0000950170-25-039259 | 10-K | XBRL Viewer | Drilling Tools International Corp

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LEASES - Summary of Components of Lease Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Lease, Cost [Abstract]
Operating Lease Cost	$ 6,494	$ 6,077
Short-term Lease Cost	136	130
Variable Lease Cost	382	320
Sublease Income	0	(76)
Total Lease Cost	$ 7,012	$ 6,451

Debt - Schedule of Future Maturities of Long Term Debt (Details) $ in Thousands	Dec. 31, 2024 USD ($)
Long-Term Debt, Fiscal Year Maturity [Abstract]
2025	$ 6,995
2026	5,975
2027	6,056
2028	6,143
2029	28,644
Total long term debt	$ 53,813

- Definition

Amount, after deduction of unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

BUSINESS COMBINATIONS - Summary of Consideration for Merger (Parenthetical) (Details) - Superior Drilling Products, Inc $ / shares in Units, $ in Millions	Jul. 31, 2024 USD ($) $ / shares shares
Business Acquisition [Line Items]
Payment amount to holders of common stock who elected to receive cash election consideration	$ 0.4
Cash election consideration per share of common stock held \| $ / shares	$ 1
Payment amount to stockholders who did not make an election to receive either cash election consideration or stock election consideration	$ 4.3
Payment amount to holders of SDPI common stock whereby the stock election shares exceeded the maximum share amount	$ 9.0
Number of shares received as consideration of merger \| shares	4,845,132
Aggregate fair value	$ 27.7
Common stock per share on closing date \| $ / shares	$ 5.72

CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Redeemable Convertible Preferred Stock	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss
Temporary equity, beginning balance at Dec. 31, 2022		$ 17,878
Temporary equity, beginning balance, shares at Dec. 31, 2022		6,719,641
Beginning balance at Dec. 31, 2022	$ 31,224		$ 1	$ 52,388	$ (21,054)	$ (111)
Beginning balance, shares at Dec. 31, 2022			11,951,137
Accretion of redeemable convertible preferred stock to redemption value prior to closing of the Merger		$ 314
Accretion of redeemable convertible preferred stock to redemption value prior to closing of the Merger	$ (314)			(314)
Net exercise of stock options by DTIH stockholder, shares	132,375		36,163
Exchange of DTIH redeemable convertible preferred stock for DTIC Common Stock		$ (18,192)
Exchange of DTIH redeemable convertible preferred stock for DTIC Common Stock, shares		(6,719,641)
Exchange of DTIH redeemable convertible preferred stock for DTIC Common Stock	$ 7,193		$ 1	7,192
Exchange of DTIH redeemable convertible preferred stock for DTIC Common Stock, shares			6,719,641
Issuance of DTIC Common Stock to former holders of DTIH redeemable convertible preferred stock in connection with Exchange Agreements	10,805			10,805
Issuance of DTIC Common Stock to former holders of DTIH redeemable convertible preferred stock in connection with Exchange Agreements, shares			2,042,181
Merger, net of redemptions and transaction costs	(8,838)		$ 1	(8,839)
Merger, net of redemptions and transaction costs, shares			5,711,721
Issuance of DTIC Common Stock in connection with the consummation of the PIPE Financing	30,000			30,000
Issuance of DTIC Common Stock in connection with the consummation of the PIPE Financing, shares			2,970,296
Stock-based compensation	3,986			3,986
Stock-based compensation			337,429
Foreign currency translation adjustment, net of tax	(114)					(114)
Net Income (Loss)	14,748				14,748
Ending balance at Dec. 31, 2023	88,690		$ 3	95,218	(6,306)	(225)
Ending balance, shares at Dec. 31, 2023			29,768,568
Net exercise of DTIH stockholders stock options	$ (35)			255	(290)
Net exercise of stock options by DTIH stockholder, shares	68,470		16,556
Merger, net of redemptions and transaction costs, shares			4,845,132
Issuance of Common Stock related to business combination	$ 27,714			27,714
Accelerated vesting of substitute stock options	138			138
Stock-based compensation	1,647			1,647
Shares issued due to vesting of restricted stock units, shares			74,440
Shares issued due to vesting of restricted stock units	443			443
Foreign currency translation adjustment, net of tax	(1,652)					(1,652)
Net Income (Loss)	3,014				3,014
Ending balance at Dec. 31, 2024	$ 119,959		$ 3	$ 125,415	$ (3,582)	$ (1,877)
Ending balance, shares at Dec. 31, 2024			34,704,696

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 15 – COMMITMENTS AND CONTINGENCIES

The Company maintains operating leases for various facilities and vehicles. See Note 9, Leases, for further information.

Litigation

From time to time, the Company may become involved in various legal proceedings in the ordinary course of its business and may be subject to third-party infringement claims.

In the normal course of business, the Company may agree to indemnify third parties with whom it enters into contractual relationships, including customers, lessors, and parties to other transactions with the Company, with respect to certain matters. The Company has agreed, under certain conditions, to hold these third parties harmless against specified losses, such as those arising from a breach of representations or covenants, other third-party claims that the Company’s products when used for their intended purposes infringe the intellectual property rights of such other third parties, or other claims made against certain parties. It is not possible to determine the maximum potential amount of liability under these indemnification obligations due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances that are likely to be involved in each particular claim.

Management Fee

The Company is required to pay a monthly management fee to a shareholder. The fee is based upon a percentage of the Company’s trailing twelve months, earnings before interest, taxes and accumulated depreciation amount, as defined in the management agreement (refer to Note 14 – Related Parties Transactions).

BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Inventories, Net

Inventories, net

The following table shows the components of inventory (in thousands):


	December 31, 2024			December 31, 2023
Raw materials	$	12,928		$	5,022
Work in progress		1,828			—
Finished goods		2,897			16
Total inventories		17,653			5,038
Allowance for obsolete inventory		(151	)		(4	)
Inventories, net	$	17,502		$	5,034

Summary of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets

The following table shows the components of prepaid expenses and other current assets (in thousands):


	December 31, 2024		December 31, 2023
Prepaid expenses:
Deposits on inventory	$	551	$	2,146
Prepaid income tax		1,293		362
Prepaid insurance		958		1,110
Prepaid rent		449		372
Prepaid equipment		263		331
Prepaid other		361		214
Other current assets:
Other		—		18
Total	$	3,874	$	4,553

Summary of Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities

The following table shows the components of accrued expenses and other current liabilities (in thousands):


	December 31, 2024		December 31, 2023
Accrued expenses:
Accrued compensation and related benefits	$	4,497	$	4,999
Accrued insurance		645		978
Accrued transaction advisory fees		—		1,000
Accrued professional services		253		189
Accrued interest		416		58
Accrued property taxes		44		60
Accrued monitoring fee		373		373
Other		264		147
Other current liabilities:
Income tax payable		459		1,586
Sales tax payable		229		71
Unbilled lost-in-hole revenue		8		76
Deferred revenue		675		1,042
Total accrued expenses and other current liabilities	$	7,863	$	10,579

SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands, £ in Millions	Feb. 28, 2025 Installment $ / shares shares	Jan. 02, 2025 GBP (£) shares	Jul. 31, 2024 USD ($)	Mar. 15, 2024 GBP (£)	Mar. 15, 2024 USD ($)	Dec. 31, 2024 shares	Dec. 31, 2023 shares
Subsequent Event [Line Items]
Common stock, shares issued						34,704,696	29,768,568
Subsequent Event \| 2025 Restricted Stock Units
Subsequent Event [Line Items]
Restricted stock units issued	909,321
Number of equal installments on each anniversaries of grant date \| Installment	4
Restricted stock units, grant date fair value per share \| $ / shares	$ 3.23
Casing Technology Group Limited \| CTG Purchase Agreement
Subsequent Event [Line Items]
Percentage acquired				100.00%	100.00%
Purchase consideration				£ 16.2	$ 20,900
Superior Drilling Products, Inc
Subsequent Event [Line Items]
Purchase consideration \| $			$ 47,916
Titan Tools Services Ltd \| Subsequent Event \| Titan Purchase Agreement
Subsequent Event [Line Items]
Percentage acquired		100.00%
Purchase consideration \| £		£ 4.9
Common stock, shares issued		900,000

INCOME TAXES - Summary of Income Tax Expense Attributable to Income From Continuing Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Current provision for income taxes:
Federal	$ 1,271	$ 162
Foreign	(1,107)	656
State	584	785
Total current	748	1,603
Deferred tax expense (benefit):
Federal	(1,078)	3,826
Foreign	480	34
State	(180)	(417)
Total deferred tax expense:	(778)	3,443
Total provision for income taxes	$ (30)	$ 5,046

SEGMENT INFORMATION - Additional Information (Details)	12 Months Ended
SEGMENT INFORMATION - Additional Information (Details)	Dec. 31, 2024 Segment
Segment Reporting [Abstract]
Segment Reporting, Factors Used to Identify Entity's Reportable Segments	Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the CODM in deciding resource allocation and assessing performance.
Segment Reporting, CODM, Individual Title and Position or Group Name [Extensible Enumeration]	srt:ChiefExecutiveOfficerMember
Number of operating segment	1
Number of reportable segment	1
Segment Reporting Information, Description of Products and Services	The Company’s single segment derives revenues from customers by providing oilfield equipment and services to operators in the oil and natural gas sectors.
Segment Reporting, Expense Information Used by CODM, Description	The CODM uses consolidated net income predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a monthly basis to forecast future performance, adjust the budget, and make decisions about the allocation of operating and capital resources to the segment.
Segment Reporting, CODM, Profit (Loss) Measure, How Used, Description	The CODM assesses performance for the single segment and decides how to allocate resources by using consolidated net income as reported on the consolidated statements of income and comprehensive income.

GOODWILL (Tables)

12 Months Ended

Dec. 31, 2024

Goodwill [Abstract]

Schedule of Change in Carrying Amount of Goodwill

The change in carrying amount of goodwill for the years ended December 31, 2024 was as follows (in thousands):


	Total
Net balance as of December 31, 2023	$	—
Additions due to business combinations		12,378
Impairments		—
Foreign currency translation		(231	)
Total	$	12,147

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
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-URI https://asc.fasb.org/1943274/2147482548/350-20-55-24

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
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+ Details

STOCK-BASED COMPENSATION - Summary of Options Outstanding (Details) - USD ($)	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward]
OUTSTANDING, beginning balance	2,361,722	2,494,097
Number of shares granted	2,670,374	0
Number of shares exercised	(68,470)	(132,375)
Number of shares forfeited	0	0
OUTSTANDING, ending balance	4,963,626	2,361,722	2,494,097
UNVESTED, ending balance	2,600,000
EXERCISABLE, December 31, 2024	2,363,626
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Weighted average exercise price, beginning balance	$ 4.02	$ 4.04
Weighted average exercise price, Granted	3.04	0
Weighted average exercise price, Exercised	3.72	5.04
Weighted average exercise price, Forfeited	0	0
Weighted average exercise price, ending balance	3.5	$ 4.02	$ 4.04
Weighted average exercise price, Unvested	3.02
Weighted average exercise price, Exercisable	$ 4.03
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Additional Disclosures [Abstract]
Weighted Average Remaining Contractual Life (in Years)	6 years 5 months 15 days	3 years 4 months 13 days	3 years 11 months 4 days
Weighted average remaining contractual life (in years), unvested	9 years 7 months 17 days
Weighted average remaining contractual life (in years), exercisable	2 years 11 months 15 days
Aggregate Intrinsic Value	$ 677	$ 0	$ 11,687
Aggregate Intrinsic Value, Unvested	23
Aggregate intrinsic value, exercisable	$ 655

OTHER EXPENSE, NET (Tables)

12 Months Ended

Dec. 31, 2024

Other Income and Expenses [Abstract]

Summary of Components of Other Expenses, Net

The following table shows the components of other expenses, net for the years ended December 31, 2024, and 2023 (in thousands):


	Year Ended December 31, 2024			Year Ended December 31, 2023
HHLLC stock-based compensation	$	—		$	(2,339	)
Transaction fees		(7,036	)		(3,640	)
Other, net		(664	)		(428	)
Interest income		197			48
Other expense, net	$	(7,503	)	$	(6,359	)

PROPERTY, PLANT AND EQUIPMENT, NET (Tables)

12 Months Ended

Dec. 31, 2024

Property, Plant and Equipment [Abstract]

Summary of Component of Property, Plant and Equipment, Net

The following table shows the component of property, plant and equipment, net (in thousands):


	Estimated Useful Lives (in Years)	December 31, 2024			December 31, 2023
Rental tools and equipment	5-10	$	205,939		$	188,949
Buildings and improvements	5-40		7,074			6,672
Office furniture, fixtures and equipment	3-5		2,507			2,389
Transportation and equipment	3-5		715			793
Total property, plant and equipment			216,234			198,803
Less: accumulated depreciation			(142,203	)		(133,003	)
Property, plant and equipment, net (excluding construction in progress)			74,031			65,800
Construction in progress			1,540			—
Property, plant and equipment, net		$	75,571		$	65,800

LEASES

12 Months Ended

Dec. 31, 2024

Leases [Abstract]

LEASES

NOTE 9 – LEASES

The Company leases various facilities and vehicles under noncancelable operating lease agreements. The remaining lease terms for our leases range from 1 month to 14 years. These leases often include options to extend the term of the lease, which may be for periods of up to 5 years. When it is reasonably certain that the option will be exercised, the impact of the renewal term is included in the lease term for purposes of determining total future lease payments and measuring the ROU asset and lease liability. We apply the short-term lease policy election, which allows us to exclude from recognition leases with an original term of 12 months or less. We have not entered into any finance leases as of December 31, 2024.

For the year ended December 31, 2024 and December 31, 2023, the components of the Company’s lease expense were as follows (in thousands):


	Year Ended December 31, 2024		Year Ended December 31, 2023
Operating Lease Cost	$	6,494	$	6,077
Short-term Lease Cost		136		130
Variable Lease Cost		382		320
Sublease Income		—		(76	)
Total Lease Cost	$	7,012	$	6,451

Supplemental balance sheet information related to leases was as follows (in thousands):


	Year Ended			Year Ended
	December 31, 2024			December 31, 2023
Weighted-average remaining lease term (in years)		7.11			6.55
Weighted average discount rate		7.57	%		5.80	%

Future undiscounted cash flows for each of the next five years and thereafter and reconciliation to the lease liabilities recognized on the consolidated balance sheet as of December 31, 2024 were as follows (in thousands):


2025	$	5,788
2026		5,113
2027		3,781
2028		3,094
2029		2,538
Thereafter		9,490
Total lease payments	$	29,804
Less: imputed interest		(6,918	)
Present value of lease liabilities	$	22,886

The Company leases downhole drilling tools to companies in the oil and natural gas industry. Such leases are accounted for in accordance with ASC 842. For the year ended December 31, 2024 and 2023, tool rental revenue was approximately $117.9 million and $119.2 million, respectively. Our lease contract periods are short-term in nature and are typically daily, monthly, per well, or footage based. As it is unknown when the customers will return our tools, no maturity table is presented.

BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Accrued expenses:
Accrued compensation and related benefits	$ 4,497	$ 4,999
Accrued insurance	645	978
Accrued transaction advisory fees	0	1,000
Accrued professional services	253	189
Accrued interest	416	58
Accrued property taxes	44	60
Accrued monitoring fee	373	373
Other	264	147
Other current liabilities:
Income tax payable	459	1,586
Sales tax payable	229	71
Unbilled lost-in-hole revenue	8	76
Deferred revenue	675	1,042
Total accrued expenses and other current liabilities	$ 7,863	$ 10,579

INTANGIBLES, NET (Tables)

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Components of Intangible Assets, Net

The following table shows the components of intangible assets, net (in thousands):


	Useful Lives (in Years)	December 31, 2024			December 31, 2023
Trade name	10-15	$	3,184		$	1,280
Developed Technology	13-20		15,438			—
Customer Relationships	15-20		21,081			—
Patents	5-20		11			270
Total intangible assets			39,714			1,550
Less: accumulated amortization			(2,482	)		(1,334	)
Intangible assets, net		$	37,232		$	216

RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2024

RELATED PARTY TRANSACTIONS

NOTE 14 – RELATED PARTY TRANSACTIONS

Management fees

For the years ended December 31, 2024 and 2023, management fees paid to Hicks Holdings Operating LLC, a shareholder of the Company, were approximately $0.8 million and $1.1 million, respectively. Management fees paid to the shareholder are included in selling, general and administrative expense in the accompanying consolidated statements of income and comprehensive income.

Director fees

For the years ended December 31, 2024 and 2023, director fees paid to our Board of Directors were approximately $0.6 million and $0.2 million, respectively. Director fees are included in selling, general and administrative expense in the accompanying consolidated statements of income and comprehensive income.

Leases

For the years ended December 31, 2024 and 2023, the Company paid rent expense to Cree Investments, LLC, a shareholder of the Company, of approximately $51 thousand and $51 thousand, respectively, relating to the lease of a building. Future minimum lease payments related to this lease are included in the future minimum lease schedule in Note 7, Leases.

Promissory Notes

Upon consummation of the Merger on June 20, 2023, the Company issued shares of DTIC Common Stock in connection with the PIPE Financing to payoff convertible promissory notes which were issued to an affiliate of the ROC Sponsor on December 6, 2022 and March 2, 2023, respectively. The notes did not bear interest and were in the amounts of $2.1 million and $2.1 million, respectively.

Working Capital Loan

Prior to the Merger on June 20, 2023, ROC paid the remaining outstanding principal amount owed to an affiliate of the ROC Sponsor in the amount of $0.4 million for a loan to fund working capital deficiencies and finance transaction costs in connection with the Merger. The loan did not bear interest.

Sale of trucks

During the year ended December 31, 2024, the Company sold two trucks to employees of the Company. The transactions were conducted at fair market value, with a total sales price of $0.1 million. As of December 31, 2024, the Company did not have any receivables recorded on the consolidated balance sheet related to this transaction.

Related Party Note Receivable

On July 31, 2024 ("Closing Date"), the Company entered into the Sixth Amendment and Restated Promissory Note with Tronco Energy Corporation ("Tronco"), an entity owned by employees of the Company. Pursuant to the Sixth Amendment and Restated Promissory Note, Tronco will make payments to the Company of $1.3 million annually, commencing on the first anniversary of the Closing Date through the fifth anniversary of the Closing Date. Per the agreement, if the 20-day average stock price of DTI falls below $3.20 per share, the principal that otherwise would have been due shall be deferred and apportioned over the remaining payment dates under specified in the agreement. Any payments due and not received by the Company before the fifth date following the anniversary date will bear interest from the date of nonpayment until paid equal to 3%. In accordance with ASC 805, the receivables fair value was measured at the present value of future cash flows upon the Closing Date. The carrying value of the note as of December 31, 2024 was $5.2 million.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(c))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(e))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/850/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

+ Details

BUSINESS COMBINATIONS

12 Months Ended

Dec. 31, 2024

Business Combinations [Abstract]

BUSINESS COMBINATIONS

NOTE 3 - BUSINESS COMBINATIONS

Acquisition of CTG

On the CTG Acquisition Date, the Company’s wholly owned subsidiary, Drilling Tools International, Inc., entered into and consummated the Share Purchase Agreement with CTG, the shareholders of CTG, and a representative of CTG, to acquire 100% of the shares of CTG for a gross cash purchase consideration of £16.2 million, or approximately $20.9 million, based on the British pound sterling to United States dollar exchange rate on the CTG Acquisition Date. CTG is incorporated in the United Kingdom and is the holding company of its wholly owned subsidiary, Deep Casing. Deep Casing specializes in the design, engineering, and manufacturing of a range of patented and innovative products for well construction, well completion, and casing installation processes for the global oil and gas sector. The CTG Acquisition allows the Company to further expand its geographical presence globally, especially in the Middle East, provides accretive earnings to consolidated results of operations, and expands the Company’s portfolio of intellectual property rights, through the acquisition of over 60 patents.

The £16.2 million, or approximately $20.9 million, gross cash purchase consideration was used on the CTG Acquisition Date to (i) settle Deep Casing’s outstanding debt of £15.3 million, or approximately $19.8 million; (ii) pay Deep Casing’s legacy shareholders £0.3 million, or approximately $0.3 million, in accordance with the Share Purchase Agreement; and (iii) pay Deep Casing’s acquisition-related costs of £0.6 million, or approximately $0.8 million.

The CTG Acquisition has been accounted for as a business combination in accordance with ASC 805, Business Combinations (“ASC 805”). Drilling Tools International, Inc. has been treated as the accounting acquirer. Accordingly, CTG’s tangible and identifiable intangible assets acquired and its liabilities assumed were recorded at their estimated fair values on the CTG Acquisition Date.

The preliminary allocation of the purchase is as follows:


Assets	Preliminary March 15, 2024			Measurement Period Adjustments		As adjusted March 15, 2024
Cash	$	2,674		$	—	$	2,674
Accounts receivable, net		3,781			—		3,781
Inventories, net		4,282			—		4,282
Prepaid expenses and other current assets		189			—		189
Property, plant and equipment , net		1,647			—		1,647
Operating lease ROU asset		315			—		315
Intangible assets, net		8,065			—		8,065
Goodwill		2,618		526			3,144
Total assets acquired	$	23,571		$	526	$	24,097

Liabilities
Accounts payable		2,656			—		2,656
Accrued expenses and other current liabilities		(295	)		526		231
Current portion of operating lease liabilities		95			—		95
Operating lease liabilities, less current portion		180			—		180
Total liabilities assumed	$	2,636		$	526	$	3,162
Total consideration transferred	$	20,935		$	—	$	20,935

The excess of the purchase price over the fair values of the net identifiable tangible and intangible assets acquired has been assigned to goodwill. Goodwill represents the future benefits as a result of the acquisition that will enhance the services available to both new and existing customers and increase the Company’s competitive position. Goodwill will be evaluated for impairment at least annually.

Goodwill attributable to the CTG Acquisition is not deductible for tax purposes. During the three months ended June 30, 2024, a measurement period adjustment was identified as it relates to assumed accrued liabilities. The total measurement period adjustment was $0.5 million. The measurement period adjustment impacted the goodwill recognized on March 15, 2024. As of December 31, 2024, the Company is substantially complete with the process of allocating the purchase price and valuing the acquired assets and liabilities assumed.

The following table sets forth the amounts allocated to the identified intangible assets, the estimated useful lives of those intangible assets as of the CTG Acquisition Date, and the methodologies used to determine the fair values of those intangible assets ($ in thousands):


	Fair value		Useful life (in years)	Fair value methodology
Intangible assets
Trade names	$	819	15	Relief from royalty method
Developed Technology		3,269	20	Relief from royalty method
Customer relationships		3,977	20	Multi-period excess earnings method of the income approach
Total intangible assets	$	8,065

The intangible assets acquired are expected to be amortized over their useful lives on a straight-line basis.

The Company incurred acquisition-related costs of $1.6 million during the year ended December 31, 2024, which are included in other income (expense), net in the consolidated statement of income and comprehensive income.

The Company’s consolidated statements of income and comprehensive income for the year ended December 31, 2024 include CTG’s revenues of $10.2 million and net income of $1.1 million.

Supplemental Pro Forma Information (unaudited)

The unaudited supplemental pro forma financial results below for the years ended December 31, 2024 and 2023, combine the consolidated results of the Company and CTG, giving effect to the CTG Acquisition as if it had been completed on January 1, 2023. This unaudited supplemental pro forma financial information is presented for informational purposes only and is not indicative of future operations or results had the acquisition been completed as of January 1, 2023, or any other date.


	Year ended December 31,
(in thousands)	2024		2023
Pro forma revenue	$	157,824	$	169,788
Pro forma net income	$	2,261	$	17,488

The unaudited supplemental pro forma financial information in the table above contains material nonrecurring pro forma adjustments to remove interest expense on CTG's debt as it is assumed that the business combination occurred and the debt was paid off on January 1, 2023.

Acquisition of Superior Drilling Products, Inc.

On March 6, 2024, the Company entered into the Merger Agreement by and among the Company, SDPI, Merger Sub, Merger Sub II, pursuant to the First Merger, with SDPI surviving as a wholly owned subsidiary of DTI and upon the effective time of the First Merger, SDPI, as the surviving corporation of the First Merger, merged with and into Merger Sub II, with Merger Sub II surviving as a wholly owned subsidiary of the Company.

In accordance with the terms of the Merger Agreement, the closing of the Merger occurred on July 31, 2024 (the “SDPI Closing Date” or “SDPI Closing”) for total consideration of $47.9 million. The consideration for the Merger of $47.9 million is comprised of the following items (in thousands):


Cash paid to holders of SDPI Common Stock(1)	$	13,668
Cash payment of SDPI transaction costs		2,907
Cash repayment of SDPI debt		2,278
Cash payment to holders of SDPI Restricted Stock		1,806
Cash severance payment to former SDPI employee(2)		233
Fair value of DTI Common Stock issued in exchange for outstanding SDPI Common Stock(3)		27,714
Fair value of replacement awards issued to holders of SDPI Options		138
Effective settlement of preexisting relationship between DTI and SDPI(4)		(828	)
Fair value of consideration transferred	$	47,916

(1) Represents cash consideration paid to holders of SDPI common stock, which consisted of (i) payment of $0.4 million to holders of SDPI common stock who elected to receive cash election consideration of $1.00 per share of SDPI common stock held pursuant to the terms of the Merger Agreement; (ii) payment of $4.3 million to SDPI stockholders who did not make an election to receive either cash election consideration or stock election consideration and, therefore, pursuant to the terms of the Merger Agreement, automatically received the cash election consideration of $1.00 per share of SDPI common stock held; and (iii) payment of $9.0 million to holders of SDPI common stock whereby the stock election shares exceeded the maximum share amount, as described in the Merger Agreement, which triggered the proration provision described in the Merger Agreement.

(2) Represents a severance payment made in accordance with the terms of an employment agreement between SDPI and an employee that was entered into prior to contemplation of the Merger Agreement. The agreement contained a provision whereby a change in control event would trigger a severance payment, and it was determined that the closing of the Merger triggered the requirement for such a payment to be made. Upon the SDPI Closing, DTI paid the severance payment on SDPI’s behalf.

(3) Represents the fair value of the shares of DTI common stock issued to holders of SDPI common stock as consideration for the Merger. Holders of SDPI common stock received 4,845,132 shares of DTI's common stock with an aggregate fair value of $27.7 million, which was calculated using the quoted market price of DTI common stock of $5.72 per share on the SDPI Closing Date.

(4) Represents the effective settlement of DTI’s accounts payable to SDPI as DTI was a customer of SDPI's prior to the SDPI Closing.

The Company previously held an equity interest in SDPI that was acquired and held prior to the SDPI Closing Date. The Company’s previously held interest was remeasured to its fair value of $1.2 million based on the market price of SDPI’s common stock on the SDPI Closing Date. This remeasurement resulted in a $0.4 million gain included in the Company’s consolidated statement of income and comprehensive income for the year ended December 31, 2024 The fair value of DTI’s previously held equity interest in SDPI was included in the measurement of goodwill on the SDPI Closing Date.

SDPI is an innovative drilling and completion tool technology company providing cost saving solutions that drive production efficiencies for the oil and natural gas drilling industry. In addition, SDPI is a manufacturer and refurbisher of polycrystalline diamond compact drill bits for leading oil field services companies. The acquisition furthers the Company's growth strategy as a premier provider of technologically differentiated solutions and services for the global oil & gas drilling industry. The SDPI acquisition allows the company to vertically integrate around our proven and successful Drill-N-Ream® tool, gain global rights to run this tool, continue the Vernal, UT bit repair business supporting major OEMs of PDC drill bits, and leverage their high-spec machine shop. In addition, we acquired over 30 patents and patents pending, the majority of which have been granted.

The acquisition of SDPI has been accounted for as a business combination in accordance with ASC 805, Business Combinations. The Company has been treated as the accounting acquirer. Accordingly, SDPI's tangible and identifiable intangible assets acquired and its liabilities assumed were recorded at their estimated fair values on the SDPI Closing Date. The purchase price allocation for the Merger is preliminary and subject to revision, primarily relating to information pertaining to inventory. Additional information that existed as of the SDPI Closing Date may become known during the remainder of the measurement period, which will not extend beyond one year from the SDPI Closing Date.

The preliminary allocation of the purchase is as follows (in thousands):


Assets acquired:
Cash	$	1,726
Accounts receivable, net		1,239
Related party note receivable, current		1,231
Inventories, net		2,800
Prepaid expenses and other current assets		573
Property, plant and equipment, net		10,213
Related party note receivable, noncurrent		4,193
Operating lease right-of-use asset		2,662
Intangible assets, net		22,850
Deposits and other long-term assets		200
Total assets acquired		47,687
Liabilities assumed:
Accounts payable		370
Current portion of operating lease liabilities		147
Accrued expenses and other current liabilities		1,804
Deferred tax liabilities, net		881
Deferred income		675
Operating lease liabilities, less current portion		2,368
Total liabilities assumed		6,245
Total identifiable net assets		41,442
Goodwill		7,718
Total net assets acquired and goodwill	$	49,160

The following table presents a preliminary reconciliation of the fair value of consideration transferred and the fair value of DTI’s investment in SDPI that was acquired and held prior to Closing which is included in the calculation of goodwill (in thousands):


Fair value of consideration transferred	$	47,916
Fair value of DTI's investment in SDPI that was acquired and held prior to Closing		1,244
Total fair value consideration transferred and fair value of DTI's investment in SDPI that was acquired and held prior to Closing	$	49,160

The excess of the fair value of the consideration transferred and the fair value of DTI’s previously held investment in SDPI over the fair values of the net identifiable tangible and intangible assets acquired has been assigned to goodwill. Goodwill represents the future benefits as a result of the acquisition that will enhance the services available to both new and existing customers and increase the Company’s competitive position. Goodwill will be evaluated for impairment at least annually. Goodwill attributable to the acquisition of SDPI is not deductible for tax purposes.

The following table sets forth the amounts allocated to the identified intangible assets, the estimated useful lives of those intangible assets as of the SDPI Closing Date, and the methodologies used to determine the fair values of those intangible assets ($ in thousands):


	Fair value		Useful life (in years)		Fair value methodology

Customer relationships	$	13,400		15	Multi-period Excess Earnings Method
Developed technology		8,600		15	Relief-From-Royalty Method
Trade names		800		15	Relief-From-Royalty Method
Backlog		50		0.4	Multi-period Excess Earnings Method
Total intangible assets	$	22,850

The intangible assets acquired are expected to be amortized over their useful lives on a straight-line basis.

The Company incurred acquisition-related costs of $3.4 million during the year ended December 31, 2024, which are included in other expense, net in the consolidated statements of income and comprehensive income.

The Company’s consolidated statements of income and comprehensive income for the year ended December 31, 2024 include SDPI's revenues of $5.0 million and net loss of $1.4 million.

Supplemental Pro Forma Information (unaudited)

The unaudited supplemental pro forma financial results below for the years ended December 31, 2024 and 2023, combine the consolidated results of the Company and SDPI, giving effect to the Merger as if it had been completed on January 1, 2023. The unaudited supplemental pro forma financial results to not give effect to the impact of the CTG or EDP Acquisition. This unaudited

supplemental pro forma financial information is presented for informational purposes only and is not indicative of future operations or results had the acquisition been completed as of January 1, 2023, or any other date.


	Year ended December 31,
(in thousands)	2024			2023
Pro forma revenue	$	159,992		$	162,509
Pro forma net income	$	(5,336	)	$	10,752

The unaudited supplemental pro forma financial information in the table above contains material nonrecurring pro forma adjustments to (i) record acquisition-related costs incurred by the Company prior to the SDPI Closing Date in the amount of $0.6 million and (ii) to record stock compensation expense of $0.5 million for SDPI options that vested upon the closing of the acquisition of SDPI.

Acquisition of European Drilling Projects B.V.

On September 30, 2024, the Company’s wholly owned subsidiary, Drilling Tools International, Inc., entered the Share Purchase Agreement with European Drilling Projects B.V. (“EDP”), and the sole shareholder of EDP, to acquire 100% of the shares of EDP. European Drilling Products is a global provider of next-generation stabilizers, specialty reamers, and wellbore optimization technology for the drilling industry. EDP designs and manufactures bespoke drilling equipment tailored to address specific industry challenges. The integration of EDP's expertise aligns seamlessly with DTI's international growth strategy and commitment to technological differentiation.

In accordance with the terms of the Merger Agreement, the closing of the acquisition occurred on October 3, 2024 (the “EDP Closing Date” or “EDP Closing”) for total consideration of $13.9 million. The consideration for the acquisition of $13.9 million is comprised of the following items (in thousands):


Cash paid to EDP's sole shareholder	$	6,307
Note payable issued by DTI to EDP’s sole shareholder (1)		5,207
Cash repayment of EDP debt		1,889
Cash paid to settle employee stock appreciation right awards (2)		468
Effective settlement of preexisting relationship between DTI and EDP (3)		29
Fair value of consideration transferred	$	13,900

(1) Represents promissory note issued to EDP's sole shareholder by DTI in lieu of cash paid at closing.

(2) Represents the employee stock appreciation rights that vest immediately upon a change in control event per the original award terms. DTI paid cash to settle the vested awards at the EDP Closing Date.

(3) Represents the effective settlement of DTI’s accounts receivable from EDP as EDP was a customer of EDP’s prior to the EDP Closing.

The acquisition of EDP has been accounted for as a business combination in accordance with ASC 805, Business Combinations (“ASC 805”). Drilling Tools International, Inc. has been treated as the accounting acquirer. Accordingly, EDP’s tangible and identifiable intangible assets acquired, and its liabilities assumed were recorded at their estimated fair values on the EDP Closing Date. The purchase price allocation for the Merger is preliminary and subject to revision. Additional information that existed as of the EDP Closing Date may become known during the remainder of the measurement period, which will not extend beyond one year from the EDP Closing Date.

The preliminary allocation of the purchase is as follows (in thousands):


Assets acquired:
Cash	$	79
Accounts receivable, net		1,180
Accrued Revenue		271
Other current assets		925
Property, plant and equipment, net		3,176
Operating lease right-of-use asset		325
Intangible assets, net		8,197
Total assets acquired		14,153
Liabilities assumed:
Accounts payable		428
Other current liabilities		876
Debt, noncurrent		138
Operating lease liabilities, less current portion		325
Deferred tax liabilities, net		2
Total liabilities assumed		1,769
Total identifiable net assets		12,384
Goodwill		1,516
Total net assets acquired and goodwill	$	13,900

The excess of the fair value of the consideration transferred over the fair values of the net identifiable tangible and intangible assets acquired has been assigned to goodwill. Goodwill represents the future benefits of acquiring EDP as the acquisition not only enhances DTI's competitive edge, but also reinforces its position as a leader in providing innovative drilling solutions to the global oil and gas industry. Goodwill will be evaluated for impairment at least annually. Goodwill attributable to the acquisition of EDP is not deductible for tax purposes.

The following table sets forth the amounts allocated to the identified intangible assets, the estimated useful lives of those intangible assets as of the EDP Closing Date, and the methodologies used to determine the fair values of those intangible assets (in thousands):


	Fair value		Useful life (in years)

Customer relationships	$	4,135		25
Developed technology		3,721		15
Trade names		341		20
Total intangible assets	$	8,197

The intangible assets acquired are expected to be amortized over their useful lives on a straight-line basis.

The Company incurred acquisition-related costs of $1.0 million during year ended December 31, 2024, which is included in other expense, net in the consolidated statements of income and comprehensive income.

The Company’s consolidated statements of income and comprehensive income for the year ended December 31, 2024 include EDP’s revenues of $1.0 million and net loss of $0.2 million from the EDP Closing Date to December 31, 2024.

LEASES (Tables)

12 Months Ended

Dec. 31, 2024

Leases [Abstract]

Summary of Components of Lease Expense

For the year ended December 31, 2024 and December 31, 2023, the components of the Company’s lease expense were as follows (in thousands):


	Year Ended December 31, 2024		Year Ended December 31, 2023
Operating Lease Cost	$	6,494	$	6,077
Short-term Lease Cost		136		130
Variable Lease Cost		382		320
Sublease Income		—		(76	)
Total Lease Cost	$	7,012	$	6,451

Summary of Supplemental Balance Sheet Information Related to Leases

Supplemental balance sheet information related to leases was as follows (in thousands):


	Year Ended			Year Ended
	December 31, 2024			December 31, 2023
Weighted-average remaining lease term (in years)		7.11			6.55
Weighted average discount rate		7.57	%		5.80	%

Summary of Future Undiscounted Cash Flows


2025	$	5,788
2026		5,113
2027		3,781
2028		3,094
2029		2,538
Thereafter		9,490
Total lease payments	$	29,804
Less: imputed interest		(6,918	)
Present value of lease liabilities	$	22,886

REVISIONS OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

12 Months Ended

Dec. 31, 2024

Prior Period Adjustment [Abstract]

REVISIONS OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

NOTE 2 - REVISIONS OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

The Company identified certain errors in its previously issued December 31, 2023 audited consolidated financial statements related to the presentation between cost of tool rental revenue and cost of product sale revenue. Through management's review of classification within the consolidated statements of income and comprehensive income, the Company identified that the cost of revenue for the sale of accessories was historically presented within cost of tool rental revenue, as opposed to correctly presented within cost of product sale revenue, whereas the associated accessory revenue is presented in product sale revenue.

Management evaluated these errors in accordance with SEC Staff Accounting Bulletin Number 99, Materiality (“SAB 99”), which is since codified in Accounting Standards Codification 250, Accounting Changes and Error Corrections (“ASC 250”). The Company performed a quantitative and qualitative assessment of the errors and determine that the errors did not have a material impact to previously issued financial statements. Management noted that the presentation errors identified resulted in a net zero impact to total

operating costs and expenses, income from operations, or net income. Therefore, these immaterial errors have been corrected in the current period in accordance with the guidance under SAB 99 and ASC 250.

The audited consolidated financial statements presented herein for the year ended December 31, 2023 have been revised to correct the errors described above in accordance with SEC SAB Topic 1.M, as codified in ASC 250.


	Year ended December 31, 2023
(In thousands)	As Previously Reported		Total Adjustment			As Revised
Cost of tool rental revenue	$	30,960	$	(2,690	)	$	28,270
Cost of product sale revenue		4,559		2,690			7,249

SEGMENT INFORMATION (Tables)

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

Schedule of Segment Revenue, Significant Expenses, Other Segment Items and Segment Net Income

The table below provides information about segment revenue, significant expenses, other segment items, and segment net income for the year ended December 31, 2024:


	Year Ended December 31,
	2024			2023
Revenue	$	154,446		$	152,034
Less:
Cost of sales		38,491			35,519
Operating, general, and administrative expenses		76,801			66,655
Other segment items(1)		8,969			8,611
Depreciation and amortization expense		23,832			20,352
Interest expense		3,369			1,103
Income tax expense		(30	)		5,046
Consolidated net income (loss)	$	3,014		$	14,748

(1) Other segment items included in segment net income include monitoring fees, miscellaneous expense (income), stock expense, and transaction expenses.

DEBT (Details) - USD ($)			12 Months Ended
DEBT (Details) - USD ($)	Oct. 03, 2024	Mar. 15, 2024	Dec. 31, 2024
Line of Credit Facility [Line Items]
Date the credit facility matures		Mar. 31, 2029
Term loan			$ 21,700,000
Revolving Credit Facility
Line of Credit Facility [Line Items]
Revolving line of credit		$ 80,000,000	$ 60,000,000
Credit Facility, collateral			The Credit Facility is collateralized by substantially all the assets of the Company.
Line of credit		$ 25,000,000	$ 27,100,000
Revolving Credit Facility \| Maximum
Line of Credit Facility [Line Items]
Credit facility annual payment			$ 5,000,000
Revolving Credit Facility \| SOFR
Line of Credit Facility [Line Items]
Basis spread on variable rate (as a percent)			9.25%
Revolving Credit Facility \| Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate (as a percent)			2.00%
Outstanding Term Loan Balance \| SOFR
Line of Credit Facility [Line Items]
Basis spread on variable rate (as a percent)			8.55%
European Drilling Projects B.V.
Line of Credit Facility [Line Items]
Unsecured promissory note	$ 5,200,000
Stated interest rate	8.00%
Notes payable, maturity date	Dec. 31, 2029
Frequency of periodic payments	quarterly

BUSINESS COMBINATIONS - Summary of Preliminary Reconciliation of Fair Value of Consideration Transferred and Fair Value of DTI's Investment in SDPI Acquired and Held Prior to Closing (Details) - Superior Drilling Products, Inc $ in Thousands	Jul. 31, 2024 USD ($)
Business Acquisition [Line Items]
Fair value of consideration transferred	$ 47,916
Fair value of DTI's investment in SDPI that was acquired and held prior to Closing	1,244
Total fair value consideration transferred and fair value of DTI's investment in SDPI that was acquired and held prior to Closing	$ 49,160

BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES

12 Months Ended

Dec. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES

NOTE 5 – BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES

Inventories, net

The following table shows the components of inventory (in thousands):


	December 31, 2024			December 31, 2023
Raw materials	$	12,928		$	5,022
Work in progress		1,828			—
Finished goods		2,897			16
Total inventories		17,653			5,038
Allowance for obsolete inventory		(151	)		(4	)
Inventories, net	$	17,502		$	5,034

Prepaid expenses and other current assets

The following table shows the components of prepaid expenses and other current assets (in thousands):


	December 31, 2024		December 31, 2023
Prepaid expenses:
Deposits on inventory	$	551	$	2,146
Prepaid income tax		1,293		362
Prepaid insurance		958		1,110
Prepaid rent		449		372
Prepaid equipment		263		331
Prepaid other		361		214
Other current assets:
Other		—		18
Total	$	3,874	$	4,553

Accrued expenses and other current liabilities

The following table shows the components of accrued expenses and other current liabilities (in thousands):


	December 31, 2024		December 31, 2023
Accrued expenses:
Accrued compensation and related benefits	$	4,497	$	4,999
Accrued insurance		645		978
Accrued transaction advisory fees		—		1,000
Accrued professional services		253		189
Accrued interest		416		58
Accrued property taxes		44		60
Accrued monitoring fee		373		373
Other		264		147
Other current liabilities:
Income tax payable		459		1,586
Sales tax payable		229		71
Unbilled lost-in-hole revenue		8		76
Deferred revenue		675		1,042
Total accrued expenses and other current liabilities	$	7,863	$	10,579

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Changes in Contract Assets (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2024 USD ($)
Change in Contract with Customer, Asset [Abstract]
Balance at December 31, 2023	$ 4,157
Revenue recognized from contract assets	55,814
Conversion of contract assets into accounts receivable	(54,522)
Balance at December 31, 2024	$ 5,449

STOCK-BASED COMPENSATION (Details)		1 Months Ended	12 Months Ended
STOCK-BASED COMPENSATION (Details)	Jun. 20, 2023	May 31, 2024 Director shares	Dec. 31, 2024 USD ($) shares	Dec. 31, 2023 USD ($) shares	Dec. 31, 2022 shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares exercised \| shares			68,470	132,375
Intrinsic value \| $			$ 655
Share-based compensation arrangement by share-based payment award, options, outstanding, number \| shares			4,963,626	2,361,722	2,494,097
Selling, General, and Administrative Expenses
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation \| $				$ 1,700,000
Other Expense
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation \| $				2,300,000
Hicks Holdings Operating LLC
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation \| $			$ 0	$ (2,339,000)
Restricted Stock Units R S U
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation \| $			700,000
Unrecognized compensation expense \| $			100,000
Restricted stock units issued \| shares		143,000
Number of directors \| Director		5
Number of restricted stock units deemed to be related to services performed vested \| shares				74,440
Remaining restricted stock units \| shares		68,560
Vesting term		1 year
Employee Stock Option
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Unrecognized compensation expense \| $			3,100,000
Employee Stock Option \| Selling, General, and Administrative Expenses
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation \| $			$ 1,400,000
Performance-based Stock Options
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of accelerated vesting stock options \| shares				534,063
Number of stock options vested \| shares				534,063
2023 Plan
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Maximum percentage of common stock issuable in accordance with outstanding Common stock	10.00%
Annual increase in percentage of common stock issuable in accordance with outstanding common stock	3.00%
Shares of common stock available for issuance \| shares			1,056,536

INVESTMENTS - EQUITY SECURITIES (Tables)

12 Months Ended

Dec. 31, 2024

Investments, Debt and Equity Securities [Abstract]

Summary of Cost and Fair Value of Investments in Equity Securities

The following table shows the cost and fair value of the Company’s investments in equity securities (in thousands):

         
        Cost

        Unrealized
Gain

        Fair Value

December 31, 2024

—

—

—


	Cost		Unrealized Loss			Fair Value
December 31, 2023	$	999	$	(111	)	$	888

GOODWILL - Schedule of Change in Carrying Amount of Goodwill (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2024 USD ($)
Goodwill [Abstract]
Net balance as of December 31, 2023	$ 0
Additions due to business combinations	12,378
Foreign currency translation	(231)
Total	$ 12,147

- Definition

Amount, after accumulated impairment loss, of asset representing future economic benefit arising from other asset acquired in business combination or from joint venture formation or both, that is not individually identified and separately recognized.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
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-Section 55
-Paragraph 49
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+ Details

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	34,704,696	29,768,568
Common stock, shares outstanding	34,704,696	29,768,568

REVISIONS OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Tables)

12 Months Ended

Dec. 31, 2024

Prior Period Adjustment [Abstract]

Summary of Audited Consolidated Financial Statements


	Year ended December 31, 2023
(In thousands)	As Previously Reported		Total Adjustment			As Revised
Cost of tool rental revenue	$	30,960	$	(2,690	)	$	28,270
Cost of product sale revenue		4,559		2,690			7,249

INCOME TAXES

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 11 – INCOME TAXES

For the years ended December 31, 2024, and 2023, income from continuing operations before taxes consisted of amounts related to U.S. operations and income associated with the Company’s foreign operations. The geographical breakdown of the Company’s income before provision for income taxes was as follows (in thousands):


	Year Ended December 31,
	2024		2023
Domestic	$	1,274	$	17,351
International		1,710		2,443
Profits before provision for income taxes	$	2,984	$	19,794

Income tax expense attributable to income from continuing operations consists of (in thousands):


	Year Ended December 31,
	2024			2023
Current provision for income taxes:
Federal	$	1,271		$	162
Foreign		(1,107	)		656
State		584			785
Total current		748			1,603
Deferred tax expense (benefit):
Federal		(1,078	)		3,826
Foreign		480			34
State		(180	)		(417	)
Total deferred tax expense:		(778	)		3,443
Total provision for income taxes	$	(30	)	$	5,046

Tax rate reconciliation

The following table presents a reconciliation of the federal statutory rate to the Company’s effective tax rate:


	Year Ended December 31,
	2024			2023
U.S. federal tax benefit at statutory rate		21.0	%		21.0	%
State taxes, net of federal benefit		12.7	%		1.9	%
Permanent differences		22.7	%		3.6	%
Permanent differences related to foreign items		-5.8	%		0.0	%
Transfer pricing		1.2	%		0.0	%
Foreign rate differential		1.4	%		0.0	%
Foreign taxes		-10.4	%		0.2	%
Valuation allowance		-0.3	%		0.0	%
Credits		-12.1	%		0.0	%
Income taxes deferred adjustment		27.0	%		0.0	%
Income taxes payable adjustment		-58.8	%		0.0	%
Other		0.4	%		-1.2	%
Effective tax rate		-1.0	%		25.5	%

Significant components of deferred taxes

The tax effects of temporary differences and carryforwards that give rise to significant portions of the deferred tax assets and deferred tax liabilities as of December 31, 2024 and 2023 are presented below (in thousands):


	Year Ended December 31,
	2024			2023
Deferred tax assets
Net operating loss carryforward	$	3,488		$	1,544
Allowance for doubtful accounts		321			333
Share-based compensation		1,800			1,451
Bonus accrual		70			440
Inventory		220			130
Intangible assets		1,815			1,129
Federal credits		3,252			—
Other		2,681			—
Gross deferred tax assets		13,647			5,028
Valuation allowance		(3,019	)		—
Net deferred tax assets		10,628			5,028
Deferred tax liabilities
Depreciation on property, plant, and equipment		(10,902	)		(11,391	)
Withholding tax on unremitted earnings		(431	)		(264	)
Other		(5,221	)		—
Deferred tax liabilities		(16,554	)		(11,655	)
Net deferred liabilities	$	(5,926	)	$	(6,627	)

At December 31, 2024 and 2023, the Company had federal net operating loss carryforward of approximately nil and $4.1 million, respectively, which may be carried forward indefinitely and state and local net operating loss carryforward of approximately $7.0 million and $8.8 million, respectively, which expire at various dates.

The utilization of the Company’s net operating losses may be subject to a limitation due to the “change in ownership provisions” under Section 382 of the Internal Revenue Code and similar state and foreign provisions. Such limitations may result in the expiration of the net operating loss carryforwards before their utilization.

The Company is subject to income taxes in the U.S. federal jurisdiction, various state jurisdictions as well as Canada. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. The Company’s tax years remain open for examination by all tax authorities since inception and carryover attributes remain open to adjustment by the U.S. and state authorities.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
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+ Details

DEBT

12 Months Ended

Dec. 31, 2024

Line of Credit Facility [Abstract]

DEBT

NOTE 10 – DEBT

In December 2015, the Company entered into a credit facility with PNC Bank, National Association (the "Existing Credit Facility"). The facility provided for a revolving line of credit with a maximum borrowing amount totaling $60.0 million.

On March 15, 2024, the Company refinanced its revolving credit facility (the “Refinancing”) by entering into a Second Amended and Restated Revolving Credit, Term Loan and Security and Guaranty Agreement (the “Credit Facility”) with certain of the Company’s subsidiaries and PNC Bank, National Association as lender and as agent. Pursuant to the terms of the Credit Facility, the Company will be provided a revolving line of credit in a principal amount up to $80.0 million and a single draw term loan (the "Term Loan") in

a principal amount of $25.0 million. The line of credit and the Term Loan mature in March 2029. The Credit Facility amends and restates the Company’s Existing Credit Facility under that certain Amended and Restated Revolving Credit, Term Loan, and Security Agreement, dated as of June 20, 2023, by and among the Company, certain of its subsidiaries, and PNC Bank National Association. Additionally, we are required to make an annual payment of up to $5,000,000, to be determined based on the Excess Cash Flows generated each fiscal year commencing with the year ended December 31, 2024, as defined in the Credit Facility. We expect to make our first payment in April 2025, and accordingly have recorded that amount within current maturities of long-term debt at December 31, 2024.

For the year ended December 31, 2024, the interest on the amount drawn on the Credit Facility and the outstanding Term Loan balance are based on the Secured Overnight Financing Rate ("SOFR") or the bank’s base lending rate plus applicable margin (approximately 9.25% and 8.55%, respectively, at December 31, 2024 ). The Credit Facility is collateralized by substantially all the assets of the Company.

As of December 31, 2024 , the Company has drawn $27.1 million against the line of credit. As of December 31, 2024, the term loan has a balance of $21.7 million.

The Company is subject to various restrictive covenants associated with these borrowings including, but not limited to, a fixed charge ratio, and a minimum amount of undrawn availability. As of December 31, 2024 , the Company was in compliance with all restrictive covenants.

In connection with acquisition of EDP, the Company issued an unsecured promissory note to the former parent company of EDP, totaling $5.2 million. The note bears an interest rate of 8% per annum. The note matures in December 2029 and payments are made quarterly. Please refer to Note 3, Business Combinations, for more information surrounding the issuance of the unsecured promissory note.

As of December 31, 2024, the future maturities of long-term debt consisted of the following (in thousands):


2025	$	6,995
2026		5,975
2027		6,056
2028		6,143
2029		28,644
Total long term debt	$	53,813

Contingent Interest Embedded Derivative Liability

Under the Credit Facility Agreement, the interest rate will reset (the 'Default Rate') upon the event of a default and an additional 2% will be added to the base rate. The Company analyzed the Default Rate feature of the Credit Facility for derivative accounting consideration under ASC 815, Derivatives and Hedging, and determined the Default Rate met the definition of a derivative as it is a contingent interest feature. The Company also noted that the Default Rate feature (the 'Default Rate Derivative') required bifurcation from the host contract and was to be accounted for at fair value. In accordance with ASC 815-15, the Company bifurcated the Default Rate feature of the note and determined the derivative is liability classified.

The Default Rate Derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings. Management has assessed the probability of occurrence for a non-credit default event and determined the likelihood of a referenced event to be remote. Therefore, the estimated fair value of the Default Rate Derivative was negligible as of December 31, 2024 and 2023 and, therefore, no amounts were recorded as of December 31, 2024 and 2023.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Allowance For Credit Losses (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2024 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Beginning balance	$ (1,458)
Addition during the period	(439)
Utilization of allowance for credit losses	207
Ending balance	$ (1,690)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2024

Accounting Policies [Abstract]

Organization and Structure

Drilling Tools International Corporation, a Delaware corporation ("DTIC" or the "Company"), manufactures, rents, inspects, and refurbishes downhole drilling tools primarily to companies in the oil and natural gas industry for bottom hole assemblies used in onshore and offshore horizontal and directional drilling.

On March 15, 2024 (the “CTG Acquisition Date”), we entered into a Share Purchase Agreement (the “Share Purchase Agreement”) with Casing Technologies Group Limited (“CTG”), certain shareholders of CTG, and a representative of CTG. Pursuant to the terms of the Share Purchase Agreement, the Company acquired one hundred percent (100%) of the shares of CTG (the “CTG Acquisition”), which wholly owns Deep Casing Tools Limited (“Deep Casing”), an energy technology development company, for approximately £16.2 million, or $20.9 million, based on the British pound sterling to United States dollar exchange rate on the CTG Acquisition Date. For further details regarding the acquisition, refer to Note 3 – “Business Combinations.”

On March 6, 2024, the Company entered into an agreement and plan of merger (the "Merger Agreement") by and among the Company, Superior Drilling Products, Inc., a Utah corporation (“SDPI”), DTI Merger Sub I, Inc., a Delaware corporation and directly wholly owned subsidiary of the Company (“Merger Sub I”), and Merger DTI Merger Sub II, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company (“Merger Sub II”), pursuant to which Merger Sub I merged with and into SDPI (the “First Merger”), with SDPI surviving as a wholly owned subsidiary of DTI and upon the effective time of the First Merger (the “First Effective Time”), SDPI, as the surviving corporation of the First Merger, merged with and into Merger Sub II (the “Second Merger,” and together with the First Merger, the “Merger”), with Merger Sub II surviving as a wholly owned subsidiary of the Company. In accordance with the terms of the Merger Agreement, the closing of the Merger occurred on July 31, 2024 (the “SDPI Closing Date” or “SDPI Closing”) for total consideration of $47.9 million. For further details regarding the acquisition, refer to Note 3 - "Business Combinations."

On October 3, 2024, the Company’s wholly owned subsidiary, Drilling Tools International, Inc., entered the Share Purchase Agreement with European Drilling Projects B.V. (“EDP”), and the sole shareholder of EDP, to acquire 100% of the shares of EDP. The total purchase price of the acquisition was $13.9 million. For further details regarding the acquisition, refer to Note 3 – “Business Combinations.”

The Company’s United States (“U.S.”) operations have locations in Texas, California, Louisiana, Oklahoma, Pennsylvania, North Dakota, New Mexico, Utah, and Wyoming. The Company’s international operations are located in Canada with additional stocking points in Europe, the Middle East, and Asia-Pacific. Operations outside the U.S. are subject to risks inherent in operating under different legal systems and various political and economic environments. Among the risks are changes in existing tax laws and possible limitations on foreign investment. The Company does not engage in hedging activities to mitigate its exposure to fluctuations in foreign currency exchange rates.

Basis of Presentation

The accompanying consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as set forth by the Financial Accounting Standards Board ("FASB") and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). References to US GAAP issued by the FASB in these notes to the accompanying consolidated financial statements are to the FASB Accounting Standards Codifications (“ASC”) and Accounting Standards Update (“ASU”).

Emerging Growth Company

Section 102(b)(1) of the Jumpstart Our Business Startups Act (“JOBS Act”) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard, until such time the Company is no longer considered to be an emerging growth company. At times, the Company may elect to early

adopt a new or revised standard. As such, the Company’s financial statements may not be comparable to companies that comply with public company effective dates.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes as of the date of the consolidated financial statements. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. In the current macroeconomic and business environment affected by the Russia-Ukraine and Israel-Hamas conflicts and inflationary pressures, these estimates require increased judgment and carry a higher degree of variability and volatility. As events continue to evolve and additional information becomes available, these estimates may change materially in future periods.

Principles of Consolidation

The accompanying unaudited consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated on consolidation. Further, the basis of consolidation incorporates the financial statements of our foreign entity, Casing Technologies Group Limited, which operates under UK Generally Accepted Accounting Principles ("UK GAAP"). Those financial statements are translated into U.S. GAAP for consolidation purposes. The translation process adheres to established accounting standards and guidelines to ensure consistency and comparability across our consolidated financial statements. This approach enables us to accurately reflect the financial position, results of operations, and cash flows of our consolidated operations.

Foreign Currency Translations and Transactions

The Company has determined that the functional and reporting currency for its operations across the globe is the functional currency of the Company’s international subsidiaries. Accordingly, all foreign balance sheet accounts have been translated into United States dollars using the rate of exchange at the respective balance sheet date. Components of the consolidated statements of income and comprehensive income have been translated at the average rates for the year of the reporting period. Translation gains and losses are recorded in accumulated other comprehensive loss as a component of stockholders’ equity. Gains or losses arising from currency exchange rate fluctuations on transactions denominated in a currency other than the local functional currency are included in the consolidated statements of income and comprehensive income. For the years ended December 31, 2024 and 2023, the aggregate foreign currency exchange rate fluctuations on transactions included in the consolidated statements of income and comprehensive income totaled approximately $44.5 thousand and $0.1 million in losses, respectively.

Concentration of Credit Risk

The Company’s customer concentration may impact its overall credit risk, either positively or negatively, in that these entities may be similarly affected by changes in economic or other conditions affecting the oil and gas industry.

For the year ended December 31, 2024, the Company generated approximately 28% of its revenue from 2 customers. For the year ended December 31, 2023, the Company generated approximately 39% of its revenue from 3 customers. Amounts due from these customers included in accounts receivable at December 31, 2024 and December 31, 2023, were approximately $6.3 million and $11.1 million, respectively.

For the year ended December 31, 2024, none of our vendors accounted for more than 10% of total purchases. For the year ended December 31, 2023, the Company had 2 vendors that represented approximately 23% of its total purchases. Amounts due to these vendors included in accounts payable at December 31, 2023 were approximately $0.3 million.

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash. The Company maintains accounts in federally insured financial institutions in excess of federally insured limits. Management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held and of the money market funds in which these investments are made.

Business Combinations

The Company applies the acquisition method of accounting for business combinations, which requires us to make use of estimates and judgments to allocate the purchase price paid for acquisitions to the fair value of the assets and liabilities acquired. We account for contingent assets and liabilities at fair value on the acquisition date, and record changes to fair value associated with these assets and liabilities as a period cost as incurred. We use established valuation techniques and engage reputable valuation specialists to assist us with these valuations. We use a reasonable measurement period to record any adjustment related to the opening balance sheet (generally, less than one year). These fair value measurements are considered level 3 fair value measurements. After the measurement period, changes to the opening balance sheet can result in the recognition of income or expense as period costs. To the extent these items stem from contingencies that existed at the balance sheet date, but are contingent upon the realization of future events, the cost is charged to expense at the time the future event becomes known.

Revenue Recognition

The Company recognizes revenue in accordance with Topic 842 (which addresses lease accounting) and Topic 606 (which addresses revenue from contracts with customers). The Company derives its revenue from two revenue types, tool rental services and product sales.

Tool Rental Services

Tool rental services consist of rental services, inspection services, and repair services. Tool rental services are accounted for under Topic 842.

Owned tool rentals represent the most significant revenue type and are governed by the Company’s standard rental contract. The Company accounts for such rentals as operating leases. The lease terms are included in the contracts, and the determination of whether the Company’s contracts contain leases generally does not require significant assumptions or judgments. Owned tool rentals represent revenue from renting tools that the Company owns. The Company does not generally provide an option for the lessee to purchase the rented equipment at the end of the lease.

The Company recognizes revenues from renting tools on a straight-line basis. The Company’s rental contract periods are daily, monthly, or per well. As part of this straight-line methodology, when the equipment is returned, the Company recognizes as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the drilling tool was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, the Company will have customers return the drilling tool and be contractually required to pay the Company more than the cumulative amount of revenue recognized to date under the straight-line methodology. Additionally, the Company has rental contracts that are based on usage, either on a per footage or per well basis. As these types of rental contracts primarily consist of variable lease payments, which are unknown at commencement, revenue is recognized when the changes in the factor on which the contingent lease payments are based occur. When the customer returns the rental equipment and the footage or usage becomes known, the Company recognizes revenue.

The Company records the amounts billed to customers in excess of recognizable revenue as deferred revenue on its consolidated balance sheet.

As noted above, the Company is unsure of when the customer will return rented drilling tools. As such, the Company cannot provide a maturity analysis of future lease payments as it is unknown when the tool will be returned and what the customer will owe upon return of the tool. The Company’s drilling tools are generally rented for short periods of time (significantly less than a year). Lessees do not provide residual value guarantees on rented equipment.

The Company expects to derive significant future benefits from its drilling tools following the end of the rental term. The Company’s rentals are generally short-term in nature, and its tools are typically rented for the majority of the time that the Company owns them.

Product Sales

Product sales consist of charges for rented tools that are damaged beyond repair, charges for lost-in-hole, and charges for lost-in-transit while in the care, custody or control of the Company’s customers, drill bit manufacturing and refurbishment, and other charges for made to order product sales as well. Product sales are accounted for under Topic 606.

Revenue is recognized when control of promised goods or services is transferred to a customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To determine revenue recognition for its arrangements with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance, and collectability of consideration is probable. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in the revenue standard. The transaction price is measured as consideration specified in a contract with a customer and excludes any sales incentives and taxes or other amounts collected on behalf of third parties. As each of the Company’s contracts with customers contain a single performance obligation to provide a product sale, the Company does not have any performance obligations requiring allocation of transaction prices.

The performance obligation for made to order product sales is satisfied and revenue is recognized at a point in time when control of the asset transfers to the customer, which typically occurs upon customer pick up. Additionally, pursuant to the contractual terms with the Company’s customers, the customer must notify the Company of, and purchase from the Company, any rented tools that are damaged beyond repair, lost-in-hole, or lost-in-transit while in the care, custody or control of the Company’s customers. Revenue is recognized for these products at a point in time upon the customer’s notification to the Company of the occurrence of one of these noted events.

The Company does not have any revenue expected to be recognized in the future related to remaining performance obligations or contracts with variable consideration related to undelivered performance obligations. There was no revenue recognized in the current period from performance obligations satisfied in previous periods.

Revenue per geographic location

Revenue generated was concentrated within the United States. For the years ended December 31, 2024 and 2023, the revenue generated within the United States was $125.3 million and $137.2 million, respectively, or 81% and 90% of total revenues. For the years ended December 31, 2024 and 2023, the revenue generated outside the United States, in Canada and International, was $29.2 million and $14.8 million, respectively, or 19% and 10% of total revenues.

Contract Assets and Liabilities

Contract assets represent the Company’s rights to consideration for work completed but not billed. As of December 31, 2024 and 2023, the Company had contract assets of $5.4 million and $4.2 million, respectively. Contract assets were recorded in accounts receivable, net in the accompanying consolidated balance sheets. The changes in contract assets for the year ended December 31, 2024 were as follows (in thousands):


Balance at December 31, 2023	$	4,157
Revenue recognized from contract assets		55,814
Conversion of contract assets into accounts receivable		(54,522	)
Balance at December 31, 2024	$	5,449

Contract liabilities consist of fees invoiced or paid by the Company’s customers for which the associated services have not been performed and revenue has not been recognized based on the Company’s revenue recognition criteria described above. As of December 31, 2024 and 2023, the Company did not have any material contract liabilities. All deferred revenue were expected to be recognized during the following 12 months, and they were recorded in accrued expenses and other current liabilities in the accompanying consolidated balance sheets.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2024 and 2023.

Accounts Receivable and Allowance for Credit Losses

The Company’s accounts receivable consists principally of uncollateralized amounts billed to customers. These receivables are generally due within 30 to 60 days of the period in which the corresponding sales or rentals occur and do not bear interest. They are recorded at net realizable value less an allowance for credit losses and are classified as account receivable, net on the consolidated balance sheets.

The Company considers both current conditions and reasonable and supportable forecasts of future conditions when evaluating expected credit losses for uncollectible receivable balances. In our determination of the allowance for credit losses, we pool receivables by days outstanding and apply an expected credit loss percentage to each pool. The expected credit loss percentage is determined using historical loss data adjusted for current conditions and forecasts of future economic conditions. Current conditions considered include predefined aging criteria, as well as specified events that indicate the balance due is not collectible. Reasonable and supportable forecasts used in determining the probability of future collection consider publicly available macroeconomic data and whether future credit losses are expected to differ from historical losses.

The changes in the allowance for credit losses for the year ended December 31, 2024 were as follows (in thousands):


Balance at December 31, 2023	$	(1,458	)
Additions during 2024		(439	)
Utilization of allowance for credit losses		207
Balance at December 31, 2024	$	(1,690	)

Inventories, net

Inventories are stated at the lower of cost or net realizable value. Cost is determined by using the specific identification method, weighted average, or the first-in-first-out ("FIFO") method, depending on the type of inventory. Inventory that is obsolete or in excess of forecasted usage is written down to its net realizable value based on assumptions regarding future demand and market conditions. Inventory write-downs are charged to cost of rental revenue and cost of product sale revenue within operating costs section of the consolidated statements of income and comprehensive income and establish a new cost basis for the inventory. Inventory includes raw material and finished goods.

Property, Plant and Equipment

Property, plant and equipment purchased by the Company are recorded at cost less accumulated depreciation. Depreciation is recorded using the straight-line method based on the estimated useful lives of the depreciable property or, for leasehold improvements, the remaining term of the lease, whichever is shorter. Assets not yet placed in use are not depreciated.

Property, plant and equipment acquired as part of a business acquisition is recorded at acquisition date fair value with subsequent additions at cost.

The cost of refurbishments and renewals are capitalized when the value of the property, plant or equipment is enhanced for an extended period. Expenditures to maintain and repair property, plant and equipment, which do not improve or extend the life of the related assets, are charged to operations when incurred. When property, plant and equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in operations.

Impairment of Long-Lived Assets

Long-lived assets with finite lives include property, plant and equipment and acquired intangible assets. The Company evaluates long-lived assets, including acquired intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets held and used is measured by comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset exceeds these estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the assets exceeds the fair value of the asset or asset group.

For the year ended December 31, 2024 and 2023, management determined that there were no triggering events necessitating impairment testing of property, plant, and equipment or intangible assets.

Leases

The Company adopted ASC 842, Leases (“ASC 842”) as of January 1, 2022 using the modified retrospective transition approach, with no restatement of prior periods or cumulative adjustments to retained earnings. Upon adoption, the Company elected the package of transition practical expedients, which allowed it to carry forward prior conclusions related to whether any expired or existing contracts are or contain leases, the lease classification for any expired or existing leases and initial direct costs for existing leases. The Company elected the use-of-hindsight to reassess lease term. The Company elected not to recognize leases with an initial term of 12 months or less within the consolidated balance sheets and to recognize those lease payments on a straight-line basis in the consolidated statements of income and comprehensive income over the lease term. The new lease accounting standard also provides practical expedients for an entity’s ongoing accounting. The Company elected the practical expedient to not separate lease and non-lease components for all leases.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and current operating lease liabilities and operating lease liabilities, net of current portion on the consolidated balance sheets. The Company recognizes lease expense for its operating leases on a straight-line basis over the term of the lease.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from a lease. ROU assets and operating lease liabilities are recognized at the commencement date based on the present value of the future minimum lease payments over the lease term. Operating lease ROU assets also include the impact of any lease incentives. An amendment to a lease is assessed to determine if it represents a lease modification or a separate contract. Lease modifications are reassessed as of the effective date of the modification using an incremental borrowing rate based on the information available at the commencement date. For modified leases the Company also reassess the lease classification as of the effective date of the modification.

The interest rate used to determine the present value of the future lease payments is the Company’s incremental borrowing rate because the interest rate implicit in the Company’s leases is not readily determinable. The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located.

The Company’s lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option in the measurement of its ROU assets and liabilities. The Company considers contractual-based factors such as the nature and terms of the renewal or termination, asset-based factors such as physical location of the asset and entity-based factors such as the importance of the leased asset to the Company’s operations to determine the lease term. The Company generally uses the base, noncancelable, lease term when determining the ROU assets and lease liabilities. The right-of-use asset is tested for impairment in accordance with ASC Topic 360, Property, Plant, and Equipment.

Lessor Accounting

Our leased equipment primarily consists of rental tools and equipment. Our agreements with our customers for rental equipment contain an operating lease component under ASC 842 because (i) there are identified assets, (ii) the customer has the right to obtain substantially all of the economic benefits from the use of the identified asset throughout the period of use and (iii) the customer directs the use of the identified assets throughout the period of use.

Our lease contract periods are daily, monthly, per well or based on footage. Lease revenue is recognized on a straight-line basis based on these rates. We do not provide an option for the lessee to purchase the rented tools at the end of the lease and the lessees do not provide residual value guarantees on the rented assets.

We recognized operating lease revenue within “Tool rental” on the consolidated statements of income and comprehensive income.

Intangibles

Intangible assets with finite useful lives include customer relationships, trade name, patents, non-compete agreements and a supply agreement. These intangible assets are amortized either on a straight-line basis over the asset’s estimated useful life or on a basis that reflects the pattern in which the economic benefits of the intangible are realized.

Goodwill

Goodwill represents the excess of purchase price paid over the fair value of the net assets of acquired businesses. We evaluate Goodwill at least annually for impairment. Goodwill is considered impaired if the carrying amount of the reporting unit exceeds its estimated fair value. We conduct our annual assessment of the recoverability of goodwill as of December 31 of each year. We first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the goodwill impairment test. If the qualitative assessment indicates that it is more likely than not that the fair value of the reporting unit is less than its carrying amount or we elect not to perform a qualitative assessment, the quantitative assessment of goodwill test is performed. The goodwill impairment test is also performed whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If it is necessary to perform the quantitative assessment to determine if our goodwill is impaired, we will utilize a discounted cash flow analysis using management’s projections that are subject to various risks and uncertainties of revenues, expenses and cash flows as well as assumptions regarding discount rates, terminal value and control premiums. Estimates of future cash flows and fair value are highly subjective and inherently imprecise. These estimates can change materially from period to period based on many factors. Accordingly, if conditions change in the future, we may record impairment losses, which could be material to any particular reporting period.

Investments - Equity Securities

Investment - Equity Securities

Equity securities are stated at fair value. Unrealized gains and losses are reflected in the consolidated statements of income and comprehensive income. The Company periodically reviews the securities for other than temporary declines in fair value below cost and more frequently when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For the year ended December 31, 2024 the Company settled all investments in equity securities for a realized loss of $12 thousand.

Derivative Financial Instruments

From time to time, the Company may enter into derivative instruments to manage exposure to interest rate fluctuations. During 2016, the Company entered into an interest swap agreement with respect to amounts outstanding under its revolving line of credit.

The Company’s interest rate swap is a pay-fixed, receive-variable interest rate swap based on SOFR swap rate. The SOFR swap rate is observable at commonly quoted intervals for the full term of the swap and therefore is considered a Level 2 item. For interest rate swaps in an asset position, the credit standing of the counterparty is analyzed and factored into the fair value measurement of the asset. The impact of the Company’s creditworthiness has also been factored into the fair value measurement of the interest rate swap in a liability position. For the years ended December 31, 2024 and 2023, the application of valuation techniques applied to similar assets and liabilities has been consistent.

This arrangement was designed to manage exposure to interest rate fluctuations by effectively exchanging existing obligations to pay interest based on floating rates for obligations to pay interest based on a fixed rate. These derivatives are marked-to-market at the end of each quarter and the realized/unrealized gain or loss is recorded as interest expense.

The interest swap agreement was settled on July 10, 2023. Upon settlement, the swap had a fair value of $0.4 million. No new interest rate swaps were entered into subsequently or during the year ended December 31, 2024.

Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is a hierarchy based upon the transparency of inputs used in the valuation of an asset or liability. Classification within the hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The valuation hierarchy contains three levels:

Level 1 – Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets.

Level 2 – Valuation inputs are quoted prices for identical assets or liabilities in markets that are not active, quoted market prices for similar assets and liabilities in active markets and other observable inputs directly or indirectly related to the assets or liabilities being measured.

Level 3 – Valuation inputs are unobservable and significant to the fair value measurement.

The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

In determining the appropriate levels, the Company performs a detailed analysis of the assets and liabilities that are measured and reported on a fair value basis. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The valuation of assets and liabilities recognized in business combinations are considered level 3 fair value measurements on the closing date of the acquisition. These assets and liabilities are not remeasured at each reporting period.

Asset and liabilities measured at fair value are summarized as follows (in thousands):

           
          Assets at Fair Value as of December 31, 2024

           
          Level 1

          Level 2

          Level 3

          Total

Investments, equity securities

—

—

—

—

Total assets at fair value

—

—

—

—


	Assets at Fair Value as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Investments, equity securities	$	888	$	—	$	—	$	888
Total assets at fair value	$	888	$	—	$	—	$	888

As of December 31, 2024 and 2023, the Company did not have any Level 2 or Level 3 assets or liabilities.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash, accounts receivable, and accounts payable. The carrying amount of such instruments approximates fair value due to their short-term nature. Additionally, the Company carries long-term debt at its amortized cost, which approximates fair value.

Preferred Stock

As of the closing of the Merger, the Board have expressly granted authority to issue shares of preferred stock, in one or more series, and to fix for each such series such voting powers, full or limited, and such designations, preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof as shall be stated and expressed in the resolution or resolutions adopted by the Board providing for the issue of such series and as may be permitted by the Delaware General Corporation Law. The number of authorized shares of preferred stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of all of the then outstanding shares of the capital stock of the corporation entitled to vote generally in the election of directors, voting together as a single class, without a separate vote of the holders of the preferred stock, or any series thereof, unless a vote of any such holders is required pursuant to any preferred stock designation.

The Board of the Company has not issued any shares of any classes or series of preferred stock as of December 31, 2024, and through the date these financial statements were available to be issued.

Cost of Revenue

The Company recorded all operating costs associated with its product sales and tool rental revenue streams in cost of product sale revenue and cost of tool rental revenue, respectively, in the consolidated statements of income and comprehensive income. All indirect operating costs, including labor, freight, contract labor and others, are included in selling, general, and administrative expense in the consolidated statements of income and comprehensive income.

Stock-Based Compensation

The Company recognizes stock-based compensation expenses over the requisite service period. The Company historically granted stock-based compensation awards with performance based vesting conditions. These options all vested upon the closing of the Merger with ROC. Subsequent to the closing of the merger with ROC, the Company’s stock-based compensation awards granted are subject to service based and performance based vesting conditions. Pursuant to ASC 718-10-35-8, the Company recognizes compensation cost for stock awards with only service conditions that have a graded vesting schedule on a straight-line basis over the service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards. ASC 718 requires that the cost of awards of equity instruments offered in exchange for employee services, including employee stock options and restricted stock awards, be measured based on the grant-date fair value of the award. The Company determines the fair value of stock options granted using the Black-Scholes-Merton option-pricing model (“Black-Scholes model”) and recognizes the cost over the period during which an employee is required to provide service in exchange for the award, generally the vesting period, net of estimated forfeitures.

For restricted stock units, the grant date fair value is determined based on quoted market price for the Company's common stock as of the grant date and the grant date fair value of the awards are recognized as compensation cost as awards vest over the requisite service period.

Earnings Per Share

Basic earnings per share is computed by dividing the net income (loss) by the weighted-average number of common shares outstanding for the period. Diluted earnings is computed by adjusting net income (loss) to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted earnings is computed by dividing the diluted net income (loss) by the weighted-average number of common shares outstanding for the period, including potential dilutive common stock. For the purposes of this calculation, outstanding stock options and redeemable convertible preferred stock are considered potential dilutive common stock and are excluded from the computation of net loss per share if their effect is anti-dilutive.

The redeemable convertible preferred stock did not contractually entitle its holders to participate in profits or losses. As such, it was not treated as a participating security in periods of net income or net loss.

Income Taxes

Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently due plus deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during the period in the deferred tax assets and liabilities.

The Company is subject to state income taxes in various jurisdictions.

The Company follows guidance issued by the FASB in accounting for uncertainty in income taxes. This guidance clarifies the accounting for income taxes by prescribing the minimum recognition threshold an income tax position is required to meet before being recognized in the consolidated financial statements and applies to all income tax positions. Each income tax position is assessed using a two-step process. A determination is first made as to whether it is more likely than not that the income tax position will be sustained, based upon technical merits and upon examination by the taxing authorities. If the income tax position is expected to meet the more likely than not criteria, the benefit recorded in the consolidated financial statements equals the largest amount that is greater than 50% likely to be realized upon its ultimate settlement. The Company has no uncertain tax positions at December 31, 2024 and

2023. The Company believes there are no tax positions taken or expected to be taken that would significantly increase or decrease unrecognized tax benefits within twelve months of the reporting date.

The Company records income tax related interest and penalties, if applicable, as a component of the provision for income tax expense. However, there were no amounts recognized relating to interest and penalties in the consolidated statements of income and comprehensive income for the year ended December 31, 2024 and 2023.

Operating Segment

Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the chief operating decision-maker (“CODM”) in deciding resource allocation and assessing performance. The Company’s Chief Executive Officer works as the CODM. The Company’s CODM reviews financial information presented on a consolidated basis for the purposes of making operations decisions, allocating resources and evaluating financial performance. Consequently, the Company has determined it operates in one operating and reportable segment.

Recent Accounting Pronouncements - Adoption of Segment Reporting Standard/Accounting Standards Issued Not Yet Effective

Recent Accounting Pronouncements - Adoption of Segment Reporting Standard

In November 2023, FASB issued Accounting Standard Update (“ASU”) 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures, which includes requirements for more robust disclosures of significant segment expenses and information used in assessing segment performance on an annual and interim basis. The guidance also requires that a public entity that has a single reportable segment provide all the disclosures required by the guidance and all existing segment disclosures under the FASB Accounting Standards Codification (“ASC”) Topic 280, Segment Reporting. This standard is effective for the Company’s annual period beginning January 1, 2024 and interim periods beginning January 1, 2025 and should be applied retrospectively to all comparative periods. Effective with this Report, the Company adopted this ASU. Refer to Note 18 (“Segment Informaton”) for the required segment disclosures.

Recent Accounting Pronouncements - Accounting Standards Issued Not Yet Effective

In December 2023, FASB issued Accounting Standard Update (“ASU”) 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures, which requires enhanced income tax disclosures that reflect how operations and related tax risks, as well as how tax planning and operational opportunities, affect the tax rate and prospects for future cash flows. This standard is effective for the Company beginning January 1, 2025 with early adoption permitted. The Company is evaluating the effects of adopting this new accounting guidance on its disclosures but does not currently expect adoption will have a material impact on the Company’s consolidated financial statements. The Company is currently evaluating the effects of adopting this new accounting guidance. The Company does not intend to early adopt this ASU.

In November 2024, FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which requires disclosure of specific information about costs and expenses within relevant expense captions on the face of the income statement, qualitative descriptions for expense captions not specifically disaggregated quantitatively, and the total amount and definition of selling expenses for interim and annual reporting periods. This standard is effective for the Company’s annual reporting period beginning January 1, 2027 and interim reporting periods beginning January 1, 2028 and should be applied retrospectively to all comparative periods. Early adoption is permitted. The Company is currently evaluating the effects of adopting this new accounting guidance.

LEASES (Details) - USD ($) $ in Millions	12 Months Ended
LEASES (Details) - USD ($) $ in Millions	Dec. 31, 2024	Dec. 31, 2023
Lessee, Lease, Description [Line Items]
Operating lease description	The Company leases various facilities and vehicles under noncancelable operating lease agreements. The remaining lease terms for our leases range from 1 month to 14 years.
Operating lease, existence of option to extend	true
Operating lease option to extend	These leases often include options to extend the term of the lease, which may be for periods of up to 5 years.
Operating lease renewl term		5 years
Tool rental revenue	$ 117.9	$ 119.2
Minimum
Lessee, Lease, Description [Line Items]
Remaining lease term	1 month
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease term	14 years

STOCK-BASED COMPENSATION

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

NOTE 12 – STOCK-BASED COMPENSATION

Stock Options

On June 20, 2023, the Company adopted the Drilling Tools International Corporation 2023 Omnibus Incentive Plan (the "2023 Plan"). The 2023 Plan became effective on the closing of the Merger. The 2023 Plan provides for the issuance of shares of Common Stock up to ten percent (10%) of the shares of outstanding Common Stock as of the closing of the Merger and automatically increases on the first trading day of each calendar year by the number of shares of Common Stock equal to three percent (3%) of the total number of outstanding Common Stock on the last day of the prior calendar year. The 2023 Plan allows for awards to be issued to employees, non-employee directors, and consultants in the form of options, stock appreciation rights, restricted shares, restricted stock units, performance based awards, other share-based awards, other cash-based awards, or a combination of the foregoing. As of December 31, 2024, there were 1,056,536 shares of Common Stock available for issuance under the 2023 Plan.

In connection with the Merger, all outstanding options to purchase shares of DTIH common stock were canceled and exchanged for options to purchase shares of DTIC Common Stock ("Company Options"). The number of Company Options issued and the associated exercise prices were adjusted using the Common Exchange Ratio used for the Merger (see Note 3, Merger). As a result of the Merger, the Company issued options to purchase a total of 2,361,722 shares of the Company's Common Stock to former holders of the DTIH stock options. The vesting schedules, remaining term, and provisions (other than the adjusted number of underlying shares and exercise prices) of the Company Options issued, are identical to the vesting schedules, remaining term, and other provisions of the DTIH stock options that were exchanged. Per a post-closing amendment, Company Options currently held by former holders of DTIH stock options are no longer subject to employment considerations.

The fair value of each stock option award is estimated on the date of grant using a Black-Scholes model. Expected volatilities are based on comparable public company data. The Company uses future estimated employee termination and forfeiture rates of the

options within the valuation model. The expected term of options granted is derived using the “plain vanilla” method due to the lack of history and volume of option activity at the Company. The risk-free rate is based on the approximate U.S. Treasury yield rate in effect at the time of grant. The Company’s calculation of share price involves the use of different valuation techniques, including a combination of an income and market approach. For any grants of stock options subsequent to the Company being publicly traded, the Company will use the quoted market price as of the grant date as an input into the Black-Scholes model.

The following table summarizes options outstanding, as well as activity for the year ended December 31, 2024 and December 31, 2023:


	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)		Aggregate Intrinsic Value
OUTSTANDING, December 31, 2022		2,494,097		$	4.04		3.93	$	11,687
Granted		—			—		—		—
Exercised		(132,375	)		5.04		—		—
Forfeited		—			—		—		—
OUTSTANDING, December 31, 2023		2,361,722			4.02		3.37		—
Granted		2,670,374			3.04		—		—
Exercised		(68,470	)		3.72		—		—
Forfeited		—			—		—		—
OUTSTANDING, December 31, 2024		4,963,626			3.50		6.46		677
UNVESTED, December 31, 2024		2,600,000			3.02		9.63		23
EXERCISABLE, December 31, 2024		2,363,626			4.03		2.96		655

During the year ended December 31, 2023, the Company recognized $1.7 million of stock-based compensation expense within selling, general, and administrative expense on the consolidated statements of income and comprehensive income related to the accelerated vesting of an executive's 534,063 performance-based stock options. The performance conditions were satisfied upon completion of the Merger and all 534,063 performance-based stock options vested on June 20, 2023.

During the year ended December 31, 2023, the Company recognized $2.3 million of stock-based compensation expense within other expense, net on the consolidated statements of income and comprehensive income as a result of the issuance of shares in accordance with the TSA with HHLLC (see Note 3 - Merger).

During the year ended December 31, 2024, the Company recognized $1.4 million of stock-based compensation expense related to stock options within selling, general, and administrative expenses on the consolidated statements of income and comprehensive income. As of December 31, 2024, total unrecognized compensation expense related to the stock options totaled $3.1 million.

Restricted Stock Units

In May 2024, the Company issued an aggregate 143,000 restricted stock units (“RSUs”) to five members of the Board (the “Directors”). Of the awards, 74,440 RSUs were deemed to be related to services performed during the year ended December 31, 2023, and were to vest immediately, while the remaining 68,560 RSUs are subject to a vesting term of one year. The Directors are considered to be employees of the Company under ASC 718.

During year ended December 31, 2024, the Company recognized $0.7 million of stock based compensation related to RSUs within selling, general, and administrative expenses on the consolidated statements of income and comprehensive income. As of December 31, 2024, unrecognized compensation expense related to the RSUs totaled $0.1 million

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

Schedule of Income (Loss) Before Provision for (Benefit From) Income Taxes

The geographical breakdown of the Company’s income before provision for income taxes was as follows (in thousands):


	Year Ended December 31,
	2024		2023
Domestic	$	1,274	$	17,351
International		1,710		2,443
Profits before provision for income taxes	$	2,984	$	19,794

Summary of Income Tax Expense Attributable to Income From Continuing Operations

Income tax expense attributable to income from continuing operations consists of (in thousands):


	Year Ended December 31,
	2024			2023
Current provision for income taxes:
Federal	$	1,271		$	162
Foreign		(1,107	)		656
State		584			785
Total current		748			1,603
Deferred tax expense (benefit):
Federal		(1,078	)		3,826
Foreign		480			34
State		(180	)		(417	)
Total deferred tax expense:		(778	)		3,443
Total provision for income taxes	$	(30	)	$	5,046

Schedule of Reconciliation of Federal Statutory Rate to Company's Effective Tax Rate

The following table presents a reconciliation of the federal statutory rate to the Company’s effective tax rate:


	Year Ended December 31,
	2024			2023
U.S. federal tax benefit at statutory rate		21.0	%		21.0	%
State taxes, net of federal benefit		12.7	%		1.9	%
Permanent differences		22.7	%		3.6	%
Permanent differences related to foreign items		-5.8	%		0.0	%
Transfer pricing		1.2	%		0.0	%
Foreign rate differential		1.4	%		0.0	%
Foreign taxes		-10.4	%		0.2	%
Valuation allowance		-0.3	%		0.0	%
Credits		-12.1	%		0.0	%
Income taxes deferred adjustment		27.0	%		0.0	%
Income taxes payable adjustment		-58.8	%		0.0	%
Other		0.4	%		-1.2	%
Effective tax rate		-1.0	%		25.5	%

Schedule of Deferred Tax Assets and Deferred Tax Liabilities


	Year Ended December 31,
	2024			2023
Deferred tax assets
Net operating loss carryforward	$	3,488		$	1,544
Allowance for doubtful accounts		321			333
Share-based compensation		1,800			1,451
Bonus accrual		70			440
Inventory		220			130
Intangible assets		1,815			1,129
Federal credits		3,252			—
Other		2,681			—
Gross deferred tax assets		13,647			5,028
Valuation allowance		(3,019	)		—
Net deferred tax assets		10,628			5,028
Deferred tax liabilities
Depreciation on property, plant, and equipment		(10,902	)		(11,391	)
Withholding tax on unremitted earnings		(431	)		(264	)
Other		(5,221	)		—
Deferred tax liabilities		(16,554	)		(11,655	)
Net deferred liabilities	$	(5,926	)	$	(6,627	)

PROPERTY, PLANT AND EQUIPMENT, NET

12 Months Ended

Dec. 31, 2024

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT, NET

NOTE 6 – PROPERTY, PLANT AND EQUIPMENT, NET

The following table shows the component of property, plant and equipment, net (in thousands):


	Estimated Useful Lives (in Years)	December 31, 2024			December 31, 2023
Rental tools and equipment	5-10	$	205,939		$	188,949
Buildings and improvements	5-40		7,074			6,672
Office furniture, fixtures and equipment	3-5		2,507			2,389
Transportation and equipment	3-5		715			793
Total property, plant and equipment			216,234			198,803
Less: accumulated depreciation			(142,203	)		(133,003	)
Property, plant and equipment, net (excluding construction in progress)			74,031			65,800
Construction in progress			1,540			—
Property, plant and equipment, net		$	75,571		$	65,800

Total depreciation expense for the year ended December 31, 2024 and 2023 was approximately $21.5 million and $20.3 million, respectively. The Company has not acquired any property, plant and equipment under capital leases.

Property, plant and equipment, net, were concentrated within the United States. As of December 31, 2024 and December 31, 2023, property, plant and equipment, net held within the United States was $66.9 million and $63.0 million, respectively, or 89% and 96% of total property, plant and equipment, net, respectively. As of December 31, 2024 and December 31, 2023, property, plant and equipment, net held outside of the United States was $8.6 million and $2.8 million, or 11% and 4% of total property, plant and equipment net for both periods.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2024

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Structure

Basis of Presentation

Emerging Growth Company

adopt a new or revised standard. As such, the Company’s financial statements may not be comparable to companies that comply with public company effective dates.

Use of Estimates

Principles of Consolidation

Foreign Currency Translations and Transactions

Concentration of Credit Risk

Business Combinations

Revenue Recognition

Tool Rental Services

Tool rental services consist of rental services, inspection services, and repair services. Tool rental services are accounted for under Topic 842.

The Company records the amounts billed to customers in excess of recognizable revenue as deferred revenue on its consolidated balance sheet.

Product Sales

Revenue per geographic location

Contract Assets and Liabilities


Balance at December 31, 2023	$	4,157
Revenue recognized from contract assets		55,814
Conversion of contract assets into accounts receivable		(54,522	)
Balance at December 31, 2024	$	5,449

Cash and Cash Equivalents

Accounts Receivable and Allowance for Credit Losses

The changes in the allowance for credit losses for the year ended December 31, 2024 were as follows (in thousands):


Balance at December 31, 2023	$	(1,458	)
Additions during 2024		(439	)
Utilization of allowance for credit losses		207
Balance at December 31, 2024	$	(1,690	)

Inventories, net

Property, Plant and Equipment

Property, plant and equipment acquired as part of a business acquisition is recorded at acquisition date fair value with subsequent additions at cost.

Impairment of Long-Lived Assets

For the year ended December 31, 2024 and 2023, management determined that there were no triggering events necessitating impairment testing of property, plant, and equipment or intangible assets.

Leases

Lessor Accounting

We recognized operating lease revenue within “Tool rental” on the consolidated statements of income and comprehensive income.

Intangibles

Goodwill

Investment - Equity Securities

Derivative Financial Instruments

Fair Value Measurements

Level 1 – Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets.

Level 3 – Valuation inputs are unobservable and significant to the fair value measurement.

Asset and liabilities measured at fair value are summarized as follows (in thousands):

           
          Assets at Fair Value as of December 31, 2024

           
          Level 1

          Level 2

          Level 3

          Total

Investments, equity securities

—

—

—

—

Total assets at fair value

—

—

—

—


	Assets at Fair Value as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Investments, equity securities	$	888	$	—	$	—	$	888
Total assets at fair value	$	888	$	—	$	—	$	888

As of December 31, 2024 and 2023, the Company did not have any Level 2 or Level 3 assets or liabilities.

Fair Value of Financial Instruments

Redeemable Convertible Preferred Stock

Prior to the closing of the Merger, there were outstanding shares of DTIH Series A redeemable convertible preferred stock (the "redeemable convertible preferred stock"), which was classified outside of permanent equity in mezzanine equity on the consolidated balance sheets as it was redeemable on a fixed date.

Upon the closing of the Merger, all of the redeemable convertible preferred stock was canceled in exchange for DTIC Common Stock and the right to receive cash. Accordingly, there was no redeemable convertible preferred stock outstanding as of December 31, 2023.

Preferred Stock

The Board of the Company has not issued any shares of any classes or series of preferred stock as of December 31, 2024, and through the date these financial statements were available to be issued.

Cost of Revenue

Stock-Based Compensation

Earnings Per Share

Income Taxes

The Company is subject to state income taxes in various jurisdictions.

2023. The Company believes there are no tax positions taken or expected to be taken that would significantly increase or decrease unrecognized tax benefits within twelve months of the reporting date.

Operating Segment

Recent Accounting Pronouncements - Adoption of Segment Reporting Standard

Recent Accounting Pronouncements - Accounting Standards Issued Not Yet Effective

BUSINESS COMBINATIONS - Summary of Preliminary Allocation of the Purchase (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Oct. 03, 2024	Jul. 31, 2024	Mar. 15, 2024	Dec. 31, 2023
Business Acquisition [Line Items]
Other current assets	$ 0				$ 18
Goodwill	$ 12,147				$ 0
Casing Technologies Group Limited
Business Acquisition [Line Items]
Cash				$ 2,674
Accounts receivable, net				3,781
Inventories, net				4,282
Prepaid expenses and other current assets				189
Property, plant and equipment , net				1,647
Operating lease ROU asset				315
Intangible assets, net				8,065
Goodwill				3,144
Total assets acquired				24,097
Accounts payable				2,656
Accrued expenses and other current liabilities				231
Current portion of operating lease liabilities				95
Operating lease liabilities, less current portion				180
Total liabilities assumed				3,162
Total consideration transferred				20,935
Casing Technologies Group Limited \| Preliminary
Business Acquisition [Line Items]
Cash				2,674
Accounts receivable, net				3,781
Inventories, net				4,282
Prepaid expenses and other current assets				189
Property, plant and equipment , net				1,647
Operating lease ROU asset				315
Intangible assets, net				8,065
Goodwill				2,618
Total assets acquired				23,571
Accounts payable				2,656
Accrued expenses and other current liabilities				(295)
Current portion of operating lease liabilities				95
Operating lease liabilities, less current portion				180
Total liabilities assumed				2,636
Total consideration transferred				20,935
Casing Technologies Group Limited \| Measurement Period Adjustments
Business Acquisition [Line Items]
Cash				0
Accounts receivable, net				0
Inventories, net				0
Prepaid expenses and other current assets				0
Property, plant and equipment , net				0
Operating lease ROU asset				0
Intangible assets, net				0
Goodwill				526
Total assets acquired				526
Accounts payable				0
Accrued expenses and other current liabilities				526
Current portion of operating lease liabilities				0
Operating lease liabilities, less current portion				0
Total liabilities assumed				526
Total consideration transferred				$ 0
Superior Drilling Products, Inc
Business Acquisition [Line Items]
Cash			$ 1,726
Accounts receivable, net			1,239
Related party note receivable, current			1,231
Inventories, net			2,800
Prepaid expenses and other current assets			573
Property, plant and equipment , net			10,213
Related party note receivable, noncurrent			4,193
Operating lease ROU asset			2,662
Intangible assets, net			22,850
Goodwill			7,718
Deposits and other long-term assets			200
Total assets acquired			47,687
Accounts payable			370
Accrued expenses and other current liabilities			1,804
Deferred tax liabilities, net			881
Deferred income			675
Current portion of operating lease liabilities			147
Operating lease liabilities, less current portion			2,368
Total liabilities assumed			6,245
Total identifiable net assets			41,442
Total consideration transferred			$ 49,160
European Drilling Projects B.V.
Business Acquisition [Line Items]
Cash		$ 79
Accounts receivable, net		1,180
Accrued Revenue		271
Other current assets		925
Property, plant and equipment , net		3,176
Operating lease ROU asset		325
Intangible assets, net		8,197
Goodwill		1,516
Total assets acquired		14,153
Accounts payable		428
Other current liabilities		876
Debt, noncurrent		138
Deferred tax liabilities, net		2
Operating lease liabilities, less current portion		325
Total liabilities assumed		1,769
Total identifiable net assets		12,384
Total consideration transferred		$ 13,900

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Dec. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

BUSINESS COMBINATIONS (Tables)

12 Months Ended

Dec. 31, 2024

Casing Technologies Group Limited

Business Acquisition [Line Items]

Summary of Preliminary Allocation of the Purchase

The preliminary allocation of the purchase is as follows:


Assets	Preliminary March 15, 2024			Measurement Period Adjustments		As adjusted March 15, 2024
Cash	$	2,674		$	—	$	2,674
Accounts receivable, net		3,781			—		3,781
Inventories, net		4,282			—		4,282
Prepaid expenses and other current assets		189			—		189
Property, plant and equipment , net		1,647			—		1,647
Operating lease ROU asset		315			—		315
Intangible assets, net		8,065			—		8,065
Goodwill		2,618		526			3,144
Total assets acquired	$	23,571		$	526	$	24,097

Liabilities
Accounts payable		2,656			—		2,656
Accrued expenses and other current liabilities		(295	)		526		231
Current portion of operating lease liabilities		95			—		95
Operating lease liabilities, less current portion		180			—		180
Total liabilities assumed	$	2,636		$	526	$	3,162
Total consideration transferred	$	20,935		$	—	$	20,935

Summary of Identified Intangible Assets, Estimated Useful Lives and Methodologies Used to Determine Fair Values


	Fair value		Useful life (in years)	Fair value methodology
Intangible assets
Trade names	$	819	15	Relief from royalty method
Developed Technology		3,269	20	Relief from royalty method
Customer relationships		3,977	20	Multi-period excess earnings method of the income approach
Total intangible assets	$	8,065

Summary of Unaudited Supplemental Pro Forma Financial Information


	Year ended December 31,
(in thousands)	2024		2023
Pro forma revenue	$	157,824	$	169,788
Pro forma net income	$	2,261	$	17,488

Superior Drilling Products, Inc

Business Acquisition [Line Items]

Summary of Preliminary Allocation of the Purchase

The preliminary allocation of the purchase is as follows (in thousands):


Assets acquired:
Cash	$	1,726
Accounts receivable, net		1,239
Related party note receivable, current		1,231
Inventories, net		2,800
Prepaid expenses and other current assets		573
Property, plant and equipment, net		10,213
Related party note receivable, noncurrent		4,193
Operating lease right-of-use asset		2,662
Intangible assets, net		22,850
Deposits and other long-term assets		200
Total assets acquired		47,687
Liabilities assumed:
Accounts payable		370
Current portion of operating lease liabilities		147
Accrued expenses and other current liabilities		1,804
Deferred tax liabilities, net		881
Deferred income		675
Operating lease liabilities, less current portion		2,368
Total liabilities assumed		6,245
Total identifiable net assets		41,442
Goodwill		7,718
Total net assets acquired and goodwill	$	49,160

Summary of Identified Intangible Assets, Estimated Useful Lives and Methodologies Used to Determine Fair Values


	Fair value		Useful life (in years)		Fair value methodology

Customer relationships	$	13,400		15	Multi-period Excess Earnings Method
Developed technology		8,600		15	Relief-From-Royalty Method
Trade names		800		15	Relief-From-Royalty Method
Backlog		50		0.4	Multi-period Excess Earnings Method
Total intangible assets	$	22,850

Summary of Unaudited Supplemental Pro Forma Financial Information


	Year ended December 31,
(in thousands)	2024			2023
Pro forma revenue	$	159,992		$	162,509
Pro forma net income	$	(5,336	)	$	10,752

Summary of Consideration for Merger

The consideration for the Merger of $47.9 million is comprised of the following items (in thousands):


Cash paid to holders of SDPI Common Stock(1)	$	13,668
Cash payment of SDPI transaction costs		2,907
Cash repayment of SDPI debt		2,278
Cash payment to holders of SDPI Restricted Stock		1,806
Cash severance payment to former SDPI employee(2)		233
Fair value of DTI Common Stock issued in exchange for outstanding SDPI Common Stock(3)		27,714
Fair value of replacement awards issued to holders of SDPI Options		138
Effective settlement of preexisting relationship between DTI and SDPI(4)		(828	)
Fair value of consideration transferred	$	47,916

(4) Represents the effective settlement of DTI’s accounts payable to SDPI as DTI was a customer of SDPI's prior to the SDPI Closing.

Summary of Preliminary Reconciliation of Fair Value of Consideration Transferred and Fair Value of DTI's Investment in SDPI Acquired and Held Prior to Closing


Fair value of consideration transferred	$	47,916
Fair value of DTI's investment in SDPI that was acquired and held prior to Closing		1,244
Total fair value consideration transferred and fair value of DTI's investment in SDPI that was acquired and held prior to Closing	$	49,160

European Drilling Projects B.V.

Business Acquisition [Line Items]

Summary of Preliminary Allocation of the Purchase

The preliminary allocation of the purchase is as follows (in thousands):


Assets acquired:
Cash	$	79
Accounts receivable, net		1,180
Accrued Revenue		271
Other current assets		925
Property, plant and equipment, net		3,176
Operating lease right-of-use asset		325
Intangible assets, net		8,197
Total assets acquired		14,153
Liabilities assumed:
Accounts payable		428
Other current liabilities		876
Debt, noncurrent		138
Operating lease liabilities, less current portion		325
Deferred tax liabilities, net		2
Total liabilities assumed		1,769
Total identifiable net assets		12,384
Goodwill		1,516
Total net assets acquired and goodwill	$	13,900

Summary of Identified Intangible Assets, Estimated Useful Lives and Methodologies Used to Determine Fair Values


	Fair value		Useful life (in years)

Customer relationships	$	4,135		25
Developed technology		3,721		15
Trade names		341		20
Total intangible assets	$	8,197

Summary of Consideration for Merger

The consideration for the acquisition of $13.9 million is comprised of the following items (in thousands):


Cash paid to EDP's sole shareholder	$	6,307
Note payable issued by DTI to EDP’s sole shareholder (1)		5,207
Cash repayment of EDP debt		1,889
Cash paid to settle employee stock appreciation right awards (2)		468
Effective settlement of preexisting relationship between DTI and EDP (3)		29
Fair value of consideration transferred	$	13,900

(1) Represents promissory note issued to EDP's sole shareholder by DTI in lieu of cash paid at closing.

(3) Represents the effective settlement of DTI’s accounts receivable from EDP as EDP was a customer of EDP’s prior to the EDP Closing.

EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2024

Defined Benefit Plan [Abstract]

EMPLOYEE BENEFITS

NOTE 16 – EMPLOYEE BENEFIT PLANS

The Company sponsors various defined contribution savings plan, primarily in the U.S., that allow employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. Under specified conditions, the Company will make contributions to the plans and/or match a percentage of the employee contributions up to certain limits. Total expense related to the defined contribution plans for the years ended December 31, 2024 and 2023 was $0.7 million and $0.5 million, respectively.

EARNINGS PER SHARE (Tables)

12 Months Ended

Dec. 31, 2024

Earnings Per Share [Abstract]

Summary of Computation of The Company's Basic and Diluted Net Earnings Per Share

The following table sets forth the computation of the Company’s basic and diluted net earnings per share for the years ended December 31, 2024 and 2023 (in thousands, except share and per share data):


	Year Ended December 31,
	2024		2023
Numerator:
Net income	$	3,014	$	14,748
Less: Redeemable Convertible Preferred Stock dividends		—		(314	)
Net income attributable to common shareholders — basic	$	3,014	$	14,434
Add: Redeemable Convertible Preferred Stock dividends		—		314
Net income attributable to common shareholders — diluted	$	3,014	$	14,748
Denominator
Weighted-average common shares used in computing earnings per share — basic		31,938,847		21,421,610
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive time-based stock options		311,277		488,997
Effect of potentially dilutive performance-based stock options		41,033		45,202
Effect of potentially dilutive restricted stock units		17,022		—
Effect of potentially dilutive redeemable convertible preferred stock		—		3,175,215
Weighted-average common shares outstanding — diluted		32,308,179		25,131,024
Earnings per share — basic	$	0.09	$	0.67
Earnings per share — diluted	$	0.09	$	0.59

Summary of Company's Potentially Dilutive Securities Excluded

As of December 31, 2024 and 2023, the Company’s potentially dilutive securities consisted of options to purchase common stock. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net income per share for the periods presented because including them would have had an anti-dilutive effect:


	Year Ended December 31,
	2024		2023
Time-based options outstanding		140,135		140,135
Total		140,135		140,135

REVENUE - (Details) - USD ($) $ in Thousands	12 Months Ended
REVENUE - (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Disaggregation of Revenue [Line Items]
Revenue	$ 154,446	$ 152,034
United States
Disaggregation of Revenue [Line Items]
Revenue	$ 125,300	$ 137,200
Percentage of revenue	81.00%	90.00%
Canada and International
Disaggregation of Revenue [Line Items]
Revenue	$ 29,200	$ 14,800
Percentage of revenue	19.00%	10.00%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Subparagraph (a)
-Publisher FASB
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 4: http://fasb.org/us-gaap/role/ref/otherTransitionRef
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Reference 5: http://fasb.org/us-gaap/role/ref/otherTransitionRef
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-Section 50
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 924
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-Section S99
-Paragraph 1
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Paragraph 30
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-42

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
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-Paragraph 22
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
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-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-40

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-4

+ Details

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2024	Mar. 14, 2025	Jun. 30, 2024
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Annual Report	true
Document Transition Report	false
Document Period End Date	Dec. 31, 2024
Entity File Number	001-41103
Entity Registrant Name	DRILLING TOOLS INTERNATIONAL CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	87-2488708
Entity Address, Address Line One	3701 Briarpark Drive
Entity Address, Address Line Two	Suite 150
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77042
City Area Code	832
Local Phone Number	742-8500
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
ICFR Auditor Attestation Flag	false
Entity Shell Company	false
Entity Public Float			$ 167
Entity Common Stock, Shares Outstanding		35,592,737
Entity Central Index Key	0001884516
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	FY
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	DTI
Security Exchange Name	NASDAQ
Auditor Name	Weaver and Tidwell, L.L.P.
Auditor Location	Austin, Texas
Auditor Firm ID	410
Document Financial Statement Error Correction [Flag]	false
Documents Incorporated by Reference [Text Block]	DOCUMENTS INCORPORATED BY REFERENCE List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980)
Auditor Opinion [Text Block]	Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Drilling Tools International Corporation (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of income and comprehensive income, consolidated statements of changes in redeemable convertible preferred stock and shareholders’ equity and consolidated statements of cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

LEASES - Summary of Future Undiscounted Cash Flows (Details) $ in Thousands	Dec. 31, 2024 USD ($)
Lessee, Operating Lease, Liability, to be Paid, Fiscal Year Maturity [Abstract]
2025	$ 5,788
2026	5,113
2027	3,781
2028	3,094
2029	2,538
Thereafter	9,490
Total lease payments	29,804
Less: imputed interest	(6,918)
Present value of lease liabilities	$ 22,886

INVESTMENTS - EQUITY SECURITIES

12 Months Ended

Dec. 31, 2024

Investments, Debt and Equity Securities [Abstract]

INVESTMENTS - EQUITY SECURITIES

NOTE 4 - INVESTMENTS – EQUITY SECURITIES

The following table shows the cost and fair value of the Company’s investments in equity securities (in thousands):

         
        Cost

        Unrealized
Gain

        Fair Value

December 31, 2024

—

—

—


	Cost		Unrealized Loss			Fair Value
December 31, 2023	$	999	$	(111	)	$	888

Unrealized holding gains on equity securities for the year ended December 31, 2024 were $0.4 million where unrealized holding losses on equity securities for the year ended December 31, 2023 were $0.3 million. On July 31, 2024, the Company elected cash for the shares

owned in SDPI. The Company received $1.2 million in cash and recognized a realized loss of $12 thousand. Refer to Note 3 - Business Combinations for more information.

INCOME TAXES (Details) - USD ($) $ in Millions	Dec. 31, 2024	Dec. 31, 2023
Schedule Of Income Taxes Reconciliation [Line Items]
Operating loss carryforwards	$ 4.1
State and Local Jurisdiction
Schedule Of Income Taxes Reconciliation [Line Items]
Operating loss carryforwards	$ 8.8	$ 7.0

BUSINESS COMBINATIONS - Summary of Unaudited Supplemental Pro Forma Financial Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Casing Technologies Group Limited
Business Acquisition [Line Items]
Pro forma revenue	$ 157,824	$ 169,788
Pro forma net income/(loss)	2,261	17,488
Superior Drilling Products, Inc
Business Acquisition [Line Items]
Pro forma revenue	159,992	162,509
Pro forma net income/(loss)	$ (5,336)	$ 10,752

INVESTMENTS - EQUITY SECURITIES (Details) - USD ($) $ in Thousands		12 Months Ended
	Jul. 31, 2024	Dec. 31, 2024	Dec. 31, 2023
Debt and Equity Securities, FV-NI [Line Items]
Unrealized holding gain (loss) on equity securities		$ 400	$ (300)
Proceeds from Sale of Equity Securities, FV-NI		1,244	0
Equity Securities, FV-NI, Realized Gain (Loss), Total		$ (12)	$ 0
SDPI
Debt and Equity Securities, FV-NI [Line Items]
Proceeds from Sale of Equity Securities, FV-NI	$ 1,200
Equity Securities, FV-NI, Realized Gain (Loss), Total	$ (12)

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Assets, Current [Abstract]
Cash	$ 6,185	$ 6,003
Accounts receivable, net	39,606	29,929
Inventories, net	17,502	5,034
Prepaid expenses and other current assets	3,874	4,553
Investments - equity securities, at fair value	0	888
Total current assets	68,076	46,408
Property, plant and equipment, net	75,571	65,800
Operating lease right-of-use asset	22,718	18,786
Intangible assets, net	37,232	216
Goodwill	12,147	0
Deferred financing costs, net	817	409
Deposits and other long-term assets	1,608	879
Total assets	222,431	132,498
Current liabilities
Accounts payable	11,983	7,751
Accrued expenses and other current liabilities	7,864	10,579
Current portion of operating lease liabilities	4,121	3,958
Current maturities of long-term debt	6,995	0
Total current liabilities	30,963	22,288
Operating lease liabilities, less current portion	18,765	14,893
Long term debt, net of current portion	19,676	0
Revolving line of credit	27,142
Deferred tax liabilities, net	5,926	6,627
Total liabilities	102,472	43,808
Commitments and contingencies (See Note 15)
Shareholders' equity
Common stock, $0.0001 par value, shares authorized 500,000,000 as of December 31, 2024 and December 31, 2023, 34,704,696 shares issued and outstanding as of December 31, 2024 and 29,768,568 shares issued and outstanding as of December 31, 2023	3	3
Additional paid-in-capital	125,415	95,218
Accumulated deficit	(3,582)	(6,306)
Accumulated other comprehensive loss	(1,877)	(225)
Total shareholders' equity	119,959	88,690
Total liabilities and shareholders' equity	222,431	132,498
Related Party
Assets, Current [Abstract]
Related party note receivable, current	909	0
Related party note receivable, less current portion	$ 4,262	$ 0

OTHER EXPENSE, NET - Summary of Components of Other Expenses, Net (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Schedule Of Other Expenses [Line Items]
Transaction Fees	$ (7,036)	$ (3,640)
Other, net	(664)	(428)
Interest income	197	48
Other expense, net	(7,503)	(6,359)
Hicks Holdings Operating LLC
Schedule Of Other Expenses [Line Items]
Stock-based compensation	$ 0	$ (2,339)

EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2024

Earnings Per Share [Abstract]

EARNINGS PER SHARE

NOTE 17 – EARNINGS PER SHARE

Basic earnings per share is computed using the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed using the weighted-average number of common shares outstanding for the period plus dilutive potential common shares, including performance share awards, using the treasury stock method. Performance share awards are included based on the number of shares that would be issued as if the end of the reporting period was the end of the performance period and the result was dilutive.


	Year Ended December 31,
	2024		2023
Numerator:
Net income	$	3,014	$	14,748
Less: Redeemable Convertible Preferred Stock dividends		—		(314	)
Net income attributable to common shareholders — basic	$	3,014	$	14,434
Add: Redeemable Convertible Preferred Stock dividends		—		314
Net income attributable to common shareholders — diluted	$	3,014	$	14,748
Denominator
Weighted-average common shares used in computing earnings per share — basic		31,938,847		21,421,610
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive time-based stock options		311,277		488,997
Effect of potentially dilutive performance-based stock options		41,033		45,202
Effect of potentially dilutive restricted stock units		17,022		—
Effect of potentially dilutive redeemable convertible preferred stock		—		3,175,215
Weighted-average common shares outstanding — diluted		32,308,179		25,131,024
Earnings per share — basic	$	0.09	$	0.67
Earnings per share — diluted	$	0.09	$	0.59


	Year Ended December 31,
	2024		2023
Time-based options outstanding		140,135		140,135
Total		140,135		140,135

GOODWILL

12 Months Ended

Dec. 31, 2024

Goodwill [Abstract]

GOODWILL

NOTE 8 - GOODWILL

The change in carrying amount of goodwill for the years ended December 31, 2024 was as follows (in thousands):


	Total
Net balance as of December 31, 2023	$	—
Additions due to business combinations		12,378
Impairments		—
Foreign currency translation		(231	)
Total	$	12,147

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Revenue, net:
Revenue, net	$ 154,446	$ 152,034
Operating costs and expenses:
Operating costs and expenses	38,491	35,519
Selling, general, and administrative expense	78,695	68,264
Depreciation and amortization expense	23,832	20,352
Total operating costs and expenses	141,018	124,135
Income from operations	13,428	27,899
Other expense, net:
Interest expense, net	(3,369)	(1,103)
Gain on sale of property	60	101
Loss on asset disposal	0	(489)
Gain (loss) on remeasurement of previously held equity interest	368	(255)
Other income (expense), net	(7,503)	(6,359)
Total other expense, net	(10,444)	(8,105)
Profits before provision for income taxes	2,984	19,794
Income tax (expense)/benefit	30	(5,046)
Net income	3,014	14,748
Accumulated dividends on redeemable convertible preferred stock	0	314
Net income attributable to common shareholders - basic	$ 3,014	$ 14,434
Basic earnings per share	$ 0.09	$ 0.67
Diluted earnings per share	$ 0.09	$ 0.59
Basic weighted-average common shares outstanding	31,938,847	21,421,610
Diluted weighted-average common shares outstanding	32,308,179	25,131,024
Comprehensive income:
Net income	$ 3,014	$ 14,748
Foreign currency translation adjustment, net of tax	(1,652)	(114)
Net comprehensive income	1,362	14,634
Tool Rental
Revenue, net:
Revenue, net	117,926	119,239
Operating costs and expenses:
Operating costs and expenses	24,110	28,270
Product Sale
Revenue, net:
Revenue, net	36,520	32,795
Operating costs and expenses:
Operating costs and expenses	$ 14,381	$ 7,249

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) € in Millions						12 Months Ended
	Oct. 03, 2024 USD ($)	Jul. 31, 2024 USD ($)	Mar. 15, 2024 EUR (€)	Mar. 15, 2024 USD ($)	Jul. 10, 2023 USD ($)	Dec. 31, 2024 USD ($) Segment shares	Dec. 31, 2023 USD ($) shares
Accounting Policies [Line Items]
Foreign currency translation adjustment, net of tax						$ 44,500	$ 100,000
Cash equivalents						0	0
Contract assets						5,400,000	4,200,000
Revenue						154,446,000	152,034,000
Contract liabilities						0	0
Realized loss on investments in equity securities						(12,000)
Accounts receivable						$ 39,606,000	$ 29,929,000
Preferred stock, shares issued \| shares
Stock options granted \| shares						2,670,374	0
Number of operating segment \| Segment						1
Number of reportable segment \| Segment						1
Minimum percentage of unrecognized tax benefits that would impact effective tax rate						50.00%
Unrecognized tax benefits						$ 0	$ 0
Unrecognized tax benefits accrued for interest and penalties						$ 0	0
Segment Reporting, Expense Information Used by CODM, Description						The CODM uses consolidated net income predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a monthly basis to forecast future performance, adjust the budget, and make decisions about the allocation of operating and capital resources to the segment.
Segment Reporting, CODM, Individual Title and Position or Group Name [Extensible Enumeration]						srt:ChiefExecutiveOfficerMember
Realized loss on settlement of interest swap						$ 0	4,000
Assets fair value						$ 0	$ 888,000
Customer Concentration Risk \| Sales Revenue \| Two Customers
Accounting Policies [Line Items]
Concentration risk percentage						28.00%
Customer Concentration Risk \| Sales Revenue \| Three Customers
Accounting Policies [Line Items]
Concentration risk percentage							39.00%
Customer Concentration Risk \| Vendor Purchases \| Zero Vendor
Accounting Policies [Line Items]
Concentration risk percentage						10.00%
Customer Concentration Risk \| Vendor Purchases \| Two Vendors
Accounting Policies [Line Items]
Concentration risk percentage							23.00%
Customer Concentration Risk \| Accounts Receivable
Accounting Policies [Line Items]
Receivables from customers						$ 6,300,000	$ 11,100,000
Customer Concentration Risk \| Accounts Payable
Accounting Policies [Line Items]
Amounts due to vendors							300,000
Interest Rate Swap
Accounting Policies [Line Items]
Unrealized gain (loss) due to change in fair value					$ 400,000
Interest swap agreement settlement date						Jul. 10, 2023
Level 3
Accounting Policies [Line Items]
Assets fair value						$ 0	0
Liabilities fair value						0	0
Level 2
Accounting Policies [Line Items]
Assets fair value						0	0
Liabilities fair value						0	0
Superior Drilling Products, Inc
Accounting Policies [Line Items]
Purchase consideration		$ 47,916,000
Revenue						5,000,000
Casing Technologies Group Limited
Accounting Policies [Line Items]
Business acquisition percentage			100.00%	100.00%
Casing Technologies Group Limited \| Deep Casing Tools Limited
Accounting Policies [Line Items]
Purchase consideration			€ 16.2	$ 20,900,000
European Drilling Projects B.V.
Accounting Policies [Line Items]
Business acquisition percentage	100.00%
Purchase consideration	$ 13,900,000
Revenue						1,000,000
United States
Accounting Policies [Line Items]
Revenue						$ 125,300,000	$ 137,200,000
Percentage of revenue						81.00%	90.00%
Canada and International
Accounting Policies [Line Items]
Revenue						$ 29,200,000	$ 14,800,000
Percentage of revenue						19.00%	10.00%

EARNINGS PER SHARE - Summary of Company's Potentially Dilutive Securities Excluded - Time-based Options Outstanding (Details) - shares	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Time-based Options Outstanding
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	140,135	140,135

Debt (Tables)

12 Months Ended

Dec. 31, 2024

Debt Disclosure [Abstract]

Schedule of Future Maturities of Long Term Debt

As of December 31, 2024, the future maturities of long-term debt consisted of the following (in thousands):


2025	$	6,995
2026		5,975
2027		6,056
2028		6,143
2029		28,644
Total long term debt	$	53,813

INTANGIBLES, NET (Details) - USD ($)	12 Months Ended
INTANGIBLES, NET (Details) - USD ($)	Dec. 31, 2024	Dec. 31, 2023
Indefinite-Lived Intangible Assets [Line Items]
Amortization expense	$ 1,200	$ 47,100,000

EARNINGS PER SHARE - Summary of Computation of Company's Basic and Diluted Net Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Numerator:
Net Income (Loss)	$ 3,014	$ 14,748
Less: Redeemable Convertible Preferred Stock dividends	0	(314)
Net income attributable to common shareholders - basic	3,014	14,434
Add: Redeemable Convertible Preferred Stock dividends	0	314
Net income attributable to common shareholders - diluted	$ 3,014	$ 14,748
Denominator
Weighted-average common shares used in computing earnings per share - basic	31,938,847	21,421,610
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive redeemable convertible preferred stock	0	3,175,215
Weighted-average common shares outstanding - diluted	32,308,179	25,131,024
Earnings per share - basic	$ 0.09	$ 0.67
Earnings per share - diluted	$ 0.09	$ 0.59
Time-based Stock Options
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive stock options	311,277	488,997
Performance-based Stock Options
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive stock options	41,033	45,202
Restricted Stock Units
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive stock options	17,022	0

SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

SEGMENT INFORMATION

NOTE 18 – SEGMENT INFORMATION

Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the CODM in deciding resource allocation and assessing performance. The Company’s Chief Executive Officer serves as the CODM. The Company’s CODM reviews financial information presented on a consolidated basis for the purposes of making operational decisions, allocating resources, and evaluating financial performance. Consequently, the Company has determined it has one operating and reportable segment as of December 31, 2024.

The Company’s single segment derives revenues from customers by providing oilfield equipment and services to operators in the oil and natural gas sectors. The CODM assesses performance for the single segment and decides how to allocate resources by using consolidated net income as reported on the consolidated statements of income and comprehensive income. The Company’s CODM does not review segment assets at a different level or category than those disclosed in the consolidated balance sheet. The CODM uses consolidated net income predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a monthly basis to forecast future performance, adjust the budget, and make decisions about the allocation of operating and capital resources to the segment.

The table below provides information about segment revenue, significant expenses, other segment items, and segment net income for the year ended December 31, 2024:


	Year Ended December 31,
	2024			2023
Revenue	$	154,446		$	152,034
Less:
Cost of sales		38,491			35,519
Operating, general, and administrative expenses		76,801			66,655
Other segment items(1)		8,969			8,611
Depreciation and amortization expense		23,832			20,352
Interest expense		3,369			1,103
Income tax expense		(30	)		5,046
Consolidated net income (loss)	$	3,014		$	14,748

(1) Other segment items included in segment net income include monitoring fees, miscellaneous expense (income), stock expense, and transaction expenses.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

INCOME TAXES - Schedule of Deferred Tax Assets and Deferred Tax Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Deferred tax assets
Net operating loss carryforward	$ 3,488	$ 1,544
Allowance for doubtful accounts	321	333
Share-based compensation	1,800	1,451
Bonus accrual	70	440
Inventory	220	130
Intangible assets	1,815	1,129
Federal credits	3,252
Other	2,681	0
Gross deferred tax assets	13,647	5,028
Valuation allowance	(3,019)	0
Net deferred tax assets	10,628	5,028
Deferred tax liabilities
Depreciation on property, plant, and equipment	(10,902)	(11,391)
Withholding tax on unremitted earnings	(431)	(264)
Other	(5,221)	0
Deferred tax liabilities	(16,554)	(11,655)
Net deferred liabilities	$ (5,926)	$ (6,627)

INTANGIBLES, NET

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLES, NET

NOTE 7 -INTANGIBLES, NET

The following table shows the components of intangible assets, net (in thousands):


	Useful Lives (in Years)	December 31, 2024			December 31, 2023
Trade name	10-15	$	3,184		$	1,280
Developed Technology	13-20		15,438			—
Customer Relationships	15-20		21,081			—
Patents	5-20		11			270
Total intangible assets			39,714			1,550
Less: accumulated amortization			(2,482	)		(1,334	)
Intangible assets, net		$	37,232		$	216

Total amortization expense for the year ended December 31, 2024 and December 31, 2023 was approximately $1.2 million and $47.1 thousand respectively.

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Cash flows from operating activities:
Net income	$ 3,014	$ 14,748
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	23,832	20,352
Amortization of deferred financing costs	313	139
Non-cash lease expense	5,121	4,515
Unrealized loss on currency remeasurement	225	0
Provision for excess and obsolete inventory	0	75
Provision for excess and obsolete property and equipment	0	122
Provision for credit losses	424	117
Deferred tax expense/(benefit)	(778)	3,443
Loss on asset disposal	0	489
Gain on sale of property	(60)	(101)
Realized loss on equity securities	12	0
Unrealized (gain) loss on equity securities	(368)	255
Realized loss on interest rate swap	0	4
Gross profit from sale of lost-in-hole equipment	(10,027)	(16,686)
Stock-based compensation expense	2,092	3,986
Interest Income on related party note receivable	(151)
Changes in operating assets and liabilities:
Accounts receivable, net	(4,015)	(1,048)
Prepaid expenses and other current assets	874	519
Inventories, net	(4,320)	(1,716)
Deposits and other current assets	0	(496)
Operating lease liabilities	(4,832)	(4,415)
Accounts payable	(78)	(1,552)
Accrued expenses and other current liabilities	(5,220)	583
Net cash flows from operating activities	6,058	23,334
Cash flows from investing activities:
Acquisition of a business, net of cash acquired	(47,258)	0
Proceeds from sale of property and equipment	79	202
Purchase of property, plant and equipment	(22,892)	(43,750)
Proceeds from sale of lost-in-hole equipment	15,253	19,684
Proceeds from sale of equity securities	1,244	0
Purchases of intangible assets	(12)	0
Net cash flows from investing activities	(53,586)	(23,864)
Cash flows from financing activities:
Proceeds from Merger and PIPE Financing, net of transaction costs	0	23,162
Payment of deferred financing costs	(722)	(324)
Proceeds from revolving line of credit	38,618	73,050
Payments on revolving line of credit	(11,476)	(91,399)
Proceeds from long-term debt	25,000	0
Payments on long-term debt	(3,535)	0
Payments to holders of DTIH redeemable convertible preferred stock in connection with retiring their DTI stock upon the Merger	0	(194)
Net cash flows from financing activities	47,885	4,295
Effect of Changes in Foreign Exchange Rate	(175)	(114)
Net Change in Cash	182	3,651
Cash at Beginning of Period	6,003	2,352
Cash at End of Period	6,185	6,003
Supplemental cash flow information:
Cash paid for interest	2,673	1,174
Cash paid for income taxes	2,970	3,006
Non-cash investing and financing activities:
ROU assets obtained in exchange for lease liabilities	5,737	3,264
Non-cash recovery of note receivable	453	0
Net exercise of stock options	254	0
Shares withheld from exercise of stock options for payment of taxes	36	0
Purchases of inventory included in accounts payable and accrued expenses and other current liabilities	1,176	601
Purchases of property and equipment included in accounts payable and accrued expenses and other current liabilities	126	1,422
Non-cash directors and officers insurance	0	695
Non-cash Merger financing	0	2,000
Exchange of DTIH redeemable convertible preferred stock for DTIC Common Stock in connection with Merger	0	7,193
Issuance of DTIC common stock to former holders of DTIH redeemable convertible preferred stock in connection with Exchange Agreements	0	10,805
Accretion of redeemable convertible preferred stock to redemption value	0	314
CTG
Non-cash investing and financing activities:
Fair value of liabilities assumed in Acquisition	3,162	0
SDPI
Cash flows from operating activities:
Net income	(1,400)
Non-cash investing and financing activities:
Fair value of liabilities assumed in Acquisition	6,246	0
EDP
Cash flows from operating activities:
Net income	(200)
Non-cash investing and financing activities:
Fair value of liabilities assumed in Acquisition	$ 1,769	$ 0

LEASES - Summary of Supplemental Balance Sheet Information Related to Leases (Details)	Dec. 31, 2024	Dec. 31, 2023
Leases [Abstract]
Weighted-average remaining lease term (in years)	7 years 1 month 9 days	6 years 6 months 18 days
Weighted average discount rate	7.57%	5.80%

OTHER EXPENSE, NET

12 Months Ended

Dec. 31, 2024

Other Income and Expenses [Abstract]

OTHER EXPENSE, NET

NOTE 13 – OTHER EXPENSE, NET

The following table shows the components of other expenses, net for the years ended December 31, 2024, and 2023 (in thousands):


	Year Ended December 31, 2024			Year Ended December 31, 2023
HHLLC stock-based compensation	$	—		$	(2,339	)
Transaction fees		(7,036	)		(3,640	)
Other, net		(664	)		(428	)
Interest income		197			48
Other expense, net	$	(7,503	)	$	(6,359	)

SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2024

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 19 – SUBSEQUENT EVENTS

Change in Reportable Segments

Beginning in January 2025, coinciding with the closing of the Company’s acquisition of Titan Tools Services Limited, the Company has realigned its operations to support its strategic initiatives to expand its global operations and reach new markets, particularly in the Eastern Hemisphere. As a result, the Company realigned its reportable segments to correspond with changes to its operating model, management structure, and organizational responsibilities. Effective January 2, 2025, the Company will bifurcate its results into two segments: Eastern Hemisphere and Western Hemisphere. As of December 31, 2024, this realignment has not been reflected within the Company’s financial statements. Beginning with the first quarter in 2025, Form 10-Q will reflect the new reportable segments and corresponding information for prior periods will be retrospectively revised to reflect this change in reportable segments.

Acquisition of Titan Tools Services Ltd.

On January 2, 2025, the Company announced the closing of a share purchase agreement (the “Titan Purchase Agreement”, the “Agreement”) to acquire one hundred percent (100%) of the shares of Titan Tools Services Limited, a Scottish limited company (“Titan”). Titan is a downhole tool rental company that specializes in renting, servicing, and manufacturing advanced drilling equipment for the oil, gas, and geothermal industries. Consideration for the Titan acquisition primarily consists of (i) £4.9 million in cash, as adjusted for cash acquired and other items pursuant to the Agreement, and (ii) 0.9 million shares of the Company’s common stock . The initial accounting for this business combination is in process, which includes conducting a valuation analysis to value the assets and liabilities assumed as a result of the transaction. As such, the impact on the consolidated financial statements cannot be estimated at this time.

Restricted Stock Unit Grant

On February 28, 2025, the Company issued restricted stock units (“2025 RSUs”) to members of the Company’s management team. A total of 909,321 units were granted. Each of the 2025 RSUs vest in substantially equal installments on each of the first four (4) anniversaries of the grant date. The 2025 RSUs were issued with a grant date fair value of $3.23 per share.

INTANGIBLES, NET - Summary of Components of Intangible Assets, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Indefinite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 39,714	$ 1,550
Less: accumulated amortization	(2,482)	(1,334)
Intangible assets, net	37,232	216
Trade Name
Indefinite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 3,184	1,280
Trade Name \| Maximum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	15 years
Trade Name \| Minimum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	10 years
Developed Technology
Indefinite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 15,438
Developed Technology \| Maximum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	20 years
Developed Technology \| Minimum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	13 years
Customer Relationships
Indefinite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 21,081
Customer Relationships \| Maximum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	20 years
Customer Relationships \| Minimum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	15 years
Patents
Indefinite-Lived Intangible Assets [Line Items]
Total intangible assets	$ 11	$ 270
Patents \| Maximum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	20 years
Patents \| Minimum
Indefinite-Lived Intangible Assets [Line Items]
Useful lives (in years)	5 years

BUSINESS COMBINATIONS - Summary of Identified Intangible Assets, Estimated Useful Lives and Methodologies Used to Determine Fair Values (Details) - USD ($) $ in Thousands	Oct. 03, 2024	Jul. 31, 2024	Mar. 15, 2024
Casing Technologies Group Limited
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value			$ 8,065
Casing Technologies Group Limited \| Trade Names
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value			$ 819
Intangible assets, useful life			15 years
Casing Technologies Group Limited \| Developed Technology
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value			$ 3,269
Intangible assets, useful life			20 years
Casing Technologies Group Limited \| Customer Relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value			$ 3,977
Intangible assets, useful life			20 years
Superior Drilling Products, Inc
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value		$ 22,850
Superior Drilling Products, Inc \| Trade Names
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value		$ 800
Intangible assets, useful life		15 years
Superior Drilling Products, Inc \| Developed Technology
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value		$ 8,600
Intangible assets, useful life		15 years
Superior Drilling Products, Inc \| Customer Relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value		$ 13,400
Intangible assets, useful life		15 years
Superior Drilling Products, Inc \| Backlog
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value		$ 50
Intangible assets, useful life		4 months 24 days
European Drilling Projects B.V.
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value	$ 8,197
European Drilling Projects B.V. \| Trade Names
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value	$ 341
Intangible assets, useful life	20 years
European Drilling Projects B.V. \| Developed Technology
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value	$ 3,721
Intangible assets, useful life	15 years
European Drilling Projects B.V. \| Customer Relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, fair value	$ 4,135
Intangible assets, useful life	25 years

PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 21,500	$ 20,300
Property, plant and equipment, net	75,571	65,800
United States
Property, Plant and Equipment [Line Items]
Property, plant and equipment, net	$ 66,900	$ 63,000
Property, plant and equipment net, Percentage	89.00%	96.00%
Outside of the United States
Property, Plant and Equipment [Line Items]
Property, plant and equipment, net	$ 8,600	$ 2,800
Property, plant and equipment net, Percentage	11.00%	4.00%

PROPERTY, PLANT AND EQUIPMENT, NET - Summary of Component of Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Total property, plant and equipment	$ 216,234	$ 198,803
Less: accumulated depreciation	(142,203)	(133,003)
Property, plant and equipment, net (excluding construction in progress)	74,031	65,800
Construction in progress	1,540	0
Property, plant and equipment, net	75,571	65,800
Rental Tools and Equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment	$ 205,939	188,949
Rental Tools and Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years
Rental Tools and Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	10 years
Buildings and Improvements
Property, Plant and Equipment [Line Items]
Total property, plant and equipment	$ 7,074	6,672
Buildings and Improvements \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years
Buildings and Improvements \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	40 years
Office Furniture, Fixtures and Equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment	$ 2,507	2,389
Office Furniture, Fixtures and Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	3 years
Office Furniture, Fixtures and Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years
Transportation and Equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment	$ 715	$ 793
Transportation and Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	3 years
Transportation and Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years

REVISIONS OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS - Summary of Audited Consolidated Financial Statements (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses	$ 38,491	$ 35,519
Tool Rental
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses	24,110	28,270
Product Sale
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses	$ 14,381	7,249
As Previously Reported \| Tool Rental
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses		30,960
As Previously Reported \| Product Sale
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses		4,559
Total Adjustment \| Tool Rental
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses		(2,690)
Total Adjustment \| Product Sale
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating costs and expenses		$ 2,690

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

INCOME TAXES - Schedule of Reconciliation of Federal Statutory Rate to Company's Effective Tax Rate (Details)	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Income Tax Disclosure [Abstract]
U.S. federal tax benefit at statutory rate	21.00%	21.00%
State taxes, net of federal benefit	12.70%	1.90%
Permanent differences	22.70%	3.60%
Permanent differences related to foreign items	(5.80%)	0.00%
Transfer pricing	1.20%	0.00%
Foreign rate differential	1.40%	0.00%
Foreign taxes	(10.40%)	0.20%
Valuation allowance	(0.30%)	0.00%
Credits	(12.10%)	0.00%
Income taxes deferred adjustment	27.00%	0.00%
Income taxes payable adjustment	(58.80%)	0.00%
Other	0.40%	(1.20%)
Effective tax rate	(1.00%)	25.50%

STOCK-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

Summary of Options Outstanding

The following table summarizes options outstanding, as well as activity for the year ended December 31, 2024 and December 31, 2023:


	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)		Aggregate Intrinsic Value
OUTSTANDING, December 31, 2022		2,494,097		$	4.04		3.93	$	11,687
Granted		—			—		—		—
Exercised		(132,375	)		5.04		—		—
Forfeited		—			—		—		—
OUTSTANDING, December 31, 2023		2,361,722			4.02		3.37		—
Granted		2,670,374			3.04		—		—
Exercised		(68,470	)		3.72		—		—
Forfeited		—			—		—		—
OUTSTANDING, December 31, 2024		4,963,626			3.50		6.46		677
UNVESTED, December 31, 2024		2,600,000			3.02		9.63		23
EXERCISABLE, December 31, 2024		2,363,626			4.03		2.96		655

REVENUE - Summary of Disaggregation of Revenues by Category (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Disaggregation of Revenue [Line Items]
Total Revenue	$ 154,446	$ 152,034
Tool Rental Services
Disaggregation of Revenue [Line Items]
Total Revenue	117,926	119,239
Product Sales
Disaggregation of Revenue [Line Items]
Total Revenue	$ 36,520	$ 32,795

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

+ References

+ Details

BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES - Summary of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Prepaid expenses:
Deposits on inventory	$ 551	$ 2,146
Prepaid income tax	1,293	362
Prepaid insurance	958	1,110
Prepaid rent	449	372
Prepaid equipment	263	331
Prepaid other	361	214
Other current assets:
Other	0	18
Total	$ 3,874	$ 4,553

RELATED PARTY TRANSACTIONS (Details)		12 Months Ended
RELATED PARTY TRANSACTIONS (Details)	Jun. 20, 2023 USD ($)	Dec. 31, 2024 USD ($) Truck $ / shares	Dec. 31, 2023 USD ($)	Mar. 02, 2023 USD ($)	Dec. 06, 2022 USD ($)
Related Party Transaction [Line Items]
Working capital loan amount	$ 400,000
PIPE Financing
Related Party Transaction [Line Items]
Payoff convertible promissory notes issued				$ 2,100,000	$ 2,100,000
Board of Directors
Related Party Transaction [Line Items]
Director fees paid		$ 600,000	$ 200,000
Hicks Holdings Operating LLC
Related Party Transaction [Line Items]
Management fees paid to shareholder		800,000	1,100,000
Cree Investments, LLC
Related Party Transaction [Line Items]
Rent expense paid to shareholder		$ 51,000	$ 51,000
Employees
Related Party Transaction [Line Items]
Number of trucks sold \| Truck		2
Sales price of trucks		$ 100,000
Receivables		0
Tronco
Related Party Transaction [Line Items]
Periodic payments of notes		$ 1,300,000
Average stock price \| $ / shares		$ 3.2
Interest rate		3.00%
Carrying value of note		$ 5,200,000

EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Millions	12 Months Ended
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Millions	Dec. 31, 2024	Dec. 31, 2023
Defined Benefit Plan [Abstract]
Defined contribution plan nature and effect of change, description	The Company sponsors various defined contribution savings plan, primarily in the U.S., that allow employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. Under specified conditions, the Company will make contributions to the plans and/or match a percentage of the employee contributions up to certain limits. Total expense related to the defined contribution plans for the years ended December 31, 2024 and 2023 was $0.7 million and $0.5 million, respectively.
Defined contribution expense	$ 0.7	$ 0.5

SEGMENT INFORMATION - Schedule of Segment Revenue, Significant Expenses, Other Segment Items and Segment Net Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Segment Reporting Information, Operating Income (Loss) [Abstract]
Revenues	$ 154,446	$ 152,034
Cost of sales	38,491	35,519
Operating, general, and administrative expenses	76,801	66,655
Other segment items	8,969	8,611
Depreciation and amortization expense	23,832	20,352
Interest expense	3,369	1,103
Income tax expense	(30)	5,046
Net income	$ 3,014	$ 14,748

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

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+ Details

BUSINESS COMBINATIONS - Summary of Consideration for Merger (Details) - USD ($) $ in Thousands	Oct. 03, 2024	Jul. 31, 2024
Superior Drilling Products, Inc
Business Acquisition [Line Items]
Cash paid to holders of SDPI Common Stock		$ 13,668
Cash payment of SDPI transaction costs		2,907
Cash repayment of debt		2,278
Cash payment to holders of SDPI Restricted Stock		1,806
Cash severance payment to former SDPI employee		233
Fair value of DTI Common Stock issued in exchange for outstanding SDPI Common Stock		27,714
Fair value of replacement awards issued to holders of SDPI Options		138
Effective settlement of preexisting relationship between DTI and SDPI		(828)
Fair value of consideration transferred		$ 47,916
European Drilling Projects B.V.
Business Acquisition [Line Items]
Cash paid to EDP's sole shareholder	$ 6,307
Note payable issued by DTI to EDP's sole shareholder	5,207
Cash repayment of EDP debt	1,889
Cash paid to settle employee stock appreciation right awards	468
Effective settlement of preexisting relationship between DTI and EDP	29
Fair value of consideration transferred	$ 13,900

INVESTMENTS - EQUITY SECURITIES - Summary of Cost and Fair Value of Investments in Equity Securities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Net Investment Income [Line Items]
Cost	$ 0	$ 999
Unrealized gain (Loss)	0	(111)
Fair value	$ 0	$ 888

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Asset and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments, equity securities	$ 0	$ 888
Total assets at fair value	0	888
Level 1
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments, equity securities	0	888
Total assets at fair value	0	888
Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments, equity securities	0	0
Total assets at fair value	0	0
Level 3
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments, equity securities	0	0
Total assets at fair value	$ 0	$ 0

INCOME TAXES - Schedule of Income (Loss) Before Provision for (Benefit From) Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Income Tax Disclosure [Abstract]
Domestic	$ 1,274	$ 17,351
International	1,710	2,443
Profits before provision for income taxes	$ 2,984	$ 19,794

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

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+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2024

Accounting Policies [Abstract]

Schedule of Changes in Contract Assets

The changes in contract assets for the year ended December 31, 2024 were as follows (in thousands):


Balance at December 31, 2023	$	4,157
Revenue recognized from contract assets		55,814
Conversion of contract assets into accounts receivable		(54,522	)
Balance at December 31, 2024	$	5,449

Schedule of Allowance For Credit Losses

The changes in the allowance for credit losses for the year ended December 31, 2024 were as follows (in thousands):


Balance at December 31, 2023	$	(1,458	)
Additions during 2024		(439	)
Utilization of allowance for credit losses		207
Balance at December 31, 2024	$	(1,690	)

Summary of Asset and Liabilities Measured at Fair Value

Asset and liabilities measured at fair value are summarized as follows (in thousands):

           
          Assets at Fair Value as of December 31, 2024

           
          Level 1

          Level 2

          Level 3

          Total

Investments, equity securities

—

—

—

—

Total assets at fair value

—

—

—

—


	Assets at Fair Value as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Investments, equity securities	$	888	$	—	$	—	$	888
Total assets at fair value	$	888	$	—	$	—	$	888

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References + Details

BALANCE SHEET DETAILS - CURRENT ASSETS AND CURRENT LIABILITIES - Summary of Inventories, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Inventory, Net [Abstract]
Raw materials	$ 12,928	$ 5,022
Work in progress	1,828
Finished goods	2,897	16
Total inventories	17,653	5,038
Allowance for obsolete inventory	(151)	(4)
Inventories, net	$ 17,502	$ 5,034

Pay vs Performance Disclosure - USD ($) $ in Thousands	12 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ 3,014	$ 14,748

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

BUSINESS COMBINATIONS (Details) $ in Thousands, £ in Millions							3 Months Ended	12 Months Ended
	Oct. 03, 2024 USD ($)	Sep. 30, 2024	Jul. 31, 2024 USD ($) Patent	Mar. 15, 2024 GBP (£)	Mar. 15, 2024 USD ($) Patent	Mar. 06, 2024	Jun. 30, 2024 USD ($)	Dec. 31, 2024 USD ($)	Dec. 31, 2023 USD ($)
Business Acquisition [Line Items]
Acquisition-related costs								$ 1,600
Revenue								154,446	$ 152,034
Net income (loss)								3,014	14,748
Aggregate gross proceeds									30,000
Goodwill								12,147	0
Other Expense
Business Acquisition [Line Items]
Stock-based compensation expense									2,300
Hicks Holdings Operating LLC
Business Acquisition [Line Items]
Stock-based compensation expense								0	$ (2,339)
Casing Technologies Group Limited
Business Acquisition [Line Items]
Total measurement period adjustments related to assumed accrued liabilities							$ 500
Revenue								10,200
Net income (loss)								1,100
Goodwill					$ 3,144
Casing Technologies Group Limited \| CTG Purchase Agreement
Business Acquisition [Line Items]
Business acquisition percentage					100.00%
Purchase consideration				£ 16.2	$ 20,900
Number of intellectual property rights patent \| Patent					60
Casing Technologies Group Limited \| Deep Casing Tools Limited
Business Acquisition [Line Items]
Settlement of outstanding debt				(15.3)	$ (19,800)
Payment to legacy shareholders				0.3	300
Acquisition-related costs				£ 0.6	$ 800
Superior Drilling Products, Inc
Business Acquisition [Line Items]
Purchase consideration			$ 47,916
Acquisition-related costs			600					3,400
Revenue								5,000
Net income (loss)								(1,400)
Date of acquisition						Mar. 06, 2024
Previously held interest remeasured to fair value			$ 1,200
Remeasurement resulted gain								400
Number of acquired patents \| Patent			30
Goodwill			$ 7,718
Stock-based compensation expense			500
Superior Drilling Products, Inc \| SDPI Merger Agreement
Business Acquisition [Line Items]
Purchase consideration			$ 47,900
European Drilling Projects B.V.
Business Acquisition [Line Items]
Business acquisition percentage	100.00%
Purchase consideration	$ 13,900
Acquisition-related costs								1,000
Revenue								1,000
Net income (loss)								$ (200)
Goodwill	1,516
Percentage of shares to acquire		100.00%
European Drilling Projects B.V. \| EDP Merger Agreement
Business Acquisition [Line Items]
Purchase consideration	$ 13,900