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Flowco Holdings Inc. (FLOC)

CIK: 0002035149. SIC: 3533 Oil & Gas Field Machinery & Equipment. Latest 10-K as of: 2026-02-26.

SIC breadcrumb: Manufacturing > Industrial And Commercial Machinery And Computer Equipment > SIC 3533 Oil & Gas Field Machinery & Equipment

SEC company page: https://www.sec.gov/edgar/browse/?CIK=2035149. Latest filing source: 0001193125-26-077219.

Selected Fundamentals

MetricValueUnitFYFiled
Revenue759,719,000USD20252026-02-26
Net income41,398,000USD20252026-02-26
Assets1,646,351,000USD20252026-02-26

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-26. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0002035149.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Free cash flow = operating cash flow - capital expenditures. Missing metrics are omitted rather than fabricated.

Metric202320242025
Revenue243,323,000535,278,000759,719,000
Net income41,398,000
Operating income78,334,000116,742,000149,012,000
Diluted EPS1.24
Operating cash flow81,862,000179,383,000294,370,000
Capital expenditures43,514,00090,494,000127,287,000
Share buybacks0.000.0015,000,000
Assets1,588,949,0001,646,351,000
Liabilities749,842,000288,427,000
Stockholders' equity0.00228,626,000
Cash and cash equivalents4,615,0004,522,000
Free cash flow38,348,00088,889,000167,083,000

Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

Metric202320242025
Net margin5.45%
Operating margin32.19%21.81%19.61%
Return on equity18.11%
Return on assets2.51%
Liabilities / equity1.26
Current ratio3.263.34

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0002035149.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

QuarterEnd DateRevenueNet IncomeDiluted EPSMethod
2025-Q12025-03-31192,350,0006,172,000reported discrete quarter
2025-Q22025-06-30193,215,0005,471,0000.21reported discrete quarter
2025-Q32025-09-30176,941,00012,517,0000.32reported discrete quarter
2025-Q42025-12-31197,213,00017,238,000derived Q4 = FY annual - nine-month YTD
2026-Q12026-03-31209,530,0007,442,0000.23reported discrete quarter

Quarterly Charts

Macro Cross-References

Latest quarter (10-Q)

Latest 10-Q source: 0001193125-26-209130.

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Published MD&A gate trimmed front/tail over-capture. Confidence: high. Filing date: 2026-05-06. Report date: 2026-03-31.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report. The following discussion includes forward-looking statements that involve certain risks and uncertainties. For further information on items that could impact our future operating performance or financial condition, see the sections entitled “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, and “Cautionary Note Regarding Forward-Looking Statements” in this Quarterly Report. We assume no obligation to update any of these forward-looking statements, except as required by law. Unless otherwise indicated or the context otherwise requires, the historical financial information in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” reflects only the historical financial results of Flowco Holdings Inc. and its consolidated subsidiaries and references to the “Company,” “we,” “our,” or “us” are to Flowco Holdings Inc. and its consolidated subsidiaries

Background and Business Overview

We are a leading provider of production optimization, artificial lift and emissions management and monetization solutions for the oil and natural gas industry. The Company’s core technologies include high pressure gas lift (“HPGL”), electric submersible pump (“ESP”), conventional gas lift, plunger lift, and vapor recovery units (“VRUs”), all supported by proprietary digital tools that enable real-time remote monitoring and control to enhance efficiency and performance.

Consistent with the manner in which our chief operating decision maker evaluates performance and allocates resources, our operations are conducted, managed and presented within the following two reportable segments:

•
Production Solutions: segment is comprised of our artificial lift operation, including digital solutions; and

•
Natural Gas Technologies: segment is comprised of our vapor recovery and natural gas systems operations.

The Production Solutions operations are critical to maximizing the economic lifespan and profitability of oil and gas wells, particularly as production naturally declines over time – especially in shale formations. The Company’s artificial lift and optimization technologies are essential in maintaining production rates and enabling wells to remain economically viable, making these offerings less discretionary and more integrated into ongoing operations.

In the Natural Gas Technologies segment, the Company also holds a leading position in the rapidly growing market for methane abatement, offering innovative VRUs and related technologies that capture fugitive emissions of methane and other hydrocarbons. These solutions not only provide economic value by monetizing captured gas, but also help customers achieve decarbonization goals and comply with increasingly stringent environmental regulations. Initially driven by safety and operational benefits, demand for these solutions has accelerated due to their strong return on investment and regulatory necessity. As a result, the Company’s offerings are viewed as indispensable in both economic and environmental contexts, providing our customers with durable earnings and stable through-cycle performance in their well productions.

Overall, we have strategically positioned ourselves to provide products and services that include a full range of equipment and technology solutions that enable our customers to efficiently and cost-effectively maximize the profitability and economic lifespan of the production phase of their operations. As a result of this strategic position, we are able to generate revenues throughout the long producing lives of oil and natural gas wells. Our products and services also integrate proprietary digital technologies that allow for remote monitoring and controls, and other enhanced uses of our equipment. We have an operating presence in every major onshore oil and natural gas producing region in the United States.

41

As of March 31, 2026, our Production Solutions and Natural Gas Technologies segments operated a combined fleet of over 5,400 active systems, generating consistent, recurring revenues through the long production life of wells. For a more detailed overview of our business, see Part 1. Item 1. Business and Part 1. Item 2. Properties included in our Annual Report.

Recent Developments and Trends

Valiant Acquisition

On March 2, 2026, we completed the previously announced agreement to acquire all of the issued and outstanding equity interests of Riverstone Oilfield Services and Equipment, Inc., a Delaware corporation (the “Acquired Company”), from Riverway Group, a Cayman Islands exempted company with limited liability (the “Seller”) pursuant to the Stock Purchase Agreement dated as of February 1, 2026 (the “Purchase Agreement”) by and between the Company and the Seller. The Acquired Company is the parent company of its wholly owned subsidiary, Valiant Artificial Lift Solutions, LLC (“Valiant”).

Pursuant to the Purchase Agreement, we paid aggregate consideration, including Valiant’s cash on hand, of approximately $315.9 million, consisting of (i) $283.1 million of cash, of which $121.3 million was related to Valiant’s cash on hand, subject to adjustment in accordance with the Purchase Agreement, and (ii) 1,454,849 shares of Class A common stock of the Company. We funded the cash portion of the acquisition through available capacity under our Revolving Credit Facility. Upon the consummation of this acquisition, both the Acquired Company and Valiant became our wholly owned subsidiaries.

We believe this acquisition (the “Valiant Acquisition”) strategically diversifies our complementary fleet within the Production Solutions segment and allows for significant expected synergies to our already vertically integrated business models across the long life production stages of a well. For additional information on the Valiant Acquisition, see Note 3 – Business Combination and Asset Acquisition of the notes to the condensed consolidated financial statements in this Quarterly Report.

Macroeconomic Conditions and Outlook

We monitor macroeconomic conditions and industry-specific drivers and key risk factors affecting our business segments as we formulate our strategic plans and make decisions related to allocating capital and human resources. Our business segments provide products and services to support oil and natural gas production. As a result, we are substantially dependent upon global oil production levels, as well as operating expenditures and new investment activity levels in the oil and natural gas sector. Demand for our products and services is impacted by overall global demand for oil and natural gas, ongoing depletion rates of existing oil and natural gas wells, and our customers’ willingness to invest in the development of new oil and natural gas resources. Our customers determine their operating and capital budgets based on current and expected future crude oil and natural gas prices and expectation of industry cost levels, among other factors. Crude oil and natural gas prices are impacted by supply and demand, which are influenced by geopolitical, macroeconomic and local events, and have historically been subject to substantial volatility and cyclicality.

We acknowledge the evolving and complex nature of the global tariff environment. Additionally, we also understand that current uncertainties about the tariffs and their effects on trading relationships may affect cost for and availability of raw materials or contribute to inflation in the markets in which we operate and increase economic pressures on our customers. We do not believe that the impacts on the current tariff environment will materially affect our business operations and results of operations. However, we continue to actively monitor the economic effects of the uncertainties created from these tariffs, as well as opportunities to mitigate their related impacts, costs and other effects in our business operations.

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Over the mid to long-term, we expect demand for oil and natural gas exploration and production as well as new energy platforms to continue to require more advanced technology from the energy services industry. While the ongoing uncertainties persist for reasons mentioned above, we remain cautiously optimistic that our integrated scope of products and service offerings, our differentiated technologies and a strong market presence will enable us to achieve a sustained long-term growth.

Critical Accounting Estimates

Refer to our “Critical Accounting Estimates” included in Part II, Item 7 – Management’s Discussions and Analysis included in our Annual Report for a discussion of our critical accounting estimates.

Consolidated Results of Operations

The following discussions relating to significant line items from our condensed consolidated statements of operations are based on available information and represent our analysis of significant changes or events that impact the comparability of reported amounts. Where appropriate, we have identified specific events and changes that affect comparability or trends and, where reasonably practicable, have quantified the impact of such items.

We currently have two operating segments: (i) Production Solutions and (ii) Natural Gas Technologies. Our corporate headquarters and certain functional departments do not earn revenues but incur costs which do not constitute business activities. Therefore, these corporate headquarters and certain functional departments do not qualify as an operating segment and have been included within corporate and other, which is also not considered a reportable segment. Corporate and other includes (i) corporate and overhead costs, and (ii) capitalized costs related to IPO and debt issuance. Corporate does not include any immaterial and aggregated operating segments. The performance of our operating segments is primarily evaluated based on revenue and segment profit or loss with respect to such segments, in addition to other measures.

43

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Three Months Ended March 31,

2026

2025

Change

($)

Change

(%)

Revenues

Rentals

$

121,873

$

97,296

$

24,577

25

%

Sales

87,657

95,054

(7,397

)

-8

%

Total revenues

209,530

192,350

17,180

9

%

Operating expenses

Cost of rentals (exclusive of

   depreciation and amortization

   disclosed separately below)

32,552

26,851

5,701

21

%

Cost of sales (exclusive of

   depreciation and amortization

   disclosed separately below)

62,404

65,566

(3,162

)

-5

%

Selling, general and administrative

   expenses

36,476

30,534

5,942

19

%

Depreciation and amortization

41,495

34,119

7,376

22

%

Loss on sale of equipment

310

(45

)

355

-789

%

Income from operations

36,293

35,325

968

3

%

Other expenses

Interest expense, net

(4,348

)

(5,365

)

1,017

-19

%

Other expenses

(461

)

(267

)

(194

)

73

%

Total other expenses

(4,809

)

(5,632

)

823

-15

%

Income before provision for income

   taxes

31,484

29,693

1,791

6

%

Income tax provision

(4,030

)

(2,648

)

(1,382

)

52

%

Net income

27,454

27,045

409

2

%

Net income attributable to redeemable non

   -controlling interests

20,012

20,873

(861

)

-4

%

Net income attributable to

Flowco Holdings Inc.

$

7,442

$

6,172

$

1,270

21

%

Revenue – rentals. Rental revenue was $121.9 million for the three months ended March 31, 2026, an increase of $24.6 million, or 25%, from $97.3 million for the three months ended March 31, 2025. This incr

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Confidence: high. Filing date: 2026-02-26. Report date: 2025-12-31.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes and other information included elsewhere in this Annual Report. In addition to historical data, this discussion contains forward-looking statements about our business, results of operations, cash flows, financial condition and prospects based on current expectations that involve risks, uncertainties and assumptions. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in Part I. Item 1A. Risk Factors and the section titled “Forward-Looking Statements” included elsewhere in this Annual. Additionally, our historical results are not necessarily indicative of the results that may be expected for any period in the future. We use words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “potential,” “seek,” “should,” “will,” “would,” and similar expressions to identify forward-looking statements.

Company Overview

We are a leading provider of production optimization, artificial lift and emissions management and monetization solutions for the oil and natural gas industry.

Consistent with the manner in which our chief operating decision maker evaluates performance and allocate resources, our operations are conducted, managed and presented within the following two reportable segments:

•
Production Solutions: segment is comprised of our artificial lift operations, including digital solutions; and

•
Natural Gas Technologies: segment is comprised of our vapor recovery and natural gas systems operations.

We have strategically positioned ourselves to provide products and services that include a full range of equipment and technology solutions that enable our customers to efficiently and cost-effectively maximize the profitability and economic lifespan of the production phase of their operations. As a result of this strategic position, we are able to generate revenues throughout the long production lives of oil and natural gas wells. Our products and services also integrate proprietary digital technologies that allow for remote monitoring and controls, and other enhanced uses of our equipment. We have an operating presence in every major onshore oil and natural gas producing region in the U.S. For a more detailed overview of our business, see Part 1. Item 1. Business and Part 1. Item 2. Properties in this Annual Report.

Recent Developments

IPO

We consummated our initial public offering (“IPO”) on January 15, 2025, in which we issued and sold 20,470,000 shares of our Class A common stock at a price of $24.00 per share, resulting in net proceeds to us of approximately $461.8 million, after deducting the underwriting discount of approximately $29.5 million.

Debt Repayments

On January 17, 2025, we used a portion of the net proceeds from the IPO, after giving effect to the redemption of certain Flowco LLC interests held by non-affiliate holders, to repay $440.0 million of outstanding borrowings under our revolving Credit Agreement. The repayment substantially lowered our outstanding debt and interest expense in 2025 and enhanced our liquidity and capital structure.

Share Repurchase Program

On June 11, 2025, our Board of Directors authorized a share repurchase program providing for the repurchase of up to $50 million of our outstanding common stock. The Repurchase Program is intended to provide the Company with

55

flexibility to return capital to shareholders and to opportunistically repurchase shares when management believes such repurchases represent an attractive use of capital. Repurchases under the Repurchase Program may be made from time to time through open market purchases, privately negotiated transactions, or other means permitted under applicable securities laws and regulations. The Repurchase Program does not obligate us to repurchase any specific number of shares, and the timing, volume, and value of any repurchases will depend on a variety of factors, including our share price, trading volume, general market conditions, liquidity considerations, capital allocation priorities, and compliance with corporate and regulatory requirements. The Repurchase Program may be modified, suspended, or discontinued at any time at the discretion of our Board of Directors.

Management evaluates share repurchases as part of its broader capital allocation strategy, which also considers investment in organic growth initiatives, potential acquisitions, debt repayment, and maintaining adequate liquidity. We expect to fund any repurchases from available cash on hand and cash generated from operations.

Asset Acquisition

On August 1, 2025, we completed the acquisition of certain HPGL and VRU systems from Archrock, Inc. for approximately $71 million in cash. The acquisition included 155 HPGL and VRU systems and represents the Company’s first acquisition following the IPO.

The acquired assets helped expand our artificial lift and vapor recovery capabilities, including the addition of electric motor drive systems, which has enhanced our ability to serve customers focused on electrification initiatives and emissions reduction. This acquisition further has strengthened our position in the Permian Basin and expanded our customer base through the addition of contracted, revenue-generating assets.

Management believes the acquisition is consistent with the Company’s inorganic growth strategy and capital allocation framework, which prioritizes the acquisition of high-quality production optimization assets at attractive valuations. The acquisition was funded with cash proceeds from borrowings under our $725.0 million five-year senior secured revolving credit facility (“Credit Facility”) and did not materially affect our overall liquidity profile.

General Trends and Company Outlook

Macroeconomic Conditions and Commodity Prices

The Company’s operating results, financial condition, and cash flows are influenced by macroeconomic conditions and trends in commodity prices, particularly crude oil and natural gas. Demand for the Company’s products and services is closely tied to exploration, development, and production activity in the oil and natural gas industry, which in turn is affected by ever changing global economic conditions, energy demand, and commodity price environments.

Global macroeconomic factors, such as inflationary pressures, interest rate levels, geopolitical developments, and supply chain dynamics, can impact customer spending behavior, capital allocation decisions, and overall industry activity. Periods of elevated inflation may increase the Company’s operating costs, including labor, materials, and transportation, while higher interest rates may affect customers’ access to capital and willingness to invest in new or expanded production. Conversely, improved macroeconomic stability and access to capital can support increased drilling and completion activity, benefiting demand for the Company’s offerings.

Commodity prices remain a primary driver of customer activity levels. Sustained periods of higher crude oil and natural gas prices generally support increased well completions, production optimization, and investment in artificial lift and surface equipment, which positively affects demand for the Company’s products and services. Conversely, declines or heightened volatility in commodity prices may result in reduced customer spending, project delays, or cancellations, which could adversely impact our revenues and margins. While customers may respond to price fluctuations with varying degrees of sensitivity depending on basin economics, hedging strategies, and balance sheet strength, prolonged periods of low or volatile prices typically lead to reduced industry activity.

56

We do not directly engage in commodity price hedging, and therefore our results are indirectly exposed to commodity price movements through changes in our customer behavior and activity levels. Management seeks to mitigate the impact of commodity price volatility through a diversified customer base, exposure to multiple basins, long-term customer relationships, and a focus on products and services that support both new well development and ongoing production.

We continue to monitor macroeconomic conditions and commodity price trends and evaluates their potential impact on our operations, financial performance, and liquidity. While future commodity prices and economic conditions remain uncertain, we believes our business model and market positioning provide resilience across commodity cycles.

Global Outlook and Geopolitical Environments

The ongoing heightened tension in the global geopolitical environments, especially the prolonged conflicts in Ukraine and in the Middle East and the continued tension between U.S. and China, continues to create uncertainty not only in the oil and natural gas markets, but also in the financial market and global supply chain. Commencing in early 2025, the Trump administration introduced new and significant trade policies and imposed or threatened to impose tariffs on imported products with numerous U.S. global trade partners. These aggressive and unpredictable trade policies could create volatility in U.S. stock markets and further disruptions in global supply chain dynamics. We do not know the ultimate severity or duration of these conflicts, but we continue to closely monitor shifts in global trade policies and evaluate their potential impacts on our business, financial condition and results of operations.

Our Industry Growth

The natural gas compression and artificial lift industry continued to experience robust growth, driven by rising global energy demand, technological innovations and evolving regulatory requirements. Advancements in compression technology, automation and data analytics continued to reshape operational efficiency and reliability across the industry. We believe that our longstanding and expansive customer relationships across every major onshore U.S. producing region combined with vertically integrated operations allow us to be strategically positioned to capitalize on these transformative trends and deliver sustainable long-term value.

As our business is closely aligned with well production and is typically less directly affected by commodity price, we are not exposed to the volatility often faced in the narrow-focused and shorter-cycle oil field service businesses. We deliver natural gas compression services in connection with domestic natural gas production that primarily occurs in natural gas basins, such as the Appalachian and Barnett, and in crude oil basins where associated natural gas is produced alongside crude oil production, such as San Juan, Anadarko and Permian basins, and Eagle Ford Shale.

Our products are chosen due to their reliability and ability to aid our customers in achieving maximum output and cash flow from their producing wells. Our products and services also integrate proprietary digital technologies that allow for remote monitoring and controls, and other enhanced uses of our equipment. We have an operating presence in every major onshore oil and natural gas producing region in the U.S., with majority of our consolidated revenue generated in Permian Basin.

Factors Affecting the Comparability of Our Financial Condition and Results of Operations

Our historical financial condition and results of operations for the periods presented may not be comparable, both from period over period and going forward, for the following reasons:

•
Selling, general and administrative expenses. During 2025, we incurred additional selling, general and administrative expenses as a result of becoming a publicly traded company. These costs include expenses associated with our annual and quarterly financial reporting with the SEC, tax preparation expenses, Sarbanes-Oxley (“SOX”) compliance expenses, audit fees, legal fees, directors and officers insurance,

57

investor relations expenses, Tax Receivable Agreement administration expenses and registrar and transfer agent fees.

•
Corporate Reorganization. For periods prior to June 20, 2024, the historical consolidated financial statements presented herein are based on the operations of our accounting predecessor, Estis. For periods subsequent to June 20, 2024, the consolidated financial statements presented are based on the combined operations of the Merging Entities. As a result, the historical consolidated financial information may not provide an accurate indication of what our actual results would have been if the 2024 Business Combination had been completed at the beginning of the earliest period presented.

•
Income Taxes. Our accounting predecessors are a collective limited liability companies that constitute as partnerships for U.S. federal income tax purposes, and therefore are not subject to U.S. federal income taxes and the provisions for income tax calculations thereof. As the IPO occurred subsequent to the last date presented in the comparative prior period in this Annual Report, the prior years’ financial information do not reflect any income tax benefit or expense attributable to us. Subsequent to the IPO, we became a taxable entity and started to be taxed as a corporation under the Internal Revenue Code and subject to U.S. federal income taxes (currently at a statutory rate of 21% of pretax earnings, as adjusted by the Internal Revenue Code), as well as state income taxes, for our interest ownership in Flowco LLC.

•
Noncontrolling Interests. As a result of the IPO and a series of related reorganization transactions in connection with the IPO (the “Transactions”), we became the sole managing member of Flowco LLC and consolidate entities in which we have a controlling financial interest. Consequently, the financial statements for periods prior to the IPO included in this Annual Report have been adjusted to combine each of the previously separated Merging Entities. For the period after the IPO, the financial position and results of operations include those of Flowco Holdings and we report the noncontrolling interests related to the portion of LLC Interests not owned by us. Additionally, all shares of our Class B common stock are held by noncontrolling interest owners. The noncontrolling interests only impact financial statements presentations as of December 31, 2025 and for the year ended December 31, 2025.

Results of Operations

The consolidated financial information included in the following tables and discussions present the historical financial information of our operations. Additionally, the discussions relating to significant line items from our consolidated statements of operations are based on available information and represent our analysis of significant changes or events that impact the comparability of reported amounts. Where appropriate, we have identified specific events and changes that affect comparability or trends and, where reasonably practicable, have quantified the impact of such items. The results of operations data in the following tables for the periods presented have been derived from the audited financial statements included elsewhere in this Annual Report.

We currently have two operating segments: (i) Production Solutions; and (ii) Natural Gas Technologies. Our corporate headquarters and certain functional departments do not earn revenues but incur costs which do not constitute business activities. Therefore, these corporate headquarters and certain functional departments do not qualify as an operating segment and have been included within corporate and other, which is also not considered a reportable segment. Corporate and other includes (i) corporate and overhead costs, and (ii) capitalized costs related to IPO and debt issuance and does not include any immaterial and aggregated operating segments. The performance of our operating segments is primarily evaluated based on revenue and segment profit or loss with respect to such segments, in addition to other measures.

58

Year Ended December 31, 2025 Compared to Year Ended December 31, 2024

Prior to June 20, 2024, all operating results reflect only Estis as predecessor to the Merging Entities. The following table sets forth certain selected financial results for the periods indicated (in thousands):

For the Year Ended December 31,

2025

2024

Change

($)

Change

(%)

Revenues

Rentals

$

417,958

$

276,687

$

141,271

51

%

Sales

341,761

258,591

83,170

32

%

Total revenues

759,719

535,278

224,441

42

%

Operating expenses

Cost of rentals (exclusive of

   depreciation and amortization

   disclosed separately below)

114,341

74,494

39,847

53

%

Cost of sales (exclusive of

   depreciation and amortization

   disclosed separately below)

232,209

189,930

42,279

22

%

Selling, general and administrative

   expenses

118,577

62,453

56,124

90

%

Depreciation and amortization

144,838

90,862

53,976

59

%

Loss on sale of equipment

742

797

(55

)

-7

%

Income from operations

149,012

116,742

32,270

28

%

Other expenses

Interest expense

(18,939

)

(32,345

)

13,406

-41

%

Loss on debt extinguishment

—

(221

)

221

-100

%

Other income (expenses)

740

(2,756

)

3,496

-127

%

Total other expenses

(18,199

)

(35,322

)

17,123

-48

%

Income before provision for income

   taxes

130,813

81,420

49,393

61

%

Income tax benefit (provision)

842

(1,171

)

2,013

-172

%

Net income

131,655

$

80,249

$

51,406

64

%

Net income attributable to redeemable non

   -controlling interests

90,257

Net income attributable to

Flowco Holdings Inc.

$

41,398

Revenue – Rentals. The primary driver for the increase in average active systems was related to Flogistix’s VRUs that were added to our combined fleet as part of the 2024 Business Combination within the Natural Gas Technologies segment and Estis’ organic growth in its surface equipment rental fleet within the Production Solutions segment. Due to the timing of the 2024 Business Combination, the year ended December 31, 2024 rental revenue include only Flogistix’s operational days of ten days in June 2024 and the six months ended December 31, 2024. Additionally, the average rental rates for VRUs are generally lower than the average rental rates for surface equipment. Accordingly, the weighted average rental rate of the combined fleet during the year ended December 31, 2025 is lower than the weighted average rental rate during the year ended December 31, 2024, which prior to the 2024 Business Combination was made up exclusively of surface equipment fleet.

Rental revenue was $418.0 million for the year ended December 31, 2025, an increase of $141.3 million, or 51%, from $276.7 million for the year ended December 31, 2024. This increase in rental revenue was driven primarily by two factors as follows:

•
Surface equipment fleet size experienced an increase of 102 average active systems per month from 1,434 during the year ended December 31, 2024, to 1,536 average active surface equipment systems per month during the year ended December 31, 2025. Additionally, average rental rate also had a $1,877 increase in

59

average monthly price from $11,195 per unit during the year ended December 31, 2024 to $13,072 per unit during the year ended December 31, 2025. These increases approximate 7% and 17% for fleet size and average rental rate per unit, respectively, and contribute to a total increase in surface equipment rental revenue of $48.3 million, or approximately 25.1%.

•
The 2024 Business Combination impact on VRUs – the year ended December 31, 2024 rental revenue only reflect ten operation days in June 2024 and the six months ended December 31, 2024 of Flogistix’s VRU systems with a total of 2,838 average active systems during this time period and an average rental rate of approximately $4,696 per unit during the same period. During the year ended December 31, 2025, Flogistix’s VRU fleet size grew to an average of 3,016 active systems per month and an average rental rate of $4,883 per unit. These increases contribute to a total increase in vapor recovery rental revenue of $92.3 million, or approximately 109.4%, in the periods compared.

Revenue – Sales. Sales revenue was $341.8 million for the year ended December 31, 2025, an increase of $83.2 million, or 32%, from $258.6 million for the year ended December 31, 2024. This increase in revenue was primarily due to the added revenue streams in the sales revenue category. Approximately $122.4 million increase of downhole components sales, or 90%, and an $8.9 million increase of VRU sales, or 22%, were added to the total sales revenue in the year ended December 31, 2025 resulting from the 2024 Business Combination, partially offset by a decrease of approximately $48.1 million in natural gas systems sales due to a completion of a project for a customer. The sales of our VRU sales experienced a modest increase year-over-year due to a shift in purchasing patterns from our operators.

Additionally, we sell our natural gas systems through intercompany transactions for further use in the Production Solutions segment in addition to sales to our customers. Approximately $58.6 million of intercompany natural gas system sales to the Production Solutions segment was recognized in the year ended December 31, 2025 as we continued the growth in our Production Solutions segment, an increase of approximately $19.4 million in intercompany revenues from approximately $39.2 million in the year ended December 31, 2024. All intercompany revenues have been eliminated in consolidation.

Cost of Rentals. Rental cost was $114.3 million for the year ended December 31, 2025, an increase of $39.8 million, or 53%, from $74.5 million for the year ended December 31, 2024. The primary driver of this increase relates to an increase of $29.3 million of costs related to Flogistix’s VRUs as part of the 2024 Business Combination within the Natural Gas Technologies segment that were included for ten operational days in June 2024 and the six months ended December 31, 2024 along with an approximately $10.6 million increase in organic higher equipment maintenance and repair costs within the Production Solutions segment.

Cost of Sales. Sales cost was $232.2 million for the year ended December 31, 2025, an increase of $42.3 million, or 22%, from $189.9 million for the year ended December 31, 2024. This increase was primarily attributable to an increase of $74.2 million of costs related to Flowco Productions within the Production Solution segment and $6.3 million of costs related to Flogistix within the Natural Gas Technologies segment as part of the 2024 Business Combination, partially offset by reduced sale volumes and less product mix of sold natural gas systems of approximately $38.2 million from a completion of a project for a customer.

Selling, general and administrative expenses. Selling, general and administrative expenses for the year ended December 31, 2025, were $118.6 million, an increase of $56.1 million, or 90% from $62.5 million for the year ended December 31, 2024. This increase was primarily attributable to the added personnel, marketing, and sales expenses related to the 2024 Business Combination, which consists of $21.4 million, $13.0 million and $21.7 million increases within the Production Solutions, Natural Gas Technologies and Corporate segments, respectively. Included in these increases are: (i) $1.3 million of settlement expenses related to a lawsuit within our Production Solutions segment in September 2025; (ii) a $1.0 million non-recurring charge in June 2025 related to the re-purposing of one of our manufacturing facilities in Pampa, TX, within our Natural Gas Technologies segment; and (iii) $2.9 million of

60

non-recurring charges in June 2025 related to termination benefits and related expenses, which includes one of our executive officers, within our Corporate segment.

Depreciation and amortization. Depreciation and amortization was $144.8 million for the year ended year ended December 31, 2025, an increase of $53.9 million, or 59%, from $90.9 million for the year ended December 31, 2024. This increase was primarily due to increased depreciation expense on machinery and equipment and increased amortization expense on intangible assets resulting from the 2024 Business Combination and from the additional HPGL and VRU systems acquired from the Archrock acquisition in August 2025.

Loss on sale of equipment. Loss on sale of equipment was $0.7 million for the year ended December 31, 2025, compared to $0.8 million for the year ended December 31, 2024, a decrease of $0.1 million, or 6.9%, due to a fewer number of unit disposals within the Production Solutions segment in 2025 compared to 2024.

Interest expense. Interest expense was $18.9 million for the year ended December 31, 2025 compared to $32.3 million for the year ended December 31, 2024. This decrease in interest expense of $13.4 million, or 41% is primarily due to decreased average borrowings outstanding in the year ended December 31, 2025 compared to the year ended December 31, 2024 resulting largely from the debt repayment in January 2025 of $440.0 million using the proceeds from the IPO, partially offset with the recent debt proceeds of $71.0 million in August 2025 to fund the Archrock acquisition.

Loss on debt extinguishments. Loss on debt extinguishments was $0.2 million for the year ended December 31, 2024 with no comparable item for the year ended December 31, 2025, related to the Credit Agreement entered into on August 20, 2024, which currently provides for a $725.0 million five-year senior secured revolving credit facility.

Other income (expenses). Other income was $0.7 million for the year ended December 31, 2025, compared to other expense of $2.8 million for the year ended December 31, 2024, a favorable swing of of $3.5 million. The change was primarily driven by various gains on lease terminations, partially offset by approximately $0.4 million of transactional expenses in the year ended December 31, 2025, and the absence of Estis’ non-operating expenses that were present during the year ended December 31, 2024.

Income tax benefit (provision). Income tax benefit was $0.8 million for the year ended December 31, 2025, a favorable swing of approximately $2.0 million, or 172%, compared to provision for income taxes of $1.2 million for the year ended December 31, 2024. Provision for income taxes for the year ended December 31, 2024, is entirely associated with Texas margin tax, as it was prior to the IPO and we were not an income tax paying entity for U.S. federal purposes. After the IPO, we became subject to U.S. federal, state, and local income taxes with respect to our allocable share of taxable income of Flowco Holdings at the prevailing corporate tax rates. The $0.8 million million income tax benefit during the year ended December 31, 2025, is comprised of approximately $2.5 million of income tax benefit position due to the exclusion of noncontrolling interest and releases of valuation allowances, is partially offset by $1.6 million Texas margin tax. The $0.4 million increase in Texas margin tax year-over-year was primarily attributable to the 2024 Business Combination.

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Year Ended December 31, 2024 Compared to Year Ended December 31, 2023

The following table sets forth certain selected financial results for the periods indicated (in thousands). Prior to June 20, 2024, all operating results reflect only Estis as predecessor to the Merging Entities:

For the Year Ended December 31,

2024

2023

Change

($)

Change

(%)

Revenues

Rentals

$

276,687

$

168,801

$

107,886

64

%

Sales

258,591

74,522

184,069

247

%

Total revenues

535,278

243,323

291,955

120

%

Operating expenses

Cost of rentals (exclusive of

   depreciation and amortization

   disclosed separately below)

74,494

42,179

32,315

77

%

Cost of sales (exclusive of

   depreciation and amortization

   disclosed separately below)

189,930

62,599

127,331

203

%

Selling, general and administrative

   expenses

62,453

15,219

47,234

310

%

Depreciation and amortization

90,862

43,822

47,040

107

%

Loss on sale of equipment

797

1,170

(373

)

-32

%

Income from operations

116,742

78,334

38,408

49

%

Other expenses

Interest expense

(32,345

)

(18,956

)

(13,389

)

71

%

Loss on debt extinguishment

(221

)

—

(221

)

100%

Other income (expenses)

(2,756

)

(910

)

(1,846

)

203

%

Total other expenses

(35,322

)

(19,866

)

(15,456

)

78

%

Income before provision for income

   taxes

81,420

58,468

22,952

39

%

Income tax provision

(1,171

)

(379

)

(792

)

209

%

Net income

$

80,249

$

58,089

$

22,160

38

%

Revenue—Rentals. Rental revenue was $276.7 million for the year ended December 31, 2024, an increase of $107.9 million, or 64%, from $168.8 million for the year ended December 31, 2023. $84.4 million of increase in rental revenue relates to the Natural Gas Technologies segment from companies acquired in the 2024 Business Combination. Rental fleet from the Natural Gas Technologies segment had an average of 2,838 active systems and an average monthly price of $4,696 for the year ended December 31, 2024. The remaining $23.5 million increase in rental revenue relates to the Production Solutions segment, which was driven by an increase of 33 average active systems per month from 1,401 during 2023 to 1,434 average active systems per month during 2024, and a $1,132 increase in average monthly price from $10,043 per unit during 2023 to $11,195 per unit during 2024. Thus, of the increase in rental revenue related to the Production Solutions segment, 2.4% is attributable to an increase in average active systems, and 11.3% is due to an increase in average monthly price.

Revenue—Sales. Sales revenue was $258.6 million for the year ended December 31, 2024, an increase of $184.1 million, or 247%, from $74.5 million for the year ended December 31, 2023. This increase in revenue was partially due to $135.5 million of revenue related to Flowco Productions within the Production Solutions segment and $41.4 million of revenue related to Flogistix within the Natural Gas Technologies segment as part of the 2024 Business Combination. The remainder of the increase was primarily due to an increase of $7.2 million of sales of natural gas systems to third parties. We sell our natural gas systems through intercompany transactions for further use in the Production Solutions segment as well as sales to our customers. During 2023, intercompany sales comprised a significant portion of total natural gas system sales as we continued to increase the volume of active systems within Production Solutions segment. Due to the change in focus of sales to third parties rather than our Production Solutions

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segment, third party sales volume of natural gas systems increased 10% year-over-year while pricing remained flat. All intercompany revenues have been eliminated in consolidation.

Cost of Rentals. Rental cost was $74.5 million for the year ended December 31, 2024, an increase of $32.3 million, or 77%, from $42.2 million for the year ended December 31, 2023. This increase was primarily attributable to $28.6 million of costs related to Flogistix as part of the 2024 Business Combination within the Natural Gas Technologies segment.

Cost of Sales. Sales cost was $189.9 million for the year ended December 31, 2024, an increase of $127.3 million, or 203%, from $62.6 million for the year ended December 31, 2023. The increase was primarily attributable to $94.9 million of costs related to Flowco Productions within the Production Solutions segment and $30.2 million of costs related to Flogistix within the Natural Gas Technologies segment as part of the 2024 Business Combination.

Selling, general and administrative expenses. Selling, general and administrative expenses were $62.5 million for the year ended December 31, 2024, an increase of $47.2 million, or 310%, from $15.2 million for the year ended December 31, 2023. This increase was primarily attributable to $21.2 million of costs related to Flowco Productions within the Production Solutions segment, $15.7 million of expenses related to Flogistix within the Natural Gas Technologies segment, and Corporate expenses of $6.0 million as a part of the 2024 Business Combination. The remaining increase of $3.9 million is due to increases in personnel expense and sales and marketing expense at Estis, including the addition of management and employees in connection with our IPO and anticipated public company reporting requirements.

Depreciation and amortization. Depreciation and amortization was $90.9 million for the year ended December 31, 2024, an increase of $47.0 million, or 107%, from $43.8 million for the year ended December 31, 2023. The increase in depreciation expense was primarily due to $13.2 million related to Flowco Productions within the Production Solutions segment and $27.6 million related to Flogistix within the Natural Gas Technologies segment as part of the 2024 Business Combination. The remainder of the increase in depreciation expense was due to purchases of machinery and equipment in the prior period, which primarily relates to the Production Solutions segment as depreciation and amortization within the Natural Gas Technologies segment remained consistent year-over-year.

Loss on sale of equipment. Loss on sale of equipment, net was $0.8 million for the year ended December 31, 2024 compared to $1.2 million for the year ended December 31, 2023, a decrease of $0.4 million, or 32%, due to fewer unit disposals in the Production Solutions segment in 2024 compared to 2023.

Interest expense. Interest expense was $32.3 million for the year ended December 31, 2024 compared to $19.0 million for the year ended December 31, 2023. This increase in interest expense of $13.4 million, or 71%, was due to interest expense related to Flowco Productions and Flogistix as part of the 2024 Business Combination, as well as the associated interest on increased borrowings under the Credit Agreement for distributions to members.

Loss on debt extinguishments. Loss on debt extinguishments was $0.2 million for the year ended December 31, 2024, with no comparable item for the year ended December 31, 2023, related to the Credit Agreement entered into on August 20, 2024, which currently provides for a $725.0 million five-year senior secured revolving credit facility.

Other income (expense). Other income (expense) was $2.8 million for the year ended December 31, 2024 compared to $0.9 million for the year ended December 31, 2023, an increase of $1.8 million, or 203%. The increase is due to $0.3 million related to Flowco Productions and Flogistix as part of the 2024 Business Combination as well as $2.7 million of transaction costs incurred in connection with the 2024 Business Combination and $0.9 million of professional service fees not determined to be direct and incremental to our IPO registration statement and not part of the core operating costs of the business. These costs were partially offset by $0.5 million of other expenses incurred during the year ended December 31, 2023 that did not recur during the year ended December 31, 2024.

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Provision for income taxes. Provision for income taxes was $1.2 million for the year ended December 31, 2024, an increase of $0.8 million or approximately 209% from $0.4 million for the year ended December 31, 2023. Provision for income taxes for the years ended December 31, 2024 and 2023, are entirely associated with Texas margin tax, as an LLC. This increase is due to Flowco Productions and Flogistix, as part of the 2024 Business Combination, being included in our financial results for approximately half of 2024.

Liquidity and Capital Resources

IPO and Subsequent Transactions

On January 15, 2025, we consummated our IPO and received $461.8 million net proceeds from the sale of 20,470,000 shares of our Class A common stock. The net proceeds from our IPO were used to purchase 20,470,000 newly issued LLC Interests directly from Flowco LLC at a price per unit equal to the IPO price per share of Class A common stock.

On August 24, 2024, we entered into a credit agreement, as amended to date, by and among Flowco MasterCo (the “Parent Borrower”), Flowco Productions, Estis Intermediate and Flogistix Intermediate, as borrowers, certain other direct and indirect subsidiaries of the Parent Borrower party thereto as guarantors, the lenders named therein, and JPMorgan Chase Bank, N.A., as administrative agent (as amended to date, the “Credit Agreement”). The Credit Agreement was entered into in connection with a continuation and upsize of the legacy credit facility established by a legacy credit agreement with Estis and certain of its subsidiaries as loan parties hereto.

In connection with the IPO described above, Flowco LLC used the net proceeds received from us to: (i) redeem approximately $20.9 million of Flowco LLC interests from certain non-affiliate holders and (ii) with respect to the remainder, repay indebtedness under our Credit Agreement of $440.0 million.

Sources of Liquidity and Indebtedness

As of December 31, 2025, we had $4.5 million of cash and cash equivalents. We believe existing cash and cash equivalents and cash flows from operations will be sufficient to support working capital and capital expenditure requirements for at least the next 12 months. We have historically generated cash and fund our operations primarily from cash flows from operating activities as well as availability under our Credit Agreement. Borrowings under our Credit Agreement have a maturity date of August 20, 2029, in which all principal owed is payable upon maturity. Our interest rate is Term Secured Overnight Finance Rate (“SOFR”) for one month plus 0.1% (“Adjusted REVSOFR30”) plus a contractual applicable margin based on the Company’s calculated leverage ratio, which combined approximates 6.4% per annum at the effective date with interest due monthly. If such rate is below contractual minimums, the interest rate will be calculated based on Adjusted Term SOFR Rate, Adjusted REVSOFR30 Rate or the Adjusted Daily Simple SOFR Rate. Depending upon market conditions and other factors, we may also have the ability to issue additional equity and/or debt, as needed.

Historically, our predecessors’ primary sources of liquidity were cash flows from operations, borrowings under Estis’ legacy credit agreement and equity provided by the Original Equity Owners. Our predecessors’ primary use of capital has been for working capital purposes, to make cash distributions to the Original Equity Owners and repay indebtedness.

As of December 31, 2025, we had $167.8 million outstanding borrowings and $557.2 million available borrowing capacity under our Credit Agreement.

As of February 20, 2026, we had $142.0 million outstanding borrowings and $579.6 million available borrowing capacity under our Credit Agreement. The Company plans to use a portion of such availability to pay the cash portion of the purchase price at the closing of the acquisition of Valiant Artificial Lift Solutions, which cash amount is expected to be $170.0 million subject to adjustments in accordance with the purchase agreement.

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On February 4, 2026, we filed a shelf registration statement on Form S-3 (the “Shelf Registration Statement”), which was declared effective on February 10, 2026. The Shelf Registration Statement registered both (i) the sale by the Company of up to $500 million of its shares of Class A common stock, preferred stock, rights, warrants or units and (ii) up to 57,530,845 shares of Class A common stock by the selling stockholders named in the Shelf Registration Statement. Such offerings may be made from time to time in one or more offerings.

Additional Liquidity Requirements

As a holding company, we have no material assets other than our ownership of LLC Interests in Flowco LLC. As such, we have no independent means of generating revenue. The Flowco LLC Agreement provides for the payment of certain distributions to the Continuing Equity Owners and to us in amounts sufficient to cover the income taxes imposed on the Company with respect to the allocation of taxable income from Flowco LLC as well as to cover our obligations under the TRA and other administrative expenses.

Regarding the ability of Flowco LLC to make distributions to us, the terms of their financing arrangements under the Credit Facility contain covenants that may restrict Flowco LLC or its subsidiaries from paying such distributions, subject to certain exceptions. Further, Flowco LLC is generally prohibited under Delaware law from making a distribution to a member to the extent that, at the time of the distribution, after giving effect to the distribution, liabilities of Flowco LLC (with certain exceptions), as applicable, exceed the fair value of its assets.

In addition, under the TRA, we are required to make cash payments to the Continuing Equity Owners equal to 85% of the tax benefits, if any, that we actually realize (or in certain circumstances are deemed to realize), as a result of (i) Basis Adjustments; (ii) Section 704(c) Allocations; and (iii) certain tax benefits (such as interest deductions) arising from payments made under the TRA. We expect the amount of the cash payments that we will be required to make under the TRA will be significant. The actual amount and timing of any payments under the TRA will vary depending upon a number of factors, including the timing of redemptions or exchanges by the Continuing Equity Owners, the amount of gain recognized by the Continuing Equity Owners, the amount and timing of the taxable income we generate in the future, and the federal tax rates then applicable. Any payments made by us to the Continuing Equity Owners under the TRA will generally reduce the amount of overall cash flow that might have otherwise been available to us.

Additionally, in the event we declare any cash dividends, we intend to cause Flowco LLC to make distributions to us in amounts sufficient to fund such cash dividends declared by us to our stockholders. Deterioration in the financial condition, earnings, or cash flow of Flowco LLC for any reason could limit or impair their ability to pay such distributions.

If we do not have sufficient funds to pay taxes or other liabilities or to fund our operations, we may have to borrow funds, which could materially affect our liquidity and financial condition and subject us to various restrictions imposed by any such lenders. To the extent we are unable to make payments under the TRA for any reason, such payments generally will be deferred and will accrue interest until paid; provided, however, that nonpayment for a specified period may constitute a material breach of a material obligation under the TRA and therefore accelerate payments due under the TRA. In addition, if Flowco LLC does not have sufficient funds to make distributions, our ability to declare and pay cash dividends will also be restricted or impaired.

See Part I – Item 1A. Risk Factors – Risks Related to our Organizational Structure in this Annual Report.

Dividends

Our Board of Directors may elect to declare cash dividends on our Class A common stock, subject to our compliance with applicable law, and depending on, among other things, economic conditions, our financial condition, results of

65

operations, projections, liquidity, earnings, legal requirements, and restrictions in the agreements governing our indebtedness.

In May, August, and November 2025, our Board of Directors declared and paid a cash dividend of $0.08 per share payable to holders of Class A common stock of record as of the close of business on May 14, 2025, August 15, 2025, and November 14, 2025 (the “Common Stock Dividend”). In conjunction with the Common Stock Dividend, Flowco LLC declared a distribution on its units of $0.08 per unit to all unitholders of record of Flowco LLC as of the close of business on May 14, 2025, August 15, 2025, and November 14, 2025, respectively. The declaration and payment of future dividends will be at the discretion of our Board of Directors and will depend on future business conditions, financial conditions, results of operations and other factors.

Common Share Repurchase Program

On June 11, 2025, our Board of Directors authorized a $50 million share repurchase program (the “Repurchase Program”) to reacquire shares via open market purchase, privately negotiated transactions, or by other means in accordance with the regulations of the Securities and Exchange Commission. The Repurchase Program does not obligate us to repurchase any particular amount of shares and may be modified, suspended, or discontinued at any time. The timing of purchases and the number of shares repurchased under the Repurchase Program will depend on a variety of factors including price, trading volume, market conditions and corporate and regulatory requirements. During the year ended December 31, 2025, we repurchased and subsequently retired 953,229 shares of our Class A common stock at an average price of $15.72 per share, excluding commissions.

On September 26, 2025, management executed a 10b5-1 repurchase plan agreement (the “Repurchase Plan Agreement”) with a third-party financial institution (the “Agent”) granting the Agent the authority to execute open-market repurchases on our behalf, up to the daily volume limit permitted under Rule 10b-18 of the Securities Exchange Act of 1934. As of December 31, 2025, no shares had been repurchased under the Repurchase Plan Agreement. The Repurchase Plan Agreement was effective November 6, 2025 through February 6, 2026 and had a maximum authorized amount of $15.0 million. Management did not renew the Repurchase Plan Agreement upon its expiration on February 6, 2026.

Cash Flow Analysis

The following table presents our summary cash flows for the periods presented. Prior to June 20, 2024, all cash flow activity reflects only our predecessor Estis.

For the Year Ended December 31,

2025

2024

Net cash provided by operating activities

$

294,370

$

179,383

Net cash used in investing activities

$

(199,752

)

$

(94,433

)

Net cash used in financing activities

$

(94,711

)

$

(80,335

)

Operating activities. Net cash provided by operating activities was $294.4 million and $179.4 million for the years ended December 31, 2025 and 2024, respectively, an increase of approximately $115.0 million. Operating cash flows increased primarily due to higher earnings as a direct result from additional business operations from FPS and Flogistix as it relates to the 2024 Business Combination. The earnings resulted from FPS and Flogistix are reflected in the entire 2025 as opposed to ten days in June 2024 and the six months ended December 31, 2024. due to the timing of the 2024 Business Combination on June 20, 2024.

Investing activities. Net cash used in investing activities was $199.8 million and $94.4 million for the years ended December 31, 2025 and 2024, respectively, an increase of $105.4 million. This increase was primarily due to an increase of $64.8 million of cash paid in asset acquisitions, an increase of $36.8 million in capital expenditures, and the absence of $3.1 million of cash acquired in 2024 from the 2024 Business Combination.

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Financing activities. Net cash used in financing activities was $94.7 million and $80.3 million for the years ended December 31, 2025 and 2024, respectively, an increase of $14.4 million. The increase in net cash used in financing activities was primarily attributable to (i) $416.7 million net cash proceeds from new financing cash activities in 2025 related to $461.8 million in IPO proceeds, $20.9 million payments to acquire the LLC Interests from the Continuing Equity Owners, $15.0 million in share repurchases, $6.7 million dividend payments to Class A common stockholders and $2.5 million of payments related to offering costs for the IPO; (ii) offset by $430.6 million change in net cash used related to $818.7 million of payments on long-term debt, $7.5 million payments related to finance lease obligations, $186.9 million of proceeds from long-term debt, $202.0 million decrease in distributions to the Continuing Equity Owners and $6.7 million decrease in payments for debt financing.

Critical Accounting Estimates

In preparing financial statements in conformity with U.S. GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates used in the preparation of these financial statements include but are not limited to the following: determination of fair value in business combinations, inventory valuation, impairment of goodwill, intangible assets and long-lived assets, share-based compensation, and useful lives of property, plant and equipment and intangible assets. Management believes these estimates and assumptions provide a reasonable basis for the fair presentation of the consolidated financial statements. Actual results could differ from those estimates.

Determination of fair value in business combinations

Accounting for the acquisition of a business requires allocation of the purchase price to the various assets acquired and liabilities assumed at their respective fair values. The determination of fair value requires the use of significant estimates and assumptions, and in making these determinations, management uses all available information. For tangible and identifiable intangible assets acquired in a business combination, the determination of fair value utilizes several valuation methodologies including discounted cash flows which has assumptions with respect to the timing and amount of future revenue and expenses associated with an asset. The assumptions made in performing these valuations include, but are not limited to, discount rate, future revenues and operating costs, projections of capital costs, royalty rate, and other assumptions believed to be consistent with those used by principal market participants. Depending on the magnitude of the acquisition and the specialized nature of these calculations, we often engage third-party specialists to assist management in evaluating our assumptions as well as appropriately measuring the fair value of assets acquired and liabilities assumed.

Inventory valuation

Inventory is composed of components, parts and materials used in the fabrication, repair and maintenance of natural gas systems. Inventory is recorded at the lower of cost or net realizable value. We evaluate the components of inventory on a regular basis for excess and obsolescence. We record the decline in the carrying value of estimated excess or obsolete inventory as a reduction of inventory and as an expense included in cost of goods and services in the period in which it is identified. Our estimate of excess and obsolete inventory is susceptible to change from period to period and requires management to make judgments about the future demand of inventory. There were no changes in this estimate year-over-year and the estimate has a low degree of estimation uncertainty as the historical write-offs are generally consistent without material fluctuations. Typically, our write-offs approximate $1 million each year due to factors that include historical usage, estimated product demand, technological developments and current market conditions. We believe our inventory valuation reserve is adequate to properly value excess and obsolete inventory as of December 31, 2025 and 2024. However, any significant changes to the factors mentioned above could lead our estimate to change.

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Income taxes

After consummation of the IPO, we became subject to U.S. federal, state, and local income taxes with respect to our allocable share of taxable income of Flowco LLC assessed at the prevailing corporate tax rates. Flowco LLC operates as a limited liability company and is treated as a partnership for income tax purposes. Accordingly, Flowco LLC incurs no significant liability for federal or state income taxes other than for certain state taxes payable directly by it, primarily related to Texas margin tax.

Deferred taxes are recorded using the asset and liability method, whereby tax assets and liabilities are determined based on the differences between the financial reporting basis and tax basis of assets and liabilities using enacted tax laws and rates expected to apply to taxable income in the year in which the differences are expected to reverse. We assess the likelihood that our deferred tax assets will be recovered through adjustments to future taxable income. To the extent we believe recovery of tax assets is not likely, we establish a valuation allowance to reduce the asset to a value we believe will be recoverable based on our expectation of future taxable income. The carrying value of the net deferred tax assets is based on management’s judgments using certain estimates and assumptions that we will be able to generate sufficient future taxable income in certain tax jurisdictions to realize the benefits of such assets. If these estimates and related assumptions change in the future, additional valuation allowances may be recorded against the deferred tax assets resulting in additional income tax expense in the future.

Goodwill and long-lived assets

We evaluate goodwill for impairment annually on December 31, unless events or changes in circumstances indicate an impairment may have occurred before that time. We estimate the fair value based on a number of factors, including macroeconomic conditions, industry and market considerations, cost factors, overall financial performance and Company specific events. Estimating projected cash flows requires us to make certain assumptions as it relates to future operating performance.

Application of the goodwill impairment test requires management’s judgments, including a qualitative assessment to determine whether there are any impairment indicators, and determining the fair value of the reporting unit. A number of significant assumptions and estimates are involved in the application of the income approach to forecast future cash flows, including revenue and operating income growth rates, discount rates and other factors. While we believe that our estimates of current value are reasonable, if actual results differ from the estimates and judgments used including such items as future cash flows and the volatility inherent in markets which we serve, impairment charges against the carrying value of those assets could be required in the future.

No events or circumstances occurred that indicated the fair value of any of our reporting units may be below its carrying amount as of December 31, 2025 or 2024. As such, no impairment expense was recorded for the years ended December 31, 2025 and 2024.

Impairment of Long-Lived Assets

Long-lived assets, including property, plant, and equipment, and other finite-lived identifiable intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Such events and changes may include significant changes in performance relative to expected operating results, significant changes in asset use, significant negative industry or economic trends, and changes in our business strategy, among others. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to estimated future undiscounted net cash flows expected to be generated by the asset.

Impairment losses are recognized in the period in which the impairment occurs and represent the excess of the asset carrying value over its fair value estimated using future discounted net cash flows. No impairment was recorded for the years ended December 31, 2025, 2024 and 2023.

Useful lives of property, plant and equipment and intangible assets

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Our industry is capital intensive. As of December 31, 2025, property and equipment represented 48.4% of our total assets and depreciation and amortization represented 23.7% of our total operating costs and expenses for the year ended December 31, 2025. As of December 31, 2024, property and equipment represented 44.2% of our total assets and depreciation and amortization represented 21.7% of our total operating costs and expenses for the year ended December 31, 2024. Our property, plant and equipment and intangible assets with finite useful lives are carried at cost less accumulated depreciation and amortization. For acquired intangible assets, we amortize the cost over their estimated useful lives using either a straight-line or an accelerated method that most accurately reflects the estimated pattern in which the economic benefit of the respective asset is consumed. No provision for salvage value is considered in determining depreciation of our property, plant and equipment. We calculate depreciation and amortization on our assets based on the estimated useful lives that we believe are reasonable. The estimated useful lives are subject to key assumptions such as maintenance and utilization. These estimates may change due to a number of factors such as changes in operating conditions or advances in technology. The estimate has a low degree of estimation uncertainty as there were no changes in the useful lives utilized by management in the periods presented. Maintenance and repairs are charged to expense when incurred. Improvements which extend the life or improve the existing asset are capitalized.

Emerging Growth Company Status

The Jumpstart Our Business Startups Act of 2012, or the JOBS Act, permits an “emerging growth company” such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, we will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies, and our consolidated financial statements may not be comparable to other public companies that comply with new or revised accounting pronouncements as of public company effective dates. We may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies.

We will continue to be an emerging growth company until the earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.235 billion or (c) in which we are deemed to be a large accelerated filer under the rules of the Securities and Exchange Commission, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million as of the last business day of our prior second fiscal quarter, or (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the previous three years.

As a public company, we are required to provide an annual management report on the effectiveness of our internal control over financial reporting commencing with our second annual report on Form 10-K. Additionally, our independent registered public accounting firm is not required to audit the effectiveness of our internal control over financial reporting until after we are no longer an “emerging growth company”, as defined in the JOBS Act.

Recent Accounting Pronouncements

For a discussion of new accounting pronouncements recently adopted and not yet adopted, see the notes to the audited consolidated financial statements included elsewhere in this Annual Report.

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