DTIHIGH SIGNALOPERATIONAL10-K

DTI underwent a significant business restructuring, consolidating from four operational divisions to two geographic segments while experiencing a 52% decline in operating income.

The company appears to have fundamentally reorganized its business model, moving away from a division-based structure (including the previously core DTR division that represented 50% of 2024 revenue) to a geographic focus on Western and Eastern hemispheres. This major operational shift coincides with substantially deteriorating financial performance, suggesting either strategic repositioning under pressure or integration challenges following the 2023 merger with ROC Energy Acquisition Corp.

Comparing 2026-03-06 vs 2025-03-14View on EDGAR →
FINANCIAL ANALYSIS

DTI's financial position deteriorated significantly with operating income plummeting 52% from $27.9M to $13.4M, while cash reserves dropped 41% to just $3.6M. Although the company reduced total debt by 15% to $45.8M, the dramatic decline in profitability combined with weakening liquidity suggests operational stress that may challenge the company's ability to execute its new geographic strategy and service existing obligations.

FINANCIAL STATEMENT CHANGES
Operating Income
P&L
-51.9%
$27.9M$13.4M

Operating income deteriorated sharply — investigate whether driven by one-time charges or structural cost issues.

Cash & Equivalents
Balance Sheet
-41%
$6.2M$3.6M

Cash declined 41% — significant cash burn or deployment; verify adequacy of remaining liquidity runway.

Total Debt
Balance Sheet
-14.9%
$53.8M$45.8M

Debt reduced 14.9% — deleveraging strengthens balance sheet and reduces financial risk.

LANGUAGE CHANGES
NEW — 2026-03-06
PRIOR — 2025-03-14
ADDED
Our Company On June 20, 2023, a merger transaction between Drilling Tools International Holdings, Inc.
("DTIH"), ROC Energy Acquisition Corp ("ROC"), and ROC Merger Sub, Inc., a directly, wholly owned subsidiary of ROC, was completed (the "Merger ).
In connection with the closing of the Merger, ROC changed its name to Drilling Tools International Corporation ("DTIC").
The common stock of DTIC ("Common Stock" or the "DTIC Common Stock") commenced trading on the Nasdaq Stock Market LLC ("Nasdaq") under the symbol "DTI" on June 21, 2023.
Operating Activities Our operating activities are divided into two geographic segments: Western Hemisphere our Western Hemisphere segment focuses on providing a comprehensive range of downhole drilling tools and services primarily for onshore and offshore operations across North America and Latin America.
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REMOVED
Operating Activities Our operating activities are divided into four divisions: Directional Tool Rentals ("DTR") Our DTR division is a leading provider of downhole tools to directional drilling and upstream energy customers in both land and offshore markets, based on the percentage of active rigs to which we supply tools in the geographies in which we are active.
DTR maintains a fleet of over 23,000 tools and accounted for approximately 50% of our 2024 revenue.
DTR rents drill collars, stabilizers, sub-assemblies and other tools used in horizontal and directional drilling of oil and natural gas.
We charge our customers a day rate, monthly rate or per-well rate, and customers are required to iv compensate us for lost or damaged tools.
DTR operates ten full-service locations and additional stocking points in key locations.
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