TISI

Image source: The Motley Fool. Tuesday, Aug. 11, 2026 at 9 a.m. ET Chief Executive Officer - Gary Hill Chief Financial Officer - Clinton Roeder Operator: Welcome to the Team, Inc. Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Joseph Caminiti with Alpha IR Group. Please go ahead. Joe Caminiti: Thank you, operator. Good morning, everyone, and welcome to Team, Inc.'s Second Quarter 2026 Earnings Call. Joining me on today's call are Gary Hill, Team's Chief Executive Officer; and Clinton Roeder, Team's Chief Financial Officer. Before we begin, I would like to remind everyone that management's remarks today may contain forward-looking statements, including statements regarding revenue, gross margin, operating expenses, adjusted EBITDA, cash flow and the company's future business outlook. These statements are based on management's current expectations and beliefs and are subject to risks and uncertainties that could cause actual results to differ materially. For a discussion of these risks, please refer to the Risk Factors section of Team's most recent annual and quarterly reports filed with the Securities and Exchange Commission as well as the company's second quarter earnings release. Team undertakes no obligation to update any forward-looking statements, which speak as of their respective dates. With that, I will turn the call over to Gary Hill, Team's Chief Executive Officer. Gary Hill: Good morning, everyone, and thank you for joining us. I'll begin with a brief overview of the second quarter, then spend most of my time discussing what I've learned during my first roughly 120 days as CEO and the actions we are taking to position Team for stronger and more consistent performance. Lastly, I will cover some additional news, which we shared yesterday regarding a significant change in our shareholder base. Clinton will then provide a more detailed review of the financial results, balance sheet and outlook. Our second quarter results reflected the underlying strength of our operating model and foundational business. Overall, our results came in soft relative to the year ago period, driven largely by the timing of customer turnaround outage and maintenance activity, particularly within the mechanical services. Given the macro environment and downstream effects of the ongoing conflict in the Middle East, several customers extended operating runs to take advantage of favorable refining economics, shifting certain planned projects out of the quarter. This resulted in lower turnaround activity and a less favorable revenue mix, which compressed margins and operating leverage. Additionally, I'd like to note that we are carrying one-off impacts to our Middle East business, more acutely impacted by the ongoing conflict. At the same time, the relative stability of our overall revenue base demonstrated the underlying resilience of the business. Inspection and Heat Treating was comparatively more stable, supported by nested and recurring inspection activity and the ongoing need for customers to safely and reliably operate their assets. On top of that relative stability, our results are capturing added resilience from the revenue growth we are driving in other markets and industry verticals, which will continue supporting results on a go-forward irrespective of the macro backdrop. We believe a meaningful portion of this specific Mechanical Services activity has been deferred and pushed out to later quarters. We expect some of that work to begin returning during the second half of the year, although the precise timing remains dependent on individual customer operating decisions, the crack spread environment and ultimately, a timely resolution to the conflict. The quarter also reinforced the importance of the transformation work already underway across Team. In my first 120 days, I spent considerable time with our employees, customers and commercial and operating leaders in order to better understand the strengths of the organization and identify areas where we can improve and capture greater value across the enterprise. Team has a strong foundation. We have highly skilled employees, deep technical expertise and long-standing relationships with many of the largest operators across our core markets. The services we provide are critical to the safe, reliable and efficient operation of customer assets. I have also seen a high level of commitment throughout the organization. Our employees understand the importance of their work and take considerable pride in supporting our customers. Building on that foundation, we identified several opportunities to improve consistency across commercial execution, labor utilization, operating efficiency and cash generation. Commercially, we see opportunities to improve how we manage our sales pipeline, estimate and price projects and strategically select the work we pursue. Operationally, we see opportunities to deploy our workforce more efficiently, create clear ownership across the organization and improve coordination between teams. We are also evaluating our global facility footprint, our fleet and overhead structure while improving the data and systems that support decision-making. Those findings became the basis for the action plan we are now executing. Our plan is centered on 3 areas: leadership and accountability, commercial execution and operational efficiency. First, we have strengthened leadership team and established clear ownership of our key priorities. In addition to my role as CEO, Clinton has joined us as Chief Financial Officer. We have also added a new Chief Operating Officer, a new Chief Human Resources Officer and a Senior Vice President of Operational Excellence, all of whom I am very excited to have part of the Team organization and will contribute meaningfully to our execution and strategic direction. We continue to evaluate opportunities to strengthen our commercial leadership and ensure we have the right structure in place to support the company's priorities. These additions are intended to improve accountability, coordination and operating discipline across Team. I also want to formally welcome Clinton. He brings relevant financial, operating and capital market experience and has already become an important partner to me and the broader leadership team. The second area of focus is commercial execution. We are putting a clear commercial structure in place and introducing greater consistency around pipeline management, estimating, quoting and account ownership. Our objective is not simply to generate more revenue, it is to pursue profitable growth in areas where Team's technical expertise, safety record and execution capabilities are valued. That includes improving pricing discipline and ensuring that travel, training, vehicles, overtime and other customer-specific requirements are appropriately reflected in our commercial terms. We are also making thoughtful investments in our systems, including opportunities to leverage AI where applicable. These system investments will be aimed at generating better visibility into customer activity, upcoming opportunities, win rates and project economics across the organization. The third area is operational efficiency. We are reviewing our global facility footprint, procurement, fleet, organizational structure and overhead costs. We are also focused on labor utilization, billable hours and better coordination between inspection and Heat Treating and mechanical services. Some actions have already been completed, while others are underway or expected to be implemented over the balance of the year. The goal is to create a more efficient and scalable operating structure that improves execution, supports stronger operating leverage and enhances cash generation as activity grows. Clinton will provide additional detail on the expected benefits, implementation costs and timing of these initiatives. Improving the performance of the existing business remains our first priority. Refining and petrochemical customers will continue to be core to Team. These facilities are complex, highly regulated and require ongoing inspection, maintenance and repair. We believe there is a meaningful opportunity to deepen our existing customer relationships and capture a greater share of the work available within our current markets. At the same time, Team's capabilities are applicable across a broader range of industrial and infrastructure end markets. We are expanding our commercial focus and see significant near-term opportunities to apply our capabilities across selected areas, including aerospace, potentially LNG, nuclear, utilities, aviation and other industrial markets. These opportunities are at different stages of development, and we are not suggesting that each is already a material contributor. Our objective is to build a broader and more balanced opportunity funnel over time with a greater mix of recurring activity and less dependence on the timing of large turnaround projects. This broader commercial strategy, together with better pricing, project selection and execution should help create a more resilient and consistently profitable business and buffer against end market cyclicality. Looking ahead, we expect a portion of the deferred Mechanical Services activity to begin returning during the second half of the year. There is a practical limit to how long customers can delay required inspection, maintenance and repair work. However, the timing remains dependent on customer operating decisions, and we are not assuming that all deferred activity returns within any single quarter based on the timing of a resolution of the conflict in the Middle East. We do note, however, that the deferral of this work may also create a stronger setup for future quarters as customer maintenance schedules normalize. More importantly, the actions underway across commercial execution, labor planning, productivity and cost management should improve Team's ability to capture that activity and generate stronger operating leverage and thus returns as it rebounds. We are still early in the transformation, but the diagnostic work is largely complete. Our priorities are clear, and implementation is underway. Team has valuable technical capabilities, long-standing customer relationships and an experienced workforce. Our focus is on pairing those strengths with stronger leadership, greater commercial discipline and a more efficient operating structure. We believe these actions will position Team to deliver more consistent performance, stronger earnings and improved cash generation over time. Before I turn the call over to Clinton, I want to briefly touch on the announcement we shared last night around the same time that we issued our earnings release. As you likely saw, Stellex Capital Management is now our largest common equity shareholder. We are excited to continue working with the Stellex team and recognize this transaction as a strong vote of confidence in the significant embedded value of the Team franchise that can be unlocked. This increase in Stellex's holdings came through a negotiated transaction with our prior shareholder, CORE Partners, and we thank CORE for their engagement and support in the years leading up to this transition. With that, I'll turn the call over to Clinton. Clinton Roeder: Thank you, Gary, and good morning, everyone. I am pleased to be joining Team and participating in my first earnings call as Chief Financial Officer. Since joining the company, I have spent time with Gary and leaders across the organization, reviewing the business, our financial processes and the transformation initiatives underway. I'm encouraged by Team's underlying strengths and the opportunity to improve margins, cash generation and operational consistency. Turning to the second quarter. Revenue was $229 million compared with $248 million in the prior year period. Inspection and Heat Treating revenue was $131 million, a 5% decrease year-over-year. This decrease was largely attributable to a $5 million drop in the U.S. and a $2.6 million reduction in Canada, both due to reduced turnaround activities in those regions. Mechanical Services revenue was $97 million, an 11% decrease year-over-year. As Gary discussed, results reflected the deferral of planned turnaround and maintenance activity as certain customers extended facility operating runs. As we have mentioned, our results have carried the impact of deferred turnaround activity as refining customers have deferred maintenance to capture strong crack spreads. To date, turnaround revenues are down a little more than 50% versus the prior year, driven by this current dynamic. Notably, the activity tied to these revenues cannot be forgone, and we expect to capture these revenues in later periods with expectations for pickup beginning in the second half of the year. While consolidated revenue remained relatively resilient, the lower contribution from turnaround work resulted in a less favorable mix of sales and also affected labor utilization and operating leverage. Selling, general and administrative expenses for the second quarter were $46.6 million, decreased by $3.9 million or 7.8% from the second quarter of 2025. Adjusted selling, general and administrative expense, which excludes expenses not representative of Team's ongoing operations such as nonrecurring professional, legal, financing and severance expenses and noncash expenses such as share-based compensation expense, decreased by $2.3 million or 4.8% to $44.6 million compared to the prior year period. Adjusted EBITDA was $13.7 million compared with $24.5 million in the second quarter of 2025. The change primarily reflected lower Mechanical Services activity and the related impact on revenue mix and labor utilization and fixed cost deleveraging. Turning to our structural cost improvement program Gary highlighted earlier, we have identified approximately $20 million to $35 million of annualized savings and productivity benefits across our facility footprint, fleet, procurement, organizational structure and operating processes. We anticipate that these initiatives will support future cash flow generation in the range of $5 million to $15 million this year. We note that while these initiatives are underway, they are very much in the early stages and are not yet reflected in our results. We expect approximately $8 million to $15 million of benefit during the second half of 2026 and expect to achieve the full annualized run rate by 2027. We currently anticipate onetime implementation costs of approximately $5 million to $10 million. These initiatives are largely within our control and intended to create a more efficient cost structure and stronger operating leverage as customers' activity improves. Alongside these actions, we are sharpening our commercial focus and extending our specialized capabilities into a more diversified set of high-value industrial end markets. Together, we expect these steps to improve our margins, support stronger performance in the second half and strengthen Team's underlying earnings power and cash flow generation over time. Turning to cash flow and the balance sheet. Cash used in operating activities was $0.7 million and capital expenditures were $3.9 million. We ended the quarter with total liquidity of approximately $51.2 million and net debt of $300.3 million. Net working capital and cash generation remain key priorities. We are focused on improving order to cash, increasing accountability throughout the organization and using future cash generation to further reduce debt. Turning to guidance. We are reaffirming our full year 2026 outlook for revenue of $920 million to $945 million, gross profit of $240 million to $260 million and adjusted EBITDA of $68 million to $73 million. In the near term, we expect our results to likely come in towards the lower half of the provided ranges, given the uncertainty of timing regarding a rebound in deferred maintenance and turnaround activity tied to the ongoing Middle East conflict and its impact on global fuel markets. Our outlook assumes that a portion of the mechanical service activity deferred during the second quarter begins returning over the balance of the year. The precise timing remains dependent on customer operating decisions, and our current expectations are, therefore, more weighted toward the second half. Guidance also incorporates the expected benefit from some of the initiatives underway, along with continued stability within inspection and Heat Treating and improved labor utilization as productivity returns. We remain focused on executing the transformation priorities Gary outlined and delivering improved margins, adjusted EBITDA and cash generation. With that, I'll turn the call back over to Gary. Gary Hill: Thank you for taking the time this morning dialing in and participating in our call. We look forward to updating you on our transformation initiatives and growth as we go forward with the year. Thank you. Joe Caminiti: Thank you, Gary and Clinton. When we announced this call, we invited investors to submit their questions ahead of time. We'd like to thank those investors who took the time to do so, and we appreciate your continued engagement. In addition, we will be opening the call up to a live Q&A following the responses to those submitted questions. Correction, we will only be taking questions today that were submitted in advance. Question one. Yesterday's announcement detailed a significant increase in ownership from Stellex Capital Management and a significant premium to market value. Can you comment on the transaction and what you believe is driving Stellex's increased ownership? And what may this additional Stellex investment mean going forward? Gary Hill: Sure. This is Gary. We can't speak on behalf of Stellex, but I can say this sends a very strong message to the management team that Stellex has confidence in our business strategy, the value to be unlocked here, the ongoing transformation and our ability to work to deliver differentiated value to our customers. We also look at it as confidence from CORE's perspective that they would not sell unless there was a significant premium. We have an incredible brand and technician workforce here at Team, and we believe there's a lot of opportunity to improve margins with structural efficiencies and by obtaining more business in markets that value our services and safety record, and we'll pay accordingly for that, whether it be in aerospace, nuclear power, midstream, data centers and so on. We can assume that Stellex shares our confidence and they have seen the opportunity before us after being a strategic investor in Team since September 2025, and it's been a very positive and constructive relationship since they initiated their position last year. We look forward to the continued collaboration with Stellex, and we view their interest as being aligned with the company and its shareholders with the ultimate goal of long-term value creation and unlocking the value of this business with improved margins while also having the highest safety standards and striving to be the employer of choice for service technicians in our industry. Joe Caminiti: This quarter, you introduced concrete targets for structural cost improvement for this year and at a full run rate. Do you anticipate sourcing structural benefits? Are there upfront capital costs associated with implementing these actions? Clinton Roeder: Yes. This is Clinton. Yes, related to the anticipation of the sourcing of the structural benefits, optimization of the supply chain, facility, fleet, global footprint and organizational structure as well as sharpening our commercial focus. It's important to note that we have started this improvement plan, but there's still a lot to do and the impacts may take some time to fully run through the financials. We have begun our efforts on the commercial side, but there's still a lot to do there as we look to the back half of 2026 and into 2027. But we have specific identified plans with goals to achieve our objectives. Regarding the upfront costs associated with implementing these actions, yes, we have estimated between $5 million to $10 million of onetime costs to implement the changes, which includes global changes to our footprint and certain technology upgrades to improve our efficiencies. We are also evaluating capital needed to drive growth in areas where we have customers asking to provide new services to them and looking for ways to ensure we get the returns needed from those customers. Joe Caminiti: You referenced significant deferrals of turnaround and maintenance activity versus the prior year due to the state of fuels markets in response to the Middle East conflict. Can you quantify the impact year-to-date on revenues? What gives you the confidence that this will begin to rebound in the second half of 2026? Gary Hill: Sure. This is Gary. The conflict has negatively impacted revenue by more than $20 million in the first half of 2026, coming from both deferred turnaround and maintenance activity, which we attribute to the increase of crack spreads for our customers and to a lesser extent, specific business activity that slowed in the Middle East region for us. While Team was able to offset some of the downside in revenue, the service line mix was unfavorable, driving lower margins. We understand that customers will want to take advantage of crack spreads when they increase, but the work cannot be indefinitely deferred. As mentioned, there is a practical limit to how long customers can delay required inspection, maintenance and repair work. So we do believe some of the activity will need to resume in the back half of 2026. However, the timing of that is dependent on some of the macro factors such as refining utilization that are, in turn, impacted by the Middle East conflict. So it can be hard to predict the exact timing. Joe Caminiti: You also referenced that Q2 saw new growth partially offsetting the pressure from refining customers or turnaround activity. Can you comment on the growth you're capturing in new markets and which of these is the most target-rich in near term? And what do you think you can ultimately achieve through these new verticals? Gary Hill: Sure. This is Gary. We are seeing growth in LNG, aerospace, commercial nuclear power, pulp and paper markets as examples, where we're seeing more than 10% year-on-year growth, and we expect growth in these markets to be higher in the second half of 2026. One of the most exciting things about these new markets is they all have high growth potential, and Team is well positioned to increase its wallet share in these markets. Part of the transformation of the organization is to position Team to take advantage of these new markets while continuing to maximize performance for the historical core markets. As we move forward, we intend to have part of our sales organization more structured and focused towards these new markets, and we also look at that from different angles, including cross-selling, sales training and technical sales expertise in these markets. Our customers want service from Team because they know what we can deliver, safe, reliable and technically superior performance by our technicians. And it's our job as a management team to ensure that we are positioned to provide that to them. Joe Caminiti: Turning to cash flow. Can you comment on how you expect to drive cash flow improvement? Clinton Roeder: Yes. This is Clinton again. This is one of the first areas identified here in my financial assessment since joining Team. The order-to-cash improvement project is focused on improving working capital throughout the business. Some of the areas of improvement are by optimizing inventory levels and reducing invoicing time line to lower overall accounts receivable required to support the business. The $5 million to $10 million cash flow improvement is targeted to be realized by end of the year, driving higher liquidity. Gary Hill: I think that concludes the questions and answers. This is Gary. Thank you for attending our second quarter review and look forward to updating everyone at our third quarter review in early November. Stay safe. Thank you. Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Before you buy stock in Team, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Team wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $421,511!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,381,960!* Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 216% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 17, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Team (TISI) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was primarily impacted by customers extending operating runs to capitalize on favorable refining economics, leading to a significant deferral of planned turnaround and maintenance activity. The ongoing conflict in the Middle East created a dual headwind, driving higher crack spreads that incentivized customer deferrals while directly impacting regional business operations. A less favorable revenue mix and lower labor utilization in Mechanical Services compressed margins, though this was partially offset by stability in nested and recurring Inspection and Heat Treating activity. Management identified a lack of consistency in commercial execution and labor planning during the initial 120-day diagnostic period, prompting a shift toward clear ownership and accountability. The company is pivoting its commercial strategy to reduce dependence on cyclical turnaround projects by expanding into high-growth verticals like aerospace, LNG, and nuclear power. Strategic positioning is being reinforced by a new leadership team focused on improving pricing discipline to ensure all customer-specific requirements are reflected in commercial terms. Guidance for the full year 2026 assumes a portion of deferred Mechanical Services activity returns in the second half, as there is a practical limit to how long customers can delay critical repairs. Management expects results to trend toward the lower half of the guidance range due to persistent uncertainty regarding the timing of a resolution to the Middle East conflict. The structural cost improvement program is designed to deliver $20 million to $35 million in annualized savings, with full run-rate achievement expected by 2027. Future performance is dependent on improving order-to-cash cycles and optimizing inventory levels to enhance liquidity and reduce net debt. System investments, including AI applications, are planned to improve visibility into win rates and project economics to drive more profitable growth. Stellex Capital Management has become the largest common equity shareholder following a negotiated transaction with CORE Partners at a significant premium to market value. Implementation of the transformation plan is expected to incur one-time costs of approximately $5 million to $10 million for footprint optimization and technology upgrades. The conflict in the Middle East negatively impacted first-half revenue by more than $20 million through both direct regional slowdowns and indirect maintenance deferrals. Management is evaluating the global facility footprint and fleet structure as part of a broader effort to create a more scalable and efficient operating model. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management views the investment as a strong vote of confidence in the company's strategy and the embedded value of the franchise. The transition from CORE Partners to Stellex is expected to support long-term value creation and the ongoing margin improvement transformation. The conflict resulted in a revenue headwind exceeding $20 million in the first half of 2026 due to unfavorable service mix and deferred work. While work cannot be deferred indefinitely, management noted that the exact timing of a rebound is difficult to predict as it remains tied to macro factors like refining utilization. Team is seeing more than 10% year-over-year growth in sectors such as LNG, aerospace, and nuclear power. The sales organization is being restructured to focus specifically on these markets through cross-selling and enhanced technical sales expertise. The company is launching an order-to-cash project focused on reducing invoicing timelines and optimizing inventory levels. Management targets a $5 million to $15 million cash flow improvement this year to drive higher liquidity.

Interested in Team, Inc.? Here are five stocks we like better. Second-quarter performance weakened: Revenue fell 7.7% year over year to $229 million, while adjusted EBITDA declined to $13.7 million from $24.5 million, primarily because refining customers deferred turnaround and maintenance work. Transformation program targets significant savings: Team identified $20 million to $35 million in annualized savings and productivity benefits, with $8 million to $15 million expected in the second half of 2026 and a full run rate in 2027. Outlook remains cautious: Team reaffirmed its 2026 guidance but expects results near the lower end of its ranges due to uncertainty about deferred project timing. Management is also pursuing growth in LNG, aerospace, nuclear power and other markets to reduce reliance on refinery turnarounds. Investing in Biotech: High Risk for a Potentially High Reward Team (NYSE:TISI) reported second-quarter 2026 revenue of $229 million, down from $248 million a year earlier, as customers deferred refinery turnaround, outage and maintenance work amid favorable refining economics and the effects of the Middle East conflict on fuel markets. Chief Executive Officer Gary Hill said the company’s results were “soft relative to the year-ago period,” primarily because several customers extended facility operating runs rather than completing planned projects during the quarter. The delayed work was particularly concentrated in the mechanical services business, reducing turnaround activity, shifting the revenue mix and pressuring margins and operating leverage. → SoundHound AI Sends a Loud Signal After Its Q2 Earnings Beat Asana sold the rip. Is it time to buy the dip? Hill, who had been CEO for roughly 120 days at the time of the call, said the company believes a meaningful portion of the deferred work will return in later periods, with some activity expected to resume during the second half of 2026. However, he said the timing will depend on customer operating decisions, refining crack spreads and developments in the Middle East conflict. Inspection and heat treating revenue totaled $131 million, a 5% year-over-year decline. Chief Financial Officer Clinton Roeder said the decrease reflected a $5 million reduction in U.S. revenue and a $2.6 million decrease in Canada, both tied to lower turnaround activity. → 3 Dividend Champion Utilities for a Market That Can't Sit Still Are Red Robin’s Sizzling Gains Overcooked or Just Starting? Mechanical services revenue was $97 million, down 11% from the prior-year quarter. Roeder said turnaround revenue was down “a little more than 50%” year to date compared with the prior year, as refining customers delayed maintenance to capitalize on strong crack spreads. While the company said its overall revenue base remained relatively resilient, lower mechanical services activity created an unfavorable sales mix and affected labor utilization and fixed-cost absorption. Selling, general and administrative expense was $46.6 million, down $3.9 million, or 7.8%, from the second quarter of 2025. Adjusted SG&A expense was $44.6 million, down $2.3 million, or 4.8%, year over year. Adjusted EBITDA was $13.7 million, compared with $24.5 million in the prior-year period. → Is Wingstop's Growth Story Losing Steam? Roeder attributed the decline in adjusted EBITDA primarily to lower mechanical services activity, the resulting revenue mix, weaker labor utilization and fixed-cost deleveraging. Hill outlined a transformation plan focused on leadership and accountability, commercial execution and operational efficiency. He said the company has added a chief operating officer, chief human resources officer and senior vice president of operational excellence, while Roeder recently joined as CFO. The company is reviewing its global facility footprint, fleet, procurement practices, organizational structure and overhead costs. It is also working to improve workforce deployment, billable hours, coordination across service lines, pricing discipline, project selection and sales-pipeline management. Roeder said the company has identified approximately $20 million to $35 million in annualized savings and productivity benefits from these initiatives. The program is expected to contribute $8 million to $15 million of benefit in the second half of 2026, with the full annualized run rate expected in 2027. Implementation is expected to require approximately $5 million to $10 million of one-time costs, including costs related to global footprint changes and technology upgrades. Roeder said the company expects the initiatives to support cash-flow generation in the range of $5 million to $15 million this year, though the actions remain in their early stages and have not yet been reflected in reported results. Refining and petrochemical customers remain central to the company’s business, according to Hill, but Team is broadening its commercial efforts toward other industrial and infrastructure markets. The company identified aerospace, LNG, commercial nuclear power, pulp and paper, utilities, aviation and other industrial markets as potential growth areas. Hill said the company is seeing more than 10% year-over-year growth in LNG, aerospace, commercial nuclear power and pulp and paper. He said Team expects growth in those markets to be higher in the second half of 2026 and plans to dedicate part of its sales organization to developing those opportunities. The company said these markets are at different stages of development and are not all currently material contributors. Its objective is to develop a more balanced opportunity funnel with more recurring activity and less dependence on the timing of major turnaround projects. Cash used in operating activities was $0.7 million during the quarter, while capital expenditures were $3.9 million. Team ended the quarter with approximately $51.2 million in total liquidity and net debt of $300.3 million. Roeder said improving working capital is a priority, including optimizing inventory and shortening invoicing timelines to reduce accounts receivable needed to support the business. The company is targeting $5 million to $10 million in cash-flow improvement by year-end. Team reaffirmed its full-year 2026 outlook for revenue of $920 million to $945 million, gross profit of $240 million to $260 million and adjusted EBITDA of $68 million to $73 million. Management said it expects results to trend toward the lower half of those ranges because of uncertainty over when deferred turnaround and maintenance activity will return. Separately, Hill said Stellex Capital Management became the company’s largest common equity shareholder through a negotiated transaction with prior shareholder Corre Partners. Hill said Team views the transaction as a vote of confidence in the company’s transformation strategy and long-term value creation potential. Team, Inc (NYSE:TISI) designs, engineers and manufactures industrial screen printing and digital printing equipment for a variety of end markets. The company's solutions are used primarily in textile decorating, apparel, signage and graphics, and specialty industrial applications. By combining precision mechanical design with automated controls, Team delivers systems that enhance production speed, print quality and repeatability for its customers. Team's product portfolio includes manual and automatic screen presses, inkjet UV LED curing systems, digital direct-to-garment printers and hybrid platforms that integrate multiple printing technologies. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Team Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Revenue: $229 million, compared with $248 million in the prior year period. Inspection and Heat Treating Revenue: $131 million, a 5% decrease year-over-year. Mechanical Services Revenue: $97 million, an 11% decrease year-over-year. Selling, General, and Administrative Expenses: $46.6 million, a decrease of $3.9 million or 7.8% from the second quarter of 2025. Adjusted SG&A Expense: $44.6 million, a decrease of $2.3 million or 4.8% compared to the prior year period. Adjusted EBITDA: $13.7 million, compared with $24.5 million in the second quarter of 2025. Cash Used in Operating Activities: $0.7 million. Capital Expenditures: $3.9 million. Total Liquidity: Approximately $51.2 million. Net Debt: $300.3 million. Full Year 2026 Revenue Guidance: Reaffirmed at $920 million to $945 million. Full Year 2026 Gross Profit Guidance: Reaffirmed at $240 million to $260 million. Full Year 2026 Adjusted EBITDA Guidance: Reaffirmed at $68 million to $73 million. Warning! GuruFocus has detected 3 Warning Signs with TISI. Is TISI fairly valued? Test your thesis with our free DCF calculator. Release Date: August 11, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Revenue base demonstrated resilience with inspection and heat treating relatively stable, supported by recurring inspection activity. Growth in new markets such as LNG, aerospace, commercial nuclear power, and pulp and paper, with more than 10% year-on-year growth. Identified $20 million to $35 million in annualized savings and productivity benefits from structural cost improvement program. Expect $8 million to $15 million of benefit from cost initiatives in the second half of 2026, with full run rate by 2027. Stellex Capital Management increased ownership, signaling confidence in the company's strategy and value creation potential. Second quarter revenue decreased to $229 million from $248 million year-over-year, driven by lower turnaround activity. Adjusted EBITDA fell to $13.7 million from $24.5 million, impacted by unfavorable revenue mix and fixed cost deleveraging. Turnaround revenues down more than 50% versus prior year due to customer deferrals, with over $20 million revenue impact in first half. Middle East conflict negatively impacted business, causing specific activity slowdown and uncertainty in timing of deferred work return. Cash used in operating activities was $0.7 million, with net debt of $300.3 million, highlighting ongoing cash generation challenges. Q: Can you comment on the transaction that made Stellex Capital Management the largest common equity shareholder and what it may mean going forward?A: Gary Hill, CEO, stated that while he cannot speak on behalf of Stellex, the increased investment is a strong vote of confidence in Team's business strategy, the value to be unlocked, and the ongoing transformation. He views it as a positive signal from Corre Partners as well, who sold at a significant premium. Hill believes Stellex shares the management team's confidence in the opportunity to improve margins through structural efficiencies and by expanding into markets that value Team's services and safety record, such as aerospace, nuclear power, and midstream data centers. He emphasized the relationship has been positive and constructive since Stellex became an investor in September 2025, with aligned interests focused on long-term value creation. Q: You introduced concrete targets for structural cost improvement. Do you anticipate sourcing structural benefits, and are there upfront capital costs associated with implementing these actions?A: Clinton Roeder, CFO, confirmed that the improvement plan has started, focusing on supply chain, facility, fleet, global footprint, and organizational structure. He noted that while efforts have begun, the full impact will take time to run through the financials, with more significant benefits expected in the back half of 2026 and into 2027. Regarding upfront costs, he estimated $5 million to $10 million in one-time implementation costs, which include global footprint changes and technology upgrades. He also mentioned they are evaluating capital needed to drive growth in areas where customers are requesting new services. Q: You referenced significant deferrals of turnaround and maintenance activity due to the Middle East conflict. Can you quantify the impact year-to-date and what gives you confidence it will rebound in the second half of 2026?A: Gary Hill, CEO, quantified the negative impact on revenue at more than $20 million in the first half of 2026, stemming from deferred turnaround and maintenance activity due to increased crack spreads for customers, and to a lesser extent, slowed business in the Middle East region. He explained that while customers will take advantage of favorable crack spreads, the work cannot be indefinitely deferred, as there is a practical limit to how long required inspection, maintenance, or repair work can be delayed. He believes some activity will need to resume in the back half of 2026, though the exact timing is dependent on macro factors like refining utilization and the conflict's resolution. Q: You referenced that Q2 saw new growth partially offsetting pressure from refining customers. Can you comment on the growth in new markets and which is the most target-rich in the near term?A: Gary Hill, CEO, identified growth in LNG, aerospace, commercial nuclear power, and pulp and paper markets, all showing more than 10% year-on-year growth, with expectations for higher growth in the second half of 2026. He highlighted that these markets have high growth potential and Team is well-positioned to increase its wallet share. As part of the transformation, the sales organization will be more structured and focused on these new markets, including cross-selling and technical sales expertise. He emphasized that customers want Team's services because of their safe, reliable, and technically superior performance. Q: Turning to cash flow, can you comment on how you expect to drive cash flow improvement?A: Clinton Roeder, CFO, identified the order-to-cash improvement project as a key priority in his financial assessment. The focus is on improving working capital by optimizing inventory levels and reducing invoicing timelines to lower overall accounts receivable. He confirmed the targeted $5 million to $10 million cash flow improvement is expected to be realized by the end of the year, driving higher liquidity. Q: What were the primary drivers of the soft second-quarter results, and how does this impact the full-year outlook?A: Gary Hill, CEO, explained that the second-quarter results were driven largely by the timing of customer turnaround, outage, and maintenance activity, particularly within mechanical services. Customers extended operating runs to take advantage of favorable refining economics, shifting planned projects out of the quarter. This resulted in lower turnaround activity and a less favorable revenue mix, compressing margins. Clinton Roeder, CFO, added that they are reaffirming the full-year 2026 guidance for revenue of $920 million to $945 million, gross profit of $240 million to $260 million, and adjusted EBITDA of $68 million to $73 million, but expect results to come in towards the lower half of the ranges given the uncertainty of timing regarding the rebound in deferred activity. Q: What are the key areas of focus in the transformation plan, and what actions have been taken so far?A: Gary Hill, CEO, outlined a plan centered on three areas: leadership and accountability, commercial execution, and operational efficiency. He noted the strengthening of the leadership team with a new COO, CHRO, and SVP of Operational Excellence. On commercial execution, the focus is on improving pipeline management, estimating, quoting, and account ownership, with an emphasis on profitable growth and pricing discipline. For operational efficiency, the company is reviewing its global facility footprint, procurement, fleet, and overhead costs, with a focus on labor utilization and better coordination between service lines. He stated that some actions are complete, while others are underway or expected to be implemented over the balance of the year. Q: Can you provide more detail on the performance of the Inspection and Heat Treating segment versus Mechanical Services?A: Clinton Roeder, CFO, reported that Inspection and Heat Treating revenue was $131 million, a 5% decrease year-over-year, largely due to a $5 million drop in the US and a $2.6 million reduction in Canada, both from reduced turnaround activities. Mechanical Services revenue was $97 million, an 11% decrease year-over-year, reflecting the deferral of planned turnaround and maintenance activity. He noted that turnaround revenues are down a little more than 50% versus the prior year, but the activity tied to these revenues cannot be foregone and is expected to be captured in later periods. Q: What is the expected benefit and timing of the structural cost improvement program?A: Clinton Roeder, CFO, stated that the company has identified approximately $20 million to $35 million of annualized savings and productivity benefits across facility footprint, fleet, procurement, organizational structure, and operating processes. These initiatives are expected to support future cash flow generation in the range of $5 million to $15 million this year. He expects approximately $8 million to $15 million of benefit during the second half of 2026, with the full annualized run rate achieved by 2027. The one-time implementation costs are estimated at $5 million to For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Company establishes structural cost reduction targets, further refines transformational pillars SUGAR LAND, Texas, Aug. 10, 2026 (GLOBE NEWSWIRE) -- Team, Inc. (NYSE: TISI) (“TEAM” or the “Company”), a global, leading provider of specialty industrial services offering customers access to a full suite of conventional, specialized, and proprietary inspection, heat-treating, and mechanical services, today reported its financial results for the quarter ended June 30, 2026. The Company also provided guidance for the full year 2026. Second Quarter 2026 Highlights: Reported revenue of $228.7 million, compared to $248.0 million in the second quarter of 2025. Generated gross margin of $54.4 million, compared to $68.1 million in the second quarter of 2025. Reported a net loss of $6.8 million, compared to a net loss of $4.3 million in the prior-year period. Delivered Adjusted EBITDA1 of $12.8 million (5.6% of consolidated revenue), compared to $24.5 million (9.9% of consolidated revenue) in the second quarter of 2025. Reduced Adjusted Selling, General and Administrative Expense¹ by $2.1 million, or 4.5%, to $44.7 million from the prior year period. Provided guidance for the full year 2026, which includes substantive increases at the midpoint of approximately 4%, 8% and 16% in revenues, gross margin and Adjusted EBITDA1, respectively, over 2025 results. 1 See the accompanying reconciliation of non-GAAP financial measures at the end of this earnings release. “In the second quarter, we continued to advance the key pillars of TEAM’s operational and commercial transformation as we position the business for stronger, more consistent performance and sustainable long-term value creation,” said Gary L. Hill, TEAM’s Chief Executive Officer. “Over the past several months, we have strengthened the leadership team, advanced initiatives on the ground to improve operational efficiency and execution, and continued to broaden our commercial focus. Alongside these actions, we are sharpening our commercial focus and extending our specialized capabilities into a more diversified set of high-value industrial end markets. Together we expect these steps to improve our margins, support stronger performance in the second half, and strengthen TEAM's underlying earnings power and cash flow generation over time. These actions are building a stronger foundation for profitable growth and improved cash generation.” Hill continued, “Second-quarter results reflected the deferral of planned turnaround and maintenance activity across our core oil and gas, and petrochemicals markets, down 51% year-to-date through June as customers extended operating runs to capitalize on favorable crack spreads and margins. Further, we faced interim weakness in our business centered geographically in the Middle East, which was more directly impacted by the ongoing conflict. While TEAM’s overall revenue base remained resilient, particularly in our Inspection and Heat-Treating segment, where we have seen encouraging growth from other markets, the lower overall level of turnaround activity resulted in a less favorable mix of sales, temporarily pressuring margins and Adjusted EBITDA. We expect a portion of this deferred Mechanical Services activity to begin returning during the second half of 2026, although the precise timing remains dependent on customer operating decisions. While creating top-line softness in the short term, we believe this dynamic will actually create additional strength and tailwinds to both segments in subsequent quarters.” Hill concluded, “In the meantime, we remain focused on the areas within our control. We have established a clear goal for our structural cost improvement program in full-year 2026 which we expect to range between $8 – $15 million, with a goal of $20 – $35 million at full annual run-rate. Further, we continue to advance commercial and productivity initiatives across the organization, which we believe will flow through to structurally stronger margins, and profitability. Together with the expansion of our leading capabilities into a more diversified set of high-value industrial end markets, these actions are intended to support improved performance through the second half and strengthen TEAM’s underlying earnings power and cash-flow generation over time.” Financial Results Second quarter revenue was $228.7 million, compared to $248.0 million in the prior-year period, reflecting revenue changes of 6.7% in the United States, 21.4% in Canada and 4.1% in our other international markets. Second quarter consolidated gross margin was $54.4 million, or 23.8% of revenue. Selling, general and administrative expenses for the second quarter were $46.8 million, decreased by $3.8 million or 7.6% from the second quarter of 2025. Adjusted Selling, General, and Administrative Expense, which excludes expenses not representative of TEAM’s ongoing operations such as non-recurring professional, legal, financing and severance expenses, and non-cash expenses such as share-based compensation expense, decreased by $2.1 million, or 4.5%, to $44.7 million compared to the prior-year period. Operating income was $2.2 million, compared to $12.1 million in the second quarter of 2025. Net loss was $6.8 million, compared to the net loss of $4.3 million in the prior-year period. Net loss attributable to common shareholders, which includes dividends and accretion related to the preferred shares, totaled $9.8 million, or $2.15 per share as compared to a net loss of $4.3 million, or $0.95 per share, in the second quarter of 2025. Adjusted EBITDA, a non-GAAP measure, was $12.8 million (5.6% of consolidated revenue), compared to $24.5 million (9.9% of consolidated revenue) in the prior-year quarter. Adjusted net loss, Adjusted EBIT, Adjusted EBITDA and Adjusted Selling, General and Administrative Expense are non-GAAP financial measures that exclude certain items that are not indicative of TEAM’s core operating activities. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is at the end of this earnings release. Segment Results The following table illustrates the composition of the Company’s revenue and operating income (loss) by segment for the three months ended June 30, 2026 and 2025 (in thousands): 1 During the current period, Emission Control Services were reclassified from the MS segment to the IHT segment to better align with how management evaluates performance. Prior period segment information (revenues, operating, and depreciation and amortization expense) was recast to reflect this change, which did not impact the Company’s consolidated revenue or adjusted EBITDA. For the three months ended June 30, 2025, this resulted in a decrease of $7.8 million in revenue and $2.2 million in operating income for the MS segment, with corresponding increases in the IHT segment. Revenues. IHT revenues decreased by $6.9 million, or 5.0%, compared to the prior-year quarter. This decrease was largely attributable to a $5.0 million drop in the U.S. and a $2.6 million reduction in Canada, both due to reduced turnaround activities in those regions. This was partially offset by an increase of approximately $0.7 million in other international markets. MS revenues also decreased by $12.4 million, or 11.3%, compared to the prior year period, reflecting lower turnaround and project activities across all operating regions. Operating income (loss). In the second quarter of 2026, IHT reported operating income of $13.3 million, down from $18.0 million in the prior-year period, with the decline primarily reflecting unfavorable project mix impacting margins as well as increased benefits costs. MS operating income was $2.3 million, compared to $8.0 million in the prior-year period, primarily due to reduced activity levels across the segment’s operating regions. The decrease in operating income was further driven by unfavorable project mix, impacting margins and higher benefit costs. Corporate and shared support services costs were lower by $0.3 million, or 2.5%, driven by lower legal and professional services costs, partially offset by higher personnel, costs including severance charges, and increased non-cash share-based compensation costs in the current period. In aggregate, consolidated operating income declined by $9.9 million, driven by the combination of factors outlined above. The following table illustrates the composition of the Company’s revenue and operating income (loss) by segment for the six months ended June 30, 2026 and 2025 (in thousands): 1 During the current period, Emission Control Services were reclassified from the MS segment to the IHT segment to better align with how management evaluates performance. Prior period segment information (revenues, operating, and depreciation and amortization expense) was recast to reflect this change, which did not impact the Company’s consolidated revenue or adjusted EBITDA. For the six months ended June 30, 2025, this resulted in a decrease of $15.2 million in revenue and $4.2 million in operating income for the MS segment, with corresponding increases in the IHT segment. Revenues. IHT revenues increased by $2.8 million, or 1.1%, relative to the prior-year period, driven by growth of $1.4 million, or 0.7%, improvement in the U.S. due to stronger turnaround services and capital project activities experienced in the first quarter. Additionally, other international markets contributed a $1.8 million, or 30.0%, increase. These increases were partially offset by a $0.4 million decrease in Canada. MS revenues decreased by $5.8 million, or 3.0%, compared to the same prior-year period, driven primarily by a slowdown in turnaround and project activities across the segment’s operating regions. Operating income (loss). IHT’s 2026 operating income totaled $24.3 million, compared to $28.7 million in the prior-year period, reflecting a decrease of $4.4 million, or 15.5%, in comparison to the prior year period, driven by unfavorable project mix impacting margins and higher benefit costs. MS operating income was $0.8 million, compared to $4.8 million in the same prior-year period, largely reflecting the impact of reduced revenue across the segment, as well as unfavorable project mix impacting margins and higher benefit costs. Corporate and shared support services costs declined by $1.1 million, or 4.1%, primarily due to lower legal and professional services costs, partially offset by higher personnel costs including severance charges and increased non-cash share-based compensation costs in the current period. As a result, these factors resulted in the Company reporting a consolidated operating loss of $1.2 million for the period. Balance Sheet and Liquidity At June 30, 2026, the Company had total liquidity of $51.2 million, including $22.3 million of cash and cash equivalents (excluding $3.7 million of restricted cash) and $28.9 million of available capacity under the ABL Credit Facility. The Company’s total debt as of June 30, 2026 was $326.3 million as compared to $297.2 million as of fiscal year end 2025. The increase is primarily due to the higher net borrowings under our ABL credit facility. The Company’s net debt (total debt less cash and cash equivalents, including restricted cash of $3.7 million), a non-GAAP financial measure, was $300.3 million at June 30, 2026. 2026 Outlook For fiscal year 2026, the Company has provided the following operating and cash flow guidance: Total Company Revenue of $920 million to $945 million, an increase of approximately 4% at the midpoint of guidance compared to 2025; Gross Margin of between $240 million and $260 million, an increase of approximately 8% at the midpoint of guidance compared to 2025; Adjusted EBITDA of between $68 million and $73 million, an increase of approximately 16% at the midpoint of guidance compared to 2025; Capital expenditures of between $13 million to $14 million; Structural cost improvements of $8 million to $15 million; Clinton Roeder, Chief Financial Officer commented, “Our year-to-date results have remained resilient in the face of the transient softness to our top-line, driven by the deferred turnaround and maintenance activity in our core markets. While we expect to recapture these revenues in subsequent quarters, the associated timing remains hard to accurately predict. We are balancing the impact of the softer top-line with our structural cost improvement program to protect underlying profitability. Further, we are sharpening our commercial focus and extending our specialized capabilities into a more diversified set of high-value industrial end markets. Combined, these initiatives are expected to drive $8 million to $15 million of improvement, and $20 million to $35 million at full annual run-rate. We are maintaining our full year 2026 guidance, but are expecting results to come in towards the bottom half of our established guidance ranges until there is increased visibility on deferred turnaround and maintenance activity.” Conference Call As previously announced, the Company will hold a conference call to discuss its second quarter 2026 financial and operating results on Tuesday, August 11, 2026, at 8:00 a.m. Central Time (9:00 a.m. Eastern Time). Interested parties in the United States may participate toll-free by dialing (877) 270-2148. Interested parties internationally may dial (412) 902-6510. Participants should ask to join “TEAM, Inc. Second Quarter 2026 Conference Call.” This call will also be webcast on TEAM’s website at www.teaminc.com. An audio replay will be available on the Company’s website following the call. Non-GAAP Financial Measures The non-GAAP measures in this earnings release are provided to enable investors, analysts and management to evaluate TEAM’s performance excluding the effects of certain items that management believes impact the comparability of operating results between reporting periods. These measures should be used in addition to, and not in lieu of, results prepared in conformity with generally accepted accounting principles (“GAAP”). A reconciliation of each of the non-GAAP financial measures to the most directly comparable historical GAAP financial measure is contained in the accompanying schedule for each of the fiscal periods indicated. About Team, Inc. Headquartered in Sugar Land, Texas, Team, Inc. (NYSE: TISI) is a global, leading provider of specialty industrial services offering customers access to a full suite of conventional, specialized, and proprietary inspection, heat-treating, and mechanical services. We deploy conventional to highly specialized inspection, condition assessment, maintenance, and repair services that result in greater safety, reliability, and operational efficiency for our customers’ most critical assets. Through locations in 13 countries, we unite the delivery of technological innovation with over a century of progressive, yet proven integrity and reliability management expertise to fuel a better tomorrow. For more information, please visit www.teaminc.com. Certain forward-looking information contained herein is being provided in accordance with the provisions of the Private Securities Litigation Reform Act of 1995. We have made reasonable efforts to ensure that the information, assumptions, and beliefs upon which this forward-looking information is based are current, reasonable, and complete. However, such forward-looking statements involve estimates, assumptions, judgments, and uncertainties. They include but are not limited to statements regarding the Company’s financial and growth prospects and strategy, including the implementation of cost-saving measures. There are known and unknown factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking information. Although it is not possible to identify all of these factors, they include, among others: the Company’s ability to generate sufficient cash from operations, access its credit facilities, or maintain its compliance with covenants under its credit agreements, and its preferred stock certificate of designation; negative market conditions, including domestic and global inflationary pressures, the impact of changes in global trade policies and tariffs, and future economic uncertainties, particularly in industries in which the Company is heavily dependent; the Company’s liquidity and ability to obtain additional financing; the impact of new or changes to existing governmental laws and regulations and their application, including tariffs; the outcome of tax examinations, changes in tax laws, and other tax matters; foreign currency exchange rate and interest rate fluctuations; the Company’s ability to repay, refinance or restructure its debt and the debt of certain of its subsidiaries; anticipated or expected purchases or sales of assets; the Company’s ability to maintain compliance with the New York Stock Exchange continued listing requirements and rules, and such known factors as are detailed in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, each as filed with the Securities and Exchange Commission, and in other reports filed by the Company with the Securities and Exchange Commission from time to time. Accordingly, there can be no assurance that the forward-looking information contained herein, including statements regarding the Company’s financial prospects and the implementation of cost-saving measures, will occur or that objectives will be achieved. We assume no obligation to publicly update or revise any forward-looking statements made today or any other forward-looking statements made by the Company, whether as a result of new information, future events or otherwise, except as may be required by law. Contact:Alpha IR GroupNick Teves or Joseph Caminiti(312) 445-2870 ___________________1  As noted within the Segments results above, revenues, operating, and depreciation and amortization expense attributable to Emission Control Services were reclassified from the MS segment to the IHT segment. 2  See the accompanying reconciliation of non-GAAP financial measures at the end of this earnings release. TEAM, INC. AND SUBSIDIARIESNon-GAAP Financial Measures(Unaudited) The Company uses supplemental non-GAAP financial measures, which are derived from consolidated financial information, including adjusted net income (loss); adjusted net income (loss) per share; earnings before interest and taxes (“EBIT”); Adjusted EBIT (defined below); adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”), free cash flow and net debt to supplement financial information presented on a GAAP basis. The Company defines adjusted net income (loss) and adjusted net income (loss) per share to exclude the following items: non-routine legal costs and settlements, non-routine professional fees, (gain) loss on debt extinguishment, certain severance charges, non-routine write off of assets, and certain other items that we believe are not indicative of core operating activities. Consolidated Adjusted EBIT, as defined by us, excludes the costs excluded from adjusted net income (loss), as well as income tax expense (benefit), interest charges, foreign currency (gain) loss, pension credit, and items of other (income) expense. Consolidated Adjusted EBITDA further excludes depreciation, amortization and non-cash share-based compensation costs from consolidated Adjusted EBIT. Segment Adjusted EBIT is equal to segment operating income (loss) excluding costs associated with non-routine legal costs and settlements, non-routine professional fees, certain severance charges, and certain other items as determined by management. Segment Adjusted EBITDA further excludes depreciation, amortization, and non-cash share-based compensation costs from segment Adjusted EBIT. Adjusted Selling, General and Administrative Expense is defined to exclude non-routine legal costs and settlements, non-routine professional fees, certain severance charges, certain other items that we believe are not indicative of core operating activities and non-cash compensation. Free Cash Flow is defined as net cash provided by (used in) operating activities minus capital expenditures paid in cash. Net debt is defined as the sum of the current and long-term portions of debt, including finance lease obligations, less cash and cash equivalents. Management believes these non-GAAP financial measures are useful to both management and investors in their analysis of our financial position and results of operations. In particular, adjusted net income (loss), adjusted net income (loss) per share, consolidated Adjusted EBIT, and consolidated Adjusted EBITDA are meaningful measures of performance which are commonly used by industry analysts, investors, lenders, and rating agencies to analyze operating performance in our industry, perform analytical comparisons, benchmark performance between periods, and measure our performance against externally communicated targets. Our Segment Adjusted EBITDA is also used as a basis for the Chief Operating Decision Maker (Chief Executive Officer) to evaluate the performance of our reportable segments. Free cash flow is used by our management and investors to analyze our ability to service and repay debt and return value directly to stakeholders. Non-GAAP measures have important limitations as analytical tools, because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures and should be read only in conjunction with financial information presented on a GAAP basis. Further, our non-GAAP financial measures may not be comparable to similarly titled measures of other companies who may calculate non-GAAP financial measures differently, limiting the usefulness of those measures for comparative purposes. The liquidity measure of free cash flow does not represent a precise calculation of residual cash flow available for discretionary expenditures. Reconciliations of each non-GAAP financial measure to its most directly comparable GAAP financial measure are presented below. ____________________________________ 1 For the three and six months ended June 30, 2026, professional fees and other included $0.7 million and $2.3 million, respectively, related to executive search and third party support costs. For the three and six months ended June 30, 2025, professional fees and other included $2.3 million and $3.0 million, respectively, related to executive search and third party support costs, and for the six months ended June 30, 2025, professional fees and other included $1.3 million related to debt financing. 2 For the three and six months ended June 30, 2026, severance charges included $0.6 million and $2.1 million related to customary severance costs associated with executive departures. 3 Represents pension cost (credit) for the U.K. pension plan based on the difference between the expected return on plan assets and the amount of the discounted pension liability. The pension plan was frozen in 1994 and no new participants have been added since that date. ___________________ 1 For the three and six months ended June 30, 2026, professional fees and other included $0.7 million and $2.3 million, respectively, related to executive search and third party support costs. For the three and six months ended June 30, 2025, professional fees and other included $2.3 million and $3.0 million, respectively, related to executive search and third party support costs, and for the six months ended June 30, 2025, professional fees and other included $1.3 million related to debt financing. 2 For the three and six months ended June 30, 2026, severance charges included $0.6 million and $2.1 million related to customary severance costs associated with executive departures. 3 Represents pension cost (credit) for the U.K. pension plan based on the difference between the expected return on plan assets and the amount of the discounted pension liability. The pension plan was frozen in 1994 and no new participants have been added since that date.4  As noted within the Segments results above, revenues, and operating and depreciation expense attributable to Emission Control Services were reclassified from the MS segment to the IHT segment. ___________________ 1 For the three and six months ended June 30, 2026, professional fees and other included $0.7 million and $2.3 million, respectively, related to executive search and third party support costs. For the three and six months ended June 30, 2025, professional fees and other included $2.3 million and $3.0 million, respectively, related to executive search and third party support costs, and for the six months ended June 30, 2025, professional fees and other included $1.3 million related to debt financing. 2 For the three and six months ended June 30, 2026, severance charges included $0.6 million and $2.1 million related to customary severance costs associated with executive departures.

This article first appeared on GuruFocus. Release Date: May 14, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Team Inc (NYSE:TISI) reported a significant 8.3% year-over-year increase in revenue for Q1 2026, reaching $215 million, marking the highest Q1 revenue since 2019. The company achieved a 45.2% increase in adjusted EBITDA to $7.7 million, with a 90 basis point improvement in adjusted EBITDA margin. Team Inc (NYSE:TISI) has a strategic vision focused on enhancing employee retention through initiatives like a hire-to-retire career path program and comprehensive benefits. The company is positioned to capitalize on growth opportunities in LNG, midstream, data centers, power, and aerospace, with strong tailwinds in these markets. Team Inc (NYSE:TISI) is prioritizing margin-accretive growth and cost efficiency, aiming to improve operating leverage and expand margins through strategic initiatives. The Middle East conflict is causing some knock-off effects in the oil and gas industry, impacting refining run times and delaying turnaround scopes. Despite improvements, Team Inc (NYSE:TISI) acknowledges the need for further cost optimization, particularly in supply chain integration and process simplification. The company faces challenges in maintaining consistent growth amidst cyclical market conditions and is focusing on less cyclical, sustainable growth opportunities. Team Inc (NYSE:TISI) is still working on strengthening its capital structure and balance sheet, indicating ongoing financial restructuring needs. There is a need for strategic additions to the leadership team to enhance capabilities and accountability, suggesting current leadership may not fully meet the company's evolving needs. Warning! GuruFocus has detected 5 Warning Signs with TISI. Is TISI fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide more details on the revenue growth drivers for the first quarter of 2026? A: Gary Hill, CEO, explained that the 8.3% year-over-year revenue growth to $215 million was driven by robust performance in both the inspection and heat treating and mechanical service segments. This was the highest Q1 revenue since 2019, indicating strong operational execution and market demand. Q: What are the strategic priorities for Team Inc. in 2026? A: Gary Hill, CEO, outlined the strategic priorities focusing on people, efficiency, leadership, and commercial results. The company aims to deepen its commitment to its workforce, improve cost efficiency, and expand market share in targeted growth markets such as LNG, midstream, data centers, power, and aerospace. Q: How is Team Inc. addressing cost efficiency and margin improvement? A: Nelson Haight, CFO, highlighted that the company has made meaningful progress in cost optimization and is focusing on further improvements, particularly in supply chains and process simplification. This is expected to enhance scalability and expand margins, contributing to improved operating leverage and adjusted EBITDA growth. Q: What is the outlook for Team Inc.'s financial performance in 2026? A: Gary Hill, CEO, provided guidance for 2026, expecting full-year revenue growth of about 4% at the midpoint, with revenue between $920 million and $945 million. The company also forecasts an 8% increase in gross margin and a 16% increase in adjusted EBITDA, driven by top-line growth and margin expansion. Q: How is Team Inc. planning to enhance its workforce engagement and retention? A: Gary Hill, CEO, emphasized the importance of the workforce and mentioned initiatives like the hire-to-retire career path program and annual satisfaction surveys. These efforts aim to improve retention rates and make Team Inc. the employer of choice by investing in employee health, wellness, and open communication. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

SUGAR LAND, Texas, May 13, 2026 (GLOBE NEWSWIRE) -- Team, Inc. (NYSE: TISI) (“TEAM” or the “Company”), a global, leading provider of specialty industrial services offering customers access to a full suite of conventional, specialized, and proprietary inspection, heat-treating, and mechanical services, today reported its financial results for the quarter ended March 31, 2026. The Company also provided guidance for the full year 2026. First Quarter 2026 Highlights: Grew revenue to $215.1 million, up $16.4 million, or 8.3%, over the first quarter of 2025. Generated gross margin of $50.2 million, up $2.9 million, or 6.1%, over the first quarter of 2025. Reported a net loss of $11.3 million, an improvement of $18.4 million over the prior year period. Increased Adjusted EBITDA1 to $7.7 million (3.6% of consolidated revenue), up 45.2% from $5.3 million (2.7% of consolidated revenue) in the 2025 first quarter. Adjusted Selling, General and Administrative Expense1 improved to 21.2% of consolidated revenue compared to 22.7% in prior year period. Provided guidance for the full year 2026, which includes substantive increases at the midpoint of approximately 4%, 8% and 16% in revenues, gross margin and Adjusted EBITDA1, respectively, over 2025 results. 1 See the accompanying reconciliation of non-GAAP financial measures at the end of this earnings release. “We delivered a solid start to 2026, with first-quarter revenues rising 8.3% year-over-year to $215.1 million — our highest Q1 revenue since 2019. This growth was driven by robust performance across both our Inspection & Heat-Treating and Mechanical Services segments,” said Gary L. Hill, TEAM’s Chief Executive Officer. “Our Inspection & Heat-Treating segment grew 8.6%, or $9.8 million, boosted by increased project and callout activity in the U.S. and Canada. Mechanical Services revenue increased 7.8%, supported by higher project and turnaround activity with both new and existing customers. These results drove meaningful profitability gains, including a 45.2% increase in Adjusted EBITDA to $7.7 million and a 90-basis point improvement in Adjusted EBITDA margin.” “In my first 100 days as CEO, I’ve been deeply impressed by the talent, technical expertise, and customer focus across the organization, and I’ve seen firsthand the value we deliver to our customers through best-in-class service, quality and safety. Building on the momentum we established in 2025, I am focused on accelerating that pace of improvement by sharpening our commercial execution, strengthening the team with targeted talent additions, and accelerating cost efficiency initiatives, and I will share more details around our go forward plan in the second quarter call. With a focus on gross margin improvement, we have already taken meaningful actions in the first quarter and see further opportunities in the second half of 2026. We expect these initiatives to further strengthen our cash flow and financial position,” commented Hill. “Looking ahead, we expect a healthy second quarter, and anticipate stronger performance in the second half of the year, driven by continued strength in the U.S. coupled with further improvement in Canada and other international markets, along with further margin expansion across both segments. For the full year, we are guiding to revenue of $920 million and $945 million and Adjusted EBITDA of between $68 million and $73 million – representing approximately 16% growth at the midpoint versus 2025. I am excited about TEAM’s potential and remain confident in our ability to deliver profitable top-line growth, expand margins, and generate stronger cash flow. These results reflect the underlying strength of our franchise and our clear path forward,” concluded Hill. Financial Results First quarter revenues reached $215.1 million, an increase of $16.4 million, or 8.3%, compared to the prior year period, driven by increases of 5.7% in the United States, 35.6% in Canada and 10.7% in our other international markets. First quarter consolidated gross margin was $50.2 million, or 23.3% of revenue. Selling, general and administrative expenses for the first quarter were $48.1 million, essentially flat versus the 2025 first quarter. Adjusted Selling, General, and Administrative Expense, which excludes expenses not representative of TEAM’s ongoing operations such as non-recurring professional, legal, financing and severance expenses, and non-cash expenses such as share-based compensation expense, represented 21.2% of consolidated revenue, a 150-basis point improvement over 22.7% for the prior year period. Operating loss was $3.4 million, a $2.6 million improvement over the 2025 period. Net loss was $11.3 million, an improvement of $18.4 million versus the net loss of $29.7 million in the 2025 first quarter. Net loss attributable to common shareholders, which includes dividends and accretion related to the preferred shares, totaled $14.2 million and $3.12 per share as compared to a net loss of $29.7 million and $6.61 per share in the 2025 first quarter. Adjusted EBITDA, a non-GAAP measure, was $7.7 million (3.6% of consolidated revenue), an improvement of $2.4 million versus $5.3 million (2.7% of consolidated revenue) in the prior year quarter. Adjusted net loss, Adjusted EBIT, Adjusted EBITDA and Adjusted Selling, General and Administrative Expense are non-GAAP financial measures that exclude certain items that are not indicative of TEAM’s core operating activities. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is at the end of this earnings release. Segment Results The following table illustrates the composition of the Company’s revenue and operating income (loss) by segment for the quarter ended March 31, 2026 and 2025 (in thousands): 1 During the current period, Emission Control Services were reclassified from the MS segment to the IHT segment to better align with how management evaluates performance. Prior period segment information (revenues, and operating and depreciation expense) was recast to reflect this change, which did not impact the Company’s consolidated revenue or adjusted EBITDA. For the three months ended March 31, 2025, this resulted in a decrease of $7.4 million in revenue and $2.0 million in operating income for the MS segment, with corresponding increases in the IHT segment. Revenues. IHT revenues increased by $9.8 million, or 8.6%, compared to the prior year quarter, with revenue growth of $6.5 million, or 6.3%, in the U.S. driven by higher activity in turnaround services and capital projects. Revenues from Canada and other international markets also contributed to the segment’s growth, increasing by $2.2 million and $1.1 million, respectively. MS revenues increased by $6.6 million, or 7.8%, versus the prior year period, primarily due to the increased turnaround and callout activity in the U.S. and higher project revenue in Canada and other international markets. Operating income (loss). IHT’s first quarter 2026 operating income was $10.9 million, up 1.7% versus the prior year period. MS operating loss improved by approximately $1.7 million compared to the prior year period, mainly due to stronger revenue in both the U.S. and Canada. Corporate and shared support services costs were lower by $0.8 million or 5.8%, mainly due to lower legal and professional services costs. Consolidated operating loss improved by $2.6 million driven by the factors discussed above. Balance Sheet and Liquidity At March 31, 2026, the Company had $49.2 million of total liquidity, consisting of consolidated cash and cash equivalents of $8.7 million, (excluding $4.1 million of restricted cash) and $40.5 million of undrawn availability consisting of $30.5 million available under the Revolving Credit Loans and $10.0 million available under the Second Lien Delayed Draw Term Loans that expired on April 15, 2026. The Company’s total debt as of March 31, 2026 was $306.5 million as compared to $297.2 million as of fiscal year end 2025. The increase is primarily due to the higher net borrowings under our ABL credit facility. The Company’s net debt (total debt less cash and cash equivalents), a non-GAAP financial measure, was $293.7 million at March 31, 2026. 2026 Outlook For fiscal year 2026, the Company has provided the following operating and cash flow guidance: Total Company Revenue of $920 million to $945 million, an increase of approximately 4% at the midpoint of guidance compared to 2025; Gross Margin of between $240 million and $260 million, an increase of approximately 8% at the midpoint of guidance compared to 2025; Adjusted EBITDA of between $68 million and $73 million, an increase of approximately 16% at the midpoint of guidance compared to 2025; Capital expenditures of between $13 million to $14 million. Conference Call As previously announced, the Company will hold a conference call to discuss its first quarter 2026 financial and operating results on Thursday, May 14, 2026, at 10:00 a.m. Central Time (11:00 a.m. Eastern Time). Interested parties in the United States may participate toll-free by dialing (877) 270-2148. Interested parties internationally may dial (412) 902-6510. Participants should ask to join “TEAM, Inc. First Quarter 2026 Conference Call.” The Company will not host questions during the call. This call will also be webcast on TEAM’s website at www.teaminc.com. An audio replay will be available on the Company’s website following the call. Non-GAAP Financial Measures The non-GAAP measures in this earnings release are provided to enable investors, analysts and management to evaluate TEAM’s performance excluding the effects of certain items that management believes impact the comparability of operating results between reporting periods. These measures should be used in addition to, and not in lieu of, results prepared in conformity with generally accepted accounting principles (“GAAP”). A reconciliation of each of the non-GAAP financial measures to the most directly comparable historical GAAP financial measure is contained in the accompanying schedule for each of the fiscal periods indicated. About Team, Inc. Headquartered in Sugar Land, Texas, Team, Inc. (NYSE: TISI) is a global, leading provider of specialty industrial services offering customers access to a full suite of conventional, specialized, and proprietary inspection, heat-treating, and mechanical services. We deploy conventional to highly specialized inspection, condition assessment, maintenance, and repair services that result in greater safety, reliability, and operational efficiency for our customers’ most critical assets. Through locations in 13 countries, we unite the delivery of technological innovation with over a century of progressive, yet proven integrity and reliability management expertise to fuel a better tomorrow. For more information, please visit www.teaminc.com. Certain forward-looking information contained herein is being provided in accordance with the provisions of the Private Securities Litigation Reform Act of 1995. We have made reasonable efforts to ensure that the information, assumptions, and beliefs upon which this forward-looking information is based are current, reasonable, and complete. However, such forward-looking statements involve estimates, assumptions, judgments, and uncertainties. They include but are not limited to statements regarding the Company’s financial and growth prospects and strategy, including the implementation of cost-saving measures. There are known and unknown factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking information. Although it is not possible to identify all of these factors, they include, among others: the Company’s ability to generate sufficient cash from operations, access its credit facilities, or maintain its compliance with covenants under its credit agreements, and its preferred stock certificate of designation; negative market conditions, including domestic and global inflationary pressures, the impact of changes in global trade policies and tariffs, and future economic uncertainties, particularly in industries in which the Company is heavily dependent; the Company’s liquidity and ability to obtain additional financing; the impact of new or changes to existing governmental laws and regulations and their application, including tariffs; the outcome of tax examinations, changes in tax laws, and other tax matters; foreign currency exchange rate and interest rate fluctuations; the Company’s ability to repay, refinance or restructure its debt and the debt of certain of its subsidiaries; anticipated or expected purchases or sales of assets; the Company’s ability to maintain compliance with the New York Stock Exchange continued listing requirements and rules, and such known factors as are detailed in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, each as filed with the Securities and Exchange Commission, and in other reports filed by the Company with the Securities and Exchange Commission from time to time. Accordingly, there can be no assurance that the forward-looking information contained herein, including statements regarding the Company’s financial prospects and the implementation of cost-saving measures, will occur or that objectives will be achieved. We assume no obligation to publicly update or revise any forward-looking statements made today or any other forward-looking statements made by the Company, whether as a result of new information, future events or otherwise, except as may be required by law. Contact:Nelson M. HaightExecutive Vice President, Chief Financial Officer(281) 388-5521 TEAM, INC. AND SUBSIDIARIESNon-GAAP Financial Measures(Unaudited) The Company uses supplemental non-GAAP financial measures, which are derived from consolidated financial information, including adjusted net income (loss); adjusted net income (loss) per share; earnings before interest and taxes (“EBIT”); Adjusted EBIT (defined below); adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”), free cash flow and net debt to supplement financial information presented on a GAAP basis. The Company defines adjusted net income (loss) and adjusted net income (loss) per share to exclude the following items: non-routine legal costs and settlements, non-routine professional fees, (gain) loss on debt extinguishment, certain severance charges, non-routine write off of assets, and certain other items that we believe are not indicative of core operating activities. Consolidated Adjusted EBIT, as defined by us, excludes the costs excluded from adjusted net income (loss), as well as income tax expense (benefit), interest charges, foreign currency (gain) loss, pension credit, and items of other (income) expense. Consolidated Adjusted EBITDA further excludes depreciation, amortization and non-cash share-based compensation costs from consolidated Adjusted EBIT. Segment Adjusted EBIT is equal to segment operating income (loss) excluding costs associated with non-routine legal costs and settlements, non-routine professional fees, certain severance charges, and certain other items as determined by management. Segment Adjusted EBITDA further excludes depreciation, amortization, and non-cash share-based compensation costs from segment Adjusted EBIT. Adjusted Selling, General and Administrative Expense is defined to exclude non-routine legal costs and settlements, non-routine professional fees, certain severance charges, certain other items that we believe are not indicative of core operating activities and non-cash compensation. Free Cash Flow is defined as net cash provided by (used in) operating activities minus capital expenditures paid in cash. Net debt is defined as the sum of the current and long-term portions of debt, including finance lease obligations, less cash and cash equivalents. Management believes these non-GAAP financial measures are useful to both management and investors in their analysis of our financial position and results of operations. In particular, adjusted net income (loss), adjusted net income (loss) per share, consolidated Adjusted EBIT, and consolidated Adjusted EBITDA are meaningful measures of performance which are commonly used by industry analysts, investors, lenders, and rating agencies to analyze operating performance in our industry, perform analytical comparisons, benchmark performance between periods, and measure our performance against externally communicated targets. Our segment Adjusted EBITDA is also used as a basis for the Chief Operating Decision Maker (Chief Executive Officer) to evaluate the performance of our reportable segments. Free cash flow is used by our management and investors to analyze our ability to service and repay debt and return value directly to stakeholders. Non-GAAP measures have important limitations as analytical tools, because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures and should be read only in conjunction with financial information presented on a GAAP basis. Further, our non-GAAP financial measures may not be comparable to similarly titled measures of other companies who may calculate non-GAAP financial measures differently, limiting the usefulness of those measures for comparative purposes. The liquidity measure of free cash flow does not represent a precise calculation of residual cash flow available for discretionary expenditures. Reconciliations of each non-GAAP financial measure to its most directly comparable GAAP financial measure are presented below.