Distribution Solutions Group Announces 2026 Third Quarter Results

Distribution Solutions Group Announces 2026 Third Quarter Results FORT WORTH, Texas--( BUSINESS WIRE)--Distribution Solutions Group, Inc. (NASDAQ: DSGR) ("DSG" or the "Company"), a premier specialty distribution company, today announced consolidated results for the third quarter ended September 30, 2026. This press release is supplemented by an earnings presentation at https://investor.distributionsolutionsgroup.com/news/events.

The following represents a summary of certain operating results (unaudited). See the reconciliations of GAAP to non-GAAP measures in Tables 2, 3 and 4.

Three Months Ended

September 30,

June 30,

(Dollars in thousands)

2026

2025

% Change

2026

% Change

Revenue

573,622

517,958

10.7

557,734

2.8

Operating income

25,249

23,619

6.9

27,868

(9.4

Non-GAAP Adjusted operating income

47,946

40,065

19.7

45,216

6.0

Net income

8,892

6,452

37.8

8,494

4.7

Non-GAAP Adjusted EBITDA

56,819

48,457

17.3

53,933

5.4

Operating income as a percent of revenue

4.4

4.6

-20bps

5.0

-60bps

Adjusted EBITDA as a percent of revenue

9.9

9.4

50bps

9.7

20bps

Revenue increased 10.7% year-over-year to $573.6 million, driven by organic sales growth of 9.2% with average daily sales improvement across all of the business units. The third quarter acquisition of American Fasteners contributed approximately $3.8 million of revenue in the third quarter. Sequentially, revenue increased 2.8% over the second quarter, driven by organic sales growth of 2.2%.

Profitability improved year-over-year on higher sales. Adjusted EBITDA margin as a percentage of sales was 9.9%, an improvement of 50 bps year-over-year. Operating income increased from $23.6 million to $25.2 million. Adjusted diluted earnings per share improved from $0.40 to $0.58 year-over-year.

Improved profitability and working capital management in the quarter drove cash flows from operations of $18.7 million in the third quarter and cumulatively $20.4 million for the nine-month period.

2026 Third Quarter Summary (1)

(1) See reconciliation of GAAP to non-GAAP measures in tables 2, 3 and 4.

Additional Information on Proposed Merger Agreement

On July 15, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Eclipse Parent Acquisitions, LLC, a Delaware limited liability company (“Parent”), Eclipse Intermediate Acquisitions, LLC, a Delaware limited liability company and wholly owned subsidiary of Parent (“Intermediate”), and Eclipse Acquisitions Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Intermediate (“Merger Sub”). Parent, Intermediate, and Merger Sub were formed by, and are affiliated with, LKCM Headwater Investments, LLC (“LKCM Headwater”), J. Bryan King, and their respective affiliates. Mr. King is the Company’s Chief Executive Officer and Chairman of the Company’s Board of Directors (the “Board”) and is also the Managing Partner of LKCM Headwater. LKCM Headwater and its affiliates beneficially own, in the aggregate, approximately 79% of the outstanding shares of the Company’s common stock, par value $1.00 per share (the “Company Common Stock”).

The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, and in accordance with the Delaware General Corporation Law (the “DGCL”), Merger Sub will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, becoming a wholly owned subsidiary of Intermediate and an indirect wholly owned subsidiary of Parent. Upon completion of the Merger, the Company will become a privately held company 100% controlled by LKCM Headwater and its affiliates, and the Company Common Stock will no longer be listed on Nasdaq. The Merger is subject to customary closing conditions, including obtaining the requisite approval of the Company’s stockholders.

The $35.00 per share purchase price to be paid by LKCM Headwater and its affiliates pursuant to the Merger Agreement represents an increase of $5.50 per share over LKCM Headwater’s initial non-binding proposal of $29.50 per share submitted to the Board on March 14, 2026 (the “Initial Proposal”), and an approximately 81% premium to the Company’s closing share price of $19.31 on March 13, 2026, the last trading day prior to public disclosure of LKCM Headwater’s proposal.

Following LKCM Headwater’s delivery of the Initial Proposal and in light of LKCM Headwater’s existing ownership position and Mr. King’s roles with both LKCM Headwater and the Company, the Board formed a special committee consisting of disinterested directors (the “Special Committee”) to evaluate the Initial Proposal and negotiate a potential transaction with LKCM Headwater. The Special Committee unanimously approved the Merger and recommended that the Board approve the Merger. The Board, upon the Special Committee’s unanimous recommendation, with certain directors recusing themselves from the vote, approved the Merger.

The closing of the transaction is subject to customary closing conditions, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”), the absence of legal restraints prohibiting the transaction, and stockholder approvals (including the approval of a majority of the votes cast by holders of DSG common stock not owned by LKCM Headwater and its affiliates). On August 20, 2026, the applicable waiting period under the HSR Act was terminated.

The transaction is not subject to a financing condition; however, in connection with the execution of the Merger Agreement, the Company entered into an amendment to its existing credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, pursuant to which, subject to the applicable terms and conditions thereof, proceeds of revolving loans may be used to finance the transactions contemplated by the Merger Agreement. For additional information, see the Company's Current Report on Form 8-K filed with the SEC on July 16, 2026.

Additional Information About the Merger and Where to Find It

In connection with the proposed Merger, on October 28, 2026, the Company filed with the U.S. Securities and Exchange Commission (the “SEC”) a definitive proxy statement on Schedule 14A (the “Proxy Statement”), and the Company, LKCM Headwater, and certain of their respective affiliates jointly filed with the SEC a transaction statement on Schedule 13E-3 (the “Schedule 13E-3”). The Proxy Statement and a proxy card will be sent or otherwise made available to stockholders of the Company entitled to vote at the special meeting relating to the Merger. This communication is not a substitute for the Proxy Statement, the Schedule 13E-3, or any other document that the Company may file with the SEC in connection with the Merger. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT, THE SCHEDULE 13E-3, AND OTHER RELEVANT DOCUMENTS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY AND THE MERGER. Investors and security holders will be able to obtain copies of the Proxy Statement, the Schedule 13E-3 and other documents filed with the SEC by the Company free of charge from the SEC’s website at www.sec.gov or from the Company’s website.

Participants in the Solicitation

The Company and certain of its directors, executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from the Company's stockholders in connection with the Merger. Information regarding the Company’s directors and executive officers is available in the Company’s proxy statement for its most recent annual meeting of stockholders (the "Annual Proxy Statement") and in other documents filed by the Company with the SEC. Additional information regarding the interests of those persons and other persons who may be deemed participants in the Merger are included in the Proxy Statement and Schedule 13E-3 and will also be included in other materials to be filed with SEC in connection with the Merger. To the extent holdings of the Company’s securities by its directors or executive officers have changed since the amounts set forth in the Annual Proxy Statement, such changes have been or will be reflected on Initial Statements of Beneficial Ownership of Securities on Form 3 or Statements of Change in Ownership on Form 4 filed with the SEC.

About Distribution Solutions Group, Inc.

DSG is a premier multi-platform specialty distribution company providing high touch, value-added distribution solutions to the maintenance, repair & operations (MRO), the original equipment manufacturer (OEM) and the industrial technologies markets. DSG was formed through the strategic combination of Lawson Products, a leader in MRO distribution of C-parts, Gexpro Services, a leading global supply chain services provider to manufacturing customers, and TestEquity, a leader in electronic test & measurement and supply solutions.

Through its collective businesses, DSG is dedicated to helping customers lower their total cost of operation by increasing productivity and efficiency with the right products, expert technical support and fast, reliable delivery to be a one-stop solution provider. DSG serves over 200,000 customers in several diverse end markets supported by approximately 4,300 dedicated employees and strong vendor partnerships. DSG ships from strategically located distribution and service centers to customers in North America, Europe, Asia, South America and the Middle East.

For more information on Distribution Solutions Group, please visit www.distributionsolutionsgroup.com.

Cautionary Note Regarding Forward-Looking Statements

This release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the "safe-harbor" provisions under the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. The Terms "aim," "anticipate," "believe," "contemplates," "continues," "could," "ensure," "estimate," "expect," "forecasts," "if," "intend," "likely," "may," "might," "objective," "outlook," "plan," "positioned," "potential," "predict," "probable," "project," "shall," "should," "strategy," "will," "would," and variations of them and other words and terms of similar meaning and expression (and the negatives of such words and terms) are intended to identify forward-looking statements.

Forward-looking statements can also be identified by the fact that they do not relate strictly to historical or current facts, including those statements relating to the obtaining of the requisite approval of the Merger by DSG stockholders and the consummation of the Merger. Such forward-looking statements are based on current expectations and involve inherent risks, uncertainties and assumptions, including factors that could delay, divert or change any of them, and could cause actual outcomes to differ materially from current expectations. DSG can give no assurance that any goal or plan set forth in forward-looking statements can be achieved, and DSG cautions readers not to place undue reliance on such statements. DSG undertakes no obligation to release publicly any revisions to forward-looking statements as a result of new information, future events or otherwise. Each forward-looking statement speaks only as of the date on which such statement is made, and DSG undertakes no obligation to update any such statement to reflect events or circumstances arising after such date. Actual results may differ materially from those projected as a result of certain risks and uncertainties. Factors that could cause or contribute to such differences or that might otherwise impact DSG's business, financial condition, and results of operations include the risk that the Merger may not be completed in a timely manner or at all, the failure to satisfy closing conditions to the Merger, including receipt of the requisite stockholder approvals, the risk that borrowings under the Company's credit agreement may not be available to finance the Merger, the possibility that competing offers or acquisition proposals will be made, the occurrence of events giving rise to termination of the Merger Agreement, including in circumstances requiring payment of the termination fee, the effect of the pendency of the Merger on the Company’s business relationships, operating results, and business generally, the effect of the announcement or pendency of the Merger on the Company’s business relationships, operating results, employees, customers, suppliers, financing sources, and other business counterparties, risks related to diverting management’s attention from the Company’s ongoing business operations, the risk of litigation relating to the Merger, the risks that DSG may encounter difficulties integrating the business of DSG with the business of other companies that DSG has combined with or may otherwise combine with, and that certain assumptions with respect to such business or transactions could prove to be inaccurate. Certain risks associated with DSG's business are also discussed from time to time in the reports DSG files with the SEC, including the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K or other reports the Company may file from time to time with the SEC, which should be reviewed carefully.

No Offer or Solicitation

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities, or a solicitation of any vote, consent, or approval, in any jurisdiction pursuant to or in connection with the Merger or otherwise, nor shall there be any sale, issuance, or transfer of securities in any jurisdiction in contravention of applicable law.

-TABLES FOLLOW-

Distribution Solutions Group, Inc.

Condensed Consolidated Balance Sheets

(Dollars in thousands, except share data)

(Unaudited)

September 30,

2026

December 31,

2025

ASSETS

Current assets:

Cash and cash equivalents

63,153

61,753

Restricted cash

9,152

13,573

Accounts receivable, less allowances

343,452

271,331

Inventories

399,921

353,374

Prepaid expenses and other current assets

49,833

46,893

Total current assets

865,511

746,924

Property, plant and equipment, net

123,104

126,605

Rental equipment, net

42,190

38,956

Goodwill

496,751

467,905

Deferred tax asset, net

1,358

1,196

Customer relationships intangibles, net

134,947

143,503

Trade names and other intangibles, net

78,391

82,552

Cash value of life insurance

22,579

21,567

Right of use operating lease assets

105,381

111,117

Other assets

8,512

8,296

Total assets

1,878,724

1,748,621

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable

198,056

151,234

Current portion of long-term debt

35,000

35,470

Current portion of lease liabilities

22,303

20,624

Accrued expenses and other current liabilities

94,997

84,137

Total current liabilities

350,356

291,465

Long-term debt, less current portion, net

723,601

664,196

Lease liabilities

91,623

98,821

Deferred tax liability, net

23,198

20,147

Other liabilities

24,796

24,645

Total liabilities

1,213,574

1,099,274

Stockholders' equity:

Preferred stock, $1 par value:

Authorized - 500,000 shares, issued and outstanding — None

—

Common stock, $1 par value:

Authorized - 70,000,000 shares

Issued - 47,990,868 and 47,860,312 shares, respectively

Outstanding - 46,286,621 and 46,180,700 shares, respectively

46,286

46,180

Capital in excess of par value

693,344

686,183

Retained deficit

(15,926

)

(33,694

)

Treasury stock – 1,704,247 and 1,679,612 shares, respectively

(44,704

)

(43,998

)

Accumulated other comprehensive income (loss)

(13,850

)

(5,324

)

Total stockholders' equity

665,150

649,347

Total liabilities and stockholders' equity

1,878,724

1,748,621

Distribution Solutions Group, Inc.

Condensed Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

2026

2025

2026

2025

Revenue

573,622

517,958

1,627,351

1,498,424

Cost of goods sold

389,820

347,632

1,100,074

994,034

Gross profit

183,802

170,326

527,277

504,390

Selling, general and administrative expenses

158,553

146,707

460,530

433,848

Operating income (loss)

25,249

23,619

66,747

70,542

Interest expense

(13,462

)

(13,955

)

(38,624

)

(42,408

)

Change in fair value of earnout liabilities

—

(1,000

)

Other income (expense), net

(529

)

(1,283

)

(1,717

)

(1,377

)

Income (loss) before income taxes

11,258

8,381

26,406

25,757

Income tax expense (benefit)

2,366

1,929

8,638

11,041

Net income (loss)

8,892

6,452

17,768

14,716

Basic income (loss) per share of common stock

0.19

0.14

0.38

0.32

Diluted income (loss) per share of common stock

0.19

0.14

0.38

0.31

Basic weighted average shares outstanding

46,267,167

46,280,811

46,227,889

46,419,969

Diluted weighted average shares outstanding

47,087,461

47,060,025

47,076,148

47,212,912

Distribution Solutions Group, Inc.

Condensed Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)

Nine Months Ended September 30,

2026

2025

Operating activities

Net income (loss)

17,768

14,716

Adjustments to reconcile to net cash used in operating activities:

Depreciation and amortization

59,770

60,359

Amortization of debt issuance costs

1,365

2,581

Stock-based compensation

6,927

4,624

Deferred income taxes

(1,954

)

975

Change in fair value of earnout liabilities

—

1,000

(Gain) loss on sale of rental equipment

(4,423

)

(3,454

)

(Gain) loss on sale of property, plant and equipment

(612

)

(716

)

Charge for step-up of acquired inventory

241

—

Net realizable value adjustment and write-offs for obsolete and excess inventory

4,299

5,694

Bad debt expense

2,459

3,480

Changes in operating assets and liabilities, net of acquisitions:

Accounts receivable

(72,412

)

(44,940

)

Inventories

(45,881

)

1,470

Prepaid expenses and other current assets

(1,165

)

3,743

Accounts payable

43,136

27,556

Accrued expenses and other current liabilities

12,826

(10,334

)

Other changes in operating assets and liabilities

(1,985

)

152

Net cash provided by (used in) operating activities

20,359

66,906

Investing activities

Purchases of property, plant and equipment

(11,215

)

(15,796

)

Proceeds from sale of property, plant and equipment

826

990

Business acquisitions, net of cash acquired

(58,331

)

(2,176

)

Purchases of rental equipment

(18,514

)

(12,849

)

Proceeds from sale of rental equipment

9,696

9,367

Net cash provided by (used in) investing activities

(77,538

)

(20,464

)

Financing activities

Proceeds from revolving lines of credit

515,172

205,943

Payments on revolving lines of credit

(432,474

)

(204,128

)

Payments on term loans

(26,250

)

(30,188

)

Deferred financing costs

(983

)

—

Repurchase of common stock

)

(20,252

)

Shares repurchased held in treasury

(707

)

(252

)

Stock option exercises

534

877

Payment of financing lease principal

(500

)

(445

)

Net cash provided by (used in) financing activities

54,791

(48,445

)

Effect of exchange rate changes on cash and cash equivalents

(633

)

2,977

Increase (decrease) in cash, cash equivalents and restricted cash

(3,021

)

974

Cash, cash equivalents and restricted cash at beginning of period

75,326

81,726

Cash, cash equivalents and restricted cash at end of period

72,305

82,700

Cash and cash equivalents

63,153

69,214

Restricted cash

9,152

13,486

Total cash, cash equivalents and restricted cash

72,305

82,700

Distribution Solutions Group, Inc.

Table 1 - Selected Segment Financial Data

(Dollars in thousands)

(Unaudited)

Three Months Ended

September 30,

2026

2025

Revenue:

Lawson Products

130,285

121,549

Canada Branch Division

62,073

59,977

Gexpro Services

139,844

130,525

TestEquity

242,303

206,479

Intersegment revenue elimination

(883

)

(572

)

Total

573,622

517,958

Operating income (loss):

Lawson Products

5,792

5,385

Canada Branch Division

3,869

3,494

Gexpro Services

13,605

13,880

TestEquity

8,335

2,635

All Other

(6,352

)

(1,775

)

Total

25,249

23,619

DISTRIBUTION SOLUTIONS GROUP, INC.

SEC REGULATION G GAAP RECONCILIATIONS

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, the Company's management believes that certain non-GAAP financial measures may provide users of this financial information with additional meaningful comparisons between current results and results in prior operating periods. Management believes that these non-GAAP financial measures can provide additional meaningful reflections of underlying trends of the business because they provide a comparison of historical information that excludes certain non-operational or non-cash items that impact the overall comparability. See Tables below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the three months ended September 30, 2026 and 2025 and the three months ended June 30, 2026. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with GAAP.

Distribution Solutions Group, Inc.

Table 2 - Reconciliation of GAAP Net Income (Loss) and GAAP Operating Income (Loss) to

Non-GAAP Adjusted EBITDA

(Dollars in thousands)

(Unaudited)

Three Months Ended

September 30,

June 30,

2026

2025

2026

Net income (loss)

8,892

6,452

8,494

Income tax expense (benefit)

2,366

1,929

5,897

Other income (expense), net

529

1,283

486

Interest expense

13,462

13,955

12,991

Operating income (loss)

25,249

23,619

27,868

Depreciation and amortization

20,181

20,042

19,865

Stock-based compensation (1)

2,345

2,400

2,158

Severance and acquisition related retention expenses (2)

752

2,094

2,204

Acquisition related costs (3)

3,981

335

Inventory step-up (4)

147

—

Other non-recurring (5)

4,164

215

1,433

Non-GAAP Adjusted EBITDA

56,819

48,457

53,933

Operating income (loss) as a percent of revenue

4.4

4.6

5.0

Adjusted EBITDA as a percent of revenue

9.9

9.4

9.7

(1)

Expense (benefit) primarily for stock-based compensation, of which a portion varies with the Company's stock price.

(2)

Includes severance expense for actions taken not related to a formal restructuring plan and acquisition related retention expenses.

(3)

Transaction and integration costs related to acquisitions.

(4)

Inventory fair value step-up adjustment for acquisition accounting related to acquisitions completed.

(5)

Other non-recurring costs consist of certain non-recurring strategic projects, costs related to the proposed Merger and other non-recurring items.

Distribution Solutions Group, Inc.

Table 3 - Reconciliation of GAAP Net Income (Loss) and GAAP Diluted EPS to

Non-GAAP Adjusted Net Income and Non-GAAP Adjusted Diluted EPS

(Dollars in thousands, except per share data)

(Unaudited)

Three Months Ended

September 30, 2026

September 30, 2025

June 30,2026

Amount

Diluted EPS (2)

Amount

Diluted EPS (2)

Amount

Diluted EPS (2)

Net income (loss)

8,892

0.19

6,452

0.14

8,494

0.18

Pretax adjustments:

Stock-based compensation

2,345

0.05

2,400

0.05

2,158

0.05

Acquisition related costs

3,981

0.08

—

335

0.01

Amortization of intangible assets

11,308

0.24

11,650

0.25

11,148

0.24

Severance and acquisition related retention expenses

752

0.02

2,094

0.04

2,204

0.05

Inventory step-up

147

—

Other non-recurring

4,164

0.09

215

—

1,433

0.03

Total pretax adjustments

22,697

0.48

16,446

0.34

17,348

0.38

Tax effect on adjustments (1)/(3)

(5,771

)

(0.12

)

(4,307

)

(0.08

)

(4,543

)

(0.11

)

Deferred tax asset valuation allowance (3)/(4)

1,616

0.03

179

—

754

0.02

Non-GAAP Adjusted net income

27,434

0.58

18,770

0.40

22,053

0.47

(1)

The adjustment to the income tax expense (benefit) is determined by excluding the non-GAAP adjustments by jurisdiction.

(2)

Pretax adjustments to diluted EPS calculated on 47.087 million, 47.060 million and 46.433 million diluted shares for the third quarter of 2026 and 2025, and the second quarter of 2026, respectively.

(3)

The quarter-to-date amounts are derived from the current period year-to-date amount less the previous quarter year-to-date amount.

(4)

The estimated impact to the deferred tax asset valuation allowance from interest expense limitations under Section 163(j) determined by including the non-GAAP adjustments by jurisdiction.

Distribution Solutions Group, Inc.

Table 4 - Reconciliation of GAAP Operating Income (Loss) to Non-GAAP Adjusted Operating Income

(Dollars in thousands)

(Unaudited)

Three Months Ended

September 30,

June 30,

2026

2025

2026

Operating income (loss)

25,249

23,619

27,868

Gross profit adjustments:

Inventory step-up (1)

147

—

Total gross profit adjustments

147

—

Selling, general and administrative expenses adjustments:

Acquisition related costs (2)

3,981

335

Amortization of intangible assets

11,308

11,650

11,148

Stock-based compensation (3)

2,345

2,400

2,158

Severance and acquisition related retention expenses (4)

752

2,094

2,204

Other non-recurring (5)

4,164

215

1,433

Total selling, general and administrative adjustments

22,550

16,446

17,278

Total adjustments

22,697

16,446

17,348

Non-GAAP Adjusted operating income

47,946

40,065

45,216

(1)

Inventory fair value step-up adjustment for acquisition accounting related to acquisitions completed.

(2)

Transaction and integration costs related to acquisitions.

(3)

Expense (benefit) primarily for stock-based compensation, of which a portion varies with the Company's stock price.

(4)

Includes severance expense for actions taken not related to a formal restructuring plan and acquisition related retention expenses.

(5)

Other non-recurring costs consist of certain non-recurring strategic projects, costs related to the proposed Merger and other non-recurring items.

Distribution Solutions Group, Inc.

Table 5 - Reconciliation of GAAP Operating Income (Loss) to Non-GAAP Adjusted EBITDA

Q3 2026 and Q3 2025

(Dollars in thousands)

(Unaudited)

Lawson Products

Gexpro Services

TestEquity

Canada Branch Division

All Other

Eliminations

Consolidated DSG

Quarter Ended

Q3 2026

Q3 2025

Q3 2026

Q3 2025

Q3 2026

Q3 2025

Q3 2026

Q3 2025

Q3 2026

Q3 2025

Q3 2026

Q3 2025

Q3 2026

Q3 2025

Revenue from external customers

130,202

121,541

139,252

130,192

242,126

206,310

62,042

59,915

—

573,622

517,958

Intersegment revenue

592

333

177

169

—

(883

)

(572

)

—

Revenue

130,285

121,549

139,844

130,525

242,303

206,479

62,073

59,977

—

(883

)

(572

)

573,622

517,958

Operating income (loss)

5,792

5,385

13,605

13,880

8,335

2,635

3,869

3,494

(6,352

)

(1,775

)

25,249

23,619

Depreciation and amortization

7,045

6,666

3,011

3,541

8,155

8,220

1,970

1,615

—

20,181

20,042

Adjustments:

Acquisition related costs(1)

2,754

(17

)

1,101

)

—

3,981

Stock-based compensation(2)

1,021

1,025

347

512

925

—

465

390

2,345

2,400

Severance and acquisition related retention expenses(3)

523

840

276

486

492

108

—

752

2,094

Inventory step-up(4)

100

—

147

—

Other non-recurring(5)

—

417

128

3,718

—

4,164

215

Non-GAAP Adjusted EBITDA

17,235

13,959

18,079

17,755

17,536

12,351

6,029

5,777

(2,060

)

(1,385

)

56,819

48,457

Operating income (loss) as a percent of revenue

4.4

9.7

10.6

3.4

1.3

6.2

5.8

N/M

4.4

4.6

Adjusted EBITDA as a percent of revenue

13.2

11.5

12.9

13.6

7.2

6.0

9.7

9.6

N/M

9.9

9.4

N/M - Not meaningful

(1)

Transaction and integration costs related to acquisitions.

(2)

Expense (benefit) primarily for stock-based compensation, of which a portion varies with the Company's stock price.

(3)

Includes severance expense from actions taken not related to a formal restructuring plan and acquisition related retention expenses.

(4)

Inventory fair value step-up adjustment for acquisition accounting related to acquisitions completed.

(5)

Other non-recurring costs consist of certain non-recurring strategic projects, costs related to the proposed Merger and other non-recurring items.

N/M

- Not meaningful