MISTRAS Group - 10-Q quarterly report FY2026 Q2

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2026


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __ to __

Commission file number 001-34481

Mistras Group, Inc.

(Exact name of registrant as specified in its charter)


Delaware		22-3341267
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

195 Clarksville Road
Princeton Junction,	New Jersey	08550
(Address of principal executive offices)		(Zip Code)

(609) 716-4000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.01 par value

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

ý Yes o No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

ý Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller

reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ý No

As of August 5, 2026, the registrant had 31,849,893 shares of common stock outstanding.

Table of Contents

TABLE OF CONTENTS


			PAGE
PART I—FINANCIAL INFORMATION

	ITEM 1.	Financial Statements	1

		Unaudited Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025	1

		Unaudited Condensed Consolidated Statements of Income (Loss) for the three and six months ended June 30, 2026 and June 30, 2025	2

		Unaudited Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2026 and June 30, 2025	3

		Unaudited Condensed Consolidated Statements of Equity for the three and six months ended June 30, 2026 and June 30, 2025	4

		Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2026 and June 30, 2025	5

		Notes to Unaudited Condensed Consolidated Financial Statements	6

	ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

	ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	35

	ITEM 4	Controls and Procedures	35

PART II—OTHER INFORMATION

	ITEM 1.	Legal Proceedings	36

	ITEM 1.A.	Risk Factors	36

	ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36

	ITEM 3.	Defaults Upon Senior Securities	36

	ITEM 4.	Mine Safety Disclosures	36

	ITEM 5.	Other Information	36

	ITEM 6.	Exhibits	38

SIGNATURES			39

Table of Contents

PART I—FINANCIAL INFORMATION

ITEM 1. Financial Statements

Mistras Group, Inc. and Subsidiaries

Unaudited Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)


	June 30, 2026		December 31, 2025
ASSETS	(unaudited)
Current Assets
Cash and cash equivalents	$	21,988	$	28,008
Accounts receivable, net	161,759		154,673
Inventories	16,733		14,002

Prepaid expenses and other current assets	18,021		19,509
Total current assets	218,501		216,192
Property, plant and equipment, net	100,241		93,164
Intangible assets, net	38,060		38,407
Goodwill	182,201		184,829
Deferred income taxes	5,641		5,377
Other assets	39,478		40,812
Total assets	$	584,122	$	578,781
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable	$	21,672	$	14,943
Accrued expenses and other current liabilities	84,456		88,026
Current portion of long-term debt	12,829		12,849
Current portion of finance lease obligations	8,136		7,025
Income taxes payable	424		1,465
Total current liabilities	127,517		124,308
Long-term debt, net of current portion	159,264		165,143
Obligations under finance leases, net of current portion	20,109		17,340
Deferred income taxes	2,468		1,264
Other long-term liabilities	34,588		35,081
Total liabilities	343,946		343,136
Commitments and contingencies (Note 13)
Equity
Preferred stock, 10,000,000 shares authorized	—		—
Common stock, $0.01 par value, 200,000,000 shares authorized, 31,853,713 and 31,567,434 shares issued and outstanding	690		499
Additional paid-in capital	258,838		256,863

Accumulated earnings	16,822		6,853
Accumulated other comprehensive loss	(36,387)		(29,111)
Total Mistras Group, Inc. stockholders’ equity	239,963		235,104
Non-controlling interests	213		541
Total equity	240,176		235,645
Total liabilities and equity	$	584,122	$	578,781

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

Table of Contents

Mistras Group, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Income (Loss)

(in thousands, except per share data)


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025

Revenue	$	193,132	$	185,405	$	362,166	$	347,020
Cost of revenue	130,965		125,739		249,782		241,025
Depreciation	5,722		5,721		11,207		11,158
Gross profit	56,445		53,945		101,177		94,837
Selling, general and administrative expenses	38,722		39,793		75,708		75,445


Reorganization and other costs	1,527		2,951		2,002		6,038
Environmental expense	460		518		329		1,058


Research and engineering	243		269		464		568
Depreciation and amortization	2,547		1,986		5,046		4,312


Income from operations	12,946		8,428		17,628		7,416
Other income, net	(1,013)		—		(1,945)		—
Interest expense	4,138		4,239		7,017		7,563
Income (loss) before provision (benefit) for income taxes	9,821		4,189		12,556		(147)
Provision (benefit) for income taxes	2,269		1,063		2,647		(105)
Net income (loss)	7,552		3,126		9,909		(42)
Less: net income (loss) attributable to noncontrolling interests, net of taxes	(29)		109		(60)		127
Net income (loss) attributable to Mistras Group, Inc.	$	7,581	$	3,017	$	9,969	$	(169)

Net income per common share:
Basic	$	0.24	$	0.10	$	0.31	$	—
Diluted	$	0.23	$	0.10	$	0.30	$	—
Weighted-average common shares outstanding:
Basic	31,831		31,439		31,725		31,268
Diluted	32,924		31,693		32,822		31,268

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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Mistras Group, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Comprehensive Income

(in thousands)


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025

Net income (loss)	$	7,552	$	3,126	$	9,909	$	(42)
Other comprehensive income (loss):
Foreign currency translation adjustments	$	(3,495)	$	11,739	$	(7,403)	$	14,212
Comprehensive income (loss)	4,057		14,865		2,506		14,170
Less: net income (loss) attributable to noncontrolling interest	(29)		109		(60)		127
Less: Foreign currency translation adjustments attributable to noncontrolling interests	(127)		(118)		(127)		(127)
Comprehensive income attributable to Mistras Group, Inc.	$	4,213	$	14,874	$	2,693	$	14,170

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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Mistras Group, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Equity

(in thousands)


	Three months ended
	Common stock			Additional paid-in capital		Accumulated earnings (deficit)		Accumulated other comprehensive loss		Total Mistras Group, Inc. stockholders’ equity		Non-controlling interests
	Shares	Amount												Total equity

Balance at March 31, 2026	31,817	$	690	$	256,316	$	9,241	$	(33,019)	$	233,228	$	369	$	233,597
Net income (loss)	—	—		—		7,581		—		7,581		(29)		7,552
Other comprehensive income (loss), net of tax	—	—		—		—		(3,368)		(3,368)		(127)		(3,495)
Share-based payments	—	—		2,552		—		—		2,552		—		2,552
Net settlement of restricted stock units	37	—		(30)		—		—		(30)		—		(30)

Balance at June 30, 2026	31,854	$	690	$	258,838	$	16,822	$	(36,387)	$	239,963	$	213	$	240,176

Balance at March 31, 2025	31,326	$	406	$	251,629	$	(13,170)	$	(40,200)	$	198,665	$	336	$	199,001
Net income	—	—		—		3,017		—		3,017		109		3,126
Other comprehensive income (loss), net of tax	—	—		—		—		11,857		11,857		(118)		11,739
Share-based payments	—	—		2,323		—		—		2,323		—		2,323
Net settlement of restricted stock units	212	59		(73)		—		—		(14)		—		(14)

Balance at June 30, 2025	31,538	$	465	$	253,879	$	(10,153)	$	(28,343)	$	215,848	$	327	$	216,175


	Six months ended
	Common stock			Additional paid-in capital		Accumulated earnings (deficit)		Accumulated other comprehensive loss		Total Mistras Group, Inc. stockholders’ equity		Non-controlling interests
	Shares	Amount												Total equity

Balance at December 31, 2025	31,567	$	499	$	256,863	$	6,853	$	(29,111)	$	235,104	$	541	$	235,645
Net income (loss)	—	—		—		9,969		—		9,969		(60)		9,909
Other comprehensive income (loss), net of tax	—	—		—		—		(7,276)		(7,276)		(127)		(7,403)
Share-based payments	—	—		3,803		—		—		3,803		—		3,803
Distribution to non-controlling interests	—	—		—		—		—		—		(141)		(141)
Net settlement of restricted stock units	287	191		(1,828)		—		—		(1,637)		—		(1,637)

Balance at June 30, 2026	31,854	$	690	$	258,838	$	16,822	$	(36,387)	$	239,963	$	213	$	240,176

Balance at December 31, 2024	31,010	$	402	$	250,832	$	(9,984)	$	(42,682)	$	198,568	$	327	$	198,895
Net income (loss)	—	—		—		(169)		—		(169)		127		(42)
Other comprehensive income (loss), net of tax	—	—		—		—		14,339		14,339		(127)		14,212
Share-based payments	—	—		4,602		—		—		4,602		—		4,602
Net settlement of restricted stock units	528	63		(1,555)		—		—		(1,492)		—		(1,492)

Balance at June 30, 2025	31,538	$	465	$	253,879	$	(10,153)	$	(28,343)	$	215,848	$	327	$	216,175

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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Mistras Group, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Cash Flows

(in thousands)


	Six months ended June 30,
	2026		2025

Cash flows from operating activities
Net income (loss)	$	9,909	$	(42)
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	16,253		15,470

Deferred income taxes	989		(48)
Share-based compensation expense	3,803		4,602
Bad debt provision for troubled customers, net of recoveries	118		553


Foreign currency (gain) loss	(1,945)		3,155

Other	(1,858)		(712)
Changes in operating assets and liabilities, net of effect of acquisitions and dispositions
Accounts receivable	(8,420)		(28,384)
Inventories	(2,869)		(206)
Prepaid expenses and other assets	1,759		(6,306)

Accounts payable	3,443		6,376
Accrued expenses and other liabilities	(2,410)		2,325
Income taxes payable	(1,054)		(402)

Net cash provided by (used in) operating activities	17,718		(3,619)
Cash flows from investing activities
Purchase of property, plant and equipment	(10,730)		(10,002)

Purchase of intangible assets	(3,247)		(2,292)

Proceeds from sale of equipment	2,115		878

Net cash used in investing activities	(11,862)		(11,416)
Cash flows from financing activities
Repayment of finance lease obligations	(3,584)		(3,027)

Repayment of long-term debt	(6,574)		(5,171)
Proceeds from revolver	27,700		47,000
Repayment of revolver	(27,000)		(22,400)


Distribution to non-controlling interests	(141)		—
Taxes paid related to net share settlement of share-based awards	(1,637)		(1,492)


Net cash (used in) provided by financing activities	(11,236)		14,910
Effect of exchange rate changes on cash and cash equivalents	(640)		1,765
Net change in cash and cash equivalents	(6,020)		1,640
Cash and cash equivalents at beginning of period	28,008		18,317
Cash and cash equivalents at end of period	$	21,988	$	19,957
Supplemental disclosure of cash paid
Interest, net	$	5,701	$	6,908
Income taxes, net of refunds	$	2,943	$	6,776
Noncash investing and financing
Equipment acquired through finance lease obligations	$	7,701	$	3,731
Capital expenditures included in accounts payable and accrued liabilities	$	3,377	$	1,362

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

1. Description of Business and Basis of Presentation

Description of Business

Mistras Group, Inc., together with its subsidiaries (the "Company"), is a global leader in technology-enabled industrial asset integrity solutions, serving critical industries including oil & gas, aerospace & defense, power & utilities, manufacturing, and civil infrastructure.

The Company provides a diversified portfolio of products and services, ranging from advanced non-destructive testing ("NDT") and pipeline inspections to real-time condition monitoring, maintenance planning, and specialized engineering, powered by a proprietary management software suite that centralizes integrity data for predictive analytics and benchmark analysis. With a long-standing track record of innovation and deep industry expertise, the Company helps clients reduce risk, extend asset life, and optimize operational performance.

The Company enhances value for its clients by integrating asset protection throughout supply chains and centralizing integrity data through a suite of Industrial Internet of Things ("IoT")-connected digital software and monitoring solutions, including OneSuite™, which serves as an ecosystem platform, pulling together all of the Company’s software and data services capabilities.

The Company’s core capabilities include NDT field inspections enhanced by advanced robotics, laboratory quality control, laboratory materials services, shop laboratory assurance testing, sensing technologies and NDT equipment, asset and mechanical integrity engineering services, and light mechanical maintenance and access services.

The Company has three operating segments. Our segments are as follows:

•North America: This segment provides asset protection solutions predominantly in North America, with the largest concentration in the United States, followed by Canada, consisting primarily of NDT, inspection, mechanical and engineering services that are used to evaluate the safety, structural integrity and reliability of critical energy, industrial and public infrastructure and commercial aerospace components. Software, digital and data services are included in this segment.

•International: This segment offers services, products and systems similar to those of the other segments to select markets within Europe, the Middle East, Africa, Asia and South America, but not to customers in China and South Korea, which are served by the Products and Systems segment.

•Products and Systems: This segment designs, manufactures, sells, installs and services the Company’s asset protection products and systems, including equipment and instrumentation, predominantly in the United States.

Recent Developments

On August 5, 2026, the Company entered into an amendment (the “Amendment”) to its Credit Agreement with the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent. The Amendment extended the maturity date of the revolving credit facility and term loan under the Credit Agreement from July 30, 2027 to July 28, 2028. The terms related to the Amendment are described in Note 15 - Subsequent Events.

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

additional tariffs ranging from 10% to 12.5% on imports from numerous trading partners under Section 301 of the Trade Act of 1974. Accordingly, the ultimate scope, duration and financial impact of U.S. trade measures remain uncertain. Ongoing changes to trade policies and related uncertainty may affect global economic conditions, supply chains and costs, and may reduce trade between the U.S. and impacted countries. Tariffs and trade barriers have not had a material effect on our business or results of operations during 2026 to date. However, new tariffs or other trade measures could result in increased costs for us or our suppliers and could impact the import of materials by our customers, including materials subject to our inspection and testing services, which could adversely affect demand for our services.

Geopolitical tensions in the Middle East, including the conflict involving the U.S. and Iran, have contributed to increased volatility in global energy markets and broader macroeconomic uncertainty. The conflict has increased uncertainty surrounding global energy supplies, international shipping routes and supply chains, contributing to fluctuations in oil and natural gas prices and increased costs for certain materials and transportation. Fluctuations in crude oil and natural gas prices may influence capital spending and maintenance activity by customers in the oil and gas sector, which could affect demand for certain of our services, particularly field inspection and asset integrity solutions. Additionally, continued instability in the Middle East could contribute to supply chain disruptions, changes in foreign currency exchange rates, and delays in customer projects. While we have not experienced material impacts to date, the situation remains dynamic, and we continue to monitor developments and assess potential impacts on our operations, financial condition, and results of operations.

Basis of Presentation

The Unaudited Condensed Consolidated Financial Statements contained in this report have been prepared in conformity with U.S. generally accepted accounting principles ("GAAP") and Securities and Exchange Commission ("SEC") guidance allowing for reduced disclosure for interim periods. In the opinion of management, the Unaudited Condensed Consolidated Financial Statements include all adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the interim periods of the years ending December 31, 2026 and December 31, 2025.

Certain items included in these statements are based on management’s estimates. Actual results may differ from those estimates. The results of operations for any interim period are not necessarily indicative of the results expected for the year. The accompanying Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the notes to the Audited Consolidated Financial Statements contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Annual Report").

Principles of Consolidation

The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of Mistras Group, Inc. as well as its wholly-owned subsidiaries, majority-owned subsidiaries and consolidated variable interest entities (VIE). For consolidated subsidiaries in which the Company’s ownership interest is less than 100%, the non-controlling interests are reported in stockholders’ equity in the accompanying Unaudited Condensed Consolidated Balance Sheets. The non-controlling interests in net results, net of tax, are classified separately in the accompanying Unaudited Condensed Consolidated Statements of Income (Loss). All significant intercompany accounts and transactions have been eliminated in consolidation.

Reclassifications

Certain amounts in prior periods have been reclassified to conform to the current year presentation. Such reclassifications did not affect the Company's consolidated financial condition or results of operations as previously reported.

Significant Accounting Policies

The Company’s significant accounting policies are disclosed in Note 1 – Summary of Significant Accounting Policies and Practices in the 2025 Annual Report. On an ongoing basis, the Company evaluates its estimates and assumptions, including among other things, those related to revenue recognition, long-lived assets, goodwill and acquisitions. Since the date of the 2025 Annual Report, there have been no material changes to the Company’s significant accounting policies.

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

Income Taxes

Income taxes are accounted for under the asset and liability method. We recognize deferred tax assets and liabilities at enacted income tax rates for the temporary differences between the financial reporting bases and the tax bases of our assets and liabilities. Any effects of changes in income tax rates or tax laws are included in the provision for income taxes in the period of enactment. Our net deferred tax assets primarily consist of net operating loss carry forwards, or NOLs. A valuation allowance is provided if it is more likely than not that some or all of a deferred income tax asset will not be realized. A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the current and prior years.

As of June 30, 2026, management concluded that it is more likely than not that a substantial portion of the Company's deferred tax assets will be realized.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution.

The Company’s effective income tax rate was approximately 23.1% and 25.4% for the three months ended June 30, 2026 and 2025, respectively. The Company’s effective income tax rate was approximately 21.1% and 71.4% for the six months ended June 30, 2026 and 2025, respectively.

The effective income tax rate for the three months ended June 30, 2026, was higher than the statutory rate primarily due to limitations on the deductibility of certain compensation expenses. The effective income tax rate for the three months ended June 30, 2025, was higher than the statutory rate primarily due to the impact of an unfavorable discrete item related to stock compensation.

The effective income tax rate for the six months ended June 30, 2026, was higher than the statutory rate primarily due to limitations on the deductibility of certain compensation expenses. The effective income tax rate for the six months ended June 30, 2025, was higher than the statutory rate primarily due to the reversal of valuation allowances.

On July 4, 2025, H.R.1, commonly referred to as the One Big Beautiful Bill Act ("OBBBA"), was enacted, which includes a broad range of tax reform provisions. These tax reform provisions include the extension and modification of certain provisions of the Tax Cuts and Jobs Act and are effective for calendar year 2025. The changes include, but are not limited to, immediate expensing of domestic research and development expenditure, the restoration of 100% bonus depreciation, and an EBITDA-based interest expense limitation. These provisions did not have a material impact on the Company’s financial statements for the three and six months ended June 30, 2026.

Recent Accounting Pronouncements

On November 4, 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures, to require disaggregation of certain expense captions into specified categories in disclosures within the notes of the financial statements. The standard is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027. Early adoption is permitted. The guidance is required to be applied prospectively and amendments in the ASU may be applied prospectively or retrospectively. We are currently evaluating the impacts this standard will have on our disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal Use Software (ASU 2025-06). This standard clarifies capitalization thresholds for software development costs and aligns accounting treatment more closely with the economic substance of modern software development activities. ASU 2025-06 is effective for annual and interim periods beginning after December 15, 2027 on a retrospective, prospective or modified prospective basis. Early adoption is permitted. We are currently evaluating the impact this standard will have on our disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow Scope Improvements (ASU 2025-11). This standard clarifies disclosure requirements and applicability for interim financial statements. This new guidance is effective for the Company for interim periods beginning October 1, 2028. Early adoption is permitted. The amendments in

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

this ASU may be adopted using the prospective or retrospective methods. We are currently evaluating the impact this standard will have on our disclosures.

2. Revenue

The Company derives the majority of its revenue by providing services on a time and materials basis, which are short-term in nature. The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers.

Performance Obligations

The Company provides highly integrated and bundled inspection services to its customers. The majority of the Company's contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts and is, therefore, not distinct. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using the Company's best estimate of the standalone selling price of each distinct good or service in the contract. The primary method used to estimate standalone selling price is a relative selling price based on price lists.

Contract modifications are not routine in the performance of the Company's contracts. Generally, when contracts are modified, the modification is to account for changes in scope to the goods and services that are provided. In most instances, contract modifications are for goods or services that are distinct, and, therefore, are accounted for as a separate contract.

The Company's performance obligations are satisfied over time as work progresses or at a point in time. The majority of the Company's revenue is recognized over time as work progresses for the Company's service deliverables, which includes providing testing, inspection and mechanical services to our customers. Revenue is recognized over time, based on time and material incurred to date which best portrays the transfer of control to the customer. The Company also utilizes an available practical expedient that provides for revenue to be recognized in an amount that corresponds directly with the value to the customer of the Company's performance completed to date. Fixed fee arrangements are determined based on expected labor, material, and overhead to be consumed on fulfillment of such services. For these arrangements, revenue is recognized on a cost-to-cost method tracked on an input basis.

The majority of the Company's revenue recognized at a point in time is related to product sales when the customer obtains control of the asset, which is generally upon shipment to the customer. Contract costs include labor, material and overhead.

The Company expects any significant remaining performance obligations to be satisfied within one year.

Contract Estimates

The majority of the Company's revenues are short-term in nature. The Company enters into master service agreements ("MSA"s) with customers that specify an overall framework and contract terms. The actual contracting to provide services or furnish products are triggered by a work order, purchase order, or some similar document issued pursuant to a MSA which sets forth the scope of services and/or identifies the products to be provided. From time-to-time, the Company may enter into longer-term contracts, which can range from several months to several years. Revenue on certain contracts is recognized as work is performed based on total costs incurred to date in relation to the total estimated costs for the performance of the contract at completion. This includes contract estimates of costs to be incurred for the performance of the contract. Cost estimation is based upon the professional knowledge and experience of the Company's project managers, engineers and financial professionals. Factors that are considered in estimating the work to be completed include the availability of materials, the effect of any delays in the Company's project performance and the recoverability of any claims. Whenever revisions of estimates, contract costs and/or contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period.

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

Revenue by Category

The following series of tables present the Company's disaggregated revenue:

Revenue by industry was as follows:


Three Months Ended June 30, 2026	North America		International		Products & Systems		Corp/Elim		Total
Oil & Gas	$	86,044	$	8,219	$	85	$	—	$	94,348
Aerospace & Defense	19,396		7,603		169		—		27,168
Industrials	12,525		7,447		489		—		20,461
Power Generation & Transmission	12,697		1,652		562		—		14,911
Other Process Industries	6,263		4,093		27		—		10,383
Infrastructure, Research & Engineering	8,946		3,621		1,660		—		14,227
Petrochemical	2,473		1,127		—		—		3,600
Other	8,285		4,248		926		(5,425)		8,034
Total	$	156,629	$	38,010	$	3,918	$	(5,425)	$	193,132


Three Months Ended June 30, 2025	North America		International		Products & Systems		Corp/Elim		Total
Oil & Gas	$	92,634	$	9,943	$	239	$	—	$	102,816
Aerospace & Defense	16,848		7,014		140		—		24,002
Industrials	11,647		7,597		360		—		19,604
Power Generation & Transmission	9,320		2,097		376		—		11,793
Other Process Industries	5,877		5,172		—		—		11,049
Infrastructure, Research & Engineering	3,461		4,020		579		—		8,060
Petrochemical	3,112		1		—		—		3,113
Other	5,093		3,233		1,046		(4,404)		4,968
Total	$	147,992	$	39,077	$	2,740	$	(4,404)	$	185,405

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)


Six Months Ended June 30, 2026	North America		International		Products & Systems		Corp/Elim		Total
Oil & Gas	$	162,928	$	16,713	$	189	$	—	$	179,830
Aerospace & Defense	39,099		15,506		202		—		54,807
Industrials	23,650		14,732		722		—		39,104
Power Generation & Transmission	17,890		2,442		1,104		—		21,436
Other Process Industries	11,484		7,875		39		—		19,398
Infrastructure, Research & Engineering	17,035		7,901		2,579		—		27,515
Petrochemical	5,379		2,057		—		—		7,436
Other	14,485		7,074		1,736		(10,655)		12,640
Total	$	291,950	$	74,300	$	6,571	$	(10,655)	$	362,166


Six Months Ended June 30, 2025	North America		International		Products & Systems		Corp/Elim		Total
Oil & Gas	$	178,365	$	20,589	$	426	$	—	$	199,380
Aerospace & Defense	30,855		13,295		256		—		44,406
Industrials	23,335		14,114		725		—		38,174
Power Generation & Transmission	12,544		3,082		820		—		16,446
Other Process Industries	12,378		8,916		8		—		21,302
Infrastructure, Research & Engineering	7,162		6,582		1,537		—		15,281
Petrochemical	5,635		111		—		—		5,746
Other	6,620		5,602		2,059		(7,996)		6,285
Total	$	276,894	$	72,291	$	5,831	$	(7,996)	$	347,020

Revenue per key geographic location was as follows:


Three Months Ended June 30, 2026	North America		International		Products & Systems		Corp/Elim		Total
United States	$	134,348	$	383	$	2,387	$	(1,283)	$	135,835
Other Americas	20,662		7		164		(1,886)		18,947
Europe	1,246		37,399		811		(2,251)		37,205
Asia-Pacific	373		221		556		(5)		1,145
Total	$	156,629	$	38,010	$	3,918	$	(5,425)	$	193,132


Three Months Ended June 30, 2025	North America		International		Products & Systems		Corp/Elim		Total
United States	$	129,011	$	3,706	$	1,268	$	(3,495)	$	130,490
Other Americas	17,202		15		212		(487)		16,942
Europe	979		35,132		450		(388)		36,173
Asia-Pacific	800		224		810		(34)		1,800
Total	$	147,992	$	39,077	$	2,740	$	(4,404)	$	185,405


Six Months Ended June 30, 2026	North America		International		Products & Systems		Corp/Elim		Total
United States	$	254,927	$	810	$	3,936	$	(3,030)	$	256,643
Other Americas	33,421		17		393		(3,464)		30,367
Europe	1,971		73,130		1,318		(4,145)		72,274
Asia-Pacific	1,631		343		924		(16)		2,882
Total	$	291,950	$	74,300	$	6,571	$	(10,655)	$	362,166

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)


Six Months Ended June 30, 2025	North America		International		Products & Systems		Corp/Elim		Total
United States	$	243,344	$	4,248	$	2,641	$	(1,479)	$	248,754
Other Americas	30,617		2,846		228		(3,631)		30,060
Europe	1,645		63,914		1,201		(2,385)		64,375
Asia-Pacific	1,288		1,283		1,761		(501)		3,831
Total	$	276,894	$	72,291	$	5,831	$	(7,996)	$	347,020

Contract Balances

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities) on the Unaudited Condensed Consolidated Balance Sheets. Amounts are generally billed as work progresses in accordance with agreed-upon contractual terms, generally at periodic intervals (e.g., weekly, bi-weekly or monthly). Generally, billing occurs subsequent to revenue recognition, resulting in contract assets. However, the Company sometimes receives advances or deposits from its customers before revenue is recognized, resulting in contract liabilities. These assets and liabilities are aggregated on an individual contract basis and reported on the Unaudited Condensed Consolidated Balance Sheets at the end of each reporting period within accounts receivable, net or accrued expenses and other current liabilities.

Revenue recognized during the six months ended June 30, 2026 and 2025 that was included in the contract liability balance at the beginning of the year was $5.9 million and $5.3 million, respectively. Changes in the contract asset and liability balances during these periods were not materially impacted by any other factors. The Company applies the practical expedient to expense incremental costs incurred related to obtaining a contract when the amortization period of the asset that the Company otherwise would have recognized is one year or less.

3. Share-Based Compensation

The Company grants share-based incentive awards to its eligible employees and non-employee directors under its Amended and Restated 2016 Long-Term Incentive Plan (the "2016 Plan"). Awards granted under the 2016 Plan may be in the form of stock options, restricted stock units and other forms of share-based incentives, including performance-based restricted stock units, stock appreciation rights and deferred stock rights. At the annual shareholders meeting on May 19, 2026, the Company’s shareholders approved an amendment to increase the total number of shares that may be issued under the 2016 Plan by 1.7 million shares, for a total of 7.9 million shares that are authorized for issuance under the 2016 Plan, of which approximately 1,980,000 shares were available for future grants as of June 30, 2026.

Stock Options

On January 6, 2025, an executive officer of the Company was granted a stock option for the purchase of 375,000 shares of the Company's common stock at an exercise price of $9.06, the closing price of the Company's common stock on the New York Stock Exchange (the "NYSE") on the grant date. These stock options can be exercised any time on or after January 6, 2026, and prior to their expiration date, which is the earlier of 10 years from the grant date or one year following the date the executive officer is no longer serving as an officer, director or in any other capacity of the Company.

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

The following table sets forth a summary of stock option activity, weighted-average exercise prices and options outstanding as of June 30, 2026 (in thousands, except per share amounts and years):


	Six Months Ended June 30,
	2026			2025
	Common Stock Options	Weighted Average Exercise Price		Common Stock Options	Weighted Average Exercise Price
Outstanding at beginning of period:	685	$	7.76	250	$	5.36
Granted	—	$	—	375	$	9.06
Exercised	—	$	—	—	$	—
Expired or forfeited	—	$	—	—	$	—
Outstanding at end of period:	685	$	7.76	625	$	7.58
Exercisable at end of period:	625	7.58		250	5.36

The Company recognized $0.1 million and $0.5 million of share-based compensation expense related to stock options during the three months ended June 30, 2026 and 2025, respectively. The Company recognized $0.2 million and $1.0 million of share-based compensation expense related to stock options during the six months ended June 30, 2026 and 2025, respectively. As of the end of the current period, there is no remaining unrecognized share-based compensation expense related to stock options.

Stock Issuances to Non-Employee Directors

As part of its compensation program for non-employee directors, the Company issues fully-vested common stock to its non-employee directors. The awards are issued to non-employee directors during the second quarter of each fiscal year. A summary of the fully-vested common stock issued by the Company to its non-employee directors, in connection with its non-employee director compensation during the six months ended June 30, 2026 and 2025 is as follows (in thousands):


	Six months ended June 30,
	2026		2025
Awards issued to non-employee directors	34		72
Grant date fair value of awards issued	$	575	$	571

Restricted Stock Unit Awards

For the three months ended June 30, 2026 and 2025, the Company recognized share-based compensation expense within Selling, general and administrative expenses related to Restricted Stock Unit ("RSU") awards of $1.0 million and $0.9 million, respectively. For the six months ended June 30, 2026 and 2025, the Company recognized share-based compensation expense within Selling, general and administrative expenses related to RSU awards of $1.7 million and $2.1 million, respectively. No share-based compensation expense was recognized within Reorganization and other costs related to RSU awards for the three or six months ended June 30, 2026. For the three and six months ended June 30, 2025, the Company recognized share-based compensation expense within Reorganization and other costs related to RSU awards of $0.5 million and $1.0 million respectively. As of June 30, 2026, there was $9.0 million of unrecognized compensation costs related to RSU awards, which is expected to be recognized over a remaining weighted-average period of 2.8 years. Upon vesting, RSUs are generally net share-settled to cover the required withholding tax and the remaining amount is converted into an equivalent number of shares of common stock.

A summary of the vesting activity of RSU awards, with the respective fair value of the awards, is as follows:


	Six months ended June 30,
	2026		2025
Restricted stock unit awards vested	347		589
Fair value of awards vested	$	4,994	$	5,596

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

A summary of the Company's outstanding, non-vested RSUs is as follows:


	Six months ended June 30,
	2026			2025
	Units	Weighted Average Grant-Date Fair Value		Units	Weighted Average Grant-Date Fair Value
Outstanding at beginning of period:	794	$	8.71	1,231	$	8.41
Granted	408	$	15.05	350	$	9.32
Vested	(347)	$	14.41	(589)	$	9.51
Forfeited	(67)	$	9.27	(141)	$	8.55
Outstanding at end of period:	788	$	11.48	851	$	8.65

Performance Restricted Stock Units

The Company maintains Performance Restricted Stock Units ("PRSUs") that have been granted to select executives and senior officers, the ultimate payout of which may vary between zero and 200% of the target award, based on the Company’s performance over a one-year period based on specific metrics approved by the Compensation Committee of the Board of Directors of the Company.

For 2026, the Compensation Committee (the “Compensation Committee”) of the Company’s Board of Directors is using the following three performance metrics for PRSU awards.

1.Free Cash Flow defined as net cash provided by operating activities less purchases of property, plant, equipment and intangible assets and is subject to adjustments approved by the Compensation Committee.

2.Adjusted EBITDA defined as net income attributable to the Company plus: interest expense, provision for income taxes, depreciation and amortization, share-based compensation expense and certain acquisition related costs (including transaction due diligence costs and adjustments to the fair value of contingent consideration), foreign exchange (gain) loss and, if applicable, certain special items which are noted.

3.Revenue

For PRSUs awarded in 2026, the Compensation Committee utilized the same metrics as 2025 PRSUs, but with revised performance goals and weighting.

PRSUs are equity-classified and compensation costs related to PRSUs with performance conditions are initially measured using the fair value of the underlying stock at the date of grant. Compensation costs related to the PRSUs with performance conditions are subsequently adjusted for changes in the expected outcomes of the performance conditions. Earned PRSUs generally vest ratably in four equal annual installments over the four years following completion of the performance period, for a total requisite service period of up to five years, and have no dividend equivalent rights.

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

A summary of the Company's PRSU activity is as follows:


	Six months ended June 30,
	2026			2025
	Units	Weighted Average Grant-Date Fair Value		Units	Weighted Average Grant-Date Fair Value
Outstanding at beginning of period:	346	$	9.93	125	$	9.12
Granted	324	$	15.28	507	$	10.08
Performance condition adjustments	—	$	—	(127)	$	8.76
Released	(19)	$	14.94	(3)	$	9.84
Forfeited	(45)	$	8.84	(9)	$	3.68
Outstanding at end of period:	606	$	12.64	493	$	9.93

For the three months ended June 30, 2026 and 2025, the Company recognized aggregate share-based compensation expense related to the stock awards described above of approximately $1.0 million and $0.4 million, respectively. For the six months ended June 30, 2026 and 2025, the Company recognized aggregate share-based compensation expense related to the stock awards described above of approximately $1.5 million and $0.6 million, respectively. At June 30, 2026, there was $5.9 million of total unrecognized compensation costs related to approximately 606,000 non-vested PRSUs, which is expected to be recognized over a remaining weighted-average period of 2.8 years.

4. Earnings per Share

Basic earnings per share is computed by dividing net income by the weighted-average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the sum of (1) the weighted-average number of shares of common stock outstanding during the period, and (2) the dilutive effect of assumed conversion of equity awards using the treasury stock method. With respect to the number of weighted-average shares outstanding (denominator), diluted shares reflect: (i) the exercise of options to acquire common stock to the extent that the options’ exercise prices are less than the average market price of common shares during the period and (ii) the pro forma vesting of restricted stock units.

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Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

The following table sets forth the computations of basic and diluted earnings per share:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025

Basic earnings per share
Numerator:
Net income (loss) attributable to Mistras Group, Inc.	$	7,581	$	3,017	$	9,969	$	(169)
Denominator:
Weighted average common shares outstanding	31,831		31,439		31,725		31,268
Basic earnings per share	$	0.24	$	0.10	$	0.31	$	—

Diluted earnings per share:
Numerator:
Net income (loss) attributable to Mistras Group, Inc.	$	7,581	$	3,017	$	9,969	$	(169)
Denominator:
Weighted average common shares outstanding	31,831		31,439		31,725		31,268
Dilutive effect of stock options outstanding (1)	386		91		355		—
Dilutive effect of restricted stock units outstanding (1)	707		163		742		—
	32,924		31,693		32,822		31,268
Diluted earnings per share	$	0.23	$	0.10	$	0.30	$	—

_______________

(1) For the three months ended June 30, 2025, 375,000 shares, related to stock options and 877,000 shares, related to restricted stock units were anti-dilutive and therefore were excluded from the calculation of diluted earnings per share. For the six months ended June 30, 2026, 6,000 shares related to RSUs were anti-dilutive and therefore were excluded from the calculation of diluted earnings per share. For the six months ended June 30, 2025, 106,000 shares, related to stock options and 867,000 shares, related to restricted stock units were excluded from the calculation of diluted earnings per share due to the net loss for the period.

5. Accounts Receivable, net

Accounts receivable consisted of the following (in thousands):


	June 30, 2026		December 31, 2025

Trade accounts receivable - billed	$	135,069	$	133,100
Trade accounts receivable - unbilled	29,826		25,139
Allowance for credit losses	(3,136)		(3,566)
Accounts receivable, net	$	161,759	$	154,673

Trade accounts receivable - unbilled are generally billed in the subsequent quarter to their revenue recognition. The Company considers Trade accounts receivable - unbilled as short-term in nature as they are normally converted to Trade accounts receivable - billed within 90 days, thus future changes in economic conditions will not have a significant effect on the credit loss estimate.

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

6. Inventories

Inventories consist of the following (in thousands):


	June 30, 2026		December 31, 2025

Raw materials and consumable supplies	$	11,388	$	9,252
Work in progress	1,518		912
Finished goods	3,827		3,838
Inventories	$	16,733	$	14,002

7. Property, Plant and Equipment, net

Property, plant and equipment, net consisted of the following:


	Useful Life (Years)	June 30, 2026		December 31, 2025

Land		$	2,459	$	2,470
Buildings and improvements	30-40	22,690		22,383
Office furniture and equipment	5-8	16,893		16,887
Machinery and equipment	5-7	321,330		308,457
		363,372		350,197
Accumulated depreciation and amortization		(263,131)		(257,033)
Property, plant and equipment, net		$	100,241	$	93,164

Depreciation expense for the three months ended June 30, 2026 and 2025 was approximately $6.2 million and $6.1 million, respectively.

Depreciation expense for the six months ended June 30, 2026 and 2025 was $12.3 million and $12.1 million, respectively.

8. Goodwill

Changes in the carrying amount of goodwill by segment is shown below:


	North America		International		Products and Systems		Total
Balance at December 31, 2025	$	184,829	$	—	$	—	$	184,829



Foreign currency translation	(2,628)		—		—		(2,628)
Balance at June 30, 2026	$	182,201	$	—	$	—	$	182,201

The Company reviews goodwill for impairment on a reporting unit basis on October 1 of each year and whenever events or changes in circumstances indicate that the fair value of a reporting unit may be less than its carrying amount.

The Company performed a quantitative annual impairment test as of October 1, 2025 and concluded that the fair value of each reporting unit exceeded its carrying amount. Additionally, through June 30, 2026, the Company did not identify any changes in circumstances that would indicate impairment of goodwill. Significant adverse changes in future periods could negatively affect the Company's key assumptions and may result in future goodwill impairment charges which could be material.

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

9. Intangible Assets

The gross amount, accumulated amortization and net carrying amount of intangible assets were as follows:


		June 30, 2026				December 31, 2025
	Useful Life (Years)	Gross Amount		Accumulated Amortization		Net Carrying Amount		Gross Amount		Accumulated Amortization		Net Carrying Amount

Customer relationships	5-18	$	108,079	$	(96,637)	$	11,442	$	109,262	$	(96,428)	$	12,834
Software/Technology	3-15	66,126		(39,666)		26,460		63,158		(37,822)		25,336
Covenants not to compete	2-5	12,324		(12,324)		—		12,387		(12,387)		—
Other	2-12	10,126		(9,968)		158		10,211		(9,974)		237
Total		$	196,655	$	(158,595)	$	38,060	$	195,018	$	(156,611)	$	38,407

Amortization expense for the three months ended June 30, 2026 and 2025 was approximately $2.0 million and $1.6 million, respectively.

Amortization expense for the six months ended June 30, 2026 and 2025 was $4.0 million and $3.4 million, respectively.

10. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following:


	June 30, 2026		December 31, 2025

Accrued salaries, wages and related employee benefits	$	30,732	$	30,391

Accrued workers’ compensation and health benefits	973		2,471
Deferred revenue	11,650		9,099

Pension accrual	2,083		2,081
Right-of-use liability - Operating	10,267		10,882
Other accrued expenses	28,751		33,102
Total	$	84,456	$	88,026

11. Long-Term Debt

Long-term debt consisted of the following:


	June 30, 2026		December 31, 2025

Senior credit facility	$	79,950	$	79,250
Senior secured term loan, net of unamortized debt issuance costs of $0.1 million and $0.2 million, respectively	90,513		96,711

Other	1,630		2,031
Total debt	172,093		177,992
Less: Current portion	(12,829)		(12,849)
Long-term debt, net of current portion	$	159,264	$	165,143

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

Senior Credit Facility

On August 1, 2022, the Company entered into a credit agreement (the “Credit Agreement”), which provides the Company with a $190 million 5-year committed revolving credit facility and a $125 million term loan with a balance of $90.5 million as of June 30, 2026. The Credit Agreement permits the Company to borrow up to $100 million in non-U.S. dollar currencies and to use up to $20 million of the credit limit for the issuance of letters of credit. As of June 30, 2026, both the revolving line of credit and the term loan under the Credit Agreement had a maturity date of July 30, 2027, which was subsequently extended to July 28, 2028.

The Credit Agreement has the following key terms, conditions and financial covenants:

•Borrowings bear interest at Secured Overnight Financing Rate ("SOFR") plus a credit spread adjustment and applicable SOFR margin ranging from 1.25% to 2.75%, based upon our Total Consolidated Debt Leverage Ratio (defined below).

◦Total Consolidated Debt Leverage Ratio means the ratio of (a) Total Consolidated Debt to (b) EBITDA (as defined in the Credit Agreement) for the trailing four consecutive fiscal quarters.

◦Total Consolidated Debt means all indebtedness (including subordinated debt) of the Company on a consolidated basis.

•The Company has the benefit of the lowest SOFR margin if its Total Consolidated Debt Leverage Ratio is equal to or less than 1.25 to 1.0, and the margin increases as the ratio increases, to the maximum margin if the ratio is greater than 3.75 to 1.0. The Credit Agreement is secured by liens on substantially all the assets of the Company and certain of its U.S subsidiaries and is guaranteed by those U.S. subsidiaries.

•The Company is required to maintain a Total Consolidated Debt Leverage Ratio of no more than 4.0 to 1.0 at the end of each quarter through June 30, 2023 and stepping down to a maximum permitted ratio of no more than 3.75 to 1.0 for the remainder of the term.

•The Company is required to maintain a Fixed Charge Coverage Ratio of 1.25 to 1.0 for the duration of the Credit Agreement, as defined in the Credit Agreement.

•The Credit Agreement limits the Company’s ability to, among other things, create liens, make investments, incur more indebtedness, merge or consolidate, make dispositions of property, pay dividends, make distributions to stockholders or repurchase our stock, enter into a new line of business, enter into transactions with affiliates and enter into burdensome agreements.

•The Credit Agreement does not limit the Company’s ability to acquire other businesses or companies except that the acquired business or company must be in the Company's line of business, the Company must be in compliance with the financial covenants on a pro forma basis after taking into account the acquisition, and the Company must provide written notice at least five business days prior to the date of an acquisition of $10 million or more.

•Quarterly payments on the term loan of $1.56 million through June 30, 2024, then increasing to $2.34 million through June 30, 2025, and to $3.12 million for each quarterly payment thereafter through maturity.

As of June 30, 2026, the Company had borrowings of $170.5 million and a total of $3.8 million of letters of credit outstanding under the Credit Agreement. The Company has capitalized costs associated with debt modifications of $0.4 million as of June 30, 2026, which are included in Other assets on the Unaudited Condensed Consolidated Balance Sheets and will be amortized into interest expense over the remaining term of the Credit Agreement through its maturity date.

As of June 30, 2026, the Company was in compliance with the terms and covenants of the Credit Agreement. The Company continuously monitors compliance with the covenants contained in the Credit Agreement.

Refer to Note 15 - Subsequent Events for details regarding the Amendment to the Credit Agreement.

Other debt

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

The Company's other debt includes bank financing provided at the local subsidiary level used to support working capital requirements and fund capital expenditures. At June 30, 2026, there was an aggregate of approximately $1.6 million outstanding, payable at various times through 2030.

12. Fair Value Measurements

The Company performs fair value measurements in accordance with the guidance provided by ASC 820, Fair Value Measurements and Disclosures. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a three level hierarchy that prioritizes the inputs used to measure fair value.

Financial instruments not measured at fair value on a recurring basis

The Company has evaluated current market conditions and borrower credit quality and has determined that the carrying value of its long-term debt approximates fair value. The fair value of the Company’s notes payable and finance lease obligations approximates their carrying amounts based on anticipated interest rates which management believes would currently be available to the Company for similar issuances of debt.

13. Commitments and Contingencies

Legal Proceedings and Government Investigations

The Company is periodically involved in lawsuits, investigations and claims. While uncertainties exist with respect to the ultimate resolution of lawsuits, investigations and claims asserted against it, except as stated below, the Company, based on currently available information, does not believe that any currently pending or threatened legal proceeding to which the Company is a party, or is likely to become a party, will have a material adverse effect on its business, results of operations, cash flows or financial condition. The costs incurred by the Company to defend lawsuits, investigations and claims and amounts the Company pays to other parties because of these matters may be covered by insurance in some circumstances.

Litigation and Commercial Claims

The Company and a subsidiary of the Company, Mistras Arizona Inspection Services LLC (“Mistras Arizona”), are subject to a lawsuit ("the DEQ Proceeding") filed by the State of Arizona and the Arizona Department of Environmental Quality (collectively “DEQ”). The DEQ Proceeding, captioned State of Arizona v. Mistras Group, Inc., Mistras Arizona Inspection Services, LLC and Naiman Phoenix, Ltd., was originally filed on February 27, 2024, in the Superior Court of the State of Arizona for Maricopa County, CV 2024-003866 (the "DEQ Complaint"). The DEQ Complaint alleges various violations of Arizona environmental laws and regulations by Mistras Arizona in connection with the operation by Mistras Arizona of its testing facility in Phoenix, Arizona. The DEQ Complaint seeks, through injunctive relief, the closing of a chromic acid plating line at the testing facility, implementation of a site assessment plan approved by the DEQ, and corrective and remedial action to bring the testing facility into compliance with laws and regulations. In addition, the DEQ is seeking unspecified penalties and costs in connection with the DEQ Proceeding.

The Superior Court held a hearing in September 2024 regarding the DEQ’s request for a preliminary injunction. On October 23, 2024, the Superior Court issued a ruling, which declined to issue the preliminary injunction requested by the DEQ, but imposed the following conditions on the Company and Mistras Arizona unless and until modified by the Superior Court or entry of a final judgment: (1) the Company and Mistras Arizona are prohibited from releasing or permitting any release of chromic acid from the facility; (2) within a reasonable time, the Company and Mistras Arizona must complete improvements to the testing facility designed to prevent future discharges of chromium or chromic acid; (3) the Company and Mistras Arizona must notify the DEQ upon completion of the improvement to enable the DEQ to conduct an inspection; and (4) the Company and Mistras Arizona are prohibited from engaging in any chrome plating operations at the testing facility until they notify the DEQ that the improvements have been completed. The DEQ may seek relief if it determines that the improvements are not sufficient to prevent discharges. In April 2025, Mistras Arizona notified the DEQ that the improvements were completed, which the DEQ

then inspected. Following the DEQ site visit, Mistras Arizona commenced its chrome plating operations on April 28, 2025. Mistras Arizona has been and intends to continue complying with the Superior Court's ruling. In the meantime, the DEQ Proceeding is ongoing.

Table of Contents

Mistras Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

It is probable that additional investigation and/or remediation costs, as well as fines and penalties will be imposed related to the DEQ Proceeding. However, the Company is unable to estimate the range of loss that it may incur and whether these amounts will be material to the Company.

In addition, Mistras Arizona’s operations in Phoenix are located at a leased site within the footprint of the Motorola 52nd Street Superfund Site (the “Motorola Site”). Mistras Arizona has received two General Notice Letters from the US Environmental Protection Agency (the "EPA"), dated May 21, 2024 and December 1, 2025, informing Mistras Arizona that the EPA has identified it as a potentially responsible party in relation to the Motorola Site. On April 29, 2025, the Company received a notice from the EPA requesting information regarding the improvements and other matters related to Phoenix testing facility. Mistras Arizona provided the EPA with the requested information in July 2025.

Pension Related Contingencies

Certain of the Company’s subsidiaries had significant reductions in their unionized workers in 2018. The collective bargaining agreements for the employees of these subsidiaries required contributions for these employees to two national multi-employer pension funds. The reduction in employees resulted in one of the Company's subsidiaries incurring a complete withdrawal to one of the pension funds under the Employee Retirement Income Security Act of 1974 ("ERISA"), which was fully satisfied in 2019. The Company has determined that the subsidiary is likely to incur partial or complete withdrawal liability to the other pension fund. The balance of the estimated total amount of this potential liability as of June 30, 2026 is approximately $2.1 million, which was incurred in 2018 and 2019.

14. Segment Disclosure

The Company’s three operating segments, which are also the Company's reportable segments, are:

Costs incurred for general corporate services, including finance, legal, and certain other costs that are provided to the segments are reported within Corporate and eliminations. Sales to the International segment from the Products and Systems segment and subsequent sales by the International segment of the same items are recorded and reflected in the operating performance of both segments. Additionally, engineering charges and royalty fees charged to the North America and International segments by the Products and Systems segment are reflected in the operating performance of each segment.

The chief operating decision maker ("CODM") reviews financial information at the operating segment level to allocate resources and to assess the operating results and financial performance for each operating segment. The Company's CODM is Natalia Shuman, our Chief Executive Officer, as she has final authority over performance assessment and resource allocation decisions. Our segments are based on the type and concentration of customers served, service requirements, methods of distribution and major product lines.

Segment income (loss) from operations is the primary performance measure used by the CODM to evaluate segment performance and allocate resources, including considering budget-to-actual variances and prior year-to-actual variances on a monthly basis in accordance with GAAP under ASC 280, Segment Reporting. Segment income (loss) from operations for each of the Company's reportable segments are comprised of revenue, selling, general & administrative expenses, and "other

expenses." "Other expenses" include cost of revenue, reorganization and environmental costs, depreciation and amortization and research and engineering.

Corporate and other assets are comprised principally of cash, deposits, property, plant and equipment, domestic deferred taxes, deferred charges and other assets. Corporate loss from operations consists of administrative charges related to corporate personnel and other charges that cannot be readily identified for allocation to a particular segment. These items of our operating profit are managed centrally at the corporate level and are excluded from the measure of segment income reviewed by the CODM, as well as the measure of segment performance used for incentive compensation purposes.

The accounting policies of the reportable segments are the same as those described in Note 1 - Description of Business and Basis of Presentation.

Selected consolidated financial information by segment for the periods shown was as follows. Income (loss) from operations by operating segment includes intercompany transactions, which are eliminated in Corporate and eliminations.

For the three months ended June 30, 2026


	Segment
	North America		International		Products and Systems		Total Reportable Segments		Corporate and eliminations		Total
Revenue	$	156,629	$	38,010	$	3,918	$	198,557	$	(5,425)	$	193,132

Selling, general & administrative expenses	23,229		8,151		890		32,270		6,452		38,722
Other Expenses	115,647		26,840		2,352		144,839		(3,375)		141,464
Income (loss) from operations	$	17,753	$	3,019	$	676	$	21,448	$	(8,502)	$	12,946

For the three months ended June 30, 2025


	Segment
	North America		International		Products and Systems		Total Reportable Segments		Corporate and eliminations		Total
Revenue	$	147,992	$	39,077	$	2,740	$	189,809	$	(4,404)	$	185,405

Selling, general & administrative expenses	20,944		7,860		782		29,586		10,207		39,793
Other Expenses	110,290		27,213		1,622		139,125		(1,941)		137,184
Income (loss) from operations	$	16,758	$	4,004	$	336	$	21,098	$	(12,670)	$	8,428

For the six months ended June 30, 2026


	Segment
	North America		International		Products and Systems		Total Reportable Segments		Corporate and eliminations		Total
Revenue	$	291,950	$	74,300	$	6,571	$	372,821	$	(10,655)	$	362,166

Selling, general & administrative expenses	44,737		16,201		1,792		62,730		12,978		75,708
Other Expenses	219,040		53,604		4,115		276,759		(7,929)		268,830
Income (loss) from operations	$	28,173	$	4,495	$	664	$	33,332	$	(15,704)	$	17,628

For the six months ended June 30, 2025


	Segment
	North America		International		Products and Systems		Total Reportable Segments		Corporate and eliminations		Total
Revenue	$	276,894	$	72,291	$	5,831	$	355,016	$	(7,996)	$	347,020

Selling, general & administrative expenses	41,683		15,066		1,620		58,369		17,076		75,445
Other Expenses	211,938		52,140		3,548		267,626		(3,467)		264,159
Income (loss) from operations	$	23,273	$	5,085	$	663	$	29,021	$	(21,605)	$	7,416

The tables above only reconcile to income (loss) from operations as our measure of segment profitability and the remainder of the reconciliation to net income can be seen on the Unaudited Condensed Consolidated Statement of Income. Products and Systems segment revenue was comprised of approximately $0.6 million and $0.5 million of sales to the International segment, which were eliminated upon consolidation, for the three months ended June 30, 2026 and 2025, respectively. Products and Systems segment revenue was comprised of approximately $1.1 million and $1.5 million of sales to the International segment, which were eliminated upon consolidation, for the six months ended June 30, 2026 and 2025, respectively. Intersegment revenue related to sales between other segments was immaterial for each of the three and six month periods ended June 30, 2026 and 2025.

Selected consolidated financial information by segment for the periods shown was as follows (with intercompany transactions eliminated in Corporate and eliminations):


	June 30, 2026		December 31, 2025
Intangible assets, net
North America	$	26,704	$	28,245
International	1,079		1,110
Products and Systems	795		733
Corporate and eliminations	9,482		8,319
Total	$	38,060	$	38,407


	June 30, 2026		December 31, 2025
Total assets
North America	$	434,680	$	426,146
International	109,659		150,741
Products and Systems	12,104		12,072
Corporate and eliminations	27,679		(10,178)
Total	$	584,122	$	578,781


	June 30, 2026		December 31, 2025
Long-lived assets
North America	$	282,572	$	278,419
International	27,059		27,900
Products and Systems	948		850
Corporate and eliminations	9,924		9,231
Total	$	320,503	$	316,400

Refer to Note 2 - Revenue, for revenue by geographic area for the three and six months ended June 30, 2026 and 2025.

15. Subsequent Events

On August 5, 2026, the Company entered into an amendment (the "Amendment") to its Credit Agreement dated August 1, 2022, with the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent. The Amendment extended the maturity date of the Company’s $190.0 million revolving credit facility and approximately $90.6 million term loan under the Credit Agreement from July 30, 2027 to July 28, 2028.

In connection with the Amendment, the Company incurred an extension fee equal to a total of 0.15% of the aggregate committed amount of the revolving credit facility and term loan held by participating lenders. There were no other changes to the material terms of the Credit Agreement, including the applicable interest rate provisions and financial covenants, which remained substantially unchanged. Refer to Note 11 - Long-Term Debt for more details regarding the terms of the Credit Agreement.

The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the Amendment, which is filed as Exhibit 10.1 to this Quarterly Report on Form 10-Q and is incorporated by reference herein.

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

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

The following Management’s Discussion and Analysis (“MD&A”) provides a discussion of our results of operations and financial position for the three and six months ended June 30, 2026 and 2025. The MD&A should be read together with our Unaudited Condensed Consolidated Financial Statements and related notes included in Item 1 in this Quarterly Report on Form 10-Q (the "Quarterly Report") and our audited consolidated financial statements and related notes included in our 2025 Annual Report. Unless otherwise specified or the context otherwise requires, “Mistras,” “the Company,” “we,” “us” and “our” refer to Mistras Group, Inc. and its consolidated subsidiaries. The MD&A includes the following sections:

•Forward-Looking Statements

•Overview

•Note about Non-GAAP Measures

•Consolidated Results of Operations

•Liquidity and Capital Resources

•Critical Accounting Policies and Estimates

Forward-Looking Statements

This Quarterly Report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934 (“Exchange Act”). Such forward-looking statements include those that express plans, anticipation, intent, contingency, goals, targets or future development and/or otherwise are not statements of historical fact. These forward-looking statements are based on our current expectations and projections about future events and they are subject to risks and uncertainties known and unknown that could cause actual results and developments to differ materially from those expressed or implied in such statements.

In some cases, you can identify forward-looking statements by terminology, such as “goals,” or “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “may,” “could,” “should,” “would,” “predicts,” “appears,” “projects,” or the negative of such terms or other similar expressions. You are urged not to place undue reliance on any such forward-looking statements, any of which may turn out to be wrong due to inaccurate assumptions, various risks, uncertainties or other factors known and unknown. Factors that could cause or contribute to differences in results and outcomes from those in our forward-looking statements, including any impacts from the imposition of tariffs or other trade restrictions, changes to the

U.S. trade policy and impacts and uncertainty arising from geopolitical instability and conflicts (including those related to the wars in the Middle East and Ukraine) include, without limitation, those discussed in the “Business—Forward-Looking Statements,” and “Risk Factors” sections of our 2025 Annual Report as well as those discussed in this Quarterly Report and in our other filings with the SEC. In addition, there are various developments discussed below which could create risks and uncertainty about our business, results of operations or liquidity.

Overview

The Company is a global leader in technology-enabled industrial asset integrity solutions, serving critical industries including oil & gas, aerospace & defense, power & utilities, manufacturing, and civil infrastructure.

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

The Company’s core capabilities also include NDT field inspections enhanced by advanced robotics, laboratory quality control and assurance testing, sensing technologies and NDT equipment, asset and mechanical integrity engineering services, and light mechanical maintenance and access services.

Our operations consist of three reportable segments: North America, International, and Products and Systems.

•North America provides asset protection solutions predominantly in North America, with the largest concentration in the United States, followed by Canada, consisting primarily of NDT, inspection, mechanical and engineering services that are used to evaluate the safety, structural integrity and reliability of critical energy, industrial and public infrastructure and commercial aerospace components. Software, digital and data services are included in this segment.

•International offers services, products and systems similar to those of the other segments to select markets within Europe, the Middle East, Africa, Asia and South America, but not to customers in China and South Korea, which are served by the Products and Systems segment.

•Products and Systems designs, manufactures, sells, installs and services the Company’s asset protection products and systems, including equipment and instrumentation, predominantly in the United States.

Given the role our solutions play in enhancing the safe and efficient operation of infrastructure, we have historically provided a majority of our solutions to our customers on a regular, recurring basis. We perform these services largely at our customers’ facilities, while primarily servicing our aerospace customers at our network of state-of-the-art, in-house laboratories. These solutions typically include NDT and inspection services, and can also include a wide range of mechanical services, including heat tracing, pre-inspection insulation stripping, coating applications, re-insulation, engineering assessments and long-term condition-monitoring. Under this business model, many customers outsource their inspection to us on a “run and maintain” basis. We have established long-term relationships as a critical solutions provider to many of the leading companies with asset-intensive infrastructure in our target markets. These markets include companies in oil and gas, aerospace and defense, industrials, power generation and transmission (including alternative and renewable energy), infrastructure, research and engineering, petrochemical, and other process industries.

We have focused on providing our advanced asset protection solutions to our customers using proprietary, technology-enabled software and testing instruments, including those developed by our Products and Systems segment. We have made numerous acquisitions in the past in an effort to grow our base of experienced, certified personnel, expand our service lines and technical capabilities, increase our geographical reach, complement our existing offerings, and leverage our fixed costs. We have increased our capabilities and the size of our customer base through the development of applied technologies and managed support services, organic growth and the integration of acquired companies. These acquisitions have provided us with additional service lines, technologies, resources and customers which we believe enhance our advantages over our competition.

We believe long-term growth can be realized in our target markets. Our level of business and financial results are impacted by world-wide macro- and micro-economic conditions generally, as well as those within our target markets. Among other things, we expect the timing of our oil and gas customers' inspection spending to be impacted by fluctuations in oil prices and broader market conditions, including potential geopolitical disruptions and uncertainty arising from conflicts in the Middle East.

We have continued providing our customers with an innovative asset protection software ecosystem through our OneSuite platform. The software platform offers functions of our software and services brands as integrated apps on a cloud environment. OneSuite serves as a single access portal for customers' data activities and provides access to 90 plus applications being offered on one centralized platform.

Recent Developments

Our cash position and liquidity remains strong. As of June 30, 2026, our cash and cash equivalents balance was approximately $22.0 million, and we had available borrowing capacity of up to $106.3 million under the revolving credit facility under our Credit Agreement.

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

Credit Agreement from July 30, 2027 to July 28, 2028. In connection with the Amendment, the Company incurred an extension fee equal to a total of 0.15% of the aggregate committed amount of the revolving credit facility and term loan held by participating lenders. There were no other changes to the material terms of the Credit Agreement, including the applicable interest rate provisions and financial covenants, which remained substantially unchanged. Refer to Note 11 - Long-Term Debt for more details regarding the terms of the Credit Agreement.

The global trade landscape continues to be highly volatile. During 2025, the U.S. government implemented a series of trade tariffs on goods imported into the U.S. from various countries, many of which prompted reciprocal tariffs and other trade measures affecting U.S. exports. The ongoing tariff environment remains complex and continues to evolve as legal proceedings and trade negotiations progress. In February 2026, the U.S. Supreme Court ruled that the International Emergency Economic Powers Act ("IEEPA"), which the U.S. government relied upon to impose certain tariffs, does not authorize the imposition of tariffs. Following that decision, the U.S. Court of International Trade directed the U.S. Customs and Border Protection ("CBP") to begin processing refunds of previously collected IEEPA tariffs, and during the second quarter of 2026, CBP commenced accepting and processing refund claims. In response to the U.S. Supreme Court's ruling, the U.S. administration implemented replacement tariffs under alternative statutory authorities, including Section 122 of the Trade Act of 1974, while also pursuing additional tariff actions under other existing trade authorities. Certain of these replacement tariffs have also been challenged in court, and the related litigation remains ongoing. On July 24, 2026, the U.S. administration announced the implementation of additional tariffs ranging from 10% to 12.5% on imports from numerous trading partners under Section 301 of the Trade Act of 1974. Accordingly, the ultimate scope, duration and financial impact of U.S. trade measures remain uncertain. Ongoing changes to trade policies and related uncertainty may affect global economic conditions, supply chains and costs, and may reduce trade between the U.S. and impacted countries. Tariffs and trade barriers have not had a material effect on our business or results of operations during 2026 to date. However, new tariffs or other trade measures could result in increased costs for us or our suppliers and could impact the import of materials by our customers, including materials subject to our inspection and testing services, which could adversely affect demand for our services.

Note About Non-GAAP Measures

The Company prepares its consolidated financial statements in accordance with GAAP. In this MD&A under the heading "Income from Operations", the non-GAAP financial performance measure "Income from operations before special items” is used for each of our three operating segments, “Corporate and Eliminations” and the "Total Company", with tables reconciling the measure to a financial measure under GAAP. This presentation excludes from "Income from Operations" (a) reorganization and other costs, which includes items such as severance, labor relations matters and asset and lease termination costs and (b) environmental expense, which relates to costs associated with the environmental matter at the Phoenix lab operated by Mistras Arizona, as described in Note 13 to the Unaudited Condensed Consolidated Financial Statements in this Quarterly Report. These adjustments have been excluded from the GAAP measure because these expenses and credits are not related to our or any individual segment's core business operations. Our management uses this non-GAAP measure as a measure of operating performance to assist in comparing performance from period to period on a consistent basis, as a measure for planning and forecasting overall expectations and for evaluating actual results against such expectations. We believe investors and other users of our financial statements benefit from the presentation of this non-GAAP measure in evaluating our performance. Income from operations before special items excludes the identified adjustments, which provides additional tools to compare our core business operating performance on a consistent basis and measure underlying trends and results in our business. Income from operations before special items is not used to determine incentive compensation for executives or employees, nor is it a replacement for the reported GAAP financial performance and/or necessarily comparable to the non-GAAP financial measures of other companies. Any measure that eliminates the foregoing items has material limitations as a performance measure and should not be considered an alternative to net income or any other measures derived in accordance with GAAP. Because Income from operations before special items may not be calculated in the same manner by all companies, this measure may not be comparable to other similarly titled measures used by other companies.

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

Results of Operations

Condensed consolidated results of operations for the three and six months ended June 30, 2026 and 2025 were as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2026			2025			2026			2025
Revenue	$	193,132		$	185,405		$	362,166		$	347,020
Gross profit	56,445			53,945			101,177			94,837
Gross profit as a % of Revenue	29.2		%	29.1		%	27.9		%	27.3		%


Income from operations	12,946			8,428			17,628			7,416
Income from operations as a % of Revenue	6.7		%	4.5		%	4.9		%	2.1		%

Income (loss) before provision (benefit) for income taxes	9,821			4,189			12,556			(147)

Net income (loss)	7,552			3,126			9,909			(42)

Net income (loss) attributable to Mistras Group, Inc.	$	7,581		$	3,017		$	9,969		$	(169)

Revenue

Revenue was $193.1 million for the three months ended June 30, 2026, an increase of $7.7 million, or 4.2%, compared with the three months ended June 30, 2025.

Revenue by segment for the three and six months ended June 30, 2026 and 2025 were as follows:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025

Revenue
North America	$	156,629	$	147,992	$	291,950	$	276,894
International	38,010		39,077		74,300		72,291
Products and Systems	3,918		2,740		6,571		5,831
Corporate and eliminations	(5,425)		(4,404)		(10,655)		(7,996)
Total	$	193,132	$	185,405	$	362,166	$	347,020

Three Months

In the three months ended June 30, 2026, total revenue increased 4.2% versus the prior year comparable period due predominantly to a low-single-digit organic increase driven by increases in the aerospace and defense, power generation and transmission, infrastructure, research, and engineering, and petrochemical end markets. North America segment revenue increased 5.8%, driven predominantly by the aerospace and defense, power generation and transmission, infrastructure, research, and engineering, and process industries end markets as a result of strong market demand. International segment revenue decreased 2.7%, due predominantly to a mid-single-digit organic decrease driven by lower market demand. The decrease was partially offset by a low-single-digit favorable impact of foreign exchange rates. Products and Systems segment revenue increased by 43.0%, due to increased sales volume and shipments as compared to the prior year comparable period.

Oil and gas customer revenue comprised approximately 49% and 55% of total revenue for the three months ended June 30, 2026 and 2025, respectively. Aerospace and defense customer revenue comprised approximately 14% and 13% of total revenue for the three months ended June 30, 2026 and 2025, respectively. The Company’s top ten customers comprised approximately 35% of total revenue for both the three months ended June 30, 2026 and 2025, with no customer accounting for 10% or more of total revenue in either three-month period.

Six Months

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

In the six months ended June 30, 2026, total revenue increased 4.4% versus the prior year comparable period due predominantly to a low single-digit organic increase and a low-single-digit favorable impact of foreign exchange rates. North America segment revenue increased 5.4% versus the prior year comparable period, driven by the aerospace and defense, power generation and transmission, infrastructure, research, and engineering end markets. International segment revenue increased 2.8% versus the prior year comparable period, due to a mid-single-digit favorable impact of foreign exchange rates, partially offset by a low-single-digit organic decrease. Products and Systems segment revenue increased by 12.7%, due to increased sales volume and shipments as compared to the prior year comparable period.

Oil and gas customer revenue comprised approximately 50% and 57% of total revenue for the six months ended June 30, 2026 and 2025, respectively. Aerospace and defense customer revenue comprised approximately 15% and 13% of total revenue for the six months ended June 30, 2026 and 2025, respectively. The Company’s top ten customers comprised approximately 35% and 37% of total revenue for the six months ended June 30, 2026 and 2025, respectively, with no customer accounting for 10% or more of total revenue in either six-month period.


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Revenue by type
Integrated Field Solutions	$	164,186	$	158,386	$	304,047	$	297,501
In-Laboratory Services	28,946		27,019		58,119		49,519
Total	$	193,132	$	185,405	$	362,166	$	347,020

In presenting the allocation of revenue by type in the table above, management makes certain assumptions in its allocation of revenue from laboratories that provide more than one type of service. The allocation methodology and assumptions made are consistent for the years presented.

Integrated Field Solutions revenue is comprised of revenue derived from on-site asset inspection, maintenance, and related technical services performed by our technicians at customer locations, as well as data-driven solutions, including software, analytics, and implementation services that provide insights and recommendations to enhance asset integrity and performance. Integrated Field Solutions revenue increased by $5.8 million for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025 and increased by $6.5 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to increases in sales volume in our power generation and transmission and infrastructure, research and engineering end markets as a result of strong market demand, partially offset by decreases in sales volume in our oil and gas end market within our North America and International segments.

In-Laboratory Services revenue is comprised of quality assurance inspections of components and materials at our in-house laboratory facilities. In-Laboratory Services revenue increased by $1.9 million for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025, and increased by $8.6 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to increased sales volumes in our aerospace and defense end market in our North America segment.

Gross Profit

Gross profit increased by $2.5 million, or 4.6%, in the three months ended June 30, 2026 versus the prior year comparable period primarily due to an improved and diversified business mix and operating efficiencies.

Gross profit by segment for the three and six months ended June 30, 2026 and 2025 was as follows:

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)


	Three months ended June 30,						Six months ended June 30,
	2026			2025			2026			2025

Gross profit
North America	$	43,030		$	40,384		$	76,566		$	70,549
% of segment revenue	27.5		%	27.3		%	26.2		%	25.5		%
International	11,796			12,270			21,891			21,358
% of segment revenue	31.0		%	31.4		%	29.5		%	29.5		%
Products and Systems	1,835			1,337			2,902			2,960
% of segment revenue	46.8		%	48.8		%	44.2		%	50.8		%
Corporate and eliminations	(216)			(46)			(182)			(30)
	$	56,445		$	53,945		$	101,177		$	94,837
% of total revenue	29.2		%	29.1		%	27.9		%	27.3		%

Three Months

Gross profit margin was 29.2% and 29.1% for the three-month periods ended June 30, 2026 and 2025, respectively. Gross profit margin for the North America segment increased by 0.2% for the three months ended June 30, 2026 as compared to the prior year comparable period primarily due to an improved and diversified business mix and operating efficiencies. International segment realized a 0.4% decline in gross profit margin to 31.0% for the three months ended June 30, 2026 as compared to the prior year comparable period primarily due to a less favorable sales mix in the current year period. Products and Systems segment gross margin had a decrease of 2.0% to 46.8% for the three months ended June 30, 2026 primarily due to a less favorable sales mix as compared to the prior period.

Six Months

Gross profit margin was 27.9% and 27.3% for the six-month periods ended June 30, 2026 and 2025, respectively. Gross profit margin for the North America segment increased 0.7% increase to 26.2% for the six months ended June 30, 2026 as compared to the prior year comparable period primarily due to an improved and diversified business mix and operating efficiencies. International segment profit margin remained flat period over period. Products and Systems segment gross margin had a decline of 6.6% to 44.2% for the six months ended June 30, 2026 primarily due to a less favorable sales mix as compared to the prior period.

Operating Expenses

Operating expenses for the three and six months ended June 30, 2026 and 2025 was as follows:


	Three months ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025

Operating Expenses
Selling, general and administrative expenses	$	38,722	$	39,793	$	75,708	$	75,445


Reorganization and other costs	1,527		2,951		2,002		6,038
Environmental expense	460		518		329		1,058


Research and engineering	243		269		464		568
Depreciation and amortization	2,547		1,986		5,046		4,312


	$	43,499	$	45,517	$	83,549	$	87,421

Three Months

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

Operating expenses decreased $2.0 million, or 4.4%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. Selling, general and administrative expenses decreased $1.1 million during the three months ended June 30, 2026 compared to the three months ended June 30, 2025, due to ongoing cost management activities. Reorganization and other costs decreased by $1.4 million to $1.5 million as compared to the prior year comparable period due to lower restructuring activity, including workforce reductions and laboratory rationalization initiatives in the three months ended June 30, 2025, which did not recur at similar levels during the current year period. Environmental expense decreased by $0.1 million as compared to the prior year comparable period due to lower expenses related to the ongoing remediation efforts related to the Mistras Arizona claim discussed in Note 13 - Commitments and Contingencies. Research and engineering expenses remained flat period over period. Depreciation and amortization increased by $0.6 million during the three months ended June 30, 2026 compared to the three months ended June 30, 2025.

Six Months

Operating expenses decreased $3.9 million, or 4.4%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Selling, general and administrative expenses increased $0.3 million during the six months ended June 30, 2026 compared to the six months ended June 30, 2025, due to strategic investments in our operations to support commercial execution and promote growth in our strategic markets, while maintaining discipline in overhead cost. Reorganization and other costs decreased by $4.0 million to $2.0 million as compared to the prior year comparable period due to lower restructuring activity, including workforce reductions and laboratory rationalization initiatives in the six months ended June 30, 2025, which did not recur at similar levels during the current year period. Environmental expense decreased by $0.7 million as compared to the prior year comparable period due to lower expenses related to the ongoing remediation efforts related to the Mistras Arizona claim discussed in Note 13 - Commitments and Contingencies. Research and engineering expenses decreased by $0.1 million during the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Depreciation and amortization increased by $0.7 million during the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

Income (Loss) from Operations

The following table shows a reconciliation of the income from operations to income from operations before special items for each of our three segments, Corporate and Elimination and for the Company in total:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025

North America:
Income from operations (GAAP)	$	17,753	$	16,758	$	28,173	$	23,273



Reorganization and other costs	510		1,113		584		2,471


Income from operations before special items (non-GAAP)	$	18,263	$	17,871	$	28,757	$	25,744
International:
Income from operations (GAAP)	$	3,019	$	4,004	$	4,495	$	5,085


Reorganization and other costs	274		92		495		270

Income from operations before special items (non-GAAP)	$	3,293	$	4,096	$	4,990	$	5,355
Products and Systems:
Income from operations (GAAP)	$	676	$	336	$	664	$	663

Reorganization and other costs	63		—		63		151
Income from operations before special items (non-GAAP)	$	739	$	336	$	727	$	814
Corporate and Eliminations:
Loss from operations (GAAP)	$	(8,502)	$	(12,670)	$	(15,704)	$	(21,605)


Environmental expense	460		518		329		1,058
Reorganization and other costs	680		1,746		860		3,146

Loss from operations before special items (non-GAAP)	$	(7,362)	$	(10,406)	$	(14,515)	$	(17,401)
Total Company:
Income from operations (GAAP)	$	12,946	$	8,428	$	17,628	$	7,416




Environmental expense	460		518		329		1,058
Reorganization and other costs	1,527		2,951		2,002		6,038



Income from operations before special items (non-GAAP)	$	14,933	$	11,897	$	19,959	$	14,512

See section Note About Non-GAAP Measures in this Quarterly Report for an explanation of the use of non-GAAP measurements.

Three Months

For the three months ended June 30, 2026, income from operations (GAAP) increased $4.5 million, or 53.6%, compared to the three months ended June 30, 2025, while income from operations before special items (non-GAAP) increased by $3.0 million, or 25.5%. As a percentage of revenue, income from operations before special items increased by 130 basis points to 7.7% in the three months ended June 30, 2026 compared to 6.4% in the three months ended June 30, 2025.

Six Months

For the six months ended June 30, 2026, income from operations (GAAP) increased $10.2 million, or 137.7%, compared to the six months ended June 30, 2025, while income from operations before special items (non-GAAP) increased by $5.4 million, or 37.5%. As a percentage of revenue, income from operations before special items increased by 130 basis points to 5.5% in the six months ended June 30, 2026 compared to 4.2% in the six months ended June 30, 2025.

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

Interest Expense

Interest expense was approximately $4.1 million and $4.2 million for the three months ended June 30, 2026 and 2025, respectively. This decrease of $0.1 million in interest expense was a result of lower interest rates during the three months ended June 30, 2026 in comparison to the prior year comparable period. Interest expense was approximately $7.0 million and $7.6 million for the six months ended June 30, 2026 and 2025, respectively. This decrease of $0.5 million in interest expense was a result of lower interest rates and lower average borrowings outstanding during the six months ended June 30, 2026 in comparison to the prior year comparable period.

Income Taxes

Our effective income tax rate was approximately 23.1% and 25.4% for the three months ended June 30, 2026 and 2025, respectively. Our effective income tax rate was approximately 21.1% and 71.4% for the six months ended June 30, 2026 and 2025, respectively.

The effective income tax rate for the three months ended June 30, 2026, was higher than the statutory rate primarily due to limitations on the deductibility of certain compensation expenses. The effective income tax rate for the three months ended June 30, 2025 was higher than the statutory rate primarily due to the impact of an unfavorable discrete item related to stock compensation.

Income tax expense varies as a function of pre-tax income and the level of non-deductible expenses, such as certain amounts of meals and entertainment expense, valuation allowances, and other permanent differences. It is also affected by discrete items that may occur in any given year but are not consistent from year to year. Our effective income tax rate may fluctuate over the next few years due to many variables including the amount and future geographic distribution of our pre-tax income, changes resulting from our acquisition strategy, and increases or decreases in our permanent differences.

Liquidity and Capital Resources

Cash flows are summarized in the table below:


	Six months ended June 30,
	2026		2025

Net cash (used in) provided by:
Operating activities	$	17,718	$	(3,619)
Investing activities	(11,862)		(11,416)
Financing activities	(11,236)		14,910
Effect of exchange rate changes on cash	(640)		1,765
Net change in cash and cash equivalents	$	(6,020)	$	1,640

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Mistras Group, Inc. and Subsidiaries

Management's Discussion and Analysis of Financial Condition and Results of Operations

(tabular dollars are in thousands)

Cash Flows from Operating Activities

During the six months ended June 30, 2026, cash provided by operating activities was $17.7 million, representing a year-over-year increase of $21.3 million, or 590%. This increase was primarily attributable to an increase in net income and movements in working capital, primarily due to higher collections of accounts receivable as compared to the prior year comparable period.

Cash Flows from Investing Activities

During the six months ended June 30, 2026, cash used in investing activities was $11.9 million, representing a $0.4 million increase compared to the prior year comparable period. The increase is primarily attributable to increased expenditures for property, plant, and equipment and intangible assets, partially offset by an increase in proceeds from sale of equipment.

Cash Flows from Financing Activities

Net cash used in financing activities was $11.2 million for the six months ended June 30, 2026, compared to net cash provided by financing activities of $14.9 million for the six months ended June 30, 2025. During the six months ended June 30, 2026, net payments of debt were approximately $9.5 million compared to net borrowings of debt of $16.4 million in the prior year comparable period.

Effect of Exchange Rate Changes on Cash and Cash Equivalents

The effect of exchange rate changes on our cash and cash equivalents was a decrease of $0.6 million in the six months ended June 30, 2026, compared to an increase of $1.8 million for the six months ended June 30, 2025.

Cash Balance and Credit Facility Borrowings

As of June 30, 2026, we had cash and cash equivalents totaling $22.0 million and $106.3 million of unused commitments under our Credit Agreement with borrowings of $170.5 million and $3.8 million of letters of credit outstanding. We finance operations primarily through our existing cash balances, cash collected from operations, bank borrowings and capital lease financing. We believe these sources are sufficient to fund our operations for the foreseeable future.

As of June 30, 2026, we were in compliance with the terms of the Credit Agreement and will continuously monitor our compliance with the covenants contained in the Credit Agreement. The Company believes that it is probable that the Company will be able to comply with the financial covenants in the Credit Agreement and that sufficient credit remains available under the Credit Agreement to meet the Company's liquidity needs. However, such matters cannot be predicted with certainty.

The terms of our Credit Agreement are described in Note 11 - Long-Term Debt of the Notes to the Unaudited Condensed Consolidated Financial Statements, under the heading "Senior Credit Facility". The terms related to the subsequent amendment to the Credit Agreement are described in Note 15 - Subsequent Events.

Contractual Obligations

Except for the subsequent amendment to the Credit Agreement described in Note 15 - Subsequent Events, there have been no significant changes in our contractual obligations and outstanding indebtedness from those disclosed in our 2025 Annual Report.

Off-balance Sheet Arrangements

We did not have, and do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

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Critical Accounting Policies and Estimates

There have been no significant changes to our critical accounting policies and estimates from the information provided in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in the 2025 Annual Report.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

There have been no significant changes to our quantitative and qualitative disclosures about market risk as discussed in Part II, Item 7A “Quantitative and Qualitative Disclosures About Market Risk,” included in the 2025 Annual Report.

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Pursuant to Rule 13a-15(b) under the Exchange Act, our management carried out an evaluation, under the supervision and with the participation of our President and Chief Executive Officer and our Senior Executive Vice President, Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls (as defined in Rule 13a-15(e) of the Exchange Act) and procedures. Based upon that evaluation, our President and Chief Executive Officer and our Senior Executive Vice President, Chief Financial Officer concluded that, as of June 30, 2026, our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the quarter ended June 30, 2026 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1. Legal Proceedings

See Note 13 - Commitments and Contingencies to the Notes to Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report for a description of our legal proceedings. There have been no material legal proceedings and no material developments with regard to any matters disclosed under Part I, Item 3 "Legal Proceedings" in our 2025 Annual Report, except as disclosed herein under Note 13 - Commitments and Contingencies to the Notes to the Unaudited Condensed Consolidated Financial Statements.

ITEM 1.A. Risk Factors

In addition to the other information set forth in this Quarterly Report, you should carefully consider the risk factors discussed under the “Risk Factors” section included in our 2025 Annual Report. There have been no material changes to the risk factors previously disclosed in the 2025 Annual Report.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) Sales of Unregistered Securities

None.

(b) Use of Proceeds from Public Offering of Common Stock

None.

The following table sets forth the shares of our common stock we acquired during the quarter as a result of the surrender of shares by employees to satisfy tax withholding obligations in connection with the vesting or settlement of restricted stock units.


Month Ending	Total Number of Shares (or Units) Purchased	Average Price Paid per Share (or Unit)
April 30, 2026	—	$	—
May 31, 2026	1,745	$	17.26
June 30, 2026	—	$	—

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4. Mine Safety Disclosures

Not applicable.

ITEM 5. Other Information

Rule 10b5-1 Trading Plans

During the three months ended June 30, 2026, none of the Company's directors or officers, as defined in Section 16 of the Securities Exchange Act of 1934, adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K of the Securities Exchange Act of 1934.

On August 5, 2026, the Company entered into an amendment to its Credit Agreement, dated August 1, 2022, with the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent. The amendment extended the maturity date of the Company's $190.0 million revolving credit facility and approximately $90.6 million outstanding term loan from July 30, 2027 to July 28, 2028. In connection with the amendment, the Company incurred an extension fee equal to 0.15% of the

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aggregate committed amount of the revolving credit facility and term loan held by participating lenders. There were no other changes to the material terms of the Credit Agreement, including the applicable interest rate provisions and financial covenants, which remained substantially unchanged. Additional information regarding the amendment is included in Note 15 – Subsequent Events to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

The foregoing description of the amendment does not purport to be complete and is qualified in its entirety by reference to the amendment, which is filed as Exhibit 10.1 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.

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ITEM 6. Exhibits


Exhibit No.						Description
10.1						Amended Credit Agreement, dated August 5, 2026

31.1						Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.2						Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

32.1						Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS						Inline XBRL Instance Document

101.SCH						Inline XBRL Schema Document

101.CAL						Inline XBRL Calculation Linkbase Document

101.LAB						Inline XBRL Labels Linkbase Document

101.PRE						Inline XBRL Presentation Linkbase Document

101.DEF						Inline XBRL Definition Linkbase Document

104						Cover Page Interactive Data File (formatted Inline XBRL and contained in Exhibit 101)

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			MISTRAS GROUP, INC.

			By:			/s/ Edward J. Prajzner
						Edward J. Prajzner
						Senior Executive Vice President and Chief Financial Officer
						(Principal Financial and Accounting Officer and duly authorized officer)

Date: August 10, 2026

MISTRAS Group - 10-Q quarterly report FY2026 Q2

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