Core Laboratories Inc. /DE/
For the period ended Dec 31, 2025. Filed Mar 23, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 23, 2026
CLB$9.03+2.1%Stored close · as of Nov 9, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-13.
0000950170-25-019072
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-23.
0001193125-26-118177
Item 1A. Risk FactorsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 131 previous paragraphs and 146 current paragraphs.
94 unchanged; 29 reworded; 21 added; 6 removed; 2 previous and 2 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
the success of our clients’ exploration and drilling efforts;
Current report
Drilling for oil and gas is subject to geologic risk, and exploration and appraisal wells are particularly exposed. In some instances, an operator’s drilling efforts may yield no recoverable hydrocarbons, known as a “dry hole”. Even when oil and gas is recoverable within a reservoir, the size of a discovery may make further drilling uneconomic. A higher incidence of dry holes or uneconomic wells could result in reduced demand for our products and services as operators abandon or substantially scale back their drilling and development programs.
Current report
Conditions in the Middle East, including current uncertainty and instability resulting from the conflict between the United States, Israel and Iran, as well as other regional hostilities could adversely affect our business.
Current report
The Company owns and operates laboratories throughout the Middle East, including an Advanced Technology Center in Abu Dhabi, reservoir rocks and fluids laboratories in Doha, Dammam and Kuwait City, and crude oil and derived products testing laboratories in Kuwait, Saudi Arabia, Bahrain, the United Arab Emirates and elsewhere in the region. Accordingly, political, economic and military conditions in the Middle East and the surrounding region directly affect our business and could materially and adversely affect our business, operations, or personnel.
Current report
On February 28, 2026 the United States and Israel initiated air strikes against Iranian military targets and leadership. Since then, retaliation by Iran against United States and Israeli interests in the Middle East has been widespread. As of the date of the filing of this Annual Report, military activity and hostilities continue to escalate in the Middle East, and the situation throughout the region remains volatile, with the potential for continued escalation into a broader and more sustained regional conflict. The situation has led to the closure of regional airspace and retaliatory strikes impacting multiple nations in the Middle East where Core Lab operates, including Saudi Arabia, Kuwait, the United Arab Emirates and Qatar.
Current report
The conflict has resulted in, and could continue to result in, supply disruptions, damage to energy infrastructure, increased shipping and insurance costs, delays or rerouting of crude oil and refined products cargos, heightened security risks, and increased volatility in commodity prices, all of which could affect our customers and our ability to do business with them. For example, since the conflict began, Iran has targeted and launched numerous attacks on critical infrastructure in the region, including refining facilities, maritime ports and international commercial marine vessels, resulting in many vessel operators and charterers re-routing to avoid the Persian Gulf, the Strait of Hormuz and adjacent regional waters, worsening existing supply chain issues, including delays in supplier deliveries, extended lead times and increased cost of freight, and impacts to the shipment of crude oil and refined products.
Current report
The intensity and duration of this conflict are difficult to predict. The conflict is rapidly evolving and it is not possible to predict its long-term consequences on the Company or its clients. Any escalation and expansion of this conflict could have a negative impact on both global and regional conditions and may adversely affect our business, financial condition and results of operations.
Current report
Since the Russia-Ukraine conflict began in February 2022, there have been several sanctions packages imposed by the U.S., the U.K., and the E.U. that impact the Company. The sanctions are complex, numerous and nuanced, requiring close review and assessment as they pertain to our business. Sanctions programs are subject to rapid change, sometimes with immediate effect, and it is possible that new sanctions programs could be established by these and other jurisdictions without warning. The extent of current sanctions measures, not all of which are fully aligned across jurisdictions, further increases operational complexity for our business and increases the risk of making errors in managing day-to-day business activities within the rapidly evolving sanctions environment.
Current report
The U.S., U.K., and E.U. continue to adopt new sanctions and enhance existing sanctions programs associated with the Russia-Ukraine conflict. Additional countries or territories, as well as additional persons or entities within or affiliated with those countries or territories, have, and in the future could, become the target of sanctions. Frequent changes in these programs require us to be diligent in ensuring our compliance with sanctions laws. We actively monitor regulatory changes as they pertain to the goods and services we provide and their impact on our business, including our business partners and customers, including through dynamic screening of our business partners globally against restricted parties lists.
Current report
Further, the U.S., U.K. and E.U. have increased their focus on sanctions enforcement with respect to the energy sector. Our current or future business partners may be affiliated with persons or entities that are or may in the future become the subject of sanctions or trade embargoes imposed by the U.S., U.K., E.U., and/or other international bodies. If we determine that certain sanctions require us to terminate existing or future contracts to which we, or our subsidiaries, are party, or if we are found to be in violation of applicable sanctions, our results of operations may be adversely affected and/or we may suffer reputational harm.
Current report
Although we have policies, procedures and internal controls in place designed to ensure compliance with sanctions laws and regulations, it is possible that an employee, contractor, agent or other intermediary could fail to comply with such policies, applicable laws and regulations, and we could be held responsible. In addition, regulators have discretion to interpret complex sanctions and may interpret certain sanctions programs and their application to our business differently than we do. Notwithstanding our compliance safeguards, there can be no assurance that we will not be found to have been in violation, particularly as the sanctions and embargo laws and regulations are amended, the lack of clarity or guidance as to the scope of certain laws and regulations, and the possibility of discretionary legal interpretations by regulators that may change over time.
Current report
Sanctions and trade embargo laws and regulations are generally subject to a strict liability standard. A party need not know it is violating sanctions and need not intend to violate sanctions to be held liable. We could be subject to significant monetary fines and other civil and/or criminal penalties for violating applicable sanctions or embargo laws even in circumstances where our conduct is consistent with our sanctions-related policies or where our conduct is inadvertent. Such violations could also limit our ability to conduct business, damage our reputation and/or subject us to increased regulatory scrutiny, any of which could result in a material adverse effect on our financial condition and results of operations.
Current report
Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments. Our input costs for raw materials and other goods, such as steel, electronic components, chemical reagents and laboratory equipment, may be adversely affected by tariffs imposed by the U.S. government on products imported into the United States. Additionally, we sell our products internationally and our product sales may be subject to any retaliatory measures by other countries. Any imposition of or increase in tariffs on the goods we purchase or the products we sell could increase our costs and the price of our products and services. To the extent we are unable to pass all or a portion of these cost increases on to our customers, such cost increases could adversely affect our results of operations.
Current report
Additional tariffs, further trade restrictions and retaliatory trade measures could disrupt our supply chain and logistics, restrict or limit the availability of goods or supplies, may cause adverse financial impacts due to volatility in foreign exchange rates and interest rates, and inflationary pressures on raw materials. Any potential impact will depend on future developments with respect to trade policy and the results of trade negotiations, all of which are beyond our control. These potential impacts, while uncertain, could adversely affect our business, results of operations and financial condition.
Current report
Increasing attention to sustainability and corporate responsibility matters may impact our business.
Current report
Our ability to maintain effective internal controls over financial reporting may be insufficient to allow us to accurately report our financial results or prevent fraud, and this could cause our financial statements to become materially misleading and adversely affect the trading price of our common stock.
Current report
The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes policies and procedures that (i) pertain to the maintenance of records that accurately and fairly reflect the transactions and dispositions of assets of the Company; (ii) provide reasonable assurance that transactions are recorded to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are made only in accordance with authorization of management; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Current report
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements, including the possibility of human error, the circumvention or overriding of controls, or fraud. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with internal policies or procedures may deteriorate. Disclosure controls and procedures and internal control over financial reporting will not prevent every accounting error or every instance of fraud. Further, the design of disclosure controls and internal control over financial reporting are governed by resource constraints, and the benefits of such controls must be considered relative to their costs. Because of the inherent limitations in every control system, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a Company have been detected. For example, if two individuals were able to circumvent our internal controls through collusion and commit fraud, the Company’s internal controls may not detect the fraud, which could potentially reach a material level if undetected.
Current report
Our ability to maintain effective internal controls over financial reporting also depends on the efforts, skills, and performance of our accounting and finance staff. The loss of key personnel or our inability to attract and retain qualified accounting personnel could adversely affect our ability to maintain effective internal controls and to prepare accurate financial statements in a timely manner.
Current report
The inability of the Company to maintain the effectiveness of our internal controls over financial reporting, including any failure to implement required new or improved controls, or any difficulty we encounter in their implementation, could result in a material weakness in the control environment. Any material weakness could affect investor confidence in the accuracy and completeness of our financial statements. As a result, our ability to raise capital through the issuance of debt or equity, or our ability to obtain financing on favorable terms, could be materially and adversely affected. This, in turn, could materially and adversely affect our business, financial condition, and the market value of our stock and require us to incur additional costs to improve our internal control systems and procedures. In addition, perceptions of the Company among customers, suppliers, lenders, investors, securities analysts, and others could be adversely affected.
Removed paragraphs (6)
Previous report
The Company routinely screens existing business partners globally against Specially Designated National / Restricted Persons lists. All new engagements with business partners are screened prior to the beginning of any business relationship. Individuals or entities that become subject to applicable sanctions are immediately blocked from further commercial activity with the Company until confirmed by the Company’s legal counsel whether permissible to proceed pursuant to a general or special license or other exemption, or a change in facts.
Previous report
Furthermore, while we have policies, procedures and internal controls in place designed to ensure compliance with applicable sanctions and trade restrictions, and though the current effects from the Russia-Ukraine conflict have, thus far, not resulted in a material adverse impact to the Company’s financial condition or results of operations, our employees, contractors, and agents may take actions in violation of such policies and applicable law and we could be held ultimately responsible. We rely on our employees to adhere to the policies, procedures and internal controls we have established to maintain compliance with evolving sanctions and export controls. To that end, we have implemented training programs, both in person and online, to educate our employees on applicable sanctions and export controls laws. If we are held responsible for a violation of U.S. or other countries’ sanctions laws, we may be subject to various penalties, any of which could have a material adverse effect on our business, financial condition or results of operations.
Previous report
Hydraulic fracturing is a process used by oil and gas exploration and production operators in the completion of certain oil and gas wells whereby water, sand or other proppants and chemical additives are injected under pressure into subsurface formations to stimulate gas and, to a lesser extent, oil production. Some countries outside the United States, such as Bulgaria, the Czech Republic and France, currently have imposed moratoria on hydraulic fracturing while other countries, such as Canada, allow fracturing activities but those activities are not as widely pursued as they are in the United States. In the United States, the fracturing process is typically regulated by state oil and gas commissions, but several federal agencies have asserted regulatory authority over certain aspects of the process.
Previous report
As another example, in December 2023, the U.S. Environmental Protection Agency (“EPA”) finalized more stringent methane emissions rules for new, modified, and reconstructed facilities in the oil and gas sector, known as OOOOb, as well as standards for existing sources for the first time ever, known as OOOOc which may increase operating costs for some of our clients. Similarly, governments have and may continue to take actions to restrict where or how our clients are permitted to operate. The requirements of the EPA’s final methane rules and similar regulations for the oil and gas industry have the potential to increase our clients’ operating costs and thus may adversely affect our financial results and cash flows.
Previous report
The United States Securities and Exchange Commission released its final rule on climate-related disclosures on March 6, 2024, requiring the disclosure of certain climate-related risks and financial impacts, as well as GHG emissions. Under the rule, large accelerated filers would be required to incorporate the applicable climate-related disclosures into their filings beginning in fiscal year 2025, with additional requirements relating to the disclosure of Scope 1 and 2 greenhouse gas emissions, if material, and attestation reports for certain large accelerated filers subsequently phasing in. However, the future of the SEC climate rule is uncertain at this time given that its implementation has been stayed pending the outcome of legal challenges; moreover, the Commission may seek to repeal the rule though we cannot predict whether such action will occur or its timing.
Reworded paragraphs (29)
Previous wording
As business conditions change, the Company may need to implement cost-cutting measures that may adversely affect its business. These cost-cutting measures may include reductions in the quarterly dividend, base salaries of senior executives and employees, annual capital expenditures, implementation of temporary employee furloughs, and workforce reductions, among other reductions of corporate and operating costs.
Current wording
As business conditions change, the Company may need to implement cost-cutting measures that may adversely affect its business. These cost-cutting measures may include reductions in various expenses, including the quarterly dividend, base salaries of senior executives and employees, and annual capital expenditures, as well as implementation of temporary employee furloughs, workforce reductions, and other measures to reduce corporate and operating costs.
Previous wording
In addition, these initiatives could result in disruptions to Core Lab’s operations. Any cost-cutting measures could also negatively impact Core Lab’s business by delaying the introduction of new products or technologies, interrupting service of additional products, or impacting employee retention. There can be no assurance that additional costs will not offset any such reductions of its operations. If Core Lab’s operating costs are higher than expected, or if it does not maintain adequate control of its costs and expenses, Core Lab’s results of operations will suffer. If Core Lab is unable to mitigate these or other potential risks related to its cost cutting initiatives, it may disrupt Core Lab’s business or could have a material adverse effect on its financial condition and results of operations.
Current wording
These cost-cutting initiatives could result in disruptions to Core Lab’s operations. Any such measures could also negatively impact Core Lab’s business by delaying the introduction of new products or technologies, interrupting the effective deployment of existing products and services, or impacting employee retention. In addition, there can be no assurance that these cost controls will closely correlate with reduced operating activity. If Core Lab’s operating costs are higher than expected, or if it does not maintain adequate control of its costs, Core Lab’s results of operations will suffer. If Core Lab is unable to mitigate these or other potential risks related to its initiatives, it may disrupt Core Lab’s business or could have a material adverse effect on its financial condition and results of operations.
Previous wording
Downturns in the oil and gas industry, or in the oilfield services business, may have a material adverse effect on our financial condition or results of operations.
Current wording
Downturns in the oil and gas industry, or in the oilfield services business, or lower success rates of our clients’ exploration and drilling efforts, may have a material adverse effect on our financial condition or results of operations.
Previous wording
civil unrest or political uncertainty in oil producing or consuming countries and other geopolitical conflict, including the ongoing conflict in the Middle East and between Russia and Ukraine;
Current wording
civil unrest or political uncertainty in oil producing or consuming countries and other geopolitical conflict, including commencement of a major military conflict between the United States, Israel and Iran in February 2026, the continuing conflict between Russia and Ukraine, and political uncertainty in Venezuela;
Previous wording
The oil and gas industry has historically experienced periodic downturns, which have been characterized by diminished demand for our oilfield services and products and downward pressure on the prices we charge. A significant downturn in the oil and gas industry could result in a reduction in demand for oilfield services and could adversely affect our operating results.
Current wording
The oil and gas industry historically has experienced periodic downturns, which have been characterized by diminished demand for our oilfield services and products and downward pressure on the prices we charge. A significant downturn in the oil and gas industry could result in a reduction in demand for oilfield services and could adversely affect our operating results.
Previous wording
We cannot accurately predict which or what level of our services and products our clients will need in the future. Orders are placed with our suppliers based on forecasts of client demand and, in some instances, we may establish buffer inventories to accommodate anticipated demand. Our forecasts of client demand are based on multiple assumptions, each of which may introduce errors into the estimates. In addition, many of our suppliers require a longer lead time to provide products than our clients’ demand for delivery of our finished products. If we overestimate client demand, we may allocate resources to the purchase of materials or manufactured products that we may not be able to sell when we expect to, if at all. As a result, we could hold excess or obsolete inventory, which would reduce gross margin and adversely affect financial results. Conversely, if we underestimate client demand or if insufficient manufacturing capacity is available, we could miss revenue opportunities and potentially lose market share and damage our client relationships. In addition, any future significant cancellations or deferrals of service contracts or product orders could materially and adversely affect profit margins, increase product obsolescence and restrict our ability to fund our operations.
Current wording
We cannot accurately predict which or what level of our services and products our clients will need in the future. Orders are placed with our suppliers based on forecasts of client demand and, in some instances, we may establish buffer inventories to accommodate anticipated demand. Our forecasts for client demand are based on multiple assumptions, each of which may introduce errors into the estimates. In addition, many of our suppliers require a longer lead time to provide products than our clients’ demand for delivery of our finished products. If we overestimate client demand, we may allocate resources to the purchase of materials or manufactured products that we may not be able to sell when we expect to, if at all. As a result, we could hold excess or obsolete inventory, which would reduce gross margin and adversely affect financial results. Conversely, if we underestimate client demand or if insufficient manufacturing capacity is available, we could miss revenue opportunities and potentially lose market share and damage our client relationships. In addition, any future significant cancellations or deferrals of service contracts or product orders could materially and adversely affect profit margins, increase product obsolescence and restrict our ability to fund our operations.
Previous wording
Historically, economic downturns and political events have resulted in lower demand for our services and products in certain markets. The continuing instability in the Middle East, North Africa, South America and Ukraine, and the potential for activity from terrorist groups that the U.S. government has cautioned against have further heightened our exposure to international risks. The global economy is highly influenced by public confidence in the geopolitical environment, and the situations in the affected countries and regions, as mentioned above, continue to be highly fluid; therefore, we expect to experience heightened international risks.
Current wording
Historically, economic downturns and political events have resulted in lower demand for our services and products in certain markets. The continuing instability in North Africa, South America and Ukraine, escalation of military conflict in the Middle East, and the potential for activity from terrorist groups that the U.S. government has cautioned against have further heightened our exposure to international risks. The global economy is highly influenced by public confidence in the geopolitical environment, and the situations in the affected countries and regions, as mentioned above, continue to be highly fluid; therefore, we expect to experience heightened international risks.
Previous wording
From time to time, certain geopolitical conflicts may lead to imposition of economic sanctions and associated export controls applicable to our operations. These sanctions may be imposed against certain countries, companies and individuals that may restrict or prohibit transactions involving the countries, companies and individuals identified, which may also further restrict or prohibit us in conducting sales and maintaining operations in any of these jurisdictions.
Current wording
From time to time, certain geopolitical conflicts may lead to imposition of economic sanctions and associated export controls applicable to our operations. These sanctions and/or export controls may be imposed against certain countries, companies and individuals and they may restrict or prohibit transactions involving the countries, companies and individuals identified, which may further restrict or prohibit us from providing good or services and/or maintaining operations in the affected jurisdictions.
Previous wording
The geopolitical conflict between Russia and Ukraine has resulted in the U.S. government, European Union, the United Kingdom and other countries imposing broad-ranging and coordinated economic sanctions and export control measures against Russia, Belarus, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic and the so-called Luhansk People’s Republic, including, among others:
Current wording
The ongoing geopolitical conflict between Russia and Ukraine has resulted in the U.S. government, European Union, the United Kingdom and other countries imposing broad-ranging economic sanctions and export control measures against Russia, Belarus, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic and the so-called Luhansk People’s Republic, including, among others:
Previous wording
a prohibition on doing business with certain Russian companies, large financial institutions, officials and oligarchs;
Current wording
a prohibition on doing business with certain Russian companies, large financial institutions, government officials and oligarchs;
Previous wording
a commitment by certain countries and the European Union to remove selected Russian banks from the Society for Worldwide Interbank Financial Telecommunications (“SWIFT”), the electronic banking network that connects banks globally;
Current wording
a commitment by certain countries and the European Union to remove selected Russian banks from the Society for Worldwide Interbank Financial Telecommunications, the electronic banking network that connects banks globally;
Previous wording
a prohibition by the U.S. on exporting, selling, or supplying certain categories of services, including engineering services and petroleum services, to persons located in Russia; and
Current wording
a prohibition on exporting, selling, or supplying certain categories of services, including engineering-related services, petroleum services and analytical testing services, to persons located in Russia; and
Previous wording
Due to the international scope of our operations, the Company is subject to various laws and regulations, including regulations issued by the U.S. Department of Treasury, the U.S. Department of State, the Bureau of Industry and Security and Office of Foreign Asset Control, as well as the counterparts of these agencies in foreign countries. The Company actively monitors changes in these regulations as they pertain to the goods and services we provide and their impact on our business, including our business partners and customers.
Current wording
Due to the international scope of our operations, the Company is subject to various laws and regulations including regulations issued by the U.S. Department of Treasury, the U.S. Department of State, the Bureau of Industry and Security and Office of Foreign Asset Control, as well as equivalent economic sanctions and trade embargo laws of other relevant jurisdictions in which we operate, including the United Kingdom and the European Union. The laws and regulations of these different jurisdictions vary in their application and do not in all instances apply to the same covered persons or prohibit the same activities in every jurisdiction. In addition, the sanctions and embargo laws and regulations for each jurisdiction may be amended to increase or reduce the restrictions they impose and may modify restricted parties lists to add or remove designated individuals or entities. Moreover, the sanctions laws may impose a full blocking or country-wide prohibition or may consist of a more targeted and specific transaction ban or sectoral sanction. Most sanctions regimes also provide that entities majority-owned or controlled by the persons or entities designated on such lists are subject to the same sanctions.
Previous wording
As the conflict in Ukraine continues, these sanctions may change and be expanded, which could further hinder the Company’s ability to do business in Russia or with certain Russian entities, which could have an adverse impact on the Company’s financial condition and results of operations. Furthermore, in retaliation against new international sanctions and as part of measures to stabilize and support the volatile Russian financial and currency markets, Russian authorities imposed significant currency control measures aimed at restricting the outflow of foreign currency and capital from Russia, imposed various restrictions on transacting with non-Russian parties, banned exports of various products and other economic and financial restrictions.
Current wording
As the conflict in Ukraine continues and these sanctions may change and be expanded, it could further hinder the Company’s ability to do business in Russia or with certain Russian entities and/or our ability to repatriate cash, which could have an adverse impact on the Company’s financial condition and results of operations. Furthermore, in retaliation against new international sanctions and as part of measures to stabilize and support the volatile Russian financial and currency markets, Russian authorities imposed significant currency control measures aimed at restricting the outflow of foreign currency and capital from Russia, imposed various restrictions on transacting with non-Russian parties, banned exports of various products and imposed other economic and financial restrictions.
Previous wording
Should future sanctions require us to cease or wind down our Russian operations, our assets located there may be impacted and could become subject to impairment. As of December 31, 2024, the Company’s fixed assets and total assets in Russia were $4.5 million and $11.7 million, respectively. Total assets located in Russia represent approximately 2% of the Company’s total assets. Additionally, the Company leases its operating facilities in Russia, and as of December 31, 2024, the contractual obligation to exit these leased facilities is approximately $0.4 million. For the year ended December 31, 2024, revenue attributable to our operations in Russia was $23.0 million, representing approximately 4% of the Company’s total revenue. If we discontinue our operations in Russia as a result of expanded sanctions, we could incur employee severance and other associated exit costs of approximately $2.5 million, as required under local laws.
Current wording
We have not experienced any material interruptions in our infrastructure, supplies or networks needed to support our operations in Russia or Ukraine. Should future sanctions require us to cease or wind down our Russian operations, our assets located there may be impacted and could become subject to impairment. As of December 31, 2025, the Company’s fixed assets and total assets in Russia were $4.6 million and $16.8 million, respectively. Total assets located in Russia represent approximately 2.8% of the Company’s total assets. Additionally, the Company leases its operating facilities in Russia, and as of December 31, 2025, the contractual obligation to exit these leased facilities is approximately $0.8 million. For the year ended December 31, 2025, revenue attributable to our operations in Russia was $26.2 million, representing approximately 5.0% of the Company’s total revenue. If we discontinue our operations in Russia as a result of expanded sanctions, we could incur employee severance and other associated exit costs of approximately $2.5 million, as required under local laws.
Previous wording
We are actively monitoring the situation in Ukraine and assessing its impact on our operations in the region, including our business partners and customers. We have not experienced any material interruptions in our infrastructure, supplies or networks needed to support our operations. However, the situation is continuously evolving and the United States, the European Union, the United Kingdom and other countries may implement additional sanctions, export controls or other measures against Russia, Belarus and other countries, regions, officials, individuals or industries in the respective territories. We have no way to predict the progress or outcome of the conflict in Ukraine or its impacts in Ukraine, Russia or Belarus as the conflict, and any resulting government responses, are fluid and beyond our control. Our operations, financial results and cash flows, including our ability to repatriate cash, may be adversely affected due to the conflict and will depend on various factors, including the extent and duration of the conflict, its effects on regional and global economic and geopolitical conditions, and the effect of more expansive or stringent laws, sanctions or trade control restrictions, whether adopted by Western nations or the Russian Federation, on our business, the global economy and global supply chains.
Current wording
We have no way to predict the progress or outcome of the conflict in Ukraine or its impacts in Ukraine, Russia or Belarus as the conflict and any resulting government responses, are fluid and beyond our control. The effect on our operations, financial results and cash flows will depend on various factors, including the extent and duration of the conflict, its effects on regional and global economic and geopolitical conditions, and the effect of more expansive or stringent laws, sanctions or trade controls, whether adopted by Western nations or the Russian Federation, on our business, the global economy and global supply chains.
Previous wording
Our results of operations may be adversely affected because our efforts to comply with applicable anti-corruption laws such as the United States’ Foreign Corrupt Practices Act (the “FCPA”) and the United Kingdom’s Anti-Bribery Act (the
Current wording
Our results of operations may be adversely affected because our efforts to comply with applicable anti-corruption laws such as the United States’ Foreign Corrupt Practices Act (the “FCPA”) and the United Kingdom’s Anti-Bribery Act (the “ABA”) could restrict our ability to do business in foreign markets relative to our competitors who are not subject to these laws.
Previous wording
The market for our services and products is characterized by changing technology and product introduction. As a result, our success is dependent upon our ability to develop or acquire new services and products on a cost-effective basis and to introduce them into the marketplace in a timely manner. While we intend to continue committing substantial financial resources and effort to the development or acquisition of new services and products, we may not be able to successfully differentiate our services and products from those of our competitors. Our clients may not consider our proposed services and products to be of value to them; or if the proposed services and products are of a competitive nature, our clients may not view them as superior to our competitors’ services and products. In addition, we may not be able to adapt to evolving markets and technologies, develop or acquire new services or products, or achieve and maintain technological advantages.
Current wording
Generative artificial intelligence (“genAI”) technologies are becoming increasingly available. As genAI technologies continue to improve, we may not be able to replicate or compete with potential applications relevant to our business, including, for example, enhanced computer modeling of reservoir rock and fluid properties, which could displace some of our current products or services. While we intend to continue committing substantial financial resources and effort to the development or acquisition of new services and products, including those embodying genAI technologies, we may not be able to successfully differentiate our services and products from those of our competitors. Our clients may not consider our proposed services and products to be of value to them; or if the proposed services and products are of a competitive nature, our clients may not view them as superior to our competitors’ services and products. In addition, we may not be able to adapt to evolving markets and technologies, develop or acquire new services or products, or achieve and maintain a competitive market advantage.
Previous wording
Compliance with environmental legal requirements in the United States at the federal, state or local levels may require acquiring permits to conduct regulated activities, incurring capital expenditures to limit or prevent emissions, discharges and any unauthorized releases, and complying with stringent practices to handle, recycle and dispose of certain wastes. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal penalties, the imposition of remedial or corrective obligations, the occurrence of delays or cancellations in the permitting, performance or expansion of projects and the issuance of injunctive relief in affected areas. Certain of these laws and regulations may impose joint and several, strict liability for environmental liabilities, such as the remediation of historical contamination or recent spills, and failure to comply with such laws and regulations could result in the assessment of damages, fines and penalties, the imposition of remedial or corrective action obligations, the occurrence of delays or cancellations in permitting or development of projects, or the suspension or cessation of some or all of our operations. These stringent laws and regulations could require us to acquire permits or other authorizations to conduct regulated activities, install and maintain costly equipment and pollution control technologies, impose specific safety and health standards addressing work protection, or to incur costs or liabilities to mitigate or remediate pollution conditions caused by our operations or attributable to former owners or operators.
Current wording
Compliance with environmental legal requirements in the United States at the federal, state or local levels may require acquiring permits to conduct regulated activities, incurring capital expenditures to limit or prevent emissions, discharges and any unauthorized releases, and complying with stringent practices to handle, recycle and dispose of certain wastes. These laws and regulations could require us to acquire permits or other authorizations to conduct regulated activities, install and maintain costly equipment and pollution control technologies, impose specific safety and health standards addressing work protection, or to incur costs or liabilities to mitigate or remediate pollution conditions caused by our operations or attributable to former owners or operators. Certain of these laws and regulations may impose liability on a joint and several and strict liability basis requiring the remediation of historical contamination not directly associated with our operations as well as more recent releases. Failure to comply with applicable laws and regulations could result in the assessment of monetary fines and other civil and/or criminal penalties, the imposition of remedial or corrective action obligations, the occurrence of delays or cancellations in permitting or development of projects, or the suspension or cessation of some or all of our operations.
Previous wording
Environmental laws and regulations could limit our clients’ exploration and production activities. For example, hydraulic fracturing continues to attract considerable public and governmental attention, both in the United States and in foreign countries, resulting in various controls applied to fracturing activities or locations where such activities may be performed. Although we do not directly engage in drilling or hydraulic fracturing activities, we provide products and services to operators in the oil and gas industry.
Current wording
Environmental laws and regulations could limit our clients’ exploration and production activities. For example, hydraulic fracturing continues to attract considerable public and governmental attention, both in the United States and in foreign countries, resulting in various controls applied to fracturing activities or locations where such activities may be performed. Although we do not directly engage in drilling or hydraulic fracturing activities, we provide products and services to operators in the oil and gas industry. For example, certain states have adopted, or are considering adopting, legal requirements that could impose more stringent disclosure, permitting and/or well construction requirements on hydraulic fracturing operations, and local governments may also seek to adopt ordinances within their jurisdictions regulating the time, place and manner of hydraulic fracturing activities.
Previous wording
U.S., foreign federal, regional, state or local governmental actions aimed at species conservation, preventing hydraulic fracturing activities, or otherwise limiting oil and gas production in certain locations, could indirectly cause us to incur additional costs, cause our or our oil and natural gas exploration and production customers’ operations to become subject to operating restrictions or bans, result in new difficulties obtaining permits or other authorizations, and limit future development activity in affected areas. To the extent any such existing or future legal requirements result in increased costs or restrictions or cancellation in the operation of our clients, such developments could reduce demand for our products and services and have an indirect material adverse effect on our business.
Current wording
U.S., foreign federal, regional, state or local governmental actions aimed at species conservation, preventing hydraulic fracturing activities, or otherwise limiting oil and gas operations or production in certain locations, could indirectly cause us to incur additional costs, cause our or our oil and natural gas exploration and production customers’ operations to become subject to operating restrictions or bans, result in new difficulties obtaining permits or other authorizations, and limit future development activity in affected areas. To the extent any such existing or future legal requirements result in increased costs or restrictions or cancellation in the operation of our clients, such developments could reduce demand for our products and services and have an indirect material adverse effect on our business.
Previous wording
Our clients in the oil and gas industry are also subject to many laws and regulations relating to environmental and natural resource protection in the United States and in foreign countries where we operate, and many are required to obtain permits and other authorizations for their operations. In particular, we, our third-party vendors that supply us with goods and services in support of our business, and our clients are subject to an increased governmental, and public, political and scientific attention focus on risks associated with the threat of climate change arising from the emission of greenhouse gases (“GHG”). Various governments have adopted or are considering adopting legislation, regulations or other regulatory initiatives, including the Paris Agreement, the Europe Climate Law, that are focused on such areas as GHG cap and trade programs, carbon taxes, reporting and tracking programs, and restriction of emissions at national or local levels in jurisdictions where we operate. Our and our clients’ compliance with such existing, or any new or amended legal requirements that are placed into effect and applicable in areas where we or our clients conduct operations, could result in our or our clients’ incurring significant additional expense and operating restrictions.
Current wording
Our clients in the oil and gas industry are also subject to many laws and regulations relating to environmental and natural resource protection in the United States and in foreign countries where we operate, and many are required to obtain permits and other authorizations for their operations. In particular, we, our third-party vendors that supply us with goods and services in support of our business, and our clients are subject to governmental, and public, political and scientific attention focus on risks associated with the threat of climate change arising from the emission of GHG. Various governments have adopted or are considering adopting legislation, regulations or other regulatory initiatives, including the Paris Agreement, the Europe Climate Law, that are focused on such areas as GHG cap and trade programs, carbon taxes, reporting and tracking programs, and restriction of emissions at national or local levels in jurisdictions where our clients operate. Compliance with existing, or any new or amended legal requirements that are placed into effect and applicable in areas where we or our clients conduct operations, could result in our or our clients’ incurring significant additional expense and operating restrictions which could result in reduced demand for our products and services.
Previous wording
New or amended legislation, executive actions, regulations or other regulatory initiatives that impose more stringent oil and gas sector requirements or fees on GHG emissions or restrict the areas in which this sector may produce oil and natural gas or generate GHG emissions could result in increased compliance costs or costs of producing fossil fuels. For example, in November 2024, the EPA finalized the methane emissions charge rule, implementing the Inflation Reduction Act of 2022 “IRA 2022,” which applies to oil and gas facilities emitting more than 25,000 metric tons of CO2 equivalent per year. If the methane emissions charge rule is implemented, it could increase our U.S. customers’ operating costs, and the fees and other requirements of the regulation could accelerate the transition away from fossil fuels, which may in turn reduce demand for our products and services and adversely affect our business and results of operations.
Current wording
New or amended legislation, executive actions, regulations or other regulatory initiatives that impose more stringent oil and gas sector requirements or fees on GHG emissions or restrict the areas in which this sector may produce oil and natural gas or generate GHG emissions could result in increased compliance costs or costs of producing fossil fuels.
Previous wording
To the extent that climate change alters weather patterns, it can impact the demand for our customers’ products. Our operations and the operations of our customers are also susceptible to the physical effects of climate change, such as increased frequency or severity of storm systems, hurricanes, droughts, floods, extreme winter weather, or geologic/geophysical conditions. Such events can impact our operations directly and indirectly, and could also result in increased insurance costs.
Current wording
To the extent that climate change alters weather patterns, it can impact the demand for our customers’ products. Our operations and the operations of our customers are also susceptible to the physical effects of climate change, such as increased frequency or severity of storm systems, hurricanes, droughts, floods, extreme winter weather, or geologic/geophysical conditions. Such events may impact our operations directly and indirectly, and could also result in increased insurance costs.
Previous wording
Regulations associated with ESG and sustainability have been, and are, being implemented and we anticipate that these regulatory requirements will continue to expand in the European Union (“EU”), the United States and globally, at all levels of government and from private institutions and stakeholders. As a result, numerous regulatory initiatives have been made, and are likely to continue to be made, to monitor and limit existing emissions of GHGs or implement laws, policies or regulatory initiatives that may contribute to energy conservation measures, stimulate demand for alternative forms of energy or limit areas where fossil fuel production may occur, which may translate into reduced demand for our services.
Current wording
Regulations associated with sustainability and corporate responsibility have been, and are, being implemented and we anticipate that these regulatory requirements will continue to expand in markets where we operate. As a result, numerous regulations have been made, and are likely to continue to be made, to monitor and limit emissions of GHGs or implement laws, policies or regulatory initiatives that may contribute to energy conservation measures, stimulate demand for alternative forms of energy or limit areas where fossil fuel production may occur, which may translate into reduced demand for our services.
Previous wording
Business operations may also subject us or our customers to state-mandated climate disclosures. For instance, the Climate-Related Financial Risk Act (“CRFRA”) in California requires the disclosure of a climate-related financial risk report (in line with the Task Force on the Climate-related Financial Disclosures (“TCFD”) recommendations or equivalent disclosure requirements under the International Sustainability Standards Board’s (“ISSB”) climate-relate disclosure standards) every other year for public and private companies that are “doing business in California” and have total annual revenue of $500 million. Reporting under this law would begin in 2026 and the ultimate impact of the law on our business is uncertain—the Governor of California has directed further consideration of the implementation deadlines for each of the laws, and there is potential for legal challenges to be filed with respect to the scope of the law—but, absent clarification or revisions to the law, alongside the SEC disclosure rule, finalization and implementation may result in increased compliance costs and increased costs of and restrictions on access to capital.
Current wording
Business operations may also subject us or our customers to state-mandated climate disclosures. For instance, the Climate-Related Financial Risk Act (“CRFRA”) in California requires the disclosure of a climate-related financial risk report (in line with the Task Force on the Climate-related Financial Disclosures recommendations or equivalent disclosure requirements under the International Sustainability Standards Board’s climate-relate disclosure standards) every other year for public and private companies that are “doing business in California” and have total annual revenue of at least $500 million. Reporting under this law was set to begin in 2026 and the ultimate impact of the law on our business is uncertain. In November 2025, the Ninth Circuit Court of Appeals granted an injunction pending appeal that stays enforcement of the CRFRA. A separate law, SB 253 directed the California Air Resources Board (“CARB”) to create rules relating to GHG reporting. CARB’s regulations require the reporting of Scope 1 and Scope 2 GHG emissions starting August 10, 2026, for companies that are “doing business in California” and have total annual revenue of at least $1 billion. Absent clarification or revisions to these laws, alongside the compliance, may result in increased costs and restrictions on access to capital.
Previous wording
Investor and societal expectations regarding voluntary ESG disclosures, and consumer demand for alternative forms of energy may result in increased costs, reduced demand for our services, reduced profits, increased risks of governmental investigations and private party litigation, and negative impacts on our stock price and access to capital markets. These pressures could have similar impacts on our customers, and therefore, indirectly impact our operations by decreasing demand for our services. Our managerial ESG Steering Team is the primary group for overseeing and managing our ESG initiatives. Team members review the implementation and effectiveness of our ESG programs and policies and report on these matters to the Board of Directors. While we have sought voluntary aspirational goals for GHG emission reductions from base year 2018, we note that even with our governance oversight in place, we may not be able to adequately identify or manage ESG-related risks and opportunities, which may include failing to achieve ESG-related aspirational goals. We have published voluntary disclosures regarding ESG matters under an annual Sustainability Report and the Global Reporting Initiative, an international independent standards organization. From time to time, statements in those voluntary disclosures may be based on aspirational expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith. Such expectations and assumptions may be prone to error or subject to misinterpretation given the lack of an established single approach to identifying, measuring and reporting on many ESG matters.
Current wording
Investor and societal expectations regarding voluntary corporate responsibility disclosures, and consumer demand for alternative forms of energy may result in increased costs, reduced demand for our services, reduced profits, increased risks of governmental investigations and private party litigation, and negative impacts on our stock price and access to capital markets. These pressures could have similar impacts on our customers, and therefore, indirectly impact our operations by decreasing demand for our services. Our managerial ESG Steering Team is the primary group for overseeing and managing our sustainability initiatives. Team members review the implementation and effectiveness of our sustainability programs and policies and report on these matters to the Board of Directors. While we have sought voluntary aspirational goals for GHG emission reductions from base year 2018, we note that even with our governance oversight in place, we may not be able to adequately identify or manage sustainability-related risks and opportunities, which may include failing to achieve sustainability-related aspirational goals. We have published voluntary disclosures regarding sustainability matters under an annual Sustainability Report and the Global Reporting Initiative, an international independent standards organization. From time to time, statements in those voluntary disclosures may be based on aspirational expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith. Such expectations and assumptions may be prone to error or subject to misinterpretation given the lack of an established single approach to identifying, measuring and reporting on many sustainability matters.
Previous wording
Our certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will, to the fullest extent permitted by applicable law, be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, employees or agents to us or our stockholders, (iii) any action asserting a claim against us or any director or officer or other employee or agent of ours arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws, or (iv) any action asserting a claim against us or any director or officer or other employee or agent of ours that is governed by the internal affairs doctrine, in each such case subject to such Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein.
Current wording
(i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, employees or agents to us or our stockholders, (iii) any action asserting a claim against us or any director or officer or other employee or agent of ours arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws, or (iv) any action asserting a claim against us or any director or officer or other employee or agent of ours that is governed by the internal affairs doctrine, in each such case subject to such Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein.
Previous wording
The exclusive forum provision would not apply to suits brought to enforce any liability or duty created by the Securities Act or the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. To the extent that any such claims may be based upon federal law claims, Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.
Current wording
The exclusive forum provision would not apply to suits brought to enforce any liability or duty created by the Securities Act of 1933 (the “Securities Act”) or the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or any other claim for which the federal courts have exclusive jurisdiction. To the extent that any such claims may be based upon federal law claims, Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
The market for our services and products is characterized by changing technology and product introduction. As a result, our success is dependent upon our ability to develop or acquire new services and products on a cost-effective basis and to introduce them into the marketplace in a timely manner. Our future growth and financial performance will depend in part upon our ability to develop, market and integrate new products and services and to accommodate our customer’s preferences along with the rapid pace of technological advancement, including artificial intelligence and machine learning.
Current report — wording carried from elsewhere
Our certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will, to the fullest extent permitted by applicable law, be the sole and exclusive forum for
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
“ABA”) could restrict our ability to do business in foreign markets relative to our competitors who are not subject to these laws.
Previous report — wording carried elsewhere
Certain states have adopted or are considering adopting, legal requirements that could impose more stringent disclosure, permitting and/or well construction requirements on hydraulic fracturing operations, and local governments may also seek to adopt ordinances within their jurisdictions regulating the time, place and manner of hydraulic fracturing activities.