a cost-sharing or cost-reimbursement arrangement with another entity, and the disaggregation of relevant expense captions. This update gives entities the ability to use estimates or other methods that produce a reasonable approximation of the amounts required to be disclosed. This update is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. Upon adoption, the amendments shall be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this Update or (2) retrospectively to any or all prior periods presented in the financial statements. September 30, 2028 We plan to adopt this ASU, as required, during fiscal year 2028 with the first disclosure enhancements reflected in our 2028 fiscal year Form 10-K. We are currently evaluating the impact the new guidance may have on our consolidated financial statements and disclosures.

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Self-Insurance

We continue to use our captive insurance companies to fund the self-insured retentions ("SIRs") and deductibles for our domestic workers’ compensation, general liability, automobile liability programs, medical stop-loss program, and certain international casualty and property programs. Our operating subsidiaries are paying premiums to the Captives, typically on a monthly basis, for the estimated losses based primarily on an external actuarial analysis. These premiums are currently held in a restricted cash account, resulting in a transfer of risk from our operating subsidiaries to the Captives. These intercompany insurance premiums are reflected as segment operating expenses within the North America Solutions, International Solutions, and Offshore Solutions reportable operating segments and are reflected as intersegment sales within "Other." Intercompany premium revenues recorded by the Captives during the three months ended June 30, 2026 and 2025 amounted to $17.3 million and $16.3 million, respectively, and $55.2 million and $50.8 million during the nine months ended June 30, 2026 and 2025, respectively, which were eliminated upon consolidation. Direct operating costs consisted primarily of adjustments to accruals for estimated losses of $(3.7) million and $29.3 million during the three months ended June 30, 2026 and 2025, respectively, and $(1.6) million and $43.5 million during the nine months ended June 30, 2026 and 2025, respectively, and rig and casualty insurance premiums of $12.6 million and $10.1 million during the three months ended June 30, 2026 and 2025, respectively, and $35.9 million and $31.8 million during the nine months ended June 30, 2026 and 2025, respectively. Our medical stop loss operating expenses for the three months ended June 30, 2026 and 2025 were $4.8 million and $4.4 million, respectively, and $11.5 million and $14.8 million for the nine months ended June 30, 2026 and 2025, respectively. These operating costs were recorded within Drilling services operating expenses in our Unaudited Condensed Consolidated Statements of Operations.

Foreign Currencies

The reporting and functional currency of the parent company, H&P, is the United States Dollar ("USD"). Our foreign subsidiaries are measured using the currency of the primary economic environment in which the entity operates (the functional currency). For some of our foreign subsidiaries, functional currency is not measured in U.S. Dollars, and, instead, is the local currency. On consolidation, the assets and liabilities of our non U.S. Dollar functional entities are translated at exchange rates in effect at the balance sheet date. Revenue and expenses are translated at the average exchange rates prevailing during the reporting period. Translation adjustments are recorded as a separate component of stockholders’ equity and are included in Other comprehensive income or loss on the Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss).

For foreign subsidiaries where the functional currency is not the USD, monetary assets and liabilities are remeasured at the exchange rate in effect at the balance sheet date, while non-monetary items are remeasured at historical exchange rates. Revenues and expenses are remeasured at the average exchange rates prevailing during the reporting period. Gains and losses resulting from remeasurement are included within Foreign currency exchange gain (loss) on the Unaudited Condensed Consolidated Statements of Operations.

International Operations Risks

International drilling operations may significantly contribute to our revenues and net operating income (loss). There can be no assurance that we will be able to successfully conduct such operations, and a failure to do so may have an adverse effect on our financial position, results of operations, and cash flows. Also, the success of our international operations will be subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general and regional economic conditions, geopolitical developments and tensions, war and uncertainty in oil-producing countries, fluctuations in currency exchange rates, foreign currency exchange restrictions and other difficulties repatriating cash from foreign countries, changes in international regulatory requirements and international employment issues, risk of expropriation of real and personal property and the burden of complying with foreign laws. Additionally, in the event that extended labor strikes occur or a country experiences significant political, economic or social instability, we could experience shortages in labor and/or material and supplies necessary to operate some of our drilling rigs, thereby potentially causing an adverse material effect on our business, financial condition and results of operations.

Because of the impact of local laws, some of our current operations and potential future operations in certain areas may be conducted through entities in which local citizens own interests. Additionally, these operations might involve entities (including joint ventures) where we hold only a minority interest or where operations are carried out under contracts with local entities. While we believe that neither operating through such entities nor pursuant to such arrangements would have a material adverse effect on our operations or revenues, there can be no assurance that we will in all cases be able to structure or restructure our operations to conform to local law (or the administration thereof) on terms acceptable to us.

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Approximately 42.7 percent and 41.7 percent of our operating revenues were generated from international locations during the three and nine months ended June 30, 2026 compared to 36.7 percent and 31.4 percent during the three and nine months ended June 30, 2025, respectively. Although we attempt to minimize the potential impact of such risks by operating in more than one geographical area, approximately 15.7 percent and 16.2 percent of our total consolidated operating revenues were from operations in the Middle East during the three and nine months ended June 30, 2026 compared to 16.1 percent and 13.2 percent during the three and nine months ended June 30, 2025, respectively. The majority of our operating revenues in the Middle East were from operations in Saudi Arabia and Oman. During the three and nine months ended June 30, 2026, a single customer in Saudi Arabia accounted for 7.2 percent and 6.9 percent of our total consolidated operating revenues, compared to 10.0 percent and 7.4 percent during the three and nine months ended June 30, 2025. This customer has the ability to suspend rigs and a portion of our rigs with this customer are currently suspended. The future occurrence of one or more international events arising from the types of risks described above could have a material adverse impact on our business, financial condition and results of operations.

NOTE 3 PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as of June 30, 2026 and September 30, 2025 consisted of the following:

(1) Included in construction in progress are costs for projects in progress to upgrade or refurbish certain rigs in our existing fleet. Additionally, we include other advances for capital maintenance purchase-orders that are open/in process. As these various projects are completed, the costs are then classified to their appropriate useful life category.

Depreciation and Abandonments

Depreciation expense, including abandonments, was $162.8 million and $160.8 million for the three months ended June 30, 2026 and 2025, respectively. Depreciation expense, including abandonments, was $487.6 million and $405.1 million for the nine months ended June 30, 2026 and 2025, respectively. These expenses are recorded within Depreciation and amortization on our Unaudited Condensed Consolidated Statements of Operations.

In April 2026, an incident involving a rig operating in Texas resulted in a fire that caused significant damage to the asset. Based on information available as of the date of this filing, management has concluded that the rig is a total loss. The rig had a net book value of approximately $11.4 million as of March 31, 2026. The Company maintains insurance coverage for this asset and has initiated a claim with its insurance carrier. Although the insurer's assessment of the claim has not yet been finalized, the Company reached an agreement with the insurer during the three months ended June 30, 2026 for a partial settlement of $25.0 million.

The loss of $11.4 million was recognized as abandonment expense within Depreciation and amortization in the Company's Unaudited Condensed Consolidated Statements of Operations for the three months ended June 30, 2026. Consistent with applicable accounting guidance, the related insurance recovery was recognized in the same financial statement line item and was limited to the amount of the recognized loss. Accordingly, an insurance recovery of $11.4 million offset the abandonment expense during the period. The remaining insurance proceeds of approximately $13.6 million, representing the portion of the partial settlement in excess of the related loss, were recognized in Gain from involuntary conversion in the Company's Unaudited Condensed Consolidated Statements of Operations during the three months ended June 30, 2026. As of June 30, 2026, we received $2.5 million of the related insurance proceeds. The remaining $22.5 million of insurance proceeds was collected in July 2026.

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Assets Held-for-Sale

The following is a summary of the changes in the balance (in thousands) of our assets held-for-sale for the period indicated below:

Fiscal Year 2025 Activity

During the fiscal year ended September 30, 2025, we committed to a plan to sell a significant portion of our real estate portfolio, including a shopping center comprised of approximately 371,000 leasable square feet with a net book value of $12.0 million.

During the fiscal year ended September 30, 2025, we identified 16 land rigs within our International Solutions operating segment that met the asset held-for-sale criteria with an aggregate net book value of $3.2 million.

Fiscal Year 2026 Activity

In October 2025, we committed to a plan to scrap 30 rigs and auxiliary equipment within our North America Solutions segment and three rigs within our Offshore Solutions segment as part of our strategy to right size our fleet and reduce expenses. Of the 30 North America Solutions rigs, 10 were previously decommissioned. The book values of those assets in our North America Solutions and Offshore Solutions segments were written down to the fair value less estimated cost to sell, and were reclassified as held-for-sale during the nine months ended June 30, 2026. As a result, we recognized a non-cash impairment charge of $97.9 million and $2.1 million in the North America Solutions and Offshore Solutions segments respectively, during the nine months ended June 30, 2026, in the Unaudited Condensed Consolidated Statements of Operations. In March 2026, we identified an additional $2.2 million of Offshore Solutions assets to be sold that were reclassified to held-for-sale. The estimated fair value of the Offshore Solutions assets exceeded the carrying value and therefore no impairment was recognized.

In October 2025, we identified six land rigs, inventory, and auxiliary assets within our International Solutions operating segment that met the asset held-for-sale criteria with an aggregate net book value of $6.4 million. The carrying amounts of these assets were determined to be equal to their estimated fair values; therefore, no impairment charge was recognized. In March 2026, we identified an international drilling rig that met the asset held-for-sale criteria. The rig's net book value of $23.5 million was written down to its estimated scrap value of $0.2 million, which represents fair value, resulting in a non-cash impairment charge of $23.3 million in our International Solutions segment during the nine months ended June 30, 2026. During the nine months ended June 30, 2026, we recognized a non-cash impairment charge of $2.8 million to write down assets previously classified as held‑for‑sale to their estimated fair value less costs to sell. In June 2026, we identified two additional international drilling rigs that met the held-for-sale criteria. The book values of those assets were written down to the fair value less estimated cost to sell. As a result, we recognized a non-cash impairment charge of $1.2 million in our International Solutions segment during the three and nine months ended June 30, 2026.

During the three months ended June 30, 2026, we completed the sale of Utica Square, a shopping center comprising approximately 371,000 leasable square feet located in Tulsa, Oklahoma, and included within our "Other" operations, receiving net proceeds of approximately $127.7 million. After considering the property's net book value and selling costs, the transaction resulted in a $114.8 million gain during the three and nine months ended June 30, 2026. The gain on sale is recorded in Other (gain) loss on sale of assets within our Unaudited Condensed Consolidated Statements of Operations.

Gain on Reimbursement of Drilling Equipment

We recognized a gain of $6.0 million and $18.1 million during the three and nine months ended June 30, 2026 as compared to a gain of $6.8 million and $26.1 million during the three and nine months ended June 30, 2025, respectively, related to customer reimbursement for the current replacement value of lost or damaged drill pipe. Gains related to these tubular assets are recorded in Gain on reimbursement of drilling equipment within our Unaudited Condensed Consolidated Statements of Operations.

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NOTE 4 GOODWILL AND INTANGIBLE ASSETS

Goodwill

Goodwill represents the excess of the purchase price over the fair values of the assets acquired and liabilities assumed in a business combination, at the date of acquisition. Goodwill is not amortized but is tested for potential impairment at the reporting unit level, at a minimum on an annual basis in the fourth fiscal quarter, or when indications of potential impairment exist. Our goodwill reporting units are North America Solutions and Offshore Solutions.

The following table sets forth our goodwill balance by segment for the periods indicated:

Indefinite-lived Intangible

After initial recognition, acquired in-process research and development ("IPR&D") projects are considered indefinite-lived until the abandonment or completion of the associated research and development effort. Acquired IPR&D is not amortized, but is subject to an annual impairment assessment. Included in Intangible assets, net, on our Unaudited Condensed Consolidated Balance Sheets as of June 30, 2026 and September 30, 2025 was $1.4 million and $3.2 million, of IPR&D, respectively. During the nine months ended June 30, 2026, we recorded a non-cash impairment charge of $3.0 million, associated with previously capitalized IPR&D that were determined to have no alternative future use. This amount is included in Asset impairment charges on our Unaudited Condensed Consolidated Statements of Operations. Additionally, during the nine months ended June 30, 2026, $0.2 million in IPR&D projects were completed and reclassified to a finite-lived intangible asset.

Finite-lived Intangibles

Finite-lived intangible assets are amortized using the straight-line method over the period in which these assets contribute to our cash flows and are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable in accordance with our policies for valuation of long-lived assets.

Our finite-lived intangible assets consist of the following:

Amortization expense in the Unaudited Condensed Consolidated Statements of Operations was $18.2 million and $18.7 million for the three months ended June 30, 2026 and 2025, respectively and $56.0 million and $31.1 million for the nine months ended June 30, 2026 and 2025, respectively.

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Over the next five years, amortization expense is estimated to be as follows:

NOTE 5 DEBT

As of June 30, 2026 and September 30, 2025, we have the following debt outstanding with maturities shown in the following table:

The principal amount and maturities of our long-term debt as of June 30, 2026 are summarized in the table below:

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Senior Notes Issued in Fiscal Year 2024

On September 17, 2024, we completed a private offering of $1.25 billion aggregate principal amount of senior notes, comprised of the following tranches (collectively, the “Notes”): $350.0 million aggregate principal amount of 4.65 percent senior notes due 2027 issued at a price equal to 99.958 percent of their face value, $350.0 million aggregate principal amount of 4.85 percent senior notes due 2029 issued at a price equal to 99.883 percent of their face value and $550.0 million aggregate principal amount of 5.50 percent senior notes due 2034 issued at a price equal to 99.670 percent of their face value. Interest on the Notes is payable semi-annually on June 1 and December 1 of each year, commencing on June 1, 2025.

In connection with the issuance of the Notes, the Company also entered into a registration rights agreement, dated as of September 17, 2024 (the "Registration Rights Agreement"), with the initial purchasers of the Notes named therein. Under the Registration Rights Agreement, the Company agreed, among other things, to use commercially reasonable efforts to file with the SEC, and cause to be declared effective, a registration statement with respect to an offer to exchange each series of the Notes for freely tradable notes (“Registered Notes”) having terms identical in all material respects to each such series of Notes (the “Registered Exchange Offer”). Accordingly, on May 15, 2025, the Company filed a registration statement on Form S-4 with the SEC, which was declared effective on May 28, 2025. On May 28, 2025, the Company launched the Registered Exchange Offer, which expired on July 10, 2025. Substantially all of the Notes were tendered and exchanged for Registered Notes in the Exchange Offer.

The indenture governing the Notes contains certain covenants that, among other things, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company. The indenture governing the Notes also contains customary events of default with respect to the Notes.

Senior Notes Issued in Fiscal Year 2021

On September 29, 2021, we issued $550.0 million aggregate principal amount of the 2.90 percent senior notes due 2031 ("the 2031 Notes") in an offering to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act as amended (the "Securities Act") and to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act. Interest on the 2031 Notes is payable semi-annually on March 29 and September 29 of each year, commencing on March 29, 2022.

In June 2022, we settled a registered exchange offer (the “2022 Registered Exchange Offer”) to exchange the 2031 Notes for new, SEC-registered notes that are substantially identical to the terms of the 2031 Notes, except that the offer and issuance of the new notes have been registered under the Securities Act and certain transfer restrictions, registration rights and additional interest provisions relating to the 2031 Notes do not apply to the new notes. All of the 2031 Notes were exchanged in the 2022 Registered Exchange Offer.

The indenture governing the 2031 Notes contains certain covenants that, among other things and subject to certain exceptions, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company. The indenture governing the 2031 Notes also contains customary events of default with respect to the 2031 Notes.

Term Loan Credit Agreement

On August 14, 2024, the Company entered into an unsecured term loan credit agreement (the "Term Loan Credit Agreement"), among the Company, Morgan Stanley Senior Funding, Inc. (“MSSF”) as administrative agent, and the other lenders party thereto. On the Closing Date, the Company drew an aggregate principal amount of $400.0 million under the Term Loan Credit Agreement for purposes of financing the Acquisition. The Term Loan Credit Agreement matures at the two-year anniversary of the funding of the term loan unless earlier terminated pursuant to the terms of the Term Loan Credit Agreement. On January 16, 2025, H&P completed the Acquisition, and the Company used the proceeds from the Term Loan Credit Agreement, together with the net proceeds from the Notes, and cash on hand, to finance the purchase price for the Acquisition, to repay or redeem certain of KCA Deutag's outstanding indebtedness, and to pay related fees and expenses. During the three and nine months ended June 30, 2026, the Company repaid $140.0 million and $200.0 million of the outstanding balance on the Term Loan Credit Agreement, respectively. As a result of the repayments, no amounts remain outstanding under the Term Loan Credit Agreement.

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The benchmark rate was the Secured Overnight Financing Rate ("SOFR"). We could elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate was the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum. The adjusted base rate was a fluctuating rate per annum equal to the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus 0.50 percent, or (iii) the one-month adjusted SOFR rate plus 1.0 percent. We also paid a commitment fee on the unused balance of the facility. Borrowing spreads as well as commitment fees were determined based on the debt rating for senior unsecured debt of the Company, as determined by Moody’s and Standard & Poor’s. The applicable margin for SOFR borrowings and adjusted base rate borrowings ranged from 1.0 percent to 1.625 percent per annum and zero to 0.625 percent per annum, respectively. Commitment fees for both rates ranged from 0.10 percent to 0.250 percent per annum. The weighted average variable interest rate on all amounts outstanding under the Term Loan Credit Agreement was 5.143 percent and 5.329 percent for the three and nine months ended June 30, 2026, respectively.

2024 Oman Facility

The 2024 Oman Facility provides for term loan borrowings of $45.5 million, which was originally fully drawn, but subsequently reduced by quarterly debt repayments. These secured bank loans are wholly denominated in Omani rial. The original principal value of these borrowings in Omani rial was OMR 17.6 million. The commitments under the 2024 Oman Facility mature December 31, 2034.

During the fiscal year ended September 30, 2025, our 2024 Oman Facility was amended to bear interest payable quarterly at a fixed rate of 6.00 percent per annum for two years and thereafter, at a rate that is the higher of (x) 5.00 percent and (y) the reference rate specified in the 2024 Oman Facility plus 1.75 percent. During the three and nine months ended June 30, 2026, the Company repaid $0.9 million and $2.6 million of the outstanding balance on the facility, respectively. Of the $40.5 million borrowings outstanding at June 30, 2026, a total of $3.4 million is payable within one year.

There is an annual financial covenant in the 2024 Oman Facility that requires KCAD Energy to maintain a debt service coverage ratio of at least 1.20:1.00. The 2024 Oman Facility and related agreements contain additional terms, conditions, restrictions and covenants that we believe are usual and customary in secured debt arrangements for companies of similar size and credit quality.

2023 Oman Facility

The 2023 Oman Facility provides for term loan borrowings of $45.6 million, which was originally fully drawn, but subsequently reduced by quarterly debt repayments. These secured bank loans are wholly denominated in Omani rial. The original principal value of these borrowings in Omani rial was OMR 17.6 million. The commitments under the 2023 Oman Facility mature December 31, 2033.

During the fiscal year ended September 30, 2025, our 2023 Oman Facility was amended to bear interest payable quarterly at a fixed rate of 6.00 percent per annum for two years and thereafter, at a rate that is the higher of (x) 5.00 percent and (y) the reference rate specified in the 2023 Oman Facility plus 1.75 percent. During the three and nine months ended June 30, 2026, the Company repaid $0.9 million and $2.6 million of the outstanding balance on the facility, respectively. Of the $37.2 million borrowings outstanding at June 30, 2026, a total of $3.4 million is payable within one year.

There is an annual financial covenant in the 2023 Oman Facility that requires KCAD Energy to maintain a debt service coverage ratio of at least 1.20:1.00. The 2023 Oman Facility and related agreements contain additional terms, conditions, restrictions and covenants that we believe are usual and customary in secured debt arrangements for companies of similar size and credit quality.

Amended Credit Facility

On August 14, 2024, the Company entered into an Amended and Restated Credit Agreement (the "Amended Credit Facility") with the lenders party thereto (the "Revolving Credit Agreement Lenders"), the issuing lenders party thereto and Wells Fargo ("Wells Fargo") as administrative agent, swingline lender and issuing lender, which amended and restated the Credit Agreement, dated as of November 13, 2018 (as amended through Amendment No. 2 to the Credit Agreement dated as of March 8, 2022, the “Existing Credit Agreement”), among the Company, the lenders party thereto and Wells Fargo, as administrative agent, swingline lender and issuing lender.

Under the terms of the Amended Credit Facility, the Company may obtain unsecured revolving loans in an aggregate principal amount not to exceed $950.0 million outstanding at any time. $775.0 million of the revolving commitments under the Amended Credit Facility expire on November 12, 2028 and $175.0 million of the revolving commitments mature on November 10, 2027 (the “Stated Maturity Date”), but the Company may request two one-year extensions of the Stated Maturity Date, subject to satisfaction of certain conditions. Commitments under the Amended Credit Facility may be increased by up to $100.0 million, subject to the agreement of the Company and new or existing Revolving Credit Agreement Lenders.

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The proceeds of the loans made under the Amended Credit Facility may be used by the Company for (i) working capital and other general corporate purposes, (ii) for the payment of fees and expenses related to the entering into of the Amended Credit Facility and the other credit documents and (iii) for the refinancing of the extensions of credit under the Existing Credit Agreement.

The benchmark rate is the SOFR. We can elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate is the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum. The adjusted base rate is a fluctuating rate per annum equal to the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus 0.50 percent, or (iii) the one-month adjusted SOFR rate plus 1.0 percent. We also pay a commitment fee on the unused balance of the facility. Borrowing spreads as well as commitment fees are determined based on the debt rating for senior unsecured debt of the Company, as determined by Moody’s and Standard & Poor’s. The applicable margin for SOFR borrowings and adjusted base rate borrowings ranges from 0.875 percent to 1.500 percent per annum and zero to 0.50 percent per annum, respectively. Commitment fees for both rates range from 0.075 percent to 0.200 percent per annum. Based on the unsecured debt rating of the Company on June 30, 2026, the spread over SOFR would have been 1.250 percent had borrowings been outstanding under the Amended Credit Facility and commitment fees would have been 0.150 percent. There is a financial covenant in the Amended Credit Facility that requires us to maintain a total funded debt to total capitalization ratio of less than or equal to 55.0 percent. The Amended Credit Facility contains additional terms, conditions, restrictions and covenants that we believe are usual and customary in unsecured debt arrangements for companies of similar size and credit quality, including a limitation that priority debt (as defined in the credit agreement) may not exceed 17.5 percent of the net worth of the Company. As of June 30, 2026, there were no borrowings or letters of credit outstanding, leaving $950.0 million available to borrow under the Amended Credit Facility.

As of June 30, 2026, we had $420.0 million in uncommitted bilateral credit facilities, for the purpose of obtaining the issuance of international letters of credit, bank guarantees, and performance bonds. Of the $420.0 million, $264.7 million was outstanding as of June 30, 2026.

The applicable agreements for all unsecured debt contain additional terms, conditions and restrictions that we believe are usual and customary in unsecured debt arrangements for companies that are similar in size and credit quality.

At June 30, 2026, we were in compliance with all debt covenants.

NOTE 6 INCOME TAXES

We use an estimated annual effective tax rate for purposes of determining the income tax provision during interim reporting periods. In calculating our estimated annual effective tax rate, we consider forecasted annual pre-tax income and estimated permanent book versus tax differences. Adjustments to the effective tax rate and estimates could occur during the year as information and assumptions change which could include, but are not limited to, changes to the forecasted amounts, estimates of permanent book versus tax differences, and changes to tax laws and rates.

Our income tax expense for the three months ended June 30, 2026 and 2025 was $72.4 million and $29.0 million, respectively, resulting in effective tax rates of 48.1 percent and (21.8) percent, respectively. Our income tax expense for the nine months ended June 30, 2026 and 2025 was $92.9 million and $92.1 million, respectively, resulting in effective tax rates of 459.1 percent and (764.9) percent, respectively. Effective tax rates differ from the U.S. federal statutory rate of 21.0 percent for the three and nine months ended June 30, 2026 and 2025, primarily due to non-deductible goodwill impairment for fiscal year 2025, permanent non-deductible items, foreign losses for which no tax benefit has been recognized, state and foreign income taxes, and discrete adjustments. The discrete adjustments are primarily due to equity compensation, return to provision adjustments, and unrecognized tax benefits.

As of June 30, 2026, we have recorded unrecognized tax benefits and related interest and penalties of approximately $19.3 million. We cannot predict with certainty if we will achieve ultimate resolution of any additional uncertain tax positions associated with our U.S. and international operations resulting in any additional material increases or decreases of our unrecognized tax benefits for the next twelve months.

NOTE 7 SHAREHOLDERS’ EQUITY

The Company has an evergreen authorization from the Board of Directors for the repurchase of up to four million common shares in any calendar year. The repurchases may be made using our cash and cash equivalents or other available sources and are held as treasury shares on our Unaudited Condensed Consolidated Balance Sheets. We did not make any share repurchases during the three and nine months ended June 30, 2026 and 2025.

A cash dividend of $0.25 per share was declared on June 3, 2026 for shareholders of record on August 18, 2026, payable on September 1, 2026. As a result, we recorded a Dividend payable of $25.4 million on our Unaudited Condensed Consolidated Balance Sheets as of June 30, 2026.

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Accumulated Other Comprehensive Income

Components of accumulated other comprehensive income were as follows:

The following is a summary of the changes in accumulated other comprehensive income (loss), net of tax, for the three and nine months ended June 30, 2026:

NOTE 8 REVENUE FROM CONTRACTS WITH CUSTOMERS

Drilling Services Revenue

The majority of our drilling services are performed on a "daywork" contract basis, under which we charge a rate per day, with the price determined by the location, depth and complexity of the well to be drilled, operating conditions, the duration of the contract, and the competitive forces of the market. These drilling services, including our technology solutions, represent a series of distinct daily services that are substantially the same, with the same pattern of transfer to the customer. Because our customers benefit equally throughout the service period and our efforts in providing drilling services are incurred relatively evenly over the period of performance, revenue is recognized over time using a time-based input measure as we provide services to the customer. For any contracts that include a provision for pooled term days at contract inception, followed by the assignment of days to specific rigs throughout the contract term, we have elected, as a practical expedient, to recognize revenue in the amount for which the entity has a right to invoice, as permitted by ASC 606.

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Performance-based contracts are contracts pursuant to which we are compensated partly based upon our performance against a mutually agreed upon set of predetermined targets. These types of contracts typically have a lower base dayrate, but give us the opportunity to receive additional compensation by meeting or exceeding certain performance targets agreed to by our customers. The variable consideration that we expect to receive is estimated at the most likely amount, and constrained to an amount such that it is probable a significant reversal of revenue previously recognized will not occur based on the performance targets. Total revenue recognized from performance contracts, including performance bonuses, was $311.5 million and $884.8 million, of which $14.7 million and $42.5 million related to performance bonuses recognized upon achievement of performance targets during the three and nine months ended June 30, 2026, respectively. Similarly, total revenue recognized from performance contracts, including performance bonuses, was $309.8 million and $941.4 million, of which $14.1 million and $48.1 million related to performance bonuses recognized upon achievement of performance targets during the three and nine months ended June 30, 2025, respectively.

Contract Costs

As of June 30, 2026 and September 30, 2025, we had capitalized fulfillment costs of $31.2 million and $34.8 million, respectively.

Remaining Performance Obligations

The total aggregate transaction price allocated to the unsatisfied performance obligations related to firm contracts, commonly referred to as backlog, as of June 30, 2026 was approximately $6.1 billion, of which $0.7 billion is expected to be recognized during the remainder of fiscal year 2026, $1.8 billion in fiscal year 2027, and $3.6 billion in fiscal year 2028 and thereafter. The firm backlog amounts do not include anticipated contract renewals or expected performance bonuses as part of its calculation. Additionally, contracts that currently contain month-to-month terms are represented in our backlog as one month of unsatisfied performance obligations. Our contracts are subject to cancellation or modification at the election of the customer. Although we have not been materially adversely affected by contract cancellations or modifications in the past due to the level of capital deployed by our customers on underlying projects, the early termination of a contract or suspension of operations may result in a rig being idle for an extended period of time, which could adversely affect our financial condition, results of operations and cash flows. Some of our revenue agreements contain provisions for optional early termination or suspension without any associated early termination fee and could cause the actual amount of revenue earned to significantly vary from the backlog reported.

Contract Assets and Liabilities

The following tables summarize the balances of our contract assets (net of allowance for estimated credit losses) and liabilities at the dates indicated:

NOTE 9 EARNINGS (LOSS) PER COMMON SHARE

ASC 260, Earnings per Share, requires companies to treat unvested share-based payment awards that have non-forfeitable rights to dividends or dividend equivalents as a separate class of securities in calculating earnings per share. We have granted and expect to continue to grant to employees restricted stock grants that contain non-forfeitable rights to dividends. Such grants are considered participating securities under ASC 260. As such, we are required to include these grants in the calculation of our basic earnings per share and calculate basic earnings per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings.

Basic earnings per share is computed utilizing the two-class method and is calculated based on the weighted-average number of common shares outstanding during the periods presented.

Diluted earnings per share is computed using the weighted-average number of common and common equivalent shares outstanding during the periods utilizing the two-class method for stock options, non-vested restricted stock and performance units.

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Under the two-class method of calculating earnings per share, dividends paid and a portion of undistributed net income, but not losses, are allocated to unvested restricted stock grants that receive dividends, which are considered participating securities.

The following table sets forth the computation of basic and diluted earnings per share:

We reported a net loss for the three months ended June 30, 2025 and the nine months ended June 30, 2026 and 2025. Accordingly, our diluted loss per share calculation was equivalent to our basic loss per share calculation since diluted loss per share excluded any assumed exercise of equity awards. These were excluded because they were deemed to be anti-dilutive, meaning their inclusion would have reduced the reported net loss per share in the applicable period.

The following potentially dilutive average shares attributable to outstanding equity awards were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive:

NOTE 10 FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS

We have certain assets and liabilities that are required to be measured and disclosed at fair value. Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. We use the following fair value hierarchy established in ASC 820-10 to measure fair value to prioritize the inputs:

• Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.

• Level 2 — Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets; quoted prices for similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

• Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

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The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Fair Value Measurements

The following tables summarize our financial assets and liabilities measured at fair value on a recurring basis and indicate the level in the fair value hierarchy in which we classify the fair value measurement as of the dates indicated below:

As of June 30, 2026, our equity security investments in geothermal energy and other equity security investments were $9.1 million and $9.6 million, respectively. These investments are subject to nonrecurring fair value measurement considerations and are carried at cost, less any impairment. Refer to "Nonrecurring Fair Value Measurements" for additional information regarding fair value measurements associated with these investments.

As of September 30, 2025, our short-term security investments in held to maturity bonds totaled $0.2 million. These investments are measured at cost, less any impairments.

As of September 30, 2025, our equity security investments in geothermal energy and other equity security investments were $14.1 million and $6.7 million, respectively. These investments are subject to nonrecurring fair value measurement considerations and are carried at cost, less any impairment. Refer to "Nonrecurring Fair Value Measurements" for additional information regarding the fair value measurements associated with these investments.

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Recurring Fair Value Measurements

Short-term Investments

Short-term investments primarily include securities classified as trading securities. Both realized and unrealized gains and losses on trading securities are included in Other income (expense) in the Unaudited Condensed Consolidated Statements of Operations. These securities are recorded at fair value. Level 1 inputs include money market mutual funds. For these items, quoted current market prices are readily available. Level 2 inputs include corporate bonds measured using broker quotations that utilize observable market inputs.

During the nine months ended June 30, 2025, we sold our equity securities of 159.7 million shares in ADNOC Drilling and received net proceeds of approximately $193.3 million. During the nine months ended June 30, 2025, we recognized a loss of approximately $12.4 million on our Unaudited Condensed Consolidated Statements of Operations, related to this investment.

Long-term Investments

Equity Securities Our long-term investments include debt and equity securities and assets held in a Non-Qualified Supplemental Savings Plan ("Savings Plan") and are recorded within Investments on our Unaudited Condensed Consolidated Balance Sheets. Our assets that we hold in the Savings Plan are comprised of mutual funds that are measured using Level 1 inputs.

As of June 30, 2026, we owned approximately 1.0 million shares in Tamboran Corp. whose securities are traded on the NYSE and Australian Stock Exchange under the ticker symbol "TBN", representing an ownership interest of approximately 3.6%. We account for this investment under ASC 321 and measure it at fair value, with changes in fair value recognized in earnings. Under the guidance, Topic 820, Fair Value Measurement, this investment is classified as a Level 1 investment based on the quoted stock price which is publicly available. Our investment is classified as a long-term equity investment within Investments on our Unaudited Condensed Consolidated Balance Sheets and measured at fair value with any gains or losses recognized through net income (loss) and recorded within Gain (loss) on investment securities on our Unaudited Condensed Consolidated Statements of Operations. During the three and nine months ended June 30, 2026, we recognized gain (loss) of $(14.3) million and $6.7 million, respectively, compared to a gain (loss) of $(0.8) million and $1.3 million for the corresponding periods in 2025.

Debt Securities During April 2022, the Company made a $33.0 million cornerstone investment in Galileo Holdco 2 Limited Technologies ("Galileo Holdco 2"), part of the group of companies known as Galileo Technologies (“Galileo”) in the form of notes with an option to convert into common shares of the parent of Galileo Holdco 2.

During the fiscal year ended September 30, 2025, we recorded a $29.6 million loss on our investment in Galileo, due to an allowance for credit loss on the convertible note, driven by heightened liquidity constraints and changes in governance, which led management to conclude that the fair value of the investment was not recoverable. As a result, the investment was fully reserved as of September 30, 2025. The loss was recognized through net income (loss) and recorded within Gain (loss) on investment securities on our Consolidated Statements of Operations. During the nine months ended June 30, 2026, we released Galileo from this legal obligation, resulting in the full write-off of the investment.

Nonrecurring Fair Value Measurements

We have certain assets that are subject to measurement at fair value on a nonrecurring basis. For these nonfinancial assets, measurement at fair value in periods subsequent to their initial recognition is applicable if they are determined to be impaired. These assets generally include property, plant and equipment, goodwill, intangible assets, and operating lease right-of-use assets. If measured at fair value in the Unaudited Condensed Consolidated Balance Sheets, these would generally be classified within Level 2 or 3 of the fair value hierarchy. Further details on any changes in valuation of these assets is provided in their respective footnotes.

Equity Securities

We also hold various other equity securities without readily determinable fair values, primarily comprised of geothermal investments. These equity securities are initially measured at cost, less any impairments, and will be marked to fair value once observable changes in identical or similar investments from the same issuer occur. All of our long-term equity securities are measured using Level 3 unobservable inputs based on the absence of market activity.

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The following table reconciles changes in the balance of our equity securities, without readily determinable fair values, including investments that have been marked to fair value on a nonrecurring basis, for the periods presented below:

During the three and nine months ended June 30, 2025, we liquidated one of our geothermal equity investments for $27.1 million.

The aggregate gains and (losses) included in earnings during the nine months ended June 30, 2026, and the three and nine months ended June 30, 2025 were attributable to the changes in fair value of various geothermal equity investments. These gains (losses) are included in Gain (loss) on investment securities on our Unaudited Condensed Consolidated Statements of Operations.

Other Financial Instruments

The carrying amount of cash and cash equivalents and restricted cash approximates fair value due to the short-term nature of these items. The majority of cash equivalents are invested in highly liquid money-market mutual funds invested primarily in direct or indirect obligations of the U.S. Government and in federally insured deposit accounts. The carrying value of accounts receivable, other current and noncurrent assets, accounts payable, accrued liabilities and other liabilities approximated fair value at June 30, 2026 and September 30, 2025.

The fair values of the long-term fixed-rate debt are based on broker quotes at June 30, 2026 and September 30, 2025. The unsecured senior notes and unsecured term loan agreement are classified within Level 2 of the fair value hierarchy as they are not actively traded in markets. The secured term agreements are classified as nonpublic debt, meaning their value was directly negotiated between the involved parties and is not observable in the market. As a result, they are categorized as Level 3. Since this debt is nonpublic, the carrying value and the fair value of the loans are identical.

The following information presents the supplemental fair value information for our long-term fixed-rate debt, net at June 30, 2026 and September 30, 2025:

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NOTE 11 COMMITMENTS AND CONTINGENCIES

Purchase Commitments

Equipment, parts, and supplies are ordered in advance to promote efficient construction and capital improvement progress. At June 30, 2026, we had outstanding purchase commitments for equipment, parts and supplies of approximately $180.4 million.

Guarantee Arrangements

We are contingently liable to sureties in respect of bonds issued by the sureties in connection with certain commitments entered into by us in the normal course of business. We have agreed to indemnify the sureties for any payments made by them in respect of such bonds.

Contingencies

During the ordinary course of our business, contingencies arise resulting from an existing condition, situation or set of circumstances involving an uncertainty as to the realization of a possible gain or loss contingency. We account for gain contingencies in accordance with the provisions of ASC 450, Contingencies, and, therefore, we do not record gain contingencies or recognize income until realized. The property and equipment of our Venezuelan subsidiary was seized by the Venezuelan government on June 30, 2010. Our wholly-owned subsidiaries, Helmerich & Payne International Drilling Co. ("HPIDC"), and Helmerich & Payne de Venezuela, C.A. filed a lawsuit in the United States District Court for the District of Columbia on September 23, 2011 against the Bolivarian Republic of Venezuela, Petroleos de Venezuela, S.A. and PDVSA Petroleo, S.A., seeking damages for the seizure of their Venezuelan drilling business in violation of international law and for breach of contract. While there exists the possibility of realizing a recovery on HPIDC's expropriation claims, we are currently unable to determine the timing or amounts we may receive, if any, or the likelihood of recovery.

The Company and its subsidiaries are parties to various other pending legal actions arising in the ordinary course of our business. We maintain insurance against certain business risks subject to certain SIRs and deductibles. Although no assurance can be given, we believe, based on our experiences to date and taking into account established reserves and insurance, that the ultimate resolution of such items will not have a material adverse impact on our financial condition, cash flows, or results of operations. When we determine a loss is probable of occurring and is reasonably estimable, we accrue an undiscounted liability for such contingencies based on our best estimate using information available at that time. If the estimated loss is a range of potential outcomes and there is no better estimate within the range, we accrue the amount at the low end of the range. We disclose contingencies where an adverse outcome may be material, or in the judgment of management, we conclude the matter should otherwise be disclosed.

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NOTE 12 BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION

Description of the Business

We are a performance-driven drilling solutions and technologies company based in Tulsa, Oklahoma with operations in all major U.S. onshore oil and gas producing basins as well as the Middle East, Europe, Latin America, and Australia. Our drilling operations consist mainly of contracting Company-owned drilling equipment primarily to large oil and gas exploration companies. We believe we are the recognized industry leader in drilling as well as technological innovation. We focus on offering our customers an integrated solutions-based approach by combining proprietary rig technology, automation software, and digital expertise into our rig operations rather than a product-based offering, such as a rig or separate technology package. Our drilling services operations are organized into the following reportable operating business segments: North America Solutions, International Solutions, and Offshore Solutions.

Each reportable operating segment is a strategic business unit that is managed separately, and consolidated revenues and expenses reflect the elimination of all material intercompany transactions. External revenues included in “Other” primarily consist of rental, manufacturing and engineering services income.

Segment Performance

In March 2026, we named a new Chief Executive Officer, Raymond John Adams III, who now serves as our chief operating decision maker ("CODM"). Our CODM evaluates segment performance and allocates resources based on segment operating income (loss) before income taxes. Components within segment operating income (loss), such as operating revenues and direct operating expenses, are used to monitor actual performance against forecasted results for each segment.

Segment operating income (loss) before income taxes includes:

• Revenues from external and internal customers
• Direct operating costs
• Depreciation and amortization
• Research and development
• Allocated general and administrative expenses
• Acquisition transaction and integration costs
• Asset impairment charges
• Restructuring charges

but excludes gain on involuntary conversion, gain on reimbursement of drilling equipment, other gain (loss) on sale of assets, corporate selling, general and administrative costs, corporate depreciation, corporate acquisition transaction and integration costs, corporate asset impairment charges, and corporate restructuring charges.

General and administrative costs are allocated to the segments based primarily on specific identification and, to the extent that such identification is not practical, other methods may be used which we believe to be a reasonable reflection of the utilization of services provided.

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Summarized financial information of our reportable segments for the three and nine months ended June 30, 2026 and 2025 is shown in the following tables:

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. Intersegment expenses are included within the amounts shown.

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(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. Intersegment expenses are included within the amounts shown.

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. Intersegment expenses are included within the amounts shown.

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(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. Intersegment expenses are included within the amounts shown.

The following table reconciles segment operating income per the tables above to income (loss) before income taxes as reported on the Unaudited Condensed Consolidated Statements of Operations:

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The following table reconciles segment total assets to total assets as reported on the Unaudited Condensed Consolidated Balance Sheets:

(1) Assets by segment exclude investments in subsidiaries and intersegment activity.

The following table presents revenues from external customers by country based on the location of service provided:

The following table presents property, plant and equipment by country based on the location of service provided:

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

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Assets Held-for-Sale

In October 2025, we committed to a plan to scrap certain rigs and related assets across our operating segments as part of our fleet rationalization strategy. As a result, these assets were reclassified as held-for-sale and, where applicable, written down to fair value less cost to sell. This resulted in non-cash impairment charges of $97.9 million and $2.1 million in the North America Solutions and Offshore Solutions segments, respectively during the nine months ended June 30, 2026.

Additionally, in March 2026, we identified an international drilling rig within our International Solutions segment that met the asset held-for-sale criteria and was therefore written down to fair value less cost to sell. This resulted in a non-cash impairment charge of $23.3 million during the nine months ended June 30, 2026. During the nine months ended June 30, 2026, we recognized a non-cash impairment charge of $2.8 million to write down assets previously classified as held‑for‑sale to their estimated fair value less costs to sell. In June 2026, we identified two international drilling rigs that met the held-for-sale criteria, one of which was written down to fair value less cost to sell, resulting in a non-cash impairment charge of $1.2 million in our International Solutions segment during the three and nine months ended June 30, 2026.

Sale of Utica Square Property

During the three months ended June 30, 2026, we completed the sale of Utica Square, a shopping center comprising approximately 371,000 leasable square feet located in Tulsa, Oklahoma, and included within our "Other" operations, receiving net proceeds of approximately $127.7 million. After considering the property's net book value and selling costs, the transaction resulted in a $114.8 million gain during the three and nine months ended June 30, 2026. The gain on sale is recorded in Other (gain) loss on sale of assets within our Unaudited Condensed Consolidated Statements of Operations.

Repayment of Term Loan

During the three and nine months ended June 30, 2026, the Company repaid $140.0 million and $200.0 million of the outstanding balance on the Term Loan Credit Agreement, respectively. As a result of the repayments, no amounts remain outstanding under the Term Loan Credit Agreement.

Contract Backlog

As of June 30, 2026 and September 30, 2025, our total contract drilling backlog, being the expected future dayrate revenue from executed contracts, was $9.1 billion and $7.0 billion, respectively. The increase was primarily due to an extension of two offshore operations and maintenance contracts, consisting of (i) a five-year contract extension with multiple renewal options and (ii) a separate four-year contract extension with multiple renewal options. Approximately 28.2 percent of the June 30, 2026 total backlog is reasonably expected to be fulfilled through fiscal year 2027, as a majority of our contracts are long term.

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The following table sets forth the total backlog by reportable segment as of June 30, 2026 and September 30, 2025:

(1) These amounts do not include anticipated contract renewals or expected performance bonuses.

(2) Included in the International Solutions reportable segment's backlog balance at June 30, 2026 is $0.6 billion of expected revenue from certain contracts in Saudi Arabia that have been temporarily suspended and are expected to gradually resume operations. The information presented in the table above reflects the fact that we expect these contracts to be extended for a period of time at least equal to the expected suspension period.

The early termination of a contract or suspension of operations may result in a rig being idle for an extended period of time, which could adversely affect our financial condition, results of operations and cash flows. Some of our revenue agreements contain provisions for optional early termination or suspension without any associated early termination fees. Early terminations could cause the actual amount of revenue earned to significantly vary from the backlog reported. See Item 1A—"Risk Factors—Our current backlog of drilling services and solutions revenue may decline and may not be fully realized as fixed‑term contracts and, in certain instances, these contracts can be terminated without an early termination payment or suspended without standby or force majeure compensation.” and Item 1A—Risk Factors—"The impact and effects of public health crises, pandemics and epidemics could have a material adverse effect on our business, financial condition and results of operations” within our 2025 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), regarding fixed term contract risk.

Results of Operations for the Three Months Ended June 30, 2026 and 2025

Consolidated Results of Operations

Net Income (Loss) Attributable to Helmerich & Payne Inc. We recorded income of $75.7 million ($0.74 diluted share) for the three months ended June 30, 2026 compared to a loss of $162.8 million ($(1.64) diluted share) for the three months ended June 30, 2025.

Operating Revenue Consolidated operating revenues were $1.0 billion during the three months ended June 30, 2026 and 2025.

Direct Operating Expenses, Excluding Depreciation and Amortization Direct operating expenses were $684.9 million and $704.2 million for the three months ended June 30, 2026 and 2025, respectively. The decrease was primarily driven by lower activity levels in our North America Solutions and International Solutions segments, partially offset by higher activity levels in our Offshore Solutions segment.

Other Operating Expenses Other operating expenses were $44.5 million and $31.1 million for the three months ended June 30, 2026 and 2025, respectively. The increase was primarily driven by a $16.2 million increase in materials and supplies expenses within our manufacturing and engineering operations.

Depreciation and Amortization Expense Depreciation and amortization expense increased to $181.0 million during the three months ended June 30, 2026 compared to $179.5 million during the three months ended June 30, 2025. The increase was primarily driven by depreciation associated with assets placed into service over the last twelve months partially offset by a reduction in depreciable asset balances associated with the reclassification of assets to held‑for‑sale during the first quarter of fiscal year 2026 within our North America Solutions and International Solutions segments. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment.

Selling, General and Administrative Expense Selling, general and administrative expenses increased to $65.8 million during the three months ended June 30, 2026 compared to $65.5 million during the three months ended June 30, 2025.

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Asset Impairment Charges During the three months ended June 30, 2026, we recorded a non-cash impairment charge of $1.2 million primarily related to certain assets that were reclassified as held‑for‑sale. The reclassification required us to adjust the assets to their fair value, which corresponded to their scrap value, resulting in the impairment. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment. During the three months ended June 30, 2025, we recorded a non-cash goodwill impairment charge of $173.3 million associated with our International Solutions and BENTEC™ reporting units.

Gain on Involuntary Conversion During the three months ended June 30, 2026, we recorded a gain of $13.6 million related to the involuntary conversion of one of our super-spec rigs in the North America Solutions segment. For additional information regarding the involuntary conversion, refer to Note 3—Property, Plant and Equipment.

Other Gain (Loss) on Sale of Assets Other gain (loss) on sale of assets was $120.0 million and $(1.3) million for the three months ended June 30, 2026 and 2025, respectively. The gain recognized in the three months ended June 30, 2026 consisted primarily of a $114.8 million gain on the sale of Utica Square. For additional information regarding the sale of Utica Square, refer to Note 3—Property, Plant and Equipment.

Interest Expense Interest expenses was $24.4 million and $29.2 million for the three months ended June 30, 2026 and 2025, respectively. The decrease was mainly attributable to lower debt balances due to the repayment of our unsecured term loan agreement. For additional information regarding our debt agreements, refer to Note 5—Debt.

Loss on Investment Securities During the three months ended June 30, 2026, we recognized an aggregate loss of $16.0 million on investment securities. The aggregate loss primarily consisted of a $14.3 million loss on our investment in Tamboran due to changes in the fair value of the investment. During the three months ended June 30, 2025, we recognized a loss of $0.3 million on investment securities.

Income Taxes For the three months ended June 30, 2026, we recorded income tax expense of $72.4 million (which includes a discrete tax benefit of $3.9 million primarily related to return provision adjustments) compared to income tax expense of $29.0 million (which includes a discrete tax expense of $1.3 million primarily related to return to provision adjustments, a decrease to the deferred state income tax rate and certain foreign taxes) for the three months ended June 30, 2025. Our statutory federal income tax rate for fiscal year 2026 and 2025 is 21.0 percent (before incremental state and foreign taxes).

Q3 FY26 FORM 10-Q     |     36

North America Solutions

(1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.

(4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 91 days).

(5) Defined as the number of rigs generating revenue at the applicable end date of the time period.

Operating Revenues Operating revenues were $562.9 million and $592.2 million in the three months ended June 30, 2026 and 2025, respectively. The decrease in operating revenues was primarily due to lower activity levels and per revenue day pricing levels.

Direct Operating Expenses Direct operating expenses decreased to $321.7 million during the three months ended June 30, 2026 as compared to $326.0 million during the three months ended June 30, 2025. This decrease was primarily due to lower activity levels as discussed above.

Depreciation and Amortization Expense Depreciation expense decreased to $83.2 million during the three months ended June 30, 2026 compared to $88.1 million during the three months ended June 30, 2025. The decrease was primarily driven by a reduction in depreciable asset balances associated with the reclassification of assets to held‑for‑sale during the first quarter of fiscal year 2026. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment.

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International Solutions

(1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.

(4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 91 days).

(5) Defined as the number of rigs generating revenue at the applicable end date of the time period.

Operating Revenues Operating revenues were $250.1 million and $265.8 million in the three months ended June 30, 2026 and 2025, respectively. The $15.7 million decrease in operating revenues was primarily driven by lower activity levels, partially offset by higher per revenue day pricing levels.

Direct Operating Expenses Direct operating expenses decreased to $219.1 million during the three months ended June 30, 2026 as compared to $231.7 million during the three months ended June 30, 2025. The decrease was primarily driven by lower activity levels, partially offset by an increase in materials and supplies expense.

Depreciation and Amortization Expense Depreciation expense increased to $74.5 million during the three months ended June 30, 2026 compared to $66.7 million during the three months ended June 30, 2025. The increase was primarily driven by depreciation associated with assets placed into service over the last twelve months offset by a decrease in depreciation due to changes in fleet composition.

Selling, General and Administrative Expense Selling, general and administrative expenses increased to $9.1 million during the three months ended June 30, 2026 compared to $5.0 million during the three months ended June 30, 2025. The increase was primarily driven by a $4.8 million increase in labor and labor-related expenses.

Asset Impairment Charges During the three months ended June 30, 2026, we recorded a non-cash impairment charge of $1.2 million primarily related to certain assets that were reclassified as held‑for‑sale. The reclassification required us to adjust the assets to their fair value, which corresponded to their scrap value, resulting in the impairment. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment. During the three months ended June 30, 2025, we recorded a non-cash goodwill impairment charge of $128.4 million associated with our International Solutions reporting unit.

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Offshore Solutions

(1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.

(4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 91 days).

(5) Defined as the number of rigs generating revenue at the applicable end date of the time period.

Operating Revenues Operating revenues were $174.4 million and $161.8 million during the three months ended June 30, 2026 and 2025, respectively. The increase was primarily driven by increased activity associated with our management contracts.

Direct Operating Expenses Direct operating expenses increased to $145.2 million during the three months ended June 30, 2026 as compared to $139.0 million during the three months ended June 30, 2025. The increase was primarily driven by increased activity levels as described above.

Other Operations

Results of our other operations, excluding corporate selling, general and administrative costs, and corporate depreciation, are as follows:

Operating Revenues We continue to use our Captive insurance companies to insure the deductibles for our domestic workers’ compensation, general liability, automobile liability claims programs, and medical stop-loss program and to insure the deductibles from the Company's international casualty and rig property programs. Operating revenues of $69.8 million and $42.9 million during the three months ended June 30, 2026 and 2025, respectively, consisted of $17.3 million and $16.3 million in intercompany premium revenues recorded by the Captives, respectively. These revenues were eliminated upon consolidation. During the three months ended June 30, 2026 and 2025, operating revenues also consisted of $52.5 million and $23.7 million from BENTEC's manufacturing and engineering operations, respectively, of which, $4.4 million and $4.5 million are related to intercompany revenues that were eliminated upon consolidation, respectively.

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Direct Operating Expenses Direct operating expenses of $64.1 million and $63.0 million during the three months ended June 30, 2026 and 2025, respectively, consisted of $(3.7) million and $29.3 million, respectively, in adjustments to accruals for estimated losses allocated to the Captives, rig and casualty insurance premiums of $12.6 million and $10.1 million, respectively, and medical stop loss expenses of $4.8 million and $4.4 million, respectively. The change to accruals for estimated losses was primarily due to actuarial valuation adjustments by our third-party actuary. During the three months ended June 30, 2026, direct operating expenses also consisted of $48.0 million from BENTEC's manufacturing and engineering operations, of which $4.4 million is related to intercompany expenses that were eliminated in consolidation. During the three months ended June 30, 2025, direct operating expenses consisted of $20.6 million from BENTEC's manufacturing and engineering operations.

Asset Impairment Charges During the three months ended June 30, 2025, we recorded a non-cash goodwill impairment charge of $44.9 million associated with our BENTEC™ reporting unit.

Results of Operations for the Nine Months Ended June 30, 2026 and 2025

It is important to note that results presented for the nine months ended June 30, 2025 reflect a full 273 days of H&P operations and 166 days of KCA Deutag operations, as the Acquisition was completed on January 16, 2025.

Consolidated Results of Operations

Net Loss Attributable to Helmerich & Payne Inc. We recorded a loss of $79.6 million ($(0.81) diluted share) for the nine months ended June 30, 2026 compared to a loss of $106.3 million ($(1.08) diluted share) for the nine months ended June 30, 2025.

Operating Revenue During the nine months ended June 30, 2026 and 2025, consolidated operating revenues were $3.0 billion and $2.7 billion, respectively. The increase was primarily driven by completion of the Acquisition, resulting in an additional $367.3 million of revenue during the nine months ended June 30, 2026. The increase was partially offset by lower activity levels in the North America Solutions segment.

Direct Operating Expenses, Excluding Depreciation and Amortization Direct operating expenses were $2.0 billion and $1.8 billion for the nine months ended June 30, 2026 and 2025, respectively. The increase was primarily driven by completion of the Acquisition, resulting in an additional $316.7 million of direct operating expenses during the nine months ended June 30, 2026. The increase was partially offset by lower activity levels in the North America Solutions segment.

Other Operating Expenses Other operating expenses were $100.5 million and $35.7 million for the nine months ended June 30, 2026 and 2025, respectively. The increase was primarily driven by completion of the Acquisition, resulting in an additional $65.9 million of costs associated with BENTEC™ manufacturing and engineering operations during the nine months ended June 30, 2026.

Depreciation and Amortization Expense Depreciation and amortization expense increased to $543.6 million during the nine months ended June 30, 2026 compared to $436.2 million during the nine months ended June 30, 2025. The increase was primarily driven by completion of the Acquisition, resulting in an additional $106.8 million of depreciation and amortization expense during the nine months ended June 30, 2026.

Selling, General and Administrative Expense Selling, general and administrative expenses decreased to $207.4 million during the nine months ended June 30, 2026 compared to $209.4 million during the nine months ended June 30, 2025. The decrease was primarily driven by overall cost reductions, partially offset by higher selling, general and administrative expenses within our operating segments, including the impact of expanded operations following the completion of the Acquisition.

Asset Impairment Charges During the nine months ended June 30, 2026, we recorded a non-cash impairment charge of $130.3 million primarily related to certain assets that were reclassified as held‑for‑sale within our North America Solutions, International Solutions, and Offshore Solutions segments. The reclassifications required us to adjust the assets to their fair value, which corresponded to their scrap value, resulting in the impairment. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment. During the nine months ended June 30, 2025, we recorded asset impairment charges of $175.1 million primarily driven by a non-cash goodwill impairment charge of $173.3 million associated with our International Solutions and BENTEC™ reporting units.

Gain on Involuntary Conversion During the nine months ended June 30, 2026, we recorded a gain of $13.6 million related to the involuntary conversion of one of our super-spec rigs in the North America Solutions segment. For additional information regarding the involuntary conversion, refer to Note 3—Property, Plant and Equipment.

Other Gain (Loss) on Sale of Assets Other gain (loss) on sale of assets was $119.4 million and $(2.1) million for the nine months ended June 30, 2026 and 2025, respectively. The gain recognized in the nine months ended June 30, 2026 consisted primarily of a $114.8 million gain on the sale of Utica Square. For additional information regarding the sale of Utica Square, refer to Note 3—Property, Plant and Equipment.

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Interest Expense Interest expenses was $75.9 million and $79.8 million for the nine months ended June 30, 2026 and 2025, respectively. The decrease was mainly attributable to lower debt balances due to the repayment of our unsecured term loan agreement. For additional information regarding our debt agreements, refer to Note 5—Debt.

Gain (Loss) on Investment Securities During the nine months ended June 30, 2026, we recognized an aggregate loss of $0.7 million on investment securities. The aggregate loss primarily consisted of a $5.0 million loss on a geothermal equity security and a $1.2 million loss on other equity securities, each resulting from changes in fair value, and a $1.2 million loss associated with a blue-chip swap transaction. The aggregate loss was partially offset by a $6.7 million gain on our investment in Tamboran due to a change in the fair value of the investment. During the nine months ended June 30, 2025, we recognized an aggregate gain of $14.1 million on investment securities. The aggregate gain consisted of $15.0 million, $10.2 million, and $1.3 million of gains on various geothermal investments, our investment in Galileo, and our investment in Tamboran, respectively, due to changes in the fair value of the investments. The gain was partially offset by a $12.4 million loss on our sale of equity investments in ADNOC Drilling.

Income Taxes For the nine months ended June 30, 2026, we recorded income tax expense of $92.9 million (which includes a discrete tax expense of $0.9 million primarily related to equity compensation, return to provision adjustments, and unrecognized tax benefits) compared to income tax expense of $92.1 million (which includes a discrete tax expense of $2.1 million related to equity compensation, return to provision adjustments, a decrease to the deferred state income tax rate and certain foreign taxes) for the nine months ended June 30, 2025. Our statutory federal income tax rate for fiscal year 2026 and 2025 is 21.0 percent (before incremental state and foreign taxes).

North America Solutions

(1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.

(4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 273 days).

(5) Defined as the number of rigs generating revenue at the applicable end date of the time period.

Operating Revenues Operating revenues were $1.6 billion and $1.8 billion during the nine months ended June 30, 2026 and 2025, respectively. The decrease in operating revenues was primarily due to lower activity levels and per revenue day pricing levels.

Direct Operating Expenses Direct operating expenses decreased to $948.9 million during the nine months ended June 30, 2026 as compared to $992.5 million during the nine months ended June 30, 2025. This decrease was primarily due to lower activity levels as discussed above.

Q3 FY26 FORM 10-Q     |     41

Depreciation and Amortization Expense Depreciation expense decreased to $250.4 million during the nine months ended June 30, 2026 compared to $263.6 million during the nine months ended June 30, 2025. The decrease was primarily driven by a reduction in depreciable asset balances associated with the reclassification of assets to held‑for‑sale during the first quarter of fiscal year 2026. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment.

Asset Impairment Charges During the nine months ended June 30, 2026, we recorded a non-cash impairment charge of $97.9 million primarily related to certain assets that were reclassified as held‑for‑sale. The reclassification required us to adjust the assets to their fair value, which corresponded to their scrap value, resulting in the impairment. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment.

International Solutions

(1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.

(4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 273 days).

(5) Defined as the number of rigs generating revenue at the applicable end date of the time period.

Operating Revenues Operating revenues were $702.7 million and $561.2 million during the nine months ended June 30, 2026 and 2025, respectively. The $141.5 million increase in operating revenues was primarily due to higher revenues from our Middle East and Latin America operations of $117.4 million and $19.8 million, respectively, reflecting increased operational scale and activity following the Acquisition.

Direct Operating Expenses Direct operating expenses increased to $631.5 million during the nine months ended June 30, 2026 as compared to $507.1 million during the nine months ended June 30, 2025. The increase in operating expenses was primarily due to higher operating expenses from our Middle East and Latin America operations of $76.4 million and $25.5 million, respectively, reflecting increased operational scale and activity following the Acquisition.

Depreciation and Amortization Expense Depreciation expense increased to $231.9 million during the nine months ended June 30, 2026 compared to $128.7 million during the nine months ended June 30, 2025. The increase was primarily driven by completion of the Acquisition, resulting in an additional $96.1 million in depreciation and amortization expense.

Asset Impairment Charges During the nine months ended June 30, 2026, we recorded a non-cash impairment charge of $27.3 million primarily related to certain assets that were reclassified as held‑for‑sale. The reclassification required us to adjust the assets to their fair value, which corresponded to their scrap value, resulting in the impairment. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment. During the nine months ended June 30, 2025, we recorded a non-cash goodwill impairment charge of $128.4 million associated with our International Solutions reporting unit.

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Offshore Solutions

(1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.

(4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 273 days).

(5) Defined as the number of rigs generating revenue at the applicable end date of the time period.

Operating Revenues Operating revenues were $534.1 million and $340.1 million in the nine months ended June 30, 2026 and 2025, respectively. The $194.0 million increase in operating revenues was primarily driven by an additional $181.8 million in revenue generated from expanded operations following the Acquisition.

Direct Operating Expenses Direct operating expenses increased to $447.0 million during the nine months ended June 30, 2026 as compared to $284.6 million during the nine months ended June 30, 2025. The increase was primarily driven by completion of the Acquisition, resulting in an additional $156.9 million in direct operating expenses during the nine months ended June 30, 2026.

Depreciation and Amortization Expense Depreciation expense increased to $31.7 million during the nine months ended June 30, 2026 compared to $22.4 million during the nine months ended June 30, 2025. The increase was primarily driven by completion of the Acquisition, resulting in an additional $11.0 million of depreciation and amortization expense during the nine months ended June 30, 2026.

Asset Impairment Charges During the nine months ended June 30, 2026, we recorded a non-cash impairment charge of $2.1 million related to certain assets that were reclassified as held‑for‑sale. The reclassification required us to adjust the assets to their fair value, which corresponded to their scrap value, resulting in the impairment. For additional information regarding our held-for-sale assets, refer to Note 3—Property, Plant and Equipment.

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Other Operations

Results of our other operations, excluding corporate selling, general and administrative costs, and corporate depreciation, are as follows:

Operating Revenues We continue to use our Captive insurance companies to insure the deductibles for our domestic workers’ compensation, general liability, automobile liability claims programs, and medical stop-loss program and to insure the deductibles from the Company's international casualty and rig property programs. Operating revenues of $176.3 million and $107.7 million during the nine months ended June 30, 2026 and 2025, respectively, consisted of $55.2 million and $50.8 million in intercompany premium revenues recorded by the Captives, respectively. These revenues were eliminated upon consolidation. During the nine months ended June 30, 2026 and 2025, operating revenues also consisted of $115.8 million and $48.3 million from BENTEC's manufacturing and engineering operations, respectively, of which, $11.2 million and $12.4 million are related to intercompany revenues that were eliminated upon consolidation, respectively.

Direct Operating Expenses Direct operating expenses of $164.4 million and $123.8 million during the nine months ended June 30, 2026 and 2025, respectively, consisted of $(1.6) million and $43.5 million, respectively, in adjustments to accruals for estimated losses allocated to the Captives, rig and casualty insurance premiums of $35.9 million and $31.8 million, respectively, and medical stop loss expenses of $11.5 million and $14.8 million, respectively. The change to accruals for estimated losses was primarily due to actuarial valuation adjustments by our third-party actuary. During the nine months ended June 30, 2026, direct operating expenses also consisted of $108.6 million from BENTEC's manufacturing and engineering operations, of which $11.2 million is related to intercompany expenses that were eliminated in consolidation. During the nine months ended June 30, 2025, direct operating expenses consisted of $32.8 million from BENTEC's manufacturing and engineering operations.

Asset Impairment Charges During the nine months ended June 30, 2026, we recorded a non-cash impairment charge of $3.0 million associated with previously capitalized in-process research and development expenses that were determined to have no alternative future use. During the nine months ended June 30, 2025, we recorded a non-cash goodwill impairment charge of $44.9 million associated with our BENTEC™ reporting unit.

Liquidity and Capital Resources

Sources of Liquidity

Our sources of available liquidity include existing cash balances on hand, cash flows from operations, and availability under the Amended Credit Facility. Our liquidity requirements include meeting ongoing working capital needs, funding our capital expenditure projects, paying dividends declared, and repaying our outstanding indebtedness. Historically, we have financed operations primarily through internally generated cash flows. During periods when internally generated cash flows are not sufficient to meet liquidity needs, we may utilize cash on hand, borrow from available credit sources, access capital markets or sell our investments. Likewise, if we are generating excess cash flows or have cash balances on hand beyond our near-term needs, we may return cash to shareholders through dividends or share repurchases, or we may invest in highly rated short-term money market and debt securities. These investments can include U.S. Treasury securities, U.S. Agency issued debt securities, highly rated corporate bonds and commercial paper, certificates of deposit and money market funds. However, in some international locations we may make short-term investments that are less conservative, as equivalent highly rated investments are unavailable.

We may seek to access the debt and equity capital markets from time to time to raise additional capital, increase liquidity as necessary, fund our additional purchases, exchange or redeem senior notes, or repay any amounts under the Amended Credit Facility. Our ability to access the debt and equity capital markets depends on a number of factors, including our credit rating, market and industry conditions and market perceptions of our industry, general economic conditions, our revenue backlog and our capital expenditure commitments.

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In the future, we may redeem, purchase, exchange or otherwise acquire certain of our outstanding debt through redemptions, exchanges for other debt, in open market purchases, privately negotiated transactions or otherwise. Such calls, repurchases, exchanges or redemptions, if any, may be material and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

Cash Flows

Our cash flows fluctuate depending on a number of factors, including, among others, the number of our drilling rigs under contract, the revenue we receive under those contracts, the efficiency with which we operate our drilling rigs, the timing of collections on outstanding accounts receivable, the timing of payments to our vendors for operating costs, and capital expenditures. As our revenues increase, net working capital is typically a use of capital, while conversely, as our revenues decrease, net working capital is typically a source of capital.

Net working capital (defined as current assets less current liabilities) was $770.0 million and $650.6 million as of June 30, 2026 and September 30, 2025, respectively.

As of June 30, 2026, we had cash and cash equivalents of $204.4 million and short-term investments of $27.0 million. Our cash flows for the nine months ended June 30, 2026, and 2025 are presented below:

Operating Activities

Cash flows provided by operating activities were $372.7 million and $336.0 million for the nine months ended June 30, 2026 and 2025, respectively. The change in cash provided by operating activities is primarily attributable to increased activity resulting from the completion of the Acquisition. Net cash outflows related to the change in working capital was $76.5 million and $101.9 million for the nine months ended June 30, 2026 and 2025, respectively.

Investing Activities

Capital Expenditures Our capital expenditures during the nine months ended June 30, 2026 were $200.2 million compared to $362.2 million during the nine months ended June 30, 2025. The decrease in capital expenditures is driven by lower equipment overhauls and certain long-term projects.

Net Purchases and Sales of Short-Term Investments Our net purchases of short-term investments during the nine months ended June 30, 2026 were $7.1 million compared to net sales of $261.4 million during the nine months ended June 30, 2025. The activity during the nine months ended June 30, 2025 is primarily driven by $193.3 million of net proceeds received from the liquidation of shares in ADNOC Drilling and our ongoing liquidity management.

Net Purchases and Sales of Long-Term Investments Our purchases of long-term investments during the nine months ended June 30, 2026 were $2.2 million compared to net sales of $29.9 million during the nine months ended June 30, 2025. The activity during the nine months ended June 30, 2025 is primarily driven by $27.1 million and $4.9 million of proceeds received from the liquidation of one of our equity security investments and one of our debt security investments, respectively.

Payment for the Acquisition of Business, Net of Cash Received During the nine months ended June 30, 2025, H&P completed the Acquisition by paying approximately $2.0 billion in cash. This included acquiring $196.7 million in cash and cash equivalents, resulting in a net cash payment of $1.8 billion.

Sale of Assets Our proceeds from asset sales during the nine months ended June 30, 2026 were $35.8 million compared to proceeds of $34.9 million during the nine months ended June 30, 2025.

Proceeds from Sale of Real Estate Assets During the nine months ended June 30, 2026 we completed the sale of Utica Square, which resulted in net proceeds of approximately $127.7 million. For additional information regarding the sale of Utica Square, refer to Note 3—Property, Plant and Equipment.

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Financing Activities

Dividends We paid cash dividends of $0.75 per share during the nine months ended June 30, 2026 and 2025. Total dividends paid were $76.1 million and $75.5 million during the nine months ended June 30, 2026 and 2025, respectively.

Debt Issuance Proceeds On January 16, 2025, we received $400.0 million of proceeds from the Term Loan Credit Agreement. During the nine months ended June 30, 2025, the Company received the final draw down of $1.4 million on the 2024 Oman facility. The receipt of funds from the 2024 Oman facility is reflected in Other within cash flows from financing activities of the Unaudited Condensed Consolidated Statements of Cash Flows. For additional information regarding debt issuance, refer to Note 5—Debt.

Debt Payments During the nine months ended June 30, 2026, the Company repaid $200.0 million of the outstanding balance on the Term Loan Credit Agreement compared to $73.0 million repaid during the nine months ended June 30, 2025. Additionally, during the nine months ended June 30, 2026, the Company repaid an aggregate of $5.1 million under its 2024 and 2023 Oman facilities compared to an aggregate of $3.4 million repaid during the nine months ended June 30, 2025. The repayments for the Oman facilities are reflected in Other within cash flows from financing activities of the Unaudited Condensed Consolidated Statements of Cash Flows. For additional information regarding debt issuance and repayment, refer to Note 5—Debt.

Senior Notes Issued in Fiscal Year 2024

On September 17, 2024, we completed a private offering of $1.25 billion aggregate principal amount of senior notes, comprised of the following tranches (collectively, the “Notes”): $350.0 million aggregate principal amount of 4.65 percent senior notes due 2027 issued at a price equal to 99.958 percent of their face value, $350.0 million aggregate principal amount of 4.85 percent senior notes due 2029 issued at a price equal to 99.883 percent of their face value and $550.0 million aggregate principal amount of 5.50 percent senior notes due 2034 issued at a price equal to 99.670 percent of their face value. Interest on the Notes is payable semi-annually on June 1 and December 1 of each year, commencing on June 1, 2025.

The indenture governing the Notes contains certain covenants that, among other things, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company. The indenture governing the Notes also contains customary events of default with respect to the Notes.

Senior Notes Issued in Fiscal Year 2021

On September 29, 2021, we issued $550.0 million aggregate principal amount of the 2.90 percent senior notes due 2031 ("the 2031 Notes") in an offering to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act as amended (the "Securities Act") and to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act. Interest on the 2031 Notes is payable semi-annually on March 29 and September 29 of each year, commencing on March 29, 2022.

In June 2022, we settled a registered exchange offer (the “2022 Registered Exchange Offer”) to exchange the 2031 Notes for new, SEC-registered notes that are substantially identical to the terms of the 2031 Notes, except that the offer and issuance of the new notes have been registered under the Securities Act and certain transfer restrictions, registration rights and additional interest provisions relating to the 2031 Notes do not apply to the new notes. All of the 2031 Notes were exchanged in the 2022 Registered Exchange Offer.

The indenture governing the 2031 Notes contains certain covenants that, among other things and subject to certain exceptions, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company. The indenture governing the 2031 Notes also contains customary events of default with respect to the 2031 Notes.

Term Loan Credit Agreement

On August 14, 2024, the Company entered into an unsecured term loan credit agreement (the "Term Loan Credit Agreement"), among the Company, Morgan Stanley Senior Funding, Inc. (“MSSF”) as administrative agent, and the other lenders party thereto. On the Closing Date, the Company drew an aggregate principal amount of $400.0 million under the Term Loan Credit Agreement for purposes of financing the Acquisition. The Term Loan Credit Agreement matures at the two-year anniversary of the funding of the term loan unless earlier terminated pursuant to the terms of the Term Loan Credit Agreement. On January 16, 2025, H&P completed the Acquisition, and the Company used the proceeds from the Term Loan Credit Agreement, together with the net proceeds from the Notes, and cash on hand, to finance the purchase price for the Acquisition, to repay or redeem certain of KCA Deutag's outstanding indebtedness, and to pay related fees and expenses. During the three and nine months ended June 30, 2026, the Company repaid $140.0 million and $200.0 million of the outstanding balance on the Term Loan Credit Agreement, respectively. As a result of the repayments, no amounts remain outstanding under the Term Loan Credit Agreement.

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The benchmark rate was the Secured Overnight Financing Rate ("SOFR"). We could elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate was the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum. The adjusted base rate was a fluctuating rate per annum equal to the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus 0.50 percent, or (iii) the one-month adjusted SOFR rate plus 1.0 percent. We also paid a commitment fee on the unused balance of the facility. Borrowing spreads as well as commitment fees were determined based on the debt rating for senior unsecured debt of the Company, as determined by Moody’s and Standard & Poor’s. The applicable margin for SOFR borrowings and adjusted base rate borrowings ranged from 1.0 percent to 1.625 percent per annum and zero to 0.625 percent per annum, respectively. Commitment fees for both rates ranged from 0.10 percent to 0.250 percent per annum. The weighted average variable interest rate on all amounts outstanding under the Term Loan Credit Agreement was 5.143 percent and 5.329 percent for the three and nine months ended June 30, 2026, respectively.

2024 Oman Facility

The 2024 Oman Facility provides for term loan borrowings of $45.5 million, which was originally fully drawn, but subsequently reduced by quarterly debt repayments. These secured bank loans are wholly denominated in Omani rial. The original principal value of these borrowings in Omani rial was OMR 17.6 million. The commitments under the 2024 Oman Facility mature December 31, 2034.

During the fiscal year ended September 30, 2025, our 2024 Oman Facility was amended to bear interest payable quarterly at a fixed rate of 6.00 percent per annum for two years and thereafter, at a rate that is the higher of (x) 5.00 percent and (y) the reference rate specified in the 2024 Oman Facility plus 1.75 percent. During the three and nine months ended June 30, 2026, the Company repaid $0.9 million and $2.6 million of the outstanding balance on the facility, respectively. Of the $40.5 million borrowings outstanding at June 30, 2026, a total of $3.4 million is payable within one year.

There is an annual financial covenant in the 2024 Oman Facility that requires KCAD Energy to maintain a debt service coverage ratio of at least 1.20:1.00. The 2024 Oman Facility and related agreements contain additional terms, conditions, restrictions and covenants that we believe are usual and customary in secured debt arrangements for companies of similar size and credit quality.

2023 Oman Facility

The 2023 Oman Facility provides for term loan borrowings of $45.6 million, which was originally fully drawn, but subsequently reduced by quarterly debt repayments. These secured bank loans are wholly denominated in Omani rial. The original principal value of these borrowings in Omani rial was OMR 17.6 million. The commitments under the 2023 Oman Facility mature December 31, 2033.

During the fiscal year ended September 30, 2025, our 2023 Oman Facility was amended to bear interest payable quarterly at a fixed rate of 6.00 percent per annum for two years and thereafter, at a rate that is the higher of (x) 5.00 percent and (y) the reference rate specified in the 2023 Oman Facility plus 1.75 percent. During the three and nine months ended June 30, 2026, the Company repaid $0.9 million and $2.6 million of the outstanding balance on the facility, respectively. Of the $37.2 million borrowings outstanding at June 30, 2026, a total of $3.4 million is payable within one year.

There is an annual financial covenant in the 2023 Oman Facility that requires KCAD Energy to maintain a debt service coverage ratio of at least 1.20:1.00. The 2023 Oman Facility and related agreements contain additional terms, conditions, restrictions and covenants that we believe are usual and customary in secured debt arrangements for companies of similar size and credit quality.

Amended Credit Facility

On August 14, 2024, the Company entered into an Amended and Restated Credit Agreement (the "Amended Credit Facility") with the lenders party thereto (the "Revolving Credit Agreement Lenders"), the issuing lenders party thereto and Wells Fargo ("Wells Fargo") as administrative agent, swingline lender and issuing lender, which amended and restated the Credit Agreement, dated as of November 13, 2018 (as amended through Amendment No. 2 to the Credit Agreement dated as of March 8, 2022, the “Existing Credit Agreement”), among the Company, the lenders party thereto and Wells Fargo, as administrative agent, swingline lender and issuing lender.

Under the terms of the Amended Credit Facility, the Company may obtain unsecured revolving loans in an aggregate principal amount not to exceed $950.0 million outstanding at any time. $775.0 million of the revolving commitments under the Amended Credit Facility expire on November 12, 2028 and $175.0 million of the revolving commitments mature on November 10, 2027 (the “Stated Maturity Date”), but the Company may request two one-year extensions of the Stated Maturity Date, subject to satisfaction of certain conditions. Commitments under the Amended Credit Facility may be increased by up to $100.0 million, subject to the agreement of the Company and new or existing Revolving Credit Agreement Lenders.

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The proceeds of the loans made under the Amended Credit Facility may be used by the Company for (i) working capital and other general corporate purposes, (ii) for the payment of fees and expenses related to the entering into of the Amended Credit Facility and the other credit documents and (iii) for the refinancing of the extensions of credit under the Existing Credit Agreement.

The benchmark rate is the SOFR. We can elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate is the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum. The adjusted base rate is a fluctuating rate per annum equal to the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus 0.50 percent, or (iii) the one-month adjusted SOFR rate plus 1.0 percent. We also pay a commitment fee on the unused balance of the facility. Borrowing spreads as well as commitment fees are determined based on the debt rating for senior unsecured debt of the Company, as determined by Moody’s and Standard & Poor’s. The applicable margin for SOFR borrowings and adjusted base rate borrowings ranges from 0.875 percent to 1.500 percent per annum and zero to 0.50 percent per annum, respectively. Commitment fees for both rates range from 0.075 percent to 0.200 percent per annum. Based on the unsecured debt rating of the Company on June 30, 2026, the spread over SOFR would have been 1.250 percent had borrowings been outstanding under the Amended Credit Facility and commitment fees would have been 0.150 percent. There is a financial covenant in the Amended Credit Facility that requires us to maintain a total funded debt to total capitalization ratio of less than or equal to 55.0 percent. The Amended Credit Facility contains additional terms, conditions, restrictions and covenants that we believe are usual and customary in unsecured debt arrangements for companies of similar size and credit quality, including a limitation that priority debt (as defined in the credit agreement) may not exceed 17.5 percent of the net worth of the Company. As of June 30, 2026, there were no borrowings or letters of credit outstanding, leaving $950.0 million available to borrow under the Amended Credit Facility.

As of June 30, 2026, we had $420.0 million in uncommitted bilateral credit facilities, for the purpose of obtaining the issuance of international letters of credit, bank guarantees, and performance bonds. Of the $420.0 million, $264.7 million was outstanding as of June 30, 2026.

The applicable agreements for all unsecured debt contain additional terms, conditions and restrictions that we believe are usual and customary in unsecured debt arrangements for companies that are similar in size and credit quality.

At June 30, 2026, we were in compliance with all debt covenants.

Future Cash Requirements

Our operating cash requirements, scheduled debt repayments, interest payments, any declared dividends, and estimated capital expenditures for fiscal year 2026 are expected to be funded through current cash and cash to be provided from operating activities. However, there can be no assurance that we will continue to generate cash flows at current levels. If needed, we may decide to obtain additional funding from our $950.0 million Amended Credit Facility. Our indebtedness under our unsecured senior notes totaled $1.8 billion at June 30, 2026 and comprised of the following maturities: $350.0 million due December 2027, $350.0 million due December 2029, $550.0 million due September 2031, and $550.0 million due December 2034. Our indebtedness under our secured term loan credit agreements totaled $77.7 million at June 30, 2026, of which $6.9 million is due within one year, and the remaining balance is required to be paid on a quarterly basis through the respective maturity dates of December 2033 and December 2034. This debt was allocated specifically to finance rig construction activities in Oman.

As of June 30, 2026, we had a $592.4 million deferred tax liability on our Unaudited Condensed Consolidated Balance Sheets, primarily related to temporary differences between the financial and income tax basis of property, plant and equipment. Our capital expenditures over the last several years have been subject to accelerated depreciation methods (including bonus depreciation) available under the Internal Revenue Code of 1986, as amended, enabling us to defer a portion of cash tax payments to future years. Future levels of capital expenditures and results of operations will determine the timing and amount of future cash tax payments. We expect to be able to meet any such obligations utilizing cash and investments on hand, as well as cash generated from ongoing operations. As of June 30, 2026, we have recorded unrecognized tax benefits and related interest and penalties of approximately $19.3 million.

Material Commitments

Material commitments as reported in our 2025 Annual Report on Form 10-K have not changed significantly as of June 30, 2026, other than those disclosed in Note 5—Debt and Note 11—Commitments and Contingencies to the Unaudited Condensed Consolidated Financial Statements.

Critical Accounting Policies and Estimates

Our accounting policies and estimates that are critical or the most important to understand our financial condition and results of operations, and that require management to make the most difficult judgments, are described in our 2025 Annual Report on Form 10-K. Based on management's evaluation, there have been no material changes in these critical accounting policies and estimates.

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Recently Issued Accounting Standards

See Note 2—Summary of Significant Accounting Policies, Related Risks and Uncertainties to the Unaudited Condensed Consolidated Financial Statements for new accounting standards not yet adopted.

Non-GAAP Measurements

Direct Margin

Direct margin is considered a non-GAAP metric. We define "Direct margin" as operating revenues less direct operating expenses. Direct margin is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. Direct margin is not a substitute for financial measures prepared in accordance with U.S. GAAP and should therefore be considered only as supplemental to such U.S. GAAP financial measures.

The following table reconciles direct margin to segment operating income (loss), which we believe is the financial measure calculated and presented in accordance with U.S. GAAP that is most directly comparable to direct margin.

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Item 3. Item

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a description of our market risks, see the following:

• Note 2—Summary of Significant Accounting Policies, Related Risks and Uncertainties to the Unaudited Condensed Consolidated Financial Statements contained in Item 1 of Part I hereof with regard to foreign currency exchange rate risk which is incorporated herein by reference;
• Note 5—Debt to the Unaudited Condensed Consolidated Financial Statements contained in Item 1 of Part I hereof with regard to interest rate risk which is incorporated herein by reference;
• Note 10—Fair Value Measurement of Financial Instruments to the Unaudited Condensed Consolidated Financial Statements contained in Item 1 of Part I hereof with regard to equity price risk which is incorporated herein by reference; and
• “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” in our 2025 Annual Report on Form 10-K filed with the SEC on November 21, 2025.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, an evaluation was performed with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, and as a result of the material weakness identified in internal control over financial reporting described in Part II, Item 9A of our 2025 Annual Report on Form 10-K being inapplicable in the current period, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of June 30, 2026 at ensuring that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting.

There have been no material changes in our internal control over financial reporting that have occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

See Note 11—Commitments and Contingencies to the Unaudited Condensed Consolidated Financial Statements for information regarding our legal proceedings.

ITEM 1A. RISK FACTORS

There have been no material changes in the risk factors previously disclosed in Part I, Item 1A— “Risk Factors” in our 2025 Annual Report on Form 10-K.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

The following documents are included as exhibits to this Form 10-Q. Those exhibits below that are incorporated herein by reference are indicated as such by the information supplied in the parenthetical thereafter. If no parenthetical appears after an exhibit, the exhibit is filed or furnished herewith.

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