FTK Flotek Industries Inc

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General

Flotek Industries, Inc. (“Flotek” or the “Company”) creates unique solutions to reduce the environmental impact of energy on air, water, land and people. A technology-driven, specialty green chemistry and data company, Flotek helps customers across industrial and commercial markets improve their environmental performance.

The Company’s Chemistry Technologies (“CT”) segment develops, manufactures, packages, distributes, delivers, and markets green specialty chemicals that aim to enhance the profitability of hydrocarbon producers.

The Company’s Data Analytics (“DA”) segment aims to enable users to maximize the value of their hydrocarbon associated processes by providing analytics associated with their hydrocarbon streams in seconds rather than minutes or days. The real-time access to information prevents waste, reduces reprocessing and allows users to pursue automation of their hydrocarbon streams to maximize their profitability.

The Company’s two operating segments, CT and DA, are both supported by its Research & Innovation advanced laboratory capabilities. For further discussion of our operations and segments, see Note 17, “Business Segment, Geographic and Major Customer Information.”

Going Concern

These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) assuming the Company will continue as a going concern. The going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. However, substantial doubt about the Company’s ability to continue as a going concern exists.

The Company currently funds its operations from cash on hand and other current assets. The Company has a history of losses and negative cash flows from operations and expects to utilize a significant amount of cash within one year after the date of filing the unaudited condensed consolidated financial statements. The availability of capital is dependent on the Company’s operating cash flow currently expected to be principally derived from the ProFrac Agreement (see Note 9, “Debt and Convertible Notes Payable” and Note 16, “Related Party Transactions”). It is not certain that the Company’s cash and other current assets and the Company’s forecasted operating cash flows currently expected to be generated from the ongoing execution of the ProFrac Agreement will provide the Company with sufficient financial resources to fund operations and meet the Company’s capital requirements and anticipated obligations as they become due in the next twelve months. The Company may require additional liquidity to continue its operations over the next twelve months to sufficiently alleviate or mitigate the conditions and events noted above, which results in substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the unaudited condensed consolidated financial statements are filed.

The Company is evaluating strategies to obtain additional funding for future operations. These strategies may include, but are not limited to, obtaining equity financing, issuing debt or entering into other financing arrangements, obtaining higher prices for its products and services, increasing the percentage of its sales from higher margin products, monetizing non-core assets, and reducing expenses. However, the Company may be unable to access further equity or debt financing when needed. As such, there can be no assurance that the Company will be able to obtain additional liquidity when needed or under acceptable terms, if at all.

The unaudited condensed consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements reflect all adjustments, in the opinion of management, necessary for the fair statement of the financial condition and results of operations for the periods presented. All such adjustments are normal and recurring in nature. The financial statements, including selected notes, have been prepared in accordance with applicable rules and regulations of the SEC regarding interim financial reporting and do not include all

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information and disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for comprehensive financial statement reporting. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s 2022 Annual Report. A copy of the 2022 Annual Report is available on the SEC’s website, www.sec.gov or on Flotek’s website, www.flotekind.com. The information contained on the Company’s website does not form a part of this Quarterly Report.

All significant intercompany accounts and transactions have been eliminated in consolidation. The Company does not have investments in any unconsolidated subsidiaries.

Cash Equivalents

Cash equivalents consist of highly liquid investments with maturities of three months or less at the date of purchase.

Restricted Cash

The Company’s restricted cash is $0.1 million and $0.1 million as of June 30, 2023 and December 31, 2022, respectively. The Company’s restricted cash consists of cash that the Company is contractually obligated to maintain in accordance with the terms of its credit card program with a financial institution.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable and accounts receivable, related party, arise from product sales and services and are stated at estimated net realizable value. This value incorporates an allowance for credit losses to reflect any loss anticipated on accounts receivable balances. The Company applies the current expected credit loss (CECL) model, which requires immediate recognition of expected credit losses over the contractual life of receivables and records the appropriate allowance for credit losses as a charge to operating expenses. The allowance for credit losses is based on a combination of the individual customer circumstances, credit conditions, and historical write-offs and collections. The Company writes off specific accounts receivable when they are determined to be uncollectible. The recovery of accounts receivable previously written off is recorded as a reduction to the allowance for credit losses charged to operating expense.

The majority of the Company’s customers are engaged in the energy industry. The cyclical nature of the energy industry may affect customers’ operating performance and cash flows, which directly impact the Company’s ability to collect on outstanding obligations. Additionally, certain customers are located in international areas that are inherently subject to risks of economic, political, and civil instability, which can impact the collectability of receivables.

Contract Assets

The Company’s contract assets represent consideration issued in the form of convertible notes (Contract Consideration Convertible Notes Payable as discussed in Note 9, “Debt and Convertible Notes Payable”) and other incremental costs related to obtaining the ProFrac Agreement. The contract assets are amortized over the term of the ProFrac Agreement (10 years) based on forecasted revenues as goods are transferred to ProFrac Services, LLC, and the amortization is presented as a reduction of the transaction price included in related party revenue in the consolidated statements of operations.

The contract assets are tested for recoverability on a recurring basis and the Company will recognize an impairment loss to the extent that the carrying amount of the contract assets exceeds the amount of consideration the Company expects to receive in the future for the transfer of goods under the ProFrac Agreement less the direct costs that relate to providing those goods in the future.

Inventories

Inventories consist of raw materials and finished goods and are stated at the lower of cost determined by using the weighted-average cost method, or net realizable value. Finished goods inventories include raw materials, direct labor and production overhead. The Company periodically reviews inventories on hand and current market conditions to determine if the cost of raw materials and finished goods inventories exceed current market prices and impairs the cost basis of the inventory accordingly. Obsolete inventory or inventory in excess of management’s estimated usage requirement is written down to its net realizable value if those amounts are determined to be less than cost. Write-downs or write-offs of inventory are charged to cost of sales.

Property and Equipment

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Property and equipment are stated at cost. The cost of ordinary maintenance and repair is charged to operating expense, while replacement of critical components and major improvements are capitalized. Depreciation or amortization of property and equipment, including operating lease right-of-use assets (“ROU”), is calculated using the straight-line method over the shorter of the lease term or the asset’s estimated useful life as follows:

Buildings and leasehold improvements			2-30 years
Machinery and equipment			7-10 years
Furniture and fixtures			3 years
Land improvements			20 years
Transportation equipment			2-5 years
Computer equipment and software			3-7 years

Property and equipment, including ROU assets, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. If events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable, the Company first compares the carrying amount of an asset or asset group to the sum of the undiscounted future cash flows expected to result from the use and eventual disposal of the asset. If the carrying amount of an asset or asset group exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposal of the asset, the Company will determine the fair value of the asset or asset group. The amount of impairment loss recognized is the excess of the asset or asset group’s carrying amount over its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary.

Assets to be disposed of are reported as assets held for sale at the lower of the carrying amount or the asset’s fair value less cost to sell and depreciation is ceased. Upon sale or other disposition of an asset, the Company recognizes a gain or loss on disposal measured as the difference between the net carrying amount of the asset and the net proceeds received.

Leases

The Company leases certain facilities, land, vehicles, and equipment. The Company determines if an arrangement is classified as a lease at inception of the arrangement.

ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the related lease. Finance leases are under the current and non-current liabilities and the underlying assets are included in property and equipment on the consolidated balance sheet.

As most of the Company’s leases do not provide an implicit rate of return, on a quarterly basis, the Company’s incremental borrowing rate is used, together with the lease term information available at commencement date of the lease, in determining the present value of lease payments. Operating lease liabilities include related options to extend or terminate lease terms that are reasonably certain of being exercised.

Leases with an initial term of 12 months or less (“short term leases”) are not recorded on the balance sheet; and the lease expense on short-term leases is recognized on a straight-line basis over the lease term.

Convertible Notes Payable and Liability Classified Contract Consideration Convertible Notes Payable

The Company accounts for the Convertible Notes Payable at amortized cost pursuant to Financial Accounting Standards Board (“FASB”) ASC Topic 470, Debt.

The Company accounted for the Contract Consideration Convertible Notes Payable issued as consideration related to a related party contract (see Note 9, “Debt and Convertible Notes Payable”), as liability classified convertible instruments in accordance with FASB ASC 718, “Stock Compensation” (“ASC 718”). Under ASC 718, liability classified convertible instruments are measured at fair value at the grant date and at each reporting date (see Note 10, “Fair Value Measurements”) with the change in fair value included in the consolidated statements of operations.

Fair Value Measurements

The Company categorizes financial assets and liabilities using a three-tier fair value hierarchy, based on the nature of the inputs used to determine fair value. Inputs refer broadly to assumptions that market participants would use to value an asset or liability

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and may be observable or unobservable. When determining the fair value of assets and liabilities, the Company uses the most reliable measurement available. See Note 10, “Fair Value Measurements.”

Revenue Recognition

The Company recognizes revenue when it satisfies performance obligations under the terms of the contract with a customer, and control of the promised goods are transferred to the customer or services are performed, in an amount that reflects the consideration the Company expects to be entitled in exchange for those goods or services.

The Company recognizes revenue based on a five-step model when all of the following criteria have been met: (i) a contract with a customer exists, (ii) performance obligations have been identified, (iii) the price to the customer has been determined, (iv) the price to the customer has been allocated to the performance obligations, and (v) performance obligations are satisfied.

Products and services are sold with fixed or determinable prices. Certain sales include discounts offered to customers for prompt payment and right of return provisions, which are considered when recognizing revenue and deferred accordingly. The Company does not act as an agent in any of its revenue arrangements.

In recognizing revenue for products and services, the Company determines the transaction price of contracts with customers, which may consist of fixed and variable consideration. Determining the transaction price may require judgment by management, which includes identifying performance obligations, estimating variable consideration to include in the transaction price, and determining whether promised goods or services can be distinguished in the context of the contract.

The majority of the CT segment revenue is chemical products that are sold at a point in time based on when control transfers to the customer determined by agreed upon delivery terms. Contracts with customers for the sale of products generally state the terms of the sale, including the quantity and price of each product purchased. Additionally, the CT segment offers various services associated to products sold which includes field services, installation, maintenance, and other functions. These services are recognized upon completion of commissioning and installation due to the short-term nature of the performance obligation when the Company has a right to invoice the customer.

The DA segment recognizes revenue for sales of equipment at the time of sale based on when control transfers to the customer based on agreed upon delivery terms. Additionally, the Company offers various services associated with products sold which includes field services, installation, maintenance, and other functions. Services are recognized upon completion of commissioning and installation due to the short-term nature of the performance obligation. There may be additional performance obligations related to providing ongoing or reoccurring maintenance. Revenue for these types of arrangements is recognized ratably over time throughout the contract period. Additionally, the Company may provide subscription-type arrangements with customers in which monthly reoccurring revenue is recognized ratably over time in accordance with agreed upon terms and conditions. Customers may be invoiced for such maintenance and subscription-type arrangements, and revenue not yet recognizable is reported under accrued liabilities and deferred revenue on the consolidated balance sheets. Subscription-type arrangements were not a material revenue stream in the six months ended June 30, 2023 and June 30, 2022.

Payment terms for both the CT and DA segments are customarily 30-60 days for domestic and 90-120 days for international from invoice receipt. Under revenue contracts for both products and services, customers are invoiced once the performance obligations have been satisfied, at which point payment is unconditional. Contract assets associated with incomplete performance obligations are not material.

The Company applies several practical expedients including:

•Sales commissions are expensed as selling, general and administrative expenses when incurred because the amortization period is generally one year or less.

•The Company’s payment terms are short-term in nature with settlements of one year or less. As a result, the Company does not adjust the promised amount of consideration for the effects of a significant financing component.

•In most service contracts, the Company has the right to consideration from a customer in an amount that corresponds directly with the value to the customer of the Company’s performance obligations completed to date and as such the Company recognizes revenue in the amount to which it has a right to invoice.

•The Company excludes from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer. Such taxes are included in accrued liabilities on our consolidated balance sheet until remitted to the governmental agency.

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Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of sales in our consolidated statement of operations.

Foreign Currency Translation

The Company’s functional currency is primarily the U.S. dollar. The Company operates principally in the United States and substantially all assets and liabilities of the Company are denominated in U.S. dollars. Financial statements of foreign subsidiaries that are not U.S. dollar functional currency are prepared using the currency of the primary economic environment of the foreign subsidiaries as the functional currency. Assets and liabilities of those foreign subsidiaries are translated into U.S. dollars at exchange rates in effect as of the end of identified reporting periods. Revenue and expense transactions are translated using the average monthly exchange rate for the reporting period. Resultant translation adjustments are recognized as other comprehensive income (loss) within stockholders’ equity.

Comprehensive Income (Loss)

Comprehensive income (loss) encompasses all changes in stockholders’ equity, except those arising from investments and distributions to stockholders. The Company’s comprehensive income loss includes consolidated net income (loss) and foreign currency translation adjustments.

Research and Development Costs

Expenditures for research activities relating to product development and improvement are charged to expense as incurred.

Income Taxes

Deferred tax assets and liabilities are recognized for temporary differences between financial statement carrying amounts and the tax bases of assets and liabilities and are measured using the tax rates expected to be in effect when the differences reverse. Deferred tax assets are also recognized for operating loss and tax credit carry forwards. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date.

A valuation allowance is established when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The establishment of a valuation allowance requires significant judgment and is impacted by various estimates. Both positive and negative evidence, as well as the objectivity and verifiability of that evidence, is considered in determining the appropriateness of recording a valuation allowance on deferred tax assets.

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

The Company’s policy is to record interest and penalties related to uncertain tax positions as income tax expense.

Stock-Based Compensation

Stock-based compensation expense, related to stock options, restricted stock awards and restricted stock units, is recognized based on their grant-date fair values. The Company recognizes compensation expense, net of estimated forfeitures, on a straight-line basis over the requisite service period of the award. Estimated forfeitures are based on historical experience.

Stock Warrants

The Company evaluated the Pre-Funded Warrants issued in June 2022 (the “June 2022 Warrants”) and the Pre-Funded Warrants issued in February 2023 (the “February 2023 Warrants”) (see Note 13, “Stockholders’ Equity) in accordance with ASC 815-40, “Contracts in Entity’s Own Equity” and determined that the June 2022 Warrants and the February 2023 Warrants meet the criteria to be classified within stockholders’ equity. Accordingly, the Company recorded the proceeds received for the June 2022 Warrants within additional paid in capital. In addition, the Company reclassified the balance of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable (see Note 9, “Debt and Convertible Notes Payable”) for the February 2023 Warrants within additional paid in capital upon conversion.

Use of Estimates

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The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from these estimates.

Significant items subject to estimates and assumptions include the useful lives of property and equipment; long lived asset impairment assessments; stock-based compensation expense; allowance for credit losses for accounts receivable; valuation allowances for inventories and deferred tax assets; recoverability and timing of the realization of contract assets; and fair value of liability classified Contract Consideration Convertible Notes Payable.

Recent Accounting Pronouncements

Changes to U.S. GAAP are established by the FASB. We evaluate the applicability and impact of all authoritative guidance issued by the FASB. Guidance not listed below was assessed and determined to be either not applicable, clarifications of items listed below, immaterial or already adopted by the Company.

New Accounting Standards Issued and Adopted as of January 1, 2023

The FASB issued ASU No. 2016-13, “Measurement of Credit Losses on Financial Instruments.” This standard replaces the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects estimates of expected credit losses over their contractual life that are recorded at inception based on historical information, current conditions, and reasonable and supportable forecasts. The Company adopted this standard prospectively as of January 1, 2023 and the adoption did not have a material impact of the Company’s consolidated financial statements and related disclosures, and there was no cumulative effect on retained earnings.

Disaggregation of Revenue

The Company differentiates revenue based on whether the source of revenue is attributable to product sales or service revenue.

Total revenue disaggregated by revenue source is as follows (in thousands):

			Three months ended June 30,												Six months ended June 30,
			2023						2022						2023						2022
Revenue:
Products (1)			$	49,062					$	28,588					$	95,829					$	40,787
Services			1,532						785						2,773						1,465
			$	50,594					$	29,373					$	98,602					$	42,252

(1) Product revenue includes sales to related parties as described in Note 16, “Related Party Transactions.”

Disaggregation of Cost of Sales

The Company differentiates cost of sales based on whether the cost is attributable to tangible goods sold, cost of services sold or other costs which cannot be directly attributable to either tangible goods or services.

Total cost of sales disaggregated is as follows (in thousands):

			Three months ended June 30,												Six months ended June 30,
			2023						2022						2023						2022
Cost of sales:
Tangible goods sold			$	41,878					$	27,379					$	83,407					$	37,167
Services			156						105						296						53
Other			4,656						4,194						9,114						7,816
			$	46,690					$	31,678					$	92,817					$	45,036

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Other cost of sales represent costs directly associated with the generation of revenue but which cannot be attributed directly to tangible goods sold or services. Examples of other costs of sales are certain personnel costs and equipment rental and insurance costs.

Cost of sales split between external and related party sales is as follows (in thousands):

			Three months ended June 30,												Six months ended June 30,
			2023						2022						2023						2022
Cost of sales:
Cost of sales for external customers			$	16,445					$	13,830					$	27,743					$	24,598
Cost of sales for related parties			30,245						17,848						65,074						20,438
			$	46,690					$	31,678					$	92,817					$	45,036

Contract assets are as follows (in thousands):

			June 30, 2023						December 31, 2022
Contract assets			$	83,060					$	83,060
Less accumulated amortization			(5,761)						(3,371)
Contract assets, net			77,299						79,689
Less current contract assets			(7,716)						(7,113)
Contract assets, long term			$	69,583					$	72,576

In connection with entering into the ProFrac Agreement on February 2, 2022 and May 17, 2022 as discussed in Note 9, “Debt and Convertible Notes Payable” and Note 16, “Related Party Transactions,” the Company recognized contract assets of $10.0 million and $69.5 million, respectively, and associated fees of $3.6 million. As of June 30, 2023 and December 31, 2022, $69.6 million and $72.6 million, respectively, of the contract assets are classified as long term based upon our estimate of the forecasted revenues from the ProFrac Agreement which will not be realized within the next twelve months of the ProFrac Agreement. The Company’s estimate of the timing of the future contract revenues is evaluated on a quarterly basis.

During the three and six months ended June 30, 2023 the Company recognized $1.1 million and $2.4 million, respectively, of contract assets amortization which is recorded as a reduction of the transaction price included in the related party revenue in the consolidated statement of operations. During each of the three and six months ended June 30, 2022, the Company recognized $0.7 million of contract assets amortization. The below table reflects our estimated amortization per year (in thousands) based on the Company’s current forecasted revenues from the ProFrac Agreement.

Years ending December 31,						Amortization
2023 (excluding the six months ended June 30, 2023)						$	3,226
2024						8,980
2025						8,980
2026						8,980
2027						8,980
Thereafter through May 2032						38,153
Total contract assets						$	77,299

Based on our tests of recoverability, we did not identify impairment of such contract assets as of June 30, 2023.

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Inventories are as follows (in thousands):

			June 30, 2023						December 31, 2022
Raw materials			$	7,404					$	5,800
Finished goods			18,473						18,130
Inventories			25,877						23,930
Less reserve for excess and obsolete inventory			(7,480)						(8,210)
Inventories, net			$	18,397					$	15,720

The provision recorded in the three months ended June 30, 2023 and 2022 was $0.2 million and $0.4 million for the CT segment and $6 thousand and $49 thousand for the DA segment, respectively. The provision recorded in the six months ended June 30, 2023 and 2022 was $0.4 million and $0.7 million for the CT segment and $0.1 million and $49.0 thousand for the DA segment, respectively.

Property and equipment are as follows (in thousands):

			June 30, 2023						December 31, 2022
Land			$	886					$	886
Land improvements			520						520
Buildings and leasehold improvements			5,356						5,356
Machinery and equipment			6,890						6,758
Furniture and fixtures			532						532
Transportation equipment			784						784
Computer equipment and software			1,556						1,425
Property and equipment			16,524						16,261
Less accumulated depreciation			(11,771)						(11,435)
Property and equipment, net			$	4,753					$	4,826

Depreciation expense totaled $0.2 million and $0.2 million for the three months ended June 30, 2023 and 2022, respectively. Depreciation expense totaled $0.3 million and $0.4 million for the six months ended June 30, 2023 and 2022, respectively.

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			Three months ended June 30,												Six months ended June 30,
			2023						2022						2023						2022
Operating lease expense			$	237					$	220					$	478					$	448
Finance lease expense:
Amortization of assets			4						4						7						8
Interest on lease liabilities			1						3						2						6
Total finance lease expense			5						7						9						14
Short-term lease expense			40						79						81						203
Total lease expense			$	282					$	306					$	568					$	665
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases			$	1,550					$	350					$	2,915					$	726
Operating cash flows from finance leases			7						10						17						20
Financing cash flows from finance leases			1						3						2						6

Maturities of lease liabilities as of June 30, 2023 are as follows (in thousands):

Years ending December 31,						Operating Leases						Finance Leases
2023 (excluding the six months ended June 30, 2023)			$	1,843					$	19
2024						2,624						23
2025						1,391						—
2026						1,418						—
2027						1,339						—
Thereafter						3,443						—
Total lease payments						$	12,058					$	42
Less: Interest						(2,572)						(2)
Present value of lease liabilities						$	9,486					$	40

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

			June 30, 2023						December 31, 2022
Operating Leases
Operating lease right-of-use assets			$	4,279					$	5,900
Current portion of operating lease liabilities			2,902						3,328
Long-term operating lease liabilities			6,584						8,044
Total operating lease liabilities			$	9,486					$	11,372
Finance Leases
Property and equipment			$	147					$	147
Accumulated depreciation			(63)						(55)
Property and equipment, net			$	84					$	92
Current portion of finance lease liabilities			$	37					$	36
Long-term finance lease liabilities			3						19
Total finance lease liabilities			$	40					$	55
Weighted Average Remaining Lease Term
Operating leases			5.4 years						5.3 years
Finance leases			1.0 year						1.6 years
Weighted Average Discount Rate
Operating leases			9.2		%				9.3		%
Finance leases			8.5		%				8.9		%

Current accrued liabilities are as follows (in thousands):

			June 30, 2023						December 31, 2022
Severance costs			$	1,314					$	2,617
Payroll and benefits			525						684
Legal costs			816						447
Contingent liability for earn-out provision			260						583
Deferred revenue, current			409						655
Taxes other than income taxes			946						1,884
Other			908						2,114
Total current accrued liabilities			$	5,178					$	8,984

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Long Term Debt

Paycheck Protection Program Loans

In April 2020, the Company received a $4.8 million loan (the “Flotek PPP loan”) under the Paycheck Protection Program (“PPP”), which was created through the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and is administered by the U.S. Small Business Administration (“SBA”). In October 2021, the Flotek PPP loan maturity date was extended from April 15, 2022 to April 15, 2025. On January 5, 2023, the Company received notice from the SBA that $4.4 million of the $4.8 million principal amount and accrued interest to that date of $0.1 million were forgiven. The remaining principal amount of $0.4 million and accrued interest is to be repaid in monthly installments of $15 thousand over the remaining term of the loan through April 15, 2025, beginning on March 15, 2023. The forgiveness of the Flotek PPP loan is accounted for as an extinguishment of the debt and the Company has recorded a $4.5 million gain in the six months ended June 30, 2023, comprising the principal amount forgiven of $4.4 million and accrued interest of $0.1 million.

Long-term debt, including current portion, is as follows (in thousands):

			June 30, 2023						December 31, 2022
Flotek PPP loan			$	328					$	4,788
Less current maturities			(179)						(2,052)
Total long-term debt, net of current portion			$	149					$	2,736

Loan repayments are scheduled as follows (in thousands):

Years ending December 31,						Repayment
2023 (excluding the six months ended June 30, 2023)						$	91
2024						180
2025						57
Total Flotek PPP loan						$	328

Convertible Notes Payable

On February 2, 2022, Flotek entered into a Private Investment in Public Equity transaction (the “PIPE transaction”) with a consortium of investors to secure growth capital for the Company. Pursuant to the PIPE transaction, Flotek issued $21.2 million in aggregate initial principal amount of Convertible Notes Payable for net cash proceeds of approximately $20.1 million (the “Convertible Notes Payable”). The investors are ProFrac Holdings, LLC, Burlington Ventures Ltd., entities associated with North Sound Management, certain funds associated with one of Flotek's directors including the D3 Family Fund and the D3 Bulldog Fund, and Firestorm Capital LLC. The Convertible Notes Payable accrued paid-in-kind interest at a rate of 10% per annum, had a maturity of one year, and were convertible into common stock of Flotek or Pre-Funded Warrants to purchase common stock of Flotek, (a) at the holder's option at any time prior to maturity, at a price of $1.088125 per share, (b) at Flotek's option, if the volume-weighted average trading price of Flotek's common stock equals or exceeds $2.50 per share, or $1.741 per share, for 20 trading days during a 30 consecutive trading day period, or (c) at maturity, at a price of $0.8705 per share. On March 21, 2022, $3.0 million of the Convertible Notes Payable, plus accrued paid-in-kind interest thereon, were converted at the holder’s option into approximately 2.8 million shares of common stock. The issuance cost of $1.1 million was amortized on a straight-line basis over the term of the Convertible Notes Payable and the amortization was included in interest expense in the unaudited condensed consolidated statements of operations.

On February 2, 2023, the Convertible Notes Payable, excluding those held by ProFrac Holdings, LLC, with a carrying value of $9.0 million, including accrued paid-in-kind interest of $0.8 million, were converted, upon maturity, into 10,335,840 shares of common stock at a price of $0.8705 per share. The Convertible Notes Payable held by ProFrac Holding, LLC, with a carrying value of $11.0 million, including accrued paid-in-kind interest of $1.0 million, were converted, upon maturity, into 12,683,280 February 2023 Warrants with an exercise price of $0.0001 per share.

Initial ProFrac Agreement Contract Consideration Convertible Notes Payable

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On February 2, 2022, the Company entered into a long-term supply agreement with ProFrac Services, LLC (the “Initial ProFrac Agreement”), a subsidiary of ProFrac Holdings LLC, in exchange for $10 million in aggregate principal amount of Contract Consideration Convertible Notes Payable (“Initial ProFrac Agreement Contract Consideration Convertible Notes Payable”), under the same terms as the Convertible Notes Payable issued in the PIPE transaction described above, including paid-in-kind interest at a rate of 10% per annum and conversion features.

The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were accounted for as liability classified convertible instruments and were initially recorded at fair value of $10.0 million on the issuance date with a corresponding contract asset.

On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable, remeasured to and carried at a fair value of $15.1 million, were converted, upon maturity, into 12,683,281 February 2023 Warrants with an exercise price of $0.0001 per share (see Note 10, “Fair Value Measurements”).

Amended ProFrac Agreement Contract Consideration Convertible Notes Payable

On May 17, 2022, the Company entered into an amendment to the Initial ProFrac Agreement (the “Amended ProFrac Agreement” and collectively with the Initial ProFrac Agreement, the “ProFrac Agreement”) upon issuance of $50 million in aggregate principal amount of Contract Consideration Convertible Notes Payable (“Amended ProFrac Agreement Contract Consideration Convertible Notes Payable”) to ProFrac. The Amended ProFrac Agreement Contract Consideration Convertible Notes Payable accrued paid-in-kind interest at a rate of 10% per annum.

The Amended ProFrac Agreement Contract Consideration Convertible Notes Payable were accounted for as liability classified convertible instruments and were initially recorded at fair value of $69.5 million on the issuance date with a corresponding contract asset.

On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable, remeasured to and carried at a fair value of $40.6 million, were converted, upon maturity, into 63,496,922 shares of common stock at a price of $0.8705 per share (see Note 10, “Fair Value Measurements”).

Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes financial assets and liabilities into the three levels of the fair value hierarchy. The hierarchy prioritizes the inputs to valuation techniques used to measure fair value and bases categorization within the hierarchy on the lowest level of input that is available and significant to the fair value measurement.

•Level 1 — Quoted prices in active markets for identical assets or liabilities;

•Level 2 — Observable inputs other than Level 1, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•Level 3 — Significant unobservable inputs that are supported by little or no market activity or that are based on the reporting entity’s assumptions about the inputs.

Fair Value of Other Financial Instruments

The carrying amounts of certain financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, accrued liabilities and accounts payable approximate fair value due to the short-term nature of these accounts.

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Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the Company’s liabilities that are measured at fair value on a recurring basis and the level within the fair value hierarchy (in thousands):

																		June 30,																								December 31,
			Level 1						Level 2						Level 3			2023						Level 1						Level 2						Level 3						2022
Contingent earnout consideration			$	—					$	—					$	260		$	260					$	—					$	—					$	583					$	583
Initial ProFrac Agreement Contract Consideration Convertible Notes			—						—						—			—						—						—						14,220						14,220
Amended ProFrac Agreement Contract Consideration Convertible Notes			—						—						—			—						—						—						69,350						69,350
Total			$	—					$	—					$	260		$	260					$	—					$	—					$	84,153					$	84,153

Contingent Earnout Consideration Key Inputs

The estimated fair value of the remaining stock performance earn-out provision, with respect to the JP3 transaction, is included in accrued liabilities as of June 30, 2023 and December 31, 2022. The estimated fair value of the earn-out provision at the end of each period was valued using a Monte Carlo model analyzing 20,000 simulations performed using Geometric Brownian Motion with inputs such as risk-neutral expected growth and volatility.

			June 30, 2023			December 31, 2022
Risk-free interest rate			4.93		%	4.34%
Expected volatility			100.0		%	100.0%
Term until liquidation (years)			1.88			2.38
Stock price			$0.73			$1.12
Discount rate			12.66		%	9.95%

Initial ProFrac Agreement Contract Consideration Notes Payable Key Inputs

The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were measured at fair value at issuance and on a recurring basis. The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable had an initial fair value of $10.0 million on February 2, 2022. The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were classified as Level 2 at the initial measurement upon issuance due to the use of a quoted price for a similar liability at that date (the PIPE transaction), and subsequently classified as Level 3 due to the use of unobservable inputs.

On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were remeasured, upon maturity, to a fair value of $15.1 million based on the closing price of the shares of common stock of $1.19, on the date of conversion. The fair value adjustment was a $0.8 million increase in each of the three and six months ended June 30, 2023, and a $2.6 million decrease and a $1.3 million increase in the three and six months ended June 30, 2022, respectively.

The estimated value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable as of December 31, 2022 was valued using a Monte Carlo simulation. The key inputs into the Monte Carlo simulation used to estimate the fair value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable maturing February 2, 2023, as of December 31, 2022 were as follows:

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						December 31, 2022
Risk-free interest rate						4.12%
Expected volatility						100.0%
Term until liquidation (years)						0.09
Stock price						$1.12
Discount rate						4.12%

Amended ProFrac Agreement Contract Consideration Convertible Notes Payable Key Inputs

On May 17, 2022, the Company measured the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable classified as Level 3 using a Monte Carlo simulation at an estimated fair value of $69.5 million. The Company reduced the discount rate assumed due to the reduced likelihood of occurrence of any of the default events in the shorter term remaining on the notes. The estimated value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable as of December 31, 2022 was valued using a Monte Carlo simulation.

On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable were remeasured, at maturity, to a fair value of $40.6 million based on the closing price of the shares of common stock of $0.64, on the date of conversion. The fair value adjustment was a decrease of $3.9 million and $30.8 million in the three and six months ended June 30, 2023, and a decrease of $14.5 million in each of the three and six months ended June 30, 2022, respectively.

The key inputs into the Monte Carlo simulation used to estimate the fair value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable maturing May 17, 2023, as of December 31, 2022 were as follows:

			December 31, 2022
Risk-free interest rate			4.59%
Expected volatility			100.0%
Term until liquidation (years)			0.38
Stock price			$1.12
Discount rate			4.59%

Assets Measured at Fair Value on a Nonrecurring Basis

The Company’s non-financial assets, including property and equipment and operating lease ROU assets, are measured at fair value on a non-recurring basis and are subject to adjustment to their fair value in certain circumstances.

Level 3 Rollforward for Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the changes in balances of liabilities for the three and six months ended June 30, 2023 and 2022 classified as Level 3 (in thousands):

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The income tax benefit differed from the amounts computed by applying the U.S. federal income tax rate of 21% to loss before income tax for the reasons set forth below:

			Three months ended June 30,												Six months ended June 30,
			2023						2022						2023						2022
U.S. federal statutory tax rate			21.0		%				21.0		%				21.0		%				21.0		%
State income taxes, net of federal benefit			120.4						—						0.1						0.1
Non-U.S. income taxed at different rates			(96.7)						3.8						—						(1.9)
Increase (reduction) in tax benefit related to stock-based awards			1291.8						3.1						0.7						(2.0)
Increase in valuation allowance			2284.5						(27.5)						(19.8)						(17.0)
Permanent differences			(3779.4)						—						(2.1)						—
Non-deductible expenses			278.8						(0.4)						0.2						0.1
Other			—						3.8						—						(2.2)
Effective income tax rate			120.4		%				3.8		%				0.1		%				(1.9)		%

Internal Revenue Code (“IRC”) section 382 addresses company ownership changes and specifically limits the utilization of certain deductions and other tax attributes on an annual basis following an ownership change. During 2023, the Company converted various debt instruments into Company stock and warrants causing an ownership change within the meaning of IRC section 382 that subjected certain of the Company’s tax attributes, including net operating losses ("NOLs"), to an IRC section 382 limitation.

As of June 30, 2023, the Company has an estimated $196.1 million in U.S. federal NOL carryforwards, $119.4 million in certain state NOL carryforwards, $7.1 million in section 163(j) interest limitation carryforwards and $3.8 million in tax credit carryforwards. As a result of the change of control experienced in 2023, the Company’s ability to use NOLs to reduce taxable income is generally limited to an annual amount which is currently estimated to be $3.5 million a year as a result of the section 382 limitation which may be revised based on further detailed analysis. NOLs that exceed the section 382 limitation in any

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Litigation

The Company is subject to routine litigation and other claims that arise in the normal course of business. Except as disclosed below, management is not aware of any pending or threatened lawsuits or proceedings that are expected to have a material effect on the Company’s financial position, results of operations or liquidity.

Former CEO (John Chisholm) Matter

On May 23, 2023, the Company entered into an agreement with John Chisholm (a former CEO of the Company) to resolve a claim made by Mr. Chisholm in arbitration for payment of outstanding severance and claims made by the Company against Mr. Chisholm. The settlement resulted in the reversal of $2.3 million of accrued severance costs during the three and six months ended June 30, 2023 and is included in severance costs in our consolidated statements of operation. The Company had withheld payment of outstanding severance to Mr. Chisholm subsequent to an investigation conducted during the year ended December 31, 2021 into corporate practices when Mr. Chisholm was CEO during the years from 2014 to 2018. The Company concluded upon completion of that investigation that its historical financial statements could be relied upon, that proper action had been taken, and that no members of current management were implicated in any improper corporate practices. The Company subsequently commenced arbitration and other legal proceedings against Mr. Chisholm, Casey Doherty/ Doherty & Doherty LLP (Flotek’s former outside general counsel) and Moss Adams LLP and its predecessor, Hein & Associates LLP (Flotek’s former independent public audit firm) to recover damages. Mr. Chisholm filed a counterclaim against the Company in the arbitration proceeding for his remaining severance, and that dispute has been resolved as previously stated. Further, on June 16, 2023, the Company entered into a settlement with Moss Adams LLP and its predecessor, Hein & Associates LLP, regarding the claims between the Company and Moss Adams LLP and Hein & Associates LLP. The arbitration action between the Company and Mr. Casey Doherty and Doherty & Doherty LLP remains outstanding.

Other Commitments and Contingencies

The Company is subject to concentrations of credit risk within trade accounts receivable, and related party accounts receivable, as the Company does not generally require collateral as support for trade receivables. In addition, the majority of the Company’s cash is invested in three major U.S. financial institutions and balances often exceed insurable amounts.

On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable discussed in Note 9, “Debt and Convertible Notes Payable”, were converted, upon maturity, into 63,496,922 shares of common stock at a price of $0.8705 per share. The Contract Consideration Convertible Notes Payable converted into common stock shares, remeasured to a fair value of $40.6 million upon maturity, were recorded as additional paid-in-capital as of June 30, 2023.

On February 2, 2023, the Convertible Notes Payable pursuant to the PIPE transaction discussed in Note 9, “Debt and Convertible Notes Payable”, excluding those held by ProFrac Holdings, LLC, were converted, upon maturity, into 10,335,840 shares of common stock at a price of $0.8705 per share. The Convertible Notes Payable converted into common stock shares had a carrying value of $9.0 million, including accrued paid-in-kind interest of $0.8 million and were recorded as additional paid-in-capital as of June 30, 2023.

The Convertible Notes Payable held by ProFrac Holding, LLC, with a carrying value of $11.0 million, including accrued interest of $1.0 million, were converted, upon maturity, into 12,683,280 February 2023 Warrants with an exercise price of $0.0001 per share and were recorded as additional paid-in-capital as of June 30, 2023.

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On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable discussed in Note 9, “Debt and Convertible Notes Payable”, remeasured to a fair value of $15.1 million upon maturity, were converted, upon maturity, into 12,683,281 February 2023 Warrants and were recorded as additional paid-in-capital as of June 30, 2023.

The February 2023 Warrants permit ProFrac Holdings II, LLC to purchase 25,366,561 shares of common stock of the Company at an exercise price equal to $0.0001 per share.

On June 21, 2022, ProFrac Holdings II, LLC paid $19.5 million for Pre-Funded Warrants (the “June 2022 Warrants”) of the Company. The June 2022 Warrants were recorded in equity at their fair value of $11.1 million, estimated using a Black-Scholes Option Pricing model, less $1.2 million of transaction costs paid. The remaining cash received of $8.4 million was recognized as an equity contribution. The June 2022 Warrants permit ProFrac Holdings II, LLC to purchase 13,104,839 shares of common stock of the Company at an exercise price equal to $0.0001 per share, and a $4.5 million exercise fee representing a 20% premium to the 30-day volume average price of the Company’s common stock at the close of business on the day prior to the date of the issuance of the June 2022 Warrants. The June 2022 Warrants, net of transaction fees of $1.1 million, and the equity contribution of $8.4 million from ProFrac Holdings II, LLC were recorded as additional paid-in capital.

The key inputs into the Black-Scholes Option Pricing Model used to estimate the fair value of the June 2022 Warrants as of the issuance on June 21, 2022 were as follows:

Risk-free interest rate			3.21%
Expected volatility			90.0%
Term until liquidation (years)			2.00
Stock price			$1.11
Strike price (exercise fee)			$4.5 million

ProFrac Holdings II, LLC and its affiliates may not receive any voting or consent rights in respect of the June 2022 Warrants or the underlying shares of common stock unless and until (i) the Company has obtained approval from a majority of its shareholders excluding ProFrac Holdings II, LLC and its affiliates and (ii) ProFrac Holdings II, LLC has paid an additional $4.5 million to the Company; provided, however, that ProFrac Holdings II may exercise the June 2022 Warrants immediately prior to the sale of the shares of common stock subject to such exercise to a non-affiliate of ProFrac Holdings II. The additional $4.5 million will be accounted for as an equity contribution if received.

On March 21, 2022, the Convertible Notes Payable issued pursuant to the PIPE transaction discussed in Note 9, “Debt and Convertible Notes Payable”, which had been purchased by certain funds associated with one of the Company’s directors including the D3 Family Fund and the D3 Bulldog Fund, which aggregated $3.0 million plus $39 thousand of accrued interest, were converted into 2,793,030 shares of the Company’s common stock.

Basic earnings (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period, which includes the February 2023 Warrants (See Note 9, “Debt and Convertible Notes Payable”, and Note 13, “Stockholders’ Equity”). Diluted earnings (loss) per common share is calculated by dividing the adjusted net income (loss) by the weighted average number of common shares outstanding combined with dilutive common share equivalents outstanding, if the effect is dilutive. Potentially dilutive common share equivalents consist of incremental shares of common stock issuable upon conversion of convertible notes payable, exercise of stock warrants and vesting and settlement of stock awards. The dilutive effect of non-vested stock issued under share‑based compensation plans, shares issuable under the Employee Stock Purchase Plan (ESPP), employee stock options outstanding, and the Pre-Funded stock warrants are computed using the treasury stock method. The dilutive effect of the Convertible Notes is computed using the if‑converted method in accordance with ASU 2020-06, which was adopted by the Company on January 1, 2022 (see Note 2, “Summary of Significant Accounting Policies”).

The calculation of the basic and diluted earnings (loss) per share for the three and six months ended June 30, 2023 and 2022 is as follows (in thousands):

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			Three months ended June 30,												Six months ended June 30,
			2023									2022						2023						2022
Numerator:
Net income (loss) for basic earnings per share			$	(21)								$	6,240					$	21,322					$	(4,484)
Adjustments to net income available to shareholders
Paid-in-Kind interest expense on convertible notes payable and Contract Consideration Convertible Notes Payable			712									1,028						2,284						1,402
Valuation (gain)/loss on Contract Consideration Convertible Notes Payable carried at FV			(3,874)									(13,229)						(29,969)						(10,228)
Adjusted net loss for diluted earnings per share			$	(3,183)								$	(5,961)					$	(6,363)					$	(13,310)
Denominator:
Basic weighted average shares outstanding			143,433									74,861						121,244						73,476
Average number of diluted shares for convertible notes payable and Contract Consideration Convertible Notes Payable			26,067									49,474						42,921						33,610
Diluted weighted average shares outstanding			169,500									124,335						164,165						$	107,086
Basic earnings (loss) per share			—									0.08						0.18						(0.06)
Diluted loss per share			(0.02)									(0.05)						(0.04)						(0.12)
Anti-dilutive incremental shares excluded from denominator for diluted earnings computation
Average number of diluted shares for June 2022 stock warrants			6,496									976						8,038						491
Average number of diluted shares for options and restricted stock			545									692						718						662

For the three and six months ended June 30, 2023 and 2022, weighted average shares for the June 2022 stock warrants and weighted average shares for employee stock awards were not included in the dilution calculation since including them would have an anti-dilutive effect as it would reduce the loss per share.

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Supplemental cash flow information is as follows (in thousands):

        

			Six months ended June 30,
			2023						2022
Supplemental cash flow information:
Interest paid			$	23					$	7
Supplemental non cash financing and investing activities:
Conversion of convertible notes payable to common stock			8,996						3,038
Conversion of convertible notes payable to February 2023 Warrants			11,040						—
Conversion of Initial Contract Consideration Convertible Notes Payable to February 2023 Warrants			15,092						—
Conversion of Amended Contract Consideration Convertible Notes Payable to common stock			40,638						—
Issuance of convertible notes payable as consideration for ProFrac Agreements			—						79,460
Issuance cost of stock warrants included in accrued accounts payable			—						1,170

On February 2, 2022, the Company entered into the Initial ProFrac Agreement, upon issuance of $10 million in aggregate principal amount of the convertible notes (the “Contract Consideration Convertible Notes Payable”) to ProFrac Holdings LLC (see Note 9, “Debt and Convertible Notes Payable”). Under the Initial ProFrac Agreement, ProFrac Services, LLC is obligated to order chemicals from the Company at least equal to the greater of (a) the chemicals required for 33% of ProFrac Services, LLC’s hydraulic fracturing fleets and (b) a baseline measured by the first ten hydraulic fracturing fleets deployed by ProFrac Services, LLC during the term of the Initial ProFrac Agreement. If the minimum volumes are not achieved in any given year, ProFrac Services LLC shall pay to the Company, as liquidated damages an amount equal to twenty-five percent (25%) of the difference between (i) the aggregate purchase price of the quantity of products comprising the minimum purchase obligation and (ii) the actual purchased volume during such calendar year.

On May 17, 2022, the Company entered into the Amended ProFrac Agreement upon issuance of $50 million in aggregate principal amount of Contract Consideration Convertible Notes Payable (see Note 9, “Debt and Convertible Notes Payable”). The Initial ProFrac Agreement was amended to (a) increase ProFrac Services LLC’s minimum purchase obligation for each year to the greater of 70% of ProFrac Services LLC’s requirements and a baseline measured by ProFrac Services, LLC’s first 30 hydraulic fracturing fleets, and (b) increase the term to 10 years.

On February 1, 2023, the Company entered into an amendment to the ProFrac Agreement (the “Amended ProFrac Agreement No. 2”) dated February 2, 2022. The Amended ProFrac Agreement No. 2 has an effective date of January 1, 2023. The ProFrac Agreement was amended to (1) provide a ramp-up period from January 1, 2023 to May 31, 2023 for ProFrac Services, LLC to increase the number of active hydraulic fracturing fleets to 30 fleets, (2) waive any liquidated damages payment relating to any potential order shortfall prior to January 1, 2023, (3) add additional fees to certain products, and (4) provide margin increases based on margins with non-ProFrac customers. The Company believes the net present value of the economic benefit attributable to the Amended ProFrac Agreement No. 2 will exceed the value of the liquidated damages payments that would have been received for the period from April 1, 2022 through December 31, 2022.

On February 2, 2023, the Convertible Notes Payable held by ProFrac Holding, LLC, with a carrying value of $11.0 million, including accrued paid-in-kind interest of $1.0 million, were converted, upon maturity, into 12,683,280 February 2023 Warrants (see Note 9, “Debt and Convertible Notes Payable” and Note 13, “Stockholders’ Equity”).

On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable, with a carrying value of $11.0 million, including accrued interest of $1 million, were converted, upon maturity, into 12,683,281 February 2023 Warrants (see Note 9, “Debt and Convertible Notes Payable” and Note 13, “Stockholders’ Equity”). The fair value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable, as of February 2, 2023, was $15.1 million (see Note 10, “Fair Value Measurements”).

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On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable, with a carrying value of $55.3 million, including accrued interest of $5.3 million, were converted, upon maturity, into 63,496,922 shares of common stock at a price of $0.8705 per share (see Note 9, “Debt and Convertible Notes Payable” and Note 13, “Stockholders’ Equity”). The fair value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable, as of May 17, 2023 was $40.6 million (see Note 10, “Fair Value Measurements”).

During the three months ended June 30, 2023 and 2022, the Company’s revenues from ProFrac Services, LLC were $32.8 million and $16.5 million, respectively. During the six months ended June 30, 2023 and 2022, the Company’s revenues from ProFrac Services LLC were $69.1 million and $18.9 million, respectively. For the three months ended June 30, 2023 and 2022, these revenues were net of amortization of contract assets of $1.1 million and $0.7 million. For the six months ended June 30, 2023 and 2022, the revenues were net of amortization of contract assets of $2.4 million and $0.7 million, respectively. Cost of sales attributable to these revenues were $30.2 million and $17.8 million, respectively for the three months ended June 30, 2023 and 2022 and $65.1 million and $19.0 million for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and December 31, 2022 our accounts receivable from ProFrac Services, LLC was $23.0 million and $22.7 million, respectively which is recorded in accounts receivable, related party on the consolidated balance sheet.

Also, during 2023 and 2022, we had the following related party transactions with ProFrac Holdings, LLC and ProFrac Holdings II, LLC:

•PIPE Transaction (see Note 9, “Debt and Convertible Notes Payable”)

•June 2022 Warrants (see Note 13, “Stockholders’ Equity)

On March 21, 2022, the Convertible Notes Payable which had been purchased by certain funds associated with one of the Company’s directors including the D3 Family Fund and the D3 Bulldog Fund, which aggregated $3.0 million plus $39 thousand of accrued interest and amortization of issuance costs of $90 thousand, were converted into 2,793,030 shares of the Company’s common stock.

Mr. Ted D. Brown was a Director of the Company beginning in November of 2013 and is the President and CEO of Confluence Resources LP (“Confluence”), a private oil and gas exploration and production company. The Company’s revenues and related cost of sales for product sold to Confluence were $1.4 million and $1.4 million, for the three and six months ended June 30, 2022. As of June 9, 2022 Mr. Brown stepped down from being a Director of the Company and Confluence is no longer considered a related party as of June 9, 2022.

Segment Information

Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the chief operating decision-maker in deciding how to allocate resources and assess performance. The operations of the Company are categorized into the following reportable segments:

Chemistry Technologies. The CT segment includes green specialty chemistries, logistics and technology services, which enable its customers to pursue improved efficiencies and performance throughout the life cycle of their wells, and also helping customers improve their ESG and operational goals. Customers of the CT segment include major integrated oil and gas companies, oilfield services companies, independent oil and gas companies, national and state-owned oil companies, and international supply chain management companies.

Data Analytics. The DA segment includes the design, development, production, sale and support of equipment and services that create and provide valuable information on the composition and properties of energy customers’ hydrocarbon fluids. The company markets products and services that support in-line data analysis of hydrocarbon components and properties. Customers of the DA segment span across the entire oil and gas market, from upstream production to midstream facilities to refineries and distribution networks.

Performance is based upon a variety of criteria. The primary financial measure is segment operating income (loss). Various functions, including certain sales and marketing activities and general and administrative activities, are provided centrally by the corporate office. Costs associated with corporate office functions, other corporate income and expense items, and income taxes are not allocated to the reportable segments.

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Summarized financial information of the reportable segments is as follows (in thousands):

As of and for the three months ended June 30,			Chemistry Technologies						Data Analytics						Corporate and Other						Total
2023
Revenue from external customers
Products			$	15,095					$	1,620					$	—					$	16,715
Services			374						731						—						1,105
Total revenue from external customers			15,469						2,351						—						17,820
Revenue from related party																					—
Products			32,345						2						—						32,347
Services			272						155						—						427
Total revenue from related parties			32,617						157						—						32,774
Gross profit			2,603						1,301						—						3,904
Change in fair value of Contract Consideration Convertible Notes Payable			(3,874)						—						—						(3,874)
Income (loss) from operations			3,795						129						(3,252)						672
Paid-in-kind interest on Contract Consideration Convertible Notes Payable			712						—						—						712
Depreciation			155						18						1						174
Additions to long-lived assets			—						135						—						135
2022
Revenue from external customers
Products			$	11,740					$	299					$	—					$	12,039
Services			371						414						—						785
Total revenue from external customers			12,111						713						—						12,824
Revenue from related party
Products			16,549						—						—						16,549
Services			—						—						—						—
Total revenue from related parties			16,549						—						—						16,549
Gross loss			(1,568)						(737)						—						(2,305)
Change in fair value of Contract Consideration Convertible Notes Payable			(17,158)						—						—						(17,158)
Loss from operations			14,944						(1,198)						(5,707)						8,039
Paid-in-kind interest on Contract Consideration Convertible Notes Payable			868						—						—						868
Paid-in-kind interest on convertible notes payable			—						—						466						466
Depreciation			166						15						1						182
Additions to long-lived assets			5						—						—						5

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---

Assets of the Company by reportable segments are as follows (in thousands):

			June 30, 2023						December 31, 2022
Chemistry Technologies			$	139,921					$	146,542
Data Analytics			7,382						5,645
Corporate and Other			10,727						12,623
Total assets			$	158,030					$	164,810

Geographic Information

Revenue by country is based on the location where services are provided and products are sold. For the three and six months ended June 30, 2023 no individual countries other than the U.S. accounted for more than 10% of revenue. For the three and six months ended June 30, 2022 no individual countries other than the U.S. and the United Arab Emirates (“UAE”) accounted for more than 10% of revenue. Revenue by geographic location is as follows (in thousands):

			Three months ended June 30,												Six months ended June 30,
			2023						2022						2023						2022
U.S. (1)			$	48,725					$	25,955					$	94,851					$	36,289
UAE			1,509						3,139						2,912						4,450
Other countries			360						279						839						1,513
Total revenue			$	50,594					$	29,373					$	98,602					$	42,252

(1) Includes revenue from related party

Long-lived assets held in countries other than the U.S. are not considered material to the consolidated financial statements.

Major Customers

Revenue from major customers, as a percentage of consolidated revenue, is as follows (in thousands):

Three months ended June 30,						Revenue						% of Total Revenue
2023
Customer A (Related Party)						$	32,774					64.8		%
2022
Customer A (Related Party)						$	16,549					52.2		%
Customer B						5,611						19.1		%

Six months ended June 30,						Revenue						% of Total Revenue
2023
Customer A (Related Party)						$	69,129					70.1		%
2022
Customer A (Related Party)						$	17,657					38.9		%
Customer B						8,218						19.5		%

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 The concentration with ProFrac Services, LLC and in the oil and gas industry increases credit, commodity and business risk.

Major Suppliers

Expenditure with major suppliers, as a percentage of consolidated supplier expenditure, is as follows (in thousands):

						Expenditure						% of Total Expenditure
Three months ended June 30,
2023
Supplier A						$	13,155					32.6		%
Supplier B						8,049						20.0		%
Supplier C						4,489						11.1		%
2022
Supplier A						7,576						31.9		%
Supplier B						4,036						17.0		%
Supplier C						2,679						11.3		%

						Expenditure						% of Total Expenditure
Six months ended June 30,
2023
Supplier A						$	30,109					36.4		%
Supplier B						15,194						18.4		%
Supplier C						8,993						10.9		%
2022
Supplier A						7,624						24.2		%
Supplier B						6,154						19.5%

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v3.23.2

Cover Page - shares	6 Months Ended
	Jun. 30, 2023	Aug. 04, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	1-13270
Entity Registrant Name	FLOTEK INDUSTRIES INC/CN
Entity Incorporation, State	DE
Entity Tax Identification Number	90-0023731
Entity Address, Street	8846 N. Sam Houston Parkway W.
Entity Address, City	Houston,
Entity Address, State	TX
Entity Address, Postal Zip Code	77064
City Area Code	713
Local Phone Number	849-9911
Title of each class	Common Stock, $0.0001 par value
Trading Symbol(s)	FTK
Name of each exchange on which registered	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		152,401,483
Entity Central Index Key	0000928054
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false

v3.23.2

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 8,841	$ 12,290
Restricted cash	101	100
Inventories, net	18,397	15,720
Other current assets	4,051	4,045
Current contract assets	7,716	7,113
Total current assets	78,994	81,087
Long-term contract assets	69,583	72,576
Property and equipment, net	4,753	4,826
Operating lease right-of-use assets	4,279	5,900
Deferred tax assets, net	404	404
Other long-term assets	17	17
Total assets	158,030	164,810
Current liabilities:
Accounts payable	44,949	33,375
Accrued liabilities	5,178	8,984
Income taxes payable	12	97
Interest payable	0	130
Current portion of operating lease liabilities	2,902	3,328
Current portion of finance lease liabilities	37	36
Current portion of long-term debt	179	2,052
Convertible notes payable	0	19,799
Contract Consideration Convertible Notes Payable	0	83,570
Total current liabilities	53,257	151,371
Deferred revenue, long-term	35	44
Long-term operating lease liabilities	6,584	8,044
Long-term finance lease liabilities	3	19
Long-term debt	149	2,736
TOTAL LIABILITIES	60,028	162,214
Stockholders’ equity:
Preferred stock, $0.0001 par value, 100,000 shares authorized; no shares issued and outstanding	0	0
Common stock, $0.0001 par value, 240,000,000 shares authorized; 158,220,075 shares issued and 151,541,446 shares outstanding at June 30, 2023 ; 83,915,918 shares issued and 77,788,391 shares outstanding at December 31, 2022	15	8
Additional paid-in capital	462,517	388,177
Accumulated other comprehensive income	147	181
Accumulated deficit	(330,197)	(351,519)
Treasury stock, at cost; 6,678,629 and 6,127,527 shares at June 30, 2023 and December 31, 2022, respectively	(34,480)	(34,251)
Total stockholders’ equity	98,002	2,596
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	158,030	164,810
Nonrelated Party
Current assets:
Accounts receivable	16,855	19,136
Related Party
Current assets:
Accounts receivable	$ 23,033	$ 22,683

v3.23.2

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Preferred stock, at par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	100,000	100,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	240,000,000	240,000,000
Common stock, shares issued (in shares)	158,220,075	83,915,918
Common stock, shares outstanding (in shares)	151,541,446	77,788,391
Treasury stock, shares (in shares)	6,678,629	6,127,527
Nonrelated Party
Accounts receivable, allowance for doubtful accounts	$ 682	$ 623
Related Party
Accounts receivable, allowance for doubtful accounts	$ 0	$ 0

v3.23.2

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue:
Total revenues	$ 50,594	$ 29,373	$ 98,602	$ 42,252
Cost of sales	46,690	31,678	92,817	45,036
Gross profit (loss)	3,904	(2,305)	5,785	(2,784)
Operating costs and expenses:
Selling, general, and administrative	8,351	6,821	14,803	11,707
Depreciation	174	182	349	377
Research and development	860	1,115	1,474	2,530
Severance costs	(2,279)	610	(56)	603
Gain on sale of property and equipment	0	(1,914)	0	(1,906)
Gain on lease termination	0	0	0	(584)
Gain in fair value of Contract Consideration Convertible Notes Payable	(3,874)	(17,158)	(29,969)	(13,266)
Total operating costs and expenses	3,232	(10,344)	(13,399)	(539)
Income (loss) from operations	672	8,039	19,184	(2,245)
Other income (expense):
Payment protection plan loan forgiveness	0	0	4,522	0
Interest expense	(705)	(1,597)	(2,377)	(2,265)
Other income (expense), net	19	(104)	9	120
Total other income (expense)	(686)	(1,701)	2,154	(2,145)
Income (loss) before income taxes	(14)	6,338	21,338	(4,390)
Income tax expense	(7)	(98)	(16)	(94)
Net income (loss)	$ (21)	$ 6,240	$ 21,322	$ (4,484)
Income (loss) per common share:
Basic (in dollars per share)	$ 0	$ 0.08	$ 0.18	$ (0.06)
Diluted (see Note 14, “Earnings (Loss) Per Share”) (in dollars per share)	$ (0.02)	$ (0.05)	$ (0.04)	$ (0.12)
Weighted average common shares:
Weighted average common shares used in computing basic income (loss) per common share (in shares)	143,433	74,861	121,244	73,476
Weighted average common shares used in computing diluted loss per common share (in shares)	169,500	124,335	164,165	107,086
Nonrelated Party
Revenue:
Revenue	$ 17,820	$ 12,824	$ 29,472	$ 23,206
Cost of sales	16,445	13,830	27,743	24,598
Related Party
Revenue:
Revenue	32,774	16,549	69,130	19,046
Cost of sales	$ 30,245	$ 17,848	$ 65,074	$ 20,438

v3.23.2

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ (21)	$ 6,240	$ 21,322	$ (4,484)
Other comprehensive income (loss):
Foreign currency translation adjustment	(13)	87	(34)	95
Comprehensive income (loss)	$ (34)	$ 6,327	$ 21,288	$ (4,389)

v3.23.2

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net income (loss)	$ 21,322	$ (4,484)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Change in fair value of contingent consideration	(324)	(134)
Change in fair value of Contract Consideration Convertible Notes Payable	(29,969)	(13,266)
Amortization of convertible note issuance cost	83	414
Paid-in-kind interest expense	2,284	1,819
Amortization of contract assets	2,390	737
Depreciation	349	377
Provision for credit losses, net of recoveries	63	87
Provision for excess and obsolete inventory	497	769
Gain on sale of property and equipment	0	(1,906)
Gain on lease termination	0	(584)
Lease expense	1,621	112
Stock compensation expense	(836)	1,591
Deferred income tax benefit	0	(5)
Paycheck protection plan loan forgiveness	(4,522)	0
Changes in current assets and liabilities:
Accounts receivable	2,218	(21,741)
Accounts receivable, related party	(350)	11,600
Inventories	(3,158)	(4,521)
Income taxes receivable	0	7
Other assets	(6)	(232)
Contract assets	0	(3,600)
Accounts payable	11,574	12,154
Accrued liabilities	(3,491)	(2,924)
Operating lease liabilities	(1,886)	(308)
Income taxes payable	(85)	99
Interest payable	(8)	24
Net cash used in operating activities	(2,234)	(23,915)
Cash flows from investing activities:
Capital expenditures	(292)	(5)
Proceeds from sale of assets	0	4,194
Net cash (used in) provided by investing activities	(292)	4,189
Cash flows from financing activities:
Payment for forfeited stock options	(617)	0
Payments on long term debt	(60)	0
Proceeds from issuance of convertible notes	0	21,150
Payment of issuance costs of convertible notes	0	(1,084)
Proceeds from issuance of warrants	0	19,500
Payments to tax authorities for shares withheld from employees	(229)	(138)
Proceeds from issuance of stock	33	24
Payments for finance leases	(15)	(21)
Net cash (used in) provided by financing activities	(888)	39,431
Effect of changes in exchange rates on cash and cash equivalents	(34)	95
Net change in cash and cash equivalents and restricted cash	(3,448)	19,800
Cash and cash equivalents at the beginning of period	12,290	11,534
Restricted cash at the beginning of period	100	1,790
Cash and cash equivalents and restricted cash at beginning of period	12,390	13,324
Cash and cash equivalents at end of period	8,841	33,084
Restricted cash at the end of period	101	40
Cash and cash equivalents and restricted cash at end of period	$ 8,942	$ 33,124

v3.23.2

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands	Total	ProFrac Agreement	Common Stock	Treasury Stock	Additional Paid-in Capital	Additional Paid-in Capital ProFrac Agreement	Accumulated Other Comprehensive Income	Accumulated Deficit
Beginning balance at Dec. 31, 2021	$ 20,192		$ 8	$ (34,100)	$ 363,417		$ 81	$ (309,214)
Beginning balance (in shares) at Dec. 31, 2021			79,484,000
Beginning balance (in shares) at Dec. 31, 2021				6,022,000
Increase (Decrease) in Equity
Net (loss) income	(4,484)							(4,484)
Foreign currency translation adjustment	95						95
Stock issued under employee stock purchase plan	24				24
Stock issued under employee stock purchase plan (in shares)				(19,000)
Restricted stock granted (in shares)			626,000
Restricted stock forfeited (in shares)			(3,000)	20,000
Stock compensation expense	1,591				1,591
Shares withheld to cover taxes	(138)			$ (138)
Shares withheld to cover taxes (in shares)			(15,000)	88,000
Issuance of warrants	9,930				9,930
Equity contribution	8,400				8,400
Conversion of convertible notes payable to Common Stock	2,948				2,948
Conversion of notes to common stock (in shares)			2,793,000
Ending balance at Jun. 30, 2022	38,558		$ 8	$ (34,238)	386,310		176	(313,698)
Ending balance (in shares) at Jun. 30, 2022			82,885,000
Ending balance (in shares) at Jun. 30, 2022				6,111,000
Beginning balance at Mar. 31, 2022	13,104		$ 8	$ (34,159)	367,104		89	(319,938)
Beginning balance (in shares) at Mar. 31, 2022			82,564,000
Beginning balance (in shares) at Mar. 31, 2022				6,073,000
Increase (Decrease) in Equity
Net (loss) income	6,240							6,240
Foreign currency translation adjustment	87						87
Stock issued under employee stock purchase plan	24				24
Stock issued under employee stock purchase plan (in shares)				(19,000)
Restricted stock granted (in shares)			339,000
Restricted stock forfeited (in shares)			(3,000)	12,000
Stock compensation expense	852				852
Shares withheld to cover taxes	(79)			$ (79)
Shares withheld to cover taxes (in shares)			(15,000)	45,000
Issuance of warrants	9,930				9,930
Equity contribution	8,400				8,400
Ending balance at Jun. 30, 2022	38,558		$ 8	$ (34,238)	386,310		176	(313,698)
Ending balance (in shares) at Jun. 30, 2022			82,885,000
Ending balance (in shares) at Jun. 30, 2022				6,111,000
Beginning balance at Dec. 31, 2022	$ 2,596		$ 8	$ (34,251)	388,177		181	(351,519)
Beginning balance (in shares) at Dec. 31, 2022	83,915,918		83,916,000
Beginning balance (in shares) at Dec. 31, 2022	6,127,527			6,127,000
Increase (Decrease) in Equity
Net (loss) income	$ 21,322							21,322
Foreign currency translation adjustment	(34)						(34)
Stock issued under employee stock purchase plan	33				33
Stock issued under employee stock purchase plan (in shares)				(43,000)
Restricted stock granted (in shares)			15,000
Restricted stock forfeited (in shares)			(40,000)	379,000
Restricted stock units vested (in shares)			496,000
Forfeited stock options purchased	(617)				(617)
Stock compensation expense	(836)				(836)
Shares withheld to cover taxes	(229)			$ (229)
Shares withheld to cover taxes (in shares)				214,000
Issuance of warrants		$ 15,092				$ 15,092
Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable to Common Stock (in shares)			63,497,000
Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable to Common Stock	40,638		$ 6		40,632
Conversion of convertible notes payable to Pre-Funded Warrants	11,040				11,040
Conversion of convertible notes payable to Common Stock	8,997		$ 1		8,996
Conversion of notes to common stock (in shares)			10,336,000
Ending balance at Jun. 30, 2023	$ 98,002		$ 15	$ (34,480)	462,517		147	(330,197)
Ending balance (in shares) at Jun. 30, 2023	158,220,075		158,220,000
Ending balance (in shares) at Jun. 30, 2023	6,678,629			6,677,000
Beginning balance at Mar. 31, 2023	$ 57,138		$ 9	$ (34,451)	421,596		160	(330,176)
Beginning balance (in shares) at Mar. 31, 2023			94,614,000
Beginning balance (in shares) at Mar. 31, 2023				6,442,000
Increase (Decrease) in Equity
Net (loss) income	(21)							(21)
Foreign currency translation adjustment	(13)						(13)
Stock issued under employee stock purchase plan	13				13
Stock issued under employee stock purchase plan (in shares)				(22,000)
Restricted stock forfeited (in shares)				214,000
Restricted stock units vested (in shares)			109,000
Stock compensation expense	276				276
Shares withheld to cover taxes	(29)			$ (29)
Shares withheld to cover taxes (in shares)				43,000
Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable to Common Stock (in shares)			63,497,000
Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable to Common Stock	40,638		$ 6		40,632
Ending balance at Jun. 30, 2023	$ 98,002		$ 15	$ (34,480)	$ 462,517		$ 147	$ (330,197)
Ending balance (in shares) at Jun. 30, 2023	158,220,075		158,220,000
Ending balance (in shares) at Jun. 30, 2023	6,678,629			6,677,000

v3.23.2

Organization and Nature of Operations	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Nature of Operations	Organization and Nature of Operations General Flotek Industries, Inc. (“Flotek” or the “Company”) creates unique solutions to reduce the environmental impact of energy on air, water, land and people. A technology-driven, specialty green chemistry and data company, Flotek helps customers across industrial and commercial markets improve their environmental performance. The Company’s Chemistry Technologies (“CT”) segment develops, manufactures, packages, distributes, delivers, and markets green specialty chemicals that aim to enhance the profitability of hydrocarbon producers. The Company’s Data Analytics (“DA”) segment aims to enable users to maximize the value of their hydrocarbon associated processes by providing analytics associated with their hydrocarbon streams in seconds rather than minutes or days. The real-time access to information prevents waste, reduces reprocessing and allows users to pursue automation of their hydrocarbon streams to maximize their profitability. The Company’s two operating segments, CT and DA, are both supported by its Research & Innovation advanced laboratory capabilities. For further discussion of our operations and segments, see Note 17, “Business Segment, Geographic and Major Customer Information.” Going Concern These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) assuming the Company will continue as a going concern. The going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. However, substantial doubt about the Company’s ability to continue as a going concern exists. The Company currently funds its operations from cash on hand and other current assets. The Company has a history of losses and negative cash flows from operations and expects to utilize a significant amount of cash within one year after the date of filing the unaudited condensed consolidated financial statements. The availability of capital is dependent on the Company’s operating cash flow currently expected to be principally derived from the ProFrac Agreement (see Note 9, “Debt and Convertible Notes Payable” and Note 16, “Related Party Transactions”). It is not certain that the Company’s cash and other current assets and the Company’s forecasted operating cash flows currently expected to be generated from the ongoing execution of the ProFrac Agreement will provide the Company with sufficient financial resources to fund operations and meet the Company’s capital requirements and anticipated obligations as they become due in the next twelve months. The Company may require additional liquidity to continue its operations over the next twelve months to sufficiently alleviate or mitigate the conditions and events noted above, which results in substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the unaudited condensed consolidated financial statements are filed. The Company is evaluating strategies to obtain additional funding for future operations. These strategies may include, but are not limited to, obtaining equity financing, issuing debt or entering into other financing arrangements, obtaining higher prices for its products and services, increasing the percentage of its sales from higher margin products, monetizing non-core assets, and reducing expenses. However, the Company may be unable to access further equity or debt financing when needed. As such, there can be no assurance that the Company will be able to obtain additional liquidity when needed or under acceptable terms, if at all. The unaudited condensed consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern.

v3.23.2

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements reflect all adjustments, in the opinion of management, necessary for the fair statement of the financial condition and results of operations for the periods presented. All such adjustments are normal and recurring in nature. The financial statements, including selected notes, have been prepared in accordance with applicable rules and regulations of the SEC regarding interim financial reporting and do not include all information and disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for comprehensive financial statement reporting. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s 2022 Annual Report. A copy of the 2022 Annual Report is available on the SEC’s website, www.sec.gov or on Flotek’s website, www.flotekind.com. The information contained on the Company’s website does not form a part of this Quarterly Report. All significant intercompany accounts and transactions have been eliminated in consolidation. The Company does not have investments in any unconsolidated subsidiaries. Cash Equivalents Cash equivalents consist of highly liquid investments with maturities of three months or less at the date of purchase. Restricted Cash The Company’s restricted cash is $0.1 million and $0.1 million as of June 30, 2023 and December 31, 2022, respectively. The Company’s restricted cash consists of cash that the Company is contractually obligated to maintain in accordance with the terms of its credit card program with a financial institution. Accounts Receivable and Allowance for Credit Losses Accounts receivable and accounts receivable, related party, arise from product sales and services and are stated at estimated net realizable value. This value incorporates an allowance for credit losses to reflect any loss anticipated on accounts receivable balances. The Company applies the current expected credit loss (CECL) model, which requires immediate recognition of expected credit losses over the contractual life of receivables and records the appropriate allowance for credit losses as a charge to operating expenses. The allowance for credit losses is based on a combination of the individual customer circumstances, credit conditions, and historical write-offs and collections. The Company writes off specific accounts receivable when they are determined to be uncollectible. The recovery of accounts receivable previously written off is recorded as a reduction to the allowance for credit losses charged to operating expense. The majority of the Company’s customers are engaged in the energy industry. The cyclical nature of the energy industry may affect customers’ operating performance and cash flows, which directly impact the Company’s ability to collect on outstanding obligations. Additionally, certain customers are located in international areas that are inherently subject to risks of economic, political, and civil instability, which can impact the collectability of receivables. Contract Assets The Company’s contract assets represent consideration issued in the form of convertible notes (Contract Consideration Convertible Notes Payable as discussed in Note 9, “Debt and Convertible Notes Payable”) and other incremental costs related to obtaining the ProFrac Agreement. The contract assets are amortized over the term of the ProFrac Agreement (10 years) based on forecasted revenues as goods are transferred to ProFrac Services, LLC, and the amortization is presented as a reduction of the transaction price included in related party revenue in the consolidated statements of operations. The contract assets are tested for recoverability on a recurring basis and the Company will recognize an impairment loss to the extent that the carrying amount of the contract assets exceeds the amount of consideration the Company expects to receive in the future for the transfer of goods under the ProFrac Agreement less the direct costs that relate to providing those goods in the future. Inventories Inventories consist of raw materials and finished goods and are stated at the lower of cost determined by using the weighted-average cost method, or net realizable value. Finished goods inventories include raw materials, direct labor and production overhead. The Company periodically reviews inventories on hand and current market conditions to determine if the cost of raw materials and finished goods inventories exceed current market prices and impairs the cost basis of the inventory accordingly. Obsolete inventory or inventory in excess of management’s estimated usage requirement is written down to its net realizable value if those amounts are determined to be less than cost. Write-downs or write-offs of inventory are charged to cost of sales. Property and Equipment Property and equipment are stated at cost. The cost of ordinary maintenance and repair is charged to operating expense, while replacement of critical components and major improvements are capitalized. Depreciation or amortization of property and equipment, including operating lease right-of-use assets (“ROU”), is calculated using the straight-line method over the shorter of the lease term or the asset’s estimated useful life as follows: Buildings and leasehold improvements 2-30 years Machinery and equipment 7-10 years Furniture and fixtures 3 years Land improvements 20 years Transportation equipment 2-5 years Computer equipment and software 3-7 years Property and equipment, including ROU assets, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. If events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable, the Company first compares the carrying amount of an asset or asset group to the sum of the undiscounted future cash flows expected to result from the use and eventual disposal of the asset. If the carrying amount of an asset or asset group exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposal of the asset, the Company will determine the fair value of the asset or asset group. The amount of impairment loss recognized is the excess of the asset or asset group’s carrying amount over its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary. Assets to be disposed of are reported as assets held for sale at the lower of the carrying amount or the asset’s fair value less cost to sell and depreciation is ceased. Upon sale or other disposition of an asset, the Company recognizes a gain or loss on disposal measured as the difference between the net carrying amount of the asset and the net proceeds received. Leases The Company leases certain facilities, land, vehicles, and equipment. The Company determines if an arrangement is classified as a lease at inception of the arrangement. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the related lease. Finance leases are under the current and non-current liabilities and the underlying assets are included in property and equipment on the consolidated balance sheet. As most of the Company’s leases do not provide an implicit rate of return, on a quarterly basis, the Company’s incremental borrowing rate is used, together with the lease term information available at commencement date of the lease, in determining the present value of lease payments. Operating lease liabilities include related options to extend or terminate lease terms that are reasonably certain of being exercised. Leases with an initial term of 12 months or less (“short term leases”) are not recorded on the balance sheet; and the lease expense on short-term leases is recognized on a straight-line basis over the lease term. Convertible Notes Payable and Liability Classified Contract Consideration Convertible Notes Payable The Company accounts for the Convertible Notes Payable at amortized cost pursuant to Financial Accounting Standards Board (“FASB”) ASC Topic 470, Debt. The Company accounted for the Contract Consideration Convertible Notes Payable issued as consideration related to a related party contract (see Note 9, “Debt and Convertible Notes Payable”), as liability classified convertible instruments in accordance with FASB ASC 718, “Stock Compensation” (“ASC 718”). Under ASC 718, liability classified convertible instruments are measured at fair value at the grant date and at each reporting date (see Note 10, “Fair Value Measurements”) with the change in fair value included in the consolidated statements of operations. Fair Value Measurements The Company categorizes financial assets and liabilities using a three-tier fair value hierarchy, based on the nature of the inputs used to determine fair value. Inputs refer broadly to assumptions that market participants would use to value an asset or liability and may be observable or unobservable. When determining the fair value of assets and liabilities, the Company uses the most reliable measurement available. See Note 10, “Fair Value Measurements.” Revenue Recognition The Company recognizes revenue when it satisfies performance obligations under the terms of the contract with a customer, and control of the promised goods are transferred to the customer or services are performed, in an amount that reflects the consideration the Company expects to be entitled in exchange for those goods or services. The Company recognizes revenue based on a five-step model when all of the following criteria have been met: (i) a contract with a customer exists, (ii) performance obligations have been identified, (iii) the price to the customer has been determined, (iv) the price to the customer has been allocated to the performance obligations, and (v) performance obligations are satisfied. Products and services are sold with fixed or determinable prices. Certain sales include discounts offered to customers for prompt payment and right of return provisions, which are considered when recognizing revenue and deferred accordingly. The Company does not act as an agent in any of its revenue arrangements. In recognizing revenue for products and services, the Company determines the transaction price of contracts with customers, which may consist of fixed and variable consideration. Determining the transaction price may require judgment by management, which includes identifying performance obligations, estimating variable consideration to include in the transaction price, and determining whether promised goods or services can be distinguished in the context of the contract. The majority of the CT segment revenue is chemical products that are sold at a point in time based on when control transfers to the customer determined by agreed upon delivery terms. Contracts with customers for the sale of products generally state the terms of the sale, including the quantity and price of each product purchased. Additionally, the CT segment offers various services associated to products sold which includes field services, installation, maintenance, and other functions. These services are recognized upon completion of commissioning and installation due to the short-term nature of the performance obligation when the Company has a right to invoice the customer. The DA segment recognizes revenue for sales of equipment at the time of sale based on when control transfers to the customer based on agreed upon delivery terms. Additionally, the Company offers various services associated with products sold which includes field services, installation, maintenance, and other functions. Services are recognized upon completion of commissioning and installation due to the short-term nature of the performance obligation. There may be additional performance obligations related to providing ongoing or reoccurring maintenance. Revenue for these types of arrangements is recognized ratably over time throughout the contract period. Additionally, the Company may provide subscription-type arrangements with customers in which monthly reoccurring revenue is recognized ratably over time in accordance with agreed upon terms and conditions. Customers may be invoiced for such maintenance and subscription-type arrangements, and revenue not yet recognizable is reported under accrued liabilities and deferred revenue on the consolidated balance sheets. Subscription-type arrangements were not a material revenue stream in the six months ended June 30, 2023 and June 30, 2022. Payment terms for both the CT and DA segments are customarily 30-60 days for domestic and 90-120 days for international from invoice receipt. Under revenue contracts for both products and services, customers are invoiced once the performance obligations have been satisfied, at which point payment is unconditional. Contract assets associated with incomplete performance obligations are not material. The Company applies several practical expedients including: •Sales commissions are expensed as selling, general and administrative expenses when incurred because the amortization period is generally one year or less. •The Company’s payment terms are short-term in nature with settlements of one year or less. As a result, the Company does not adjust the promised amount of consideration for the effects of a significant financing component. •In most service contracts, the Company has the right to consideration from a customer in an amount that corresponds directly with the value to the customer of the Company’s performance obligations completed to date and as such the Company recognizes revenue in the amount to which it has a right to invoice. •The Company excludes from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer. Such taxes are included in accrued liabilities on our consolidated balance sheet until remitted to the governmental agency. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of sales in our consolidated statement of operations. Foreign Currency Translation The Company’s functional currency is primarily the U.S. dollar. The Company operates principally in the United States and substantially all assets and liabilities of the Company are denominated in U.S. dollars. Financial statements of foreign subsidiaries that are not U.S. dollar functional currency are prepared using the currency of the primary economic environment of the foreign subsidiaries as the functional currency. Assets and liabilities of those foreign subsidiaries are translated into U.S. dollars at exchange rates in effect as of the end of identified reporting periods. Revenue and expense transactions are translated using the average monthly exchange rate for the reporting period. Resultant translation adjustments are recognized as other comprehensive income (loss) within stockholders’ equity. Comprehensive Income (Loss) Comprehensive income (loss) encompasses all changes in stockholders’ equity, except those arising from investments and distributions to stockholders. The Company’s comprehensive income loss includes consolidated net income (loss) and foreign currency translation adjustments. Research and Development Costs Expenditures for research activities relating to product development and improvement are charged to expense as incurred. Income Taxes Deferred tax assets and liabilities are recognized for temporary differences between financial statement carrying amounts and the tax bases of assets and liabilities and are measured using the tax rates expected to be in effect when the differences reverse. Deferred tax assets are also recognized for operating loss and tax credit carry forwards. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is established when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The establishment of a valuation allowance requires significant judgment and is impacted by various estimates. Both positive and negative evidence, as well as the objectivity and verifiability of that evidence, is considered in determining the appropriateness of recording a valuation allowance on deferred tax assets. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company’s policy is to record interest and penalties related to uncertain tax positions as income tax expense. Stock-Based Compensation Stock-based compensation expense, related to stock options, restricted stock awards and restricted stock units, is recognized based on their grant-date fair values. The Company recognizes compensation expense, net of estimated forfeitures, on a straight-line basis over the requisite service period of the award. Estimated forfeitures are based on historical experience. Stock Warrants The Company evaluated the Pre-Funded Warrants issued in June 2022 (the “June 2022 Warrants”) and the Pre-Funded Warrants issued in February 2023 (the “February 2023 Warrants”) (see Note 13, “Stockholders’ Equity) in accordance with ASC 815-40, “Contracts in Entity’s Own Equity” and determined that the June 2022 Warrants and the February 2023 Warrants meet the criteria to be classified within stockholders’ equity. Accordingly, the Company recorded the proceeds received for the June 2022 Warrants within additional paid in capital. In addition, the Company reclassified the balance of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable (see Note 9, “Debt and Convertible Notes Payable”) for the February 2023 Warrants within additional paid in capital upon conversion. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from these estimates. Significant items subject to estimates and assumptions include the useful lives of property and equipment; long lived asset impairment assessments; stock-based compensation expense; allowance for credit losses for accounts receivable; valuation allowances for inventories and deferred tax assets; recoverability and timing of the realization of contract assets; and fair value of liability classified Contract Consideration Convertible Notes Payable. Recent Accounting Pronouncements Changes to U.S. GAAP are established by the FASB. We evaluate the applicability and impact of all authoritative guidance issued by the FASB. Guidance not listed below was assessed and determined to be either not applicable, clarifications of items listed below, immaterial or already adopted by the Company. New Accounting Standards Issued and Adopted as of January 1, 2023 The FASB issued ASU No. 2016-13, “Measurement of Credit Losses on Financial Instruments.” This standard replaces the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects estimates of expected credit losses over their contractual life that are recorded at inception based on historical information, current conditions, and reasonable and supportable forecasts. The Company adopted this standard prospectively as of January 1, 2023 and the adoption did not have a material impact of the Company’s consolidated financial statements and related disclosures, and there was no cumulative effect on retained earnings.

v3.23.2

Revenue from Contracts with Customers	6 Months Ended
	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue from Contracts with Customers	Revenue from Contracts with Customers Disaggregation of Revenue The Company differentiates revenue based on whether the source of revenue is attributable to product sales or service revenue. Total revenue disaggregated by revenue source is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Revenue: Products (1) $ 49,062  $ 28,588  $ 95,829  $ 40,787  Services 1,532  785  2,773  1,465  $ 50,594  $ 29,373  $ 98,602  $ 42,252  (1) Product revenue includes sales to related parties as described in Note 16, “Related Party Transactions.” Disaggregation of Cost of Sales The Company differentiates cost of sales based on whether the cost is attributable to tangible goods sold, cost of services sold or other costs which cannot be directly attributable to either tangible goods or services. Total cost of sales disaggregated is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Cost of sales: Tangible goods sold $ 41,878  $ 27,379  $ 83,407  $ 37,167  Services 156  105  296  53  Other 4,656  4,194  9,114  7,816  $ 46,690  $ 31,678  $ 92,817  $ 45,036  Other cost of sales represent costs directly associated with the generation of revenue but which cannot be attributed directly to tangible goods sold or services. Examples of other costs of sales are certain personnel costs and equipment rental and insurance costs. Cost of sales split between external and related party sales is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Cost of sales: Cost of sales for external customers $ 16,445  $ 13,830  $ 27,743  $ 24,598  Cost of sales for related parties 30,245  17,848  65,074  20,438  $ 46,690  $ 31,678  $ 92,817  $ 45,036  Contract Assets Contract assets are as follows (in thousands): June 30, 2023 December 31, 2022 Contract assets $ 83,060  $ 83,060  Less accumulated amortization (5,761) (3,371) Contract assets, net 77,299  79,689  Less current contract assets (7,716) (7,113) Contract assets, long term $ 69,583  $ 72,576  In connection with entering into the ProFrac Agreement on February 2, 2022 and May 17, 2022 as discussed in Note 9, “Debt and Convertible Notes Payable” and Note 16, “Related Party Transactions,” the Company recognized contract assets of $10.0 million and $69.5 million, respectively, and associated fees of $3.6 million. As of June 30, 2023 and December 31, 2022, $69.6 million and $72.6 million, respectively, of the contract assets are classified as long term based upon our estimate of the forecasted revenues from the ProFrac Agreement which will not be realized within the next twelve months of the ProFrac Agreement. The Company’s estimate of the timing of the future contract revenues is evaluated on a quarterly basis. During the three and six months ended June 30, 2023 the Company recognized $1.1 million and $2.4 million, respectively, of contract assets amortization which is recorded as a reduction of the transaction price included in the related party revenue in the consolidated statement of operations. During each of the three and six months ended June 30, 2022, the Company recognized $0.7 million of contract assets amortization. The below table reflects our estimated amortization per year (in thousands) based on the Company’s current forecasted revenues from the ProFrac Agreement. Years ending December 31, Amortization 2023 (excluding the six months ended June 30, 2023) $ 3,226  2024 8,980  2025 8,980  2026 8,980  2027 8,980  Thereafter through May 2032 38,153  Total contract assets $ 77,299  Based on our tests of recoverability, we did not identify impairment of such contract assets as of June 30, 2023.

v3.23.2

Contract Assets	6 Months Ended
	Jun. 30, 2023
Revenue Recognition [Abstract]
Contract Assets	Revenue from Contracts with Customers Disaggregation of Revenue The Company differentiates revenue based on whether the source of revenue is attributable to product sales or service revenue. Total revenue disaggregated by revenue source is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Revenue: Products (1) $ 49,062  $ 28,588  $ 95,829  $ 40,787  Services 1,532  785  2,773  1,465  $ 50,594  $ 29,373  $ 98,602  $ 42,252  (1) Product revenue includes sales to related parties as described in Note 16, “Related Party Transactions.” Disaggregation of Cost of Sales The Company differentiates cost of sales based on whether the cost is attributable to tangible goods sold, cost of services sold or other costs which cannot be directly attributable to either tangible goods or services. Total cost of sales disaggregated is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Cost of sales: Tangible goods sold $ 41,878  $ 27,379  $ 83,407  $ 37,167  Services 156  105  296  53  Other 4,656  4,194  9,114  7,816  $ 46,690  $ 31,678  $ 92,817  $ 45,036  Other cost of sales represent costs directly associated with the generation of revenue but which cannot be attributed directly to tangible goods sold or services. Examples of other costs of sales are certain personnel costs and equipment rental and insurance costs. Cost of sales split between external and related party sales is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Cost of sales: Cost of sales for external customers $ 16,445  $ 13,830  $ 27,743  $ 24,598  Cost of sales for related parties 30,245  17,848  65,074  20,438  $ 46,690  $ 31,678  $ 92,817  $ 45,036  Contract Assets Contract assets are as follows (in thousands): June 30, 2023 December 31, 2022 Contract assets $ 83,060  $ 83,060  Less accumulated amortization (5,761) (3,371) Contract assets, net 77,299  79,689  Less current contract assets (7,716) (7,113) Contract assets, long term $ 69,583  $ 72,576  In connection with entering into the ProFrac Agreement on February 2, 2022 and May 17, 2022 as discussed in Note 9, “Debt and Convertible Notes Payable” and Note 16, “Related Party Transactions,” the Company recognized contract assets of $10.0 million and $69.5 million, respectively, and associated fees of $3.6 million. As of June 30, 2023 and December 31, 2022, $69.6 million and $72.6 million, respectively, of the contract assets are classified as long term based upon our estimate of the forecasted revenues from the ProFrac Agreement which will not be realized within the next twelve months of the ProFrac Agreement. The Company’s estimate of the timing of the future contract revenues is evaluated on a quarterly basis. During the three and six months ended June 30, 2023 the Company recognized $1.1 million and $2.4 million, respectively, of contract assets amortization which is recorded as a reduction of the transaction price included in the related party revenue in the consolidated statement of operations. During each of the three and six months ended June 30, 2022, the Company recognized $0.7 million of contract assets amortization. The below table reflects our estimated amortization per year (in thousands) based on the Company’s current forecasted revenues from the ProFrac Agreement. Years ending December 31, Amortization 2023 (excluding the six months ended June 30, 2023) $ 3,226  2024 8,980  2025 8,980  2026 8,980  2027 8,980  Thereafter through May 2032 38,153  Total contract assets $ 77,299  Based on our tests of recoverability, we did not identify impairment of such contract assets as of June 30, 2023.

v3.23.2

Inventories	6 Months Ended
	Jun. 30, 2023
Inventory Disclosure [Abstract]
Inventories	Inventories Inventories are as follows (in thousands): June 30, 2023 December 31, 2022 Raw materials $ 7,404  $ 5,800  Finished goods 18,473  18,130  Inventories 25,877  23,930  Less reserve for excess and obsolete inventory (7,480) (8,210) Inventories, net $ 18,397  $ 15,720  The provision recorded in the three months ended June 30, 2023 and 2022 was $0.2 million and $0.4 million for the CT segment and $6 thousand and $49 thousand for the DA segment, respectively. The provision recorded in the six months ended June 30, 2023 and 2022 was $0.4 million and $0.7 million for the CT segment and $0.1 million and $49.0 thousand for the DA segment, respectively.

v3.23.2

Property and Equipment	6 Months Ended
	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
Property and Equipment	Property and Equipment Property and equipment are as follows (in thousands): June 30, 2023 December 31, 2022 Land $ 886  $ 886  Land improvements 520  520  Buildings and leasehold improvements 5,356  5,356  Machinery and equipment 6,890  6,758  Furniture and fixtures 532  532  Transportation equipment 784  784  Computer equipment and software 1,556  1,425     Property and equipment 16,524  16,261  Less accumulated depreciation (11,771) (11,435) Property and equipment, net $ 4,753  $ 4,826  Depreciation expense totaled $0.2 million and $0.2 million for the three months ended June 30, 2023 and 2022, respectively. Depreciation expense totaled $0.3 million and $0.4 million for the six months ended June 30, 2023 and 2022, respectively.

v3.23.2

Leases	6 Months Ended
	Jun. 30, 2023
Leases [Abstract]
Leases	LeasesThe components of lease expense and supplemental cash flow information are as follows (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Operating lease expense $ 237  $ 220  $ 478  $ 448  Finance lease expense: Amortization of assets 4  4  7  8  Interest on lease liabilities 1  3  2  6  Total finance lease expense 5  7  9  14  Short-term lease expense 40  79  81  203  Total lease expense $ 282  $ 306  $ 568  $ 665  Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 1,550  $ 350  $ 2,915  $ 726  Operating cash flows from finance leases 7  10  17  20  Financing cash flows from finance leases 1  3  2  6  Maturities of lease liabilities as of June 30, 2023 are as follows (in thousands): Years ending December 31, Operating Leases Finance Leases 2023 (excluding the six months ended June 30, 2023) $ 1,843  $ 19  2024 2,624  23  2025 1,391  —  2026 1,418  —  2027 1,339  —  Thereafter 3,443  —  Total lease payments $ 12,058  $ 42  Less: Interest (2,572) (2) Present value of lease liabilities $ 9,486  $ 40  Supplemental balance sheet information related to leases is as follows (in thousands): June 30, 2023 December 31, 2022 Operating Leases Operating lease right-of-use assets $ 4,279  $ 5,900  Current portion of operating lease liabilities 2,902  3,328  Long-term operating lease liabilities 6,584  8,044  Total operating lease liabilities $ 9,486  $ 11,372  Finance Leases Property and equipment $ 147  $ 147  Accumulated depreciation (63) (55) Property and equipment, net $ 84  $ 92  Current portion of finance lease liabilities $ 37  $ 36  Long-term finance lease liabilities 3  19  Total finance lease liabilities $ 40  $ 55  Weighted Average Remaining Lease Term Operating leases 5.4 years 5.3 years Finance leases 1.0 year 1.6 years Weighted Average Discount Rate Operating leases 9.2  % 9.3  % Finance leases 8.5  % 8.9  %
Leases	LeasesThe components of lease expense and supplemental cash flow information are as follows (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Operating lease expense $ 237  $ 220  $ 478  $ 448  Finance lease expense: Amortization of assets 4  4  7  8  Interest on lease liabilities 1  3  2  6  Total finance lease expense 5  7  9  14  Short-term lease expense 40  79  81  203  Total lease expense $ 282  $ 306  $ 568  $ 665  Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 1,550  $ 350  $ 2,915  $ 726  Operating cash flows from finance leases 7  10  17  20  Financing cash flows from finance leases 1  3  2  6  Maturities of lease liabilities as of June 30, 2023 are as follows (in thousands): Years ending December 31, Operating Leases Finance Leases 2023 (excluding the six months ended June 30, 2023) $ 1,843  $ 19  2024 2,624  23  2025 1,391  —  2026 1,418  —  2027 1,339  —  Thereafter 3,443  —  Total lease payments $ 12,058  $ 42  Less: Interest (2,572) (2) Present value of lease liabilities $ 9,486  $ 40  Supplemental balance sheet information related to leases is as follows (in thousands): June 30, 2023 December 31, 2022 Operating Leases Operating lease right-of-use assets $ 4,279  $ 5,900  Current portion of operating lease liabilities 2,902  3,328  Long-term operating lease liabilities 6,584  8,044  Total operating lease liabilities $ 9,486  $ 11,372  Finance Leases Property and equipment $ 147  $ 147  Accumulated depreciation (63) (55) Property and equipment, net $ 84  $ 92  Current portion of finance lease liabilities $ 37  $ 36  Long-term finance lease liabilities 3  19  Total finance lease liabilities $ 40  $ 55  Weighted Average Remaining Lease Term Operating leases 5.4 years 5.3 years Finance leases 1.0 year 1.6 years Weighted Average Discount Rate Operating leases 9.2  % 9.3  % Finance leases 8.5  % 8.9  %

v3.23.2

Accrued Liabilities	6 Months Ended
	Jun. 30, 2023
Payables and Accruals [Abstract]
Accrued Liabilities	Accrued Liabilities Current accrued liabilities are as follows (in thousands):   June 30, 2023 December 31, 2022 Severance costs $ 1,314  $ 2,617  Payroll and benefits 525  684  Legal costs 816  447  Contingent liability for earn-out provision 260  583  Deferred revenue, current 409  655  Taxes other than income taxes 946  1,884  Other 908  2,114  Total current accrued liabilities $ 5,178  $ 8,984

v3.23.2

Debt and Convertible Notes Payable	6 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
Debt and Convertible Notes Payable	Debt and Convertible Notes Payable Long Term Debt Paycheck Protection Program Loans In April 2020, the Company received a $4.8 million loan (the “Flotek PPP loan”) under the Paycheck Protection Program (“PPP”), which was created through the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and is administered by the U.S. Small Business Administration (“SBA”). In October 2021, the Flotek PPP loan maturity date was extended from April 15, 2022 to April 15, 2025. On January 5, 2023, the Company received notice from the SBA that $4.4 million of the $4.8 million principal amount and accrued interest to that date of $0.1 million were forgiven. The remaining principal amount of $0.4 million and accrued interest is to be repaid in monthly installments of $15 thousand over the remaining term of the loan through April 15, 2025, beginning on March 15, 2023. The forgiveness of the Flotek PPP loan is accounted for as an extinguishment of the debt and the Company has recorded a $4.5 million gain in the six months ended June 30, 2023, comprising the principal amount forgiven of $4.4 million and accrued interest of $0.1 million. Long-term debt, including current portion, is as follows (in thousands): June 30, 2023 December 31, 2022 Flotek PPP loan $ 328  $ 4,788  Less current maturities (179) (2,052) Total long-term debt, net of current portion $ 149  $ 2,736  Loan repayments are scheduled as follows (in thousands): Years ending December 31, Repayment 2023 (excluding the six months ended June 30, 2023) $ 91  2024 180  2025 57  Total Flotek PPP loan $ 328  Convertible Notes Payable On February 2, 2022, Flotek entered into a Private Investment in Public Equity transaction (the “PIPE transaction”) with a consortium of investors to secure growth capital for the Company. Pursuant to the PIPE transaction, Flotek issued $21.2 million in aggregate initial principal amount of Convertible Notes Payable for net cash proceeds of approximately $20.1 million (the “Convertible Notes Payable”). The investors are ProFrac Holdings, LLC, Burlington Ventures Ltd., entities associated with North Sound Management, certain funds associated with one of Flotek's directors including the D3 Family Fund and the D3 Bulldog Fund, and Firestorm Capital LLC. The Convertible Notes Payable accrued paid-in-kind interest at a rate of 10% per annum, had a maturity of one year, and were convertible into common stock of Flotek or Pre-Funded Warrants to purchase common stock of Flotek, (a) at the holder's option at any time prior to maturity, at a price of $1.088125 per share, (b) at Flotek's option, if the volume-weighted average trading price of Flotek's common stock equals or exceeds $2.50 per share, or $1.741 per share, for 20 trading days during a 30 consecutive trading day period, or (c) at maturity, at a price of $0.8705 per share. On March 21, 2022, $3.0 million of the Convertible Notes Payable, plus accrued paid-in-kind interest thereon, were converted at the holder’s option into approximately 2.8 million shares of common stock. The issuance cost of $1.1 million was amortized on a straight-line basis over the term of the Convertible Notes Payable and the amortization was included in interest expense in the unaudited condensed consolidated statements of operations. On February 2, 2023, the Convertible Notes Payable, excluding those held by ProFrac Holdings, LLC, with a carrying value of $9.0 million, including accrued paid-in-kind interest of $0.8 million, were converted, upon maturity, into 10,335,840 shares of common stock at a price of $0.8705 per share. The Convertible Notes Payable held by ProFrac Holding, LLC, with a carrying value of $11.0 million, including accrued paid-in-kind interest of $1.0 million, were converted, upon maturity, into 12,683,280 February 2023 Warrants with an exercise price of $0.0001 per share. Initial ProFrac Agreement Contract Consideration Convertible Notes Payable On February 2, 2022, the Company entered into a long-term supply agreement with ProFrac Services, LLC (the “Initial ProFrac Agreement”), a subsidiary of ProFrac Holdings LLC, in exchange for $10 million in aggregate principal amount of Contract Consideration Convertible Notes Payable (“Initial ProFrac Agreement Contract Consideration Convertible Notes Payable”), under the same terms as the Convertible Notes Payable issued in the PIPE transaction described above, including paid-in-kind interest at a rate of 10% per annum and conversion features. The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were accounted for as liability classified convertible instruments and were initially recorded at fair value of $10.0 million on the issuance date with a corresponding contract asset. On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable, remeasured to and carried at a fair value of $15.1 million, were converted, upon maturity, into 12,683,281 February 2023 Warrants with an exercise price of $0.0001 per share (see Note 10, “Fair Value Measurements”). Amended ProFrac Agreement Contract Consideration Convertible Notes Payable On May 17, 2022, the Company entered into an amendment to the Initial ProFrac Agreement (the “Amended ProFrac Agreement” and collectively with the Initial ProFrac Agreement, the “ProFrac Agreement”) upon issuance of $50 million in aggregate principal amount of Contract Consideration Convertible Notes Payable (“Amended ProFrac Agreement Contract Consideration Convertible Notes Payable”) to ProFrac. The Amended ProFrac Agreement Contract Consideration Convertible Notes Payable accrued paid-in-kind interest at a rate of 10% per annum. The Amended ProFrac Agreement Contract Consideration Convertible Notes Payable were accounted for as liability classified convertible instruments and were initially recorded at fair value of $69.5 million on the issuance date with a corresponding contract asset. On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable, remeasured to and carried at a fair value of $40.6 million, were converted, upon maturity, into 63,496,922 shares of common stock at a price of $0.8705 per share (see Note 10, “Fair Value Measurements”).

v3.23.2

Fair Value Measurements	6 Months Ended
	Jun. 30, 2023
Fair Value Disclosures [Abstract]
Fair Value Measurements	Fair Value Measurements Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes financial assets and liabilities into the three levels of the fair value hierarchy. The hierarchy prioritizes the inputs to valuation techniques used to measure fair value and bases categorization within the hierarchy on the lowest level of input that is available and significant to the fair value measurement. •Level 1 — Quoted prices in active markets for identical assets or liabilities; •Level 2 — Observable inputs other than Level 1, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and •Level 3 — Significant unobservable inputs that are supported by little or no market activity or that are based on the reporting entity’s assumptions about the inputs. Fair Value of Other Financial Instruments The carrying amounts of certain financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, accrued liabilities and accounts payable approximate fair value due to the short-term nature of these accounts. Liabilities Measured at Fair Value on a Recurring Basis The following table presents the Company’s liabilities that are measured at fair value on a recurring basis and the level within the fair value hierarchy (in thousands): June 30, December 31, Level 1 Level 2 Level 3 2023 Level 1 Level 2 Level 3 2022 Contingent earnout consideration $ —  $ —  $ 260  $ 260  $ —  $ —  $ 583  $ 583  Initial ProFrac Agreement Contract Consideration Convertible Notes —  —  —  —  —  —  14,220  14,220  Amended ProFrac Agreement Contract Consideration Convertible Notes —  —  —  —  —  —  69,350  69,350  Total $ —  $ —  $ 260  $ 260  $ —  $ —  $ 84,153  $ 84,153  Contingent Earnout Consideration Key Inputs The estimated fair value of the remaining stock performance earn-out provision, with respect to the JP3 transaction, is included in accrued liabilities as of June 30, 2023 and December 31, 2022. The estimated fair value of the earn-out provision at the end of each period was valued using a Monte Carlo model analyzing 20,000 simulations performed using Geometric Brownian Motion with inputs such as risk-neutral expected growth and volatility. June 30, 2023 December 31, 2022 Risk-free interest rate 4.93  % 4.34% Expected volatility 100.0  % 100.0% Term until liquidation (years) 1.88 2.38 Stock price $0.73 $1.12 Discount rate 12.66  % 9.95% Initial ProFrac Agreement Contract Consideration Notes Payable Key Inputs The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were measured at fair value at issuance and on a recurring basis. The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable had an initial fair value of $10.0 million on February 2, 2022. The Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were classified as Level 2 at the initial measurement upon issuance due to the use of a quoted price for a similar liability at that date (the PIPE transaction), and subsequently classified as Level 3 due to the use of unobservable inputs. On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable were remeasured, upon maturity, to a fair value of $15.1 million based on the closing price of the shares of common stock of $1.19, on the date of conversion. The fair value adjustment was a $0.8 million increase in each of the three and six months ended June 30, 2023, and a $2.6 million decrease and a $1.3 million increase in the three and six months ended June 30, 2022, respectively. The estimated value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable as of December 31, 2022 was valued using a Monte Carlo simulation. The key inputs into the Monte Carlo simulation used to estimate the fair value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable maturing February 2, 2023, as of December 31, 2022 were as follows: December 31, 2022 Risk-free interest rate 4.12% Expected volatility 100.0% Term until liquidation (years) 0.09 Stock price $1.12 Discount rate 4.12% Amended ProFrac Agreement Contract Consideration Convertible Notes Payable Key Inputs On May 17, 2022, the Company measured the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable classified as Level 3 using a Monte Carlo simulation at an estimated fair value of $69.5 million. The Company reduced the discount rate assumed due to the reduced likelihood of occurrence of any of the default events in the shorter term remaining on the notes. The estimated value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable as of December 31, 2022 was valued using a Monte Carlo simulation. On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable were remeasured, at maturity, to a fair value of $40.6 million based on the closing price of the shares of common stock of $0.64, on the date of conversion. The fair value adjustment was a decrease of $3.9 million and $30.8 million in the three and six months ended June 30, 2023, and a decrease of $14.5 million in each of the three and six months ended June 30, 2022, respectively. The key inputs into the Monte Carlo simulation used to estimate the fair value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable maturing May 17, 2023, as of December 31, 2022 were as follows: December 31, 2022 Risk-free interest rate 4.59% Expected volatility 100.0% Term until liquidation (years) 0.38 Stock price $1.12 Discount rate 4.59% Assets Measured at Fair Value on a Nonrecurring Basis The Company’s non-financial assets, including property and equipment and operating lease ROU assets, are measured at fair value on a non-recurring basis and are subject to adjustment to their fair value in certain circumstances. Level 3 Rollforward for Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table presents the changes in balances of liabilities for the three and six months ended June 30, 2023 and 2022 classified as Level 3 (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Balance - beginning of period $ 44,025  $ 14,752  $ 84,153  $ 608  Transfer of ProFrac Agreement Contract Consideration Convertible Notes Payable from Level 2 —  —  —  10,000  Issuance of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable —  69,460  —  69,460  Increase in principal of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest —  257  85  415  Increase in principal of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest 712  611  2,043  611  Change in fair value of contingent earnout consideration 35  (228) (323) (134) Change in fair value of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable —  (2,637) 786  1,255  Change in fair value of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable (3,874) (14,521) (30,755) (14,521) Conversion of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity —  —  (15,091) —  Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity (40,638) —  (40,638) —  Balance - end of period $ 260  $ 67,694  $ 260  $ 67,694

v3.23.2

Income Taxes	6 Months Ended
	Jun. 30, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The income tax benefit differed from the amounts computed by applying the U.S. federal income tax rate of 21% to loss before income tax for the reasons set forth below: Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 U.S. federal statutory tax rate 21.0  % 21.0  % 21.0  % 21.0  % State income taxes, net of federal benefit 120.4  —  0.1  0.1  Non-U.S. income taxed at different rates (96.7) 3.8  —  (1.9) Increase (reduction) in tax benefit related to stock-based awards 1291.8  3.1  0.7  (2.0) Increase in valuation allowance 2284.5  (27.5) (19.8) (17.0) Permanent differences (3779.4) —  (2.1) —  Non-deductible expenses 278.8  (0.4) 0.2  0.1  Other —  3.8  —  (2.2) Effective income tax rate 120.4  % 3.8  % 0.1  % (1.9) % Internal Revenue Code (“IRC”) section 382 addresses company ownership changes and specifically limits the utilization of certain deductions and other tax attributes on an annual basis following an ownership change. During 2023, the Company converted various debt instruments into Company stock and warrants causing an ownership change within the meaning of IRC section 382 that subjected certain of the Company’s tax attributes, including net operating losses ("NOLs"), to an IRC section 382 limitation. As of June 30, 2023, the Company has an estimated $196.1 million in U.S. federal NOL carryforwards, $119.4 million in certain state NOL carryforwards, $7.1 million in section 163(j) interest limitation carryforwards and $3.8 million in tax credit carryforwards. As a result of the change of control experienced in 2023, the Company’s ability to use NOLs to reduce taxable income is generally limited to an annual amount which is currently estimated to be $3.5 million a year as a result of the section 382 limitation which may be revised based on further detailed analysis. NOLs that exceed the section 382 limitation in any year continue to be allowed as carryforwards until they expire and can be used to offset taxable income for years within the carryover period subject to the limitation in each year. Federal NOLs incurred prior to 2018 generally have a 20-year life until they expire in varying amounts between 2029 and 2037. Federal NOLs generated in 2018 and after are carried forward indefinitely. State NOLs have various carryforward periods depending on the legislation in the respective state jurisdiction. The Company’s use of new NOLs arising after the date of an ownership change would not be impacted by the 382 limitation. If the Company does not generate a sufficient level of taxable income prior to the expiration of the pre-2018 NOL carryforward periods, then the ability to apply those NOLs as offsets to future taxable income is lost. Based on the preliminary section 382 limitation, the Company estimates that $41.9 million of the state NOL carryforwards and $3.8 million of the tax credit carryforwards will expire unutilized. The tax effected amount of the estimated expirations is included in the Company’s valuation allowance.

v3.23.2

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Litigation The Company is subject to routine litigation and other claims that arise in the normal course of business. Except as disclosed below, management is not aware of any pending or threatened lawsuits or proceedings that are expected to have a material effect on the Company’s financial position, results of operations or liquidity. Former CEO (John Chisholm) Matter On May 23, 2023, the Company entered into an agreement with John Chisholm (a former CEO of the Company) to resolve a claim made by Mr. Chisholm in arbitration for payment of outstanding severance and claims made by the Company against Mr. Chisholm. The settlement resulted in the reversal of $2.3 million of accrued severance costs during the three and six months ended June 30, 2023 and is included in severance costs in our consolidated statements of operation. The Company had withheld payment of outstanding severance to Mr. Chisholm subsequent to an investigation conducted during the year ended December 31, 2021 into corporate practices when Mr. Chisholm was CEO during the years from 2014 to 2018. The Company concluded upon completion of that investigation that its historical financial statements could be relied upon, that proper action had been taken, and that no members of current management were implicated in any improper corporate practices. The Company subsequently commenced arbitration and other legal proceedings against Mr. Chisholm, Casey Doherty/ Doherty & Doherty LLP (Flotek’s former outside general counsel) and Moss Adams LLP and its predecessor, Hein & Associates LLP (Flotek’s former independent public audit firm) to recover damages. Mr. Chisholm filed a counterclaim against the Company in the arbitration proceeding for his remaining severance, and that dispute has been resolved as previously stated. Further, on June 16, 2023, the Company entered into a settlement with Moss Adams LLP and its predecessor, Hein & Associates LLP, regarding the claims between the Company and Moss Adams LLP and Hein & Associates LLP. The arbitration action between the Company and Mr. Casey Doherty and Doherty & Doherty LLP remains outstanding. Other Commitments and Contingencies The Company is subject to concentrations of credit risk within trade accounts receivable, and related party accounts receivable, as the Company does not generally require collateral as support for trade receivables. In addition, the majority of the Company’s cash is invested in three major U.S. financial institutions and balances often exceed insurable amounts.

v3.23.2

Stockholders’ Equity	6 Months Ended
	Jun. 30, 2023
Equity [Abstract]
Stockholders’ Equity	Stockholders’ Equity On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable discussed in Note 9, “Debt and Convertible Notes Payable”, were converted, upon maturity, into 63,496,922 shares of common stock at a price of $0.8705 per share. The Contract Consideration Convertible Notes Payable converted into common stock shares, remeasured to a fair value of $40.6 million upon maturity, were recorded as additional paid-in-capital as of June 30, 2023. On February 2, 2023, the Convertible Notes Payable pursuant to the PIPE transaction discussed in Note 9, “Debt and Convertible Notes Payable”, excluding those held by ProFrac Holdings, LLC, were converted, upon maturity, into 10,335,840 shares of common stock at a price of $0.8705 per share. The Convertible Notes Payable converted into common stock shares had a carrying value of $9.0 million, including accrued paid-in-kind interest of $0.8 million and were recorded as additional paid-in-capital as of June 30, 2023. The Convertible Notes Payable held by ProFrac Holding, LLC, with a carrying value of $11.0 million, including accrued interest of $1.0 million, were converted, upon maturity, into 12,683,280 February 2023 Warrants with an exercise price of $0.0001 per share and were recorded as additional paid-in-capital as of June 30, 2023. On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable discussed in Note 9, “Debt and Convertible Notes Payable”, remeasured to a fair value of $15.1 million upon maturity, were converted, upon maturity, into 12,683,281 February 2023 Warrants and were recorded as additional paid-in-capital as of June 30, 2023. The February 2023 Warrants permit ProFrac Holdings II, LLC to purchase 25,366,561 shares of common stock of the Company at an exercise price equal to $0.0001 per share. On June 21, 2022, ProFrac Holdings II, LLC paid $19.5 million for Pre-Funded Warrants (the “June 2022 Warrants”) of the Company. The June 2022 Warrants were recorded in equity at their fair value of $11.1 million, estimated using a Black-Scholes Option Pricing model, less $1.2 million of transaction costs paid. The remaining cash received of $8.4 million was recognized as an equity contribution. The June 2022 Warrants permit ProFrac Holdings II, LLC to purchase 13,104,839 shares of common stock of the Company at an exercise price equal to $0.0001 per share, and a $4.5 million exercise fee representing a 20% premium to the 30-day volume average price of the Company’s common stock at the close of business on the day prior to the date of the issuance of the June 2022 Warrants. The June 2022 Warrants, net of transaction fees of $1.1 million, and the equity contribution of $8.4 million from ProFrac Holdings II, LLC were recorded as additional paid-in capital. The key inputs into the Black-Scholes Option Pricing Model used to estimate the fair value of the June 2022 Warrants as of the issuance on June 21, 2022 were as follows: Risk-free interest rate 3.21% Expected volatility 90.0% Term until liquidation (years) 2.00 Stock price $1.11 Strike price (exercise fee) $4.5 million ProFrac Holdings II, LLC and its affiliates may not receive any voting or consent rights in respect of the June 2022 Warrants or the underlying shares of common stock unless and until (i) the Company has obtained approval from a majority of its shareholders excluding ProFrac Holdings II, LLC and its affiliates and (ii) ProFrac Holdings II, LLC has paid an additional $4.5 million to the Company; provided, however, that ProFrac Holdings II may exercise the June 2022 Warrants immediately prior to the sale of the shares of common stock subject to such exercise to a non-affiliate of ProFrac Holdings II. The additional $4.5 million will be accounted for as an equity contribution if received. On March 21, 2022, the Convertible Notes Payable issued pursuant to the PIPE transaction discussed in Note 9, “Debt and Convertible Notes Payable”, which had been purchased by certain funds associated with one of the Company’s directors including the D3 Family Fund and the D3 Bulldog Fund, which aggregated $3.0 million plus $39 thousand of accrued interest, were converted into 2,793,030 shares of the Company’s common stock.

v3.23.2

Earnings (Loss) Per Share	6 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
Earnings (Loss) Per Share	Earnings (Loss) Per Share Basic earnings (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period, which includes the February 2023 Warrants (See Note 9, “Debt and Convertible Notes Payable”, and Note 13, “Stockholders’ Equity”). Diluted earnings (loss) per common share is calculated by dividing the adjusted net income (loss) by the weighted average number of common shares outstanding combined with dilutive common share equivalents outstanding, if the effect is dilutive. Potentially dilutive common share equivalents consist of incremental shares of common stock issuable upon conversion of convertible notes payable, exercise of stock warrants and vesting and settlement of stock awards. The dilutive effect of non-vested stock issued under share‑based compensation plans, shares issuable under the Employee Stock Purchase Plan (ESPP), employee stock options outstanding, and the Pre-Funded stock warrants are computed using the treasury stock method. The dilutive effect of the Convertible Notes is computed using the if‑converted method in accordance with ASU 2020-06, which was adopted by the Company on January 1, 2022 (see Note 2, “Summary of Significant Accounting Policies”). The calculation of the basic and diluted earnings (loss) per share for the three and six months ended June 30, 2023 and 2022 is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Numerator: Net income (loss) for basic earnings per share $ (21) $ 6,240  $ 21,322  $ (4,484) Adjustments to net income available to shareholders Paid-in-Kind interest expense on convertible notes payable and Contract Consideration Convertible Notes Payable 712  1,028  2,284  1,402  Valuation (gain)/loss on Contract Consideration Convertible Notes Payable carried at FV (3,874) (13,229) (29,969) (10,228) Adjusted net loss for diluted earnings per share $ (3,183) $ (5,961) $ (6,363) $ (13,310) Denominator: Basic weighted average shares outstanding 143,433  74,861  121,244  73,476  Average number of diluted shares for convertible notes payable and Contract Consideration Convertible Notes Payable 26,067  49,474  42,921  33,610  Diluted weighted average shares outstanding 169,500  124,335  164,165  $ 107,086  Basic earnings (loss) per share —  0.08  0.18  (0.06) Diluted loss per share (0.02) (0.05) (0.04) (0.12) Anti-dilutive incremental shares excluded from denominator for diluted earnings computation Average number of diluted shares for June 2022 stock warrants 6,496  976  8,038  491  Average number of diluted shares for options and restricted stock 545  692  718  662  For the three and six months ended June 30, 2023 and 2022, weighted average shares for the June 2022 stock warrants and weighted average shares for employee stock awards were not included in the dilution calculation since including them would have an anti-dilutive effect as it would reduce the loss per share.

v3.23.2

Supplemental Cash Flow Information	6 Months Ended
	Jun. 30, 2023
Supplemental Cash Flow Elements [Abstract]
Supplemental Cash Flow Information	Supplemental Cash Flow Information Supplemental cash flow information is as follows (in thousands):            Six months ended June 30,   2023 2022 Supplemental cash flow information: Interest paid $ 23  $ 7  Supplemental non cash financing and investing activities: Conversion of convertible notes payable to common stock 8,996  3,038  Conversion of convertible notes payable to February 2023 Warrants 11,040  —  Conversion of Initial Contract Consideration Convertible Notes Payable to February 2023 Warrants 15,092  —  Conversion of Amended Contract Consideration Convertible Notes Payable to common stock 40,638  —  Issuance of convertible notes payable as consideration for ProFrac Agreements —  79,460  Issuance cost of stock warrants included in accrued accounts payable —  1,170

v3.23.2

Related Party Transactions	6 Months Ended
	Jun. 30, 2023
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions On February 2, 2022, the Company entered into the Initial ProFrac Agreement, upon issuance of $10 million in aggregate principal amount of the convertible notes (the “Contract Consideration Convertible Notes Payable”) to ProFrac Holdings LLC (see Note 9, “Debt and Convertible Notes Payable”). Under the Initial ProFrac Agreement, ProFrac Services, LLC is obligated to order chemicals from the Company at least equal to the greater of (a) the chemicals required for 33% of ProFrac Services, LLC’s hydraulic fracturing fleets and (b) a baseline measured by the first ten hydraulic fracturing fleets deployed by ProFrac Services, LLC during the term of the Initial ProFrac Agreement. If the minimum volumes are not achieved in any given year, ProFrac Services LLC shall pay to the Company, as liquidated damages an amount equal to twenty-five percent (25%) of the difference between (i) the aggregate purchase price of the quantity of products comprising the minimum purchase obligation and (ii) the actual purchased volume during such calendar year. On May 17, 2022, the Company entered into the Amended ProFrac Agreement upon issuance of $50 million in aggregate principal amount of Contract Consideration Convertible Notes Payable (see Note 9, “Debt and Convertible Notes Payable”). The Initial ProFrac Agreement was amended to (a) increase ProFrac Services LLC’s minimum purchase obligation for each year to the greater of 70% of ProFrac Services LLC’s requirements and a baseline measured by ProFrac Services, LLC’s first 30 hydraulic fracturing fleets, and (b) increase the term to 10 years. On February 1, 2023, the Company entered into an amendment to the ProFrac Agreement (the “Amended ProFrac Agreement No. 2”) dated February 2, 2022. The Amended ProFrac Agreement No. 2 has an effective date of January 1, 2023. The ProFrac Agreement was amended to (1) provide a ramp-up period from January 1, 2023 to May 31, 2023 for ProFrac Services, LLC to increase the number of active hydraulic fracturing fleets to 30 fleets, (2) waive any liquidated damages payment relating to any potential order shortfall prior to January 1, 2023, (3) add additional fees to certain products, and (4) provide margin increases based on margins with non-ProFrac customers. The Company believes the net present value of the economic benefit attributable to the Amended ProFrac Agreement No. 2 will exceed the value of the liquidated damages payments that would have been received for the period from April 1, 2022 through December 31, 2022. On February 2, 2023, the Convertible Notes Payable held by ProFrac Holding, LLC, with a carrying value of $11.0 million, including accrued paid-in-kind interest of $1.0 million, were converted, upon maturity, into 12,683,280 February 2023 Warrants (see Note 9, “Debt and Convertible Notes Payable” and Note 13, “Stockholders’ Equity”). On February 2, 2023, the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable, with a carrying value of $11.0 million, including accrued interest of $1 million, were converted, upon maturity, into 12,683,281 February 2023 Warrants (see Note 9, “Debt and Convertible Notes Payable” and Note 13, “Stockholders’ Equity”). The fair value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable, as of February 2, 2023, was $15.1 million (see Note 10, “Fair Value Measurements”). On May 17, 2023, the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable, with a carrying value of $55.3 million, including accrued interest of $5.3 million, were converted, upon maturity, into 63,496,922 shares of common stock at a price of $0.8705 per share (see Note 9, “Debt and Convertible Notes Payable” and Note 13, “Stockholders’ Equity”). The fair value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable, as of May 17, 2023 was $40.6 million (see Note 10, “Fair Value Measurements”). During the three months ended June 30, 2023 and 2022, the Company’s revenues from ProFrac Services, LLC were $32.8 million and $16.5 million, respectively. During the six months ended June 30, 2023 and 2022, the Company’s revenues from ProFrac Services LLC were $69.1 million and $18.9 million, respectively. For the three months ended June 30, 2023 and 2022, these revenues were net of amortization of contract assets of $1.1 million and $0.7 million. For the six months ended June 30, 2023 and 2022, the revenues were net of amortization of contract assets of $2.4 million and $0.7 million, respectively. Cost of sales attributable to these revenues were $30.2 million and $17.8 million, respectively for the three months ended June 30, 2023 and 2022 and $65.1 million and $19.0 million for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and December 31, 2022 our accounts receivable from ProFrac Services, LLC was $23.0 million and $22.7 million, respectively which is recorded in accounts receivable, related party on the consolidated balance sheet. Also, during 2023 and 2022, we had the following related party transactions with ProFrac Holdings, LLC and ProFrac Holdings II, LLC: •PIPE Transaction (see Note 9, “Debt and Convertible Notes Payable”) •June 2022 Warrants (see Note 13, “Stockholders’ Equity) On March 21, 2022, the Convertible Notes Payable which had been purchased by certain funds associated with one of the Company’s directors including the D3 Family Fund and the D3 Bulldog Fund, which aggregated $3.0 million plus $39 thousand of accrued interest and amortization of issuance costs of $90 thousand, were converted into 2,793,030 shares of the Company’s common stock. Mr. Ted D. Brown was a Director of the Company beginning in November of 2013 and is the President and CEO of Confluence Resources LP (“Confluence”), a private oil and gas exploration and production company. The Company’s revenues and related cost of sales for product sold to Confluence were $1.4 million and $1.4 million, for the three and six months ended June 30, 2022. As of June 9, 2022 Mr. Brown stepped down from being a Director of the Company and Confluence is no longer considered a related party as of June 9, 2022.

v3.23.2

Business Segment, Geographic and Major Customer Information	6 Months Ended
	Jun. 30, 2023
Segment Reporting [Abstract]
Business Segment, Geographic and Major Customer Information	Business Segment, Geographic and Major Customer Information Segment Information Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the chief operating decision-maker in deciding how to allocate resources and assess performance. The operations of the Company are categorized into the following reportable segments: Chemistry Technologies. The CT segment includes green specialty chemistries, logistics and technology services, which enable its customers to pursue improved efficiencies and performance throughout the life cycle of their wells, and also helping customers improve their ESG and operational goals. Customers of the CT segment include major integrated oil and gas companies, oilfield services companies, independent oil and gas companies, national and state-owned oil companies, and international supply chain management companies. Data Analytics. The DA segment includes the design, development, production, sale and support of equipment and services that create and provide valuable information on the composition and properties of energy customers’ hydrocarbon fluids. The company markets products and services that support in-line data analysis of hydrocarbon components and properties. Customers of the DA segment span across the entire oil and gas market, from upstream production to midstream facilities to refineries and distribution networks. Performance is based upon a variety of criteria. The primary financial measure is segment operating income (loss). Various functions, including certain sales and marketing activities and general and administrative activities, are provided centrally by the corporate office. Costs associated with corporate office functions, other corporate income and expense items, and income taxes are not allocated to the reportable segments. Summarized financial information of the reportable segments is as follows (in thousands): As of and for the three months ended June 30, Chemistry Technologies Data Analytics Corporate and Other Total 2023 Revenue from external customers Products $ 15,095  $ 1,620  $ —  $ 16,715  Services 374  731  —  1,105  Total revenue from external customers 15,469  2,351  —  17,820  Revenue from related party —  Products 32,345  2  —  32,347  Services 272  155  —  427  Total revenue from related parties 32,617  157  —  32,774  Gross profit 2,603  1,301  —  3,904  Change in fair value of Contract Consideration Convertible Notes Payable (3,874) —  —  (3,874) Income (loss) from operations 3,795  129  (3,252) 672  Paid-in-kind interest on Contract Consideration Convertible Notes Payable 712  —  —  712  Depreciation 155  18  1  174  Additions to long-lived assets —  135  —  135  2022 Revenue from external customers Products $ 11,740  $ 299  $ —  $ 12,039  Services 371  414  —  785  Total revenue from external customers 12,111  713  —  12,824  Revenue from related party Products 16,549  —  —  16,549  Services —  —  —  —  Total revenue from related parties 16,549  —  —  16,549  Gross loss (1,568) (737) —  (2,305) Change in fair value of Contract Consideration Convertible Notes Payable (17,158) —  —  (17,158) Loss from operations 14,944  (1,198) (5,707) 8,039  Paid-in-kind interest on Contract Consideration Convertible Notes Payable 868  —  —  868  Paid-in-kind interest on convertible notes payable —  —  466  466  Depreciation 166  15  1  182  Additions to long-lived assets 5  —  —  5  As of and for the six months ended June 30, Chemistry Technologies Data Analytics Corporate and Other Total 2023 Revenue from external customers Products $ 23,654  $ 3,562  $ —  $ 27,216  Services 1,039  1,217  —  2,256  Total revenue from external customers 24,693  4,779  —  29,472  Revenue from related party —  Products 68,611  2  —  68,613  Services 272  245  —  517  Total revenue from related parties 68,883  247  —  69,130  Gross profit 3,038  2,747  —  5,785  Change in fair value of Contract Consideration Convertible Notes Payable (29,969) —  —  (29,969) Income (loss) from operations 27,174  587  (8,577) 19,184  Paid-in-kind interest on Contract Consideration Convertible Notes Payable 2,129  —  —  2,129  Paid-in-kind interest on convertible notes payable —  —  155  155  Depreciation 312  36  1  349  Additions to long-lived assets 30  230  32  292  2022 Revenue from external customers Products $ 20,650  $ 1,091  $ —  $ 21,741  Services 772  693  —  1,465  Total revenue from external customers 21,422  1,784  —  23,206  Revenue from related party Products 19,046  —  —  19,046  Services —  —  —  —  Total revenue from related parties 19,046  —  —  19,046  Gross loss (2,231) (553) —  (2,784) Change in fair value of Contract Consideration Convertible Notes Payable (13,266) —  —  (13,266) Loss from operations 8,887  (2,006) (9,126) (2,245) Paid-in-kind interest on Contract Consideration Convertible Notes Payable 1,026  —  —  1,026  Paid-in-kind interest on convertible notes payable —  —  793  793  Depreciation 345  31  1  377  Additions to long-lived assets 5  —  —  5  Assets of the Company by reportable segments are as follows (in thousands): June 30, 2023 December 31, 2022 Chemistry Technologies $ 139,921  $ 146,542  Data Analytics 7,382  5,645  Corporate and Other 10,727  12,623  Total assets $ 158,030  $ 164,810  Geographic Information Revenue by country is based on the location where services are provided and products are sold. For the three and six months ended June 30, 2023 no individual countries other than the U.S. accounted for more than 10% of revenue. For the three and six months ended June 30, 2022 no individual countries other than the U.S. and the United Arab Emirates (“UAE”) accounted for more than 10% of revenue. Revenue by geographic location is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 U.S. (1) $ 48,725  $ 25,955  $ 94,851  $ 36,289  UAE 1,509  3,139  2,912  4,450  Other countries 360  279  839  1,513  Total revenue $ 50,594  $ 29,373  $ 98,602  $ 42,252  (1) Includes revenue from related party Long-lived assets held in countries other than the U.S. are not considered material to the consolidated financial statements. Major Customers Revenue from major customers, as a percentage of consolidated revenue, is as follows (in thousands): Three months ended June 30, Revenue % of Total Revenue 2023 Customer A (Related Party) $ 32,774  64.8  % 2022 Customer A (Related Party) $ 16,549  52.2  % Customer B 5,611  19.1  % Six months ended June 30, Revenue % of Total Revenue 2023 Customer A (Related Party) $ 69,129  70.1  % 2022 Customer A (Related Party) $ 17,657  38.9  % Customer B 8,218  19.5  %  The concentration with ProFrac Services, LLC and in the oil and gas industry increases credit, commodity and business risk. Major Suppliers Expenditure with major suppliers, as a percentage of consolidated supplier expenditure, is as follows (in thousands): Expenditure % of Total Expenditure Three months ended June 30, 2023 Supplier A $ 13,155  32.6  % Supplier B 8,049  20.0  % Supplier C 4,489  11.1  % 2022 Supplier A 7,576  31.9  % Supplier B 4,036  17.0  % Supplier C 2,679  11.3  % Expenditure % of Total Expenditure Six months ended June 30, 2023 Supplier A $ 30,109  36.4  % Supplier B 15,194  18.4  % Supplier C 8,993  10.9  % 2022 Supplier A 7,624  24.2  % Supplier B 6,154  19.5%

v3.23.2

Subsequent Events	6 Months Ended
	Jun. 30, 2023
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events We have evaluated the effects of events that have occurred subsequent to June 30, 2023, and there have been no material events that would require recognition in the June 30, 2023 interim financial statements or disclosure in the notes to the consolidated financial statements.

v3.23.2

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements reflect all adjustments, in the opinion of management, necessary for the fair statement of the financial condition and results of operations for the periods presented. All such adjustments are normal and recurring in nature. The financial statements, including selected notes, have been prepared in accordance with applicable rules and regulations of the SEC regarding interim financial reporting and do not include all information and disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for comprehensive financial statement reporting. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s 2022 Annual Report.
Consolidation	All significant intercompany accounts and transactions have been eliminated in consolidation. The Company does not have investments in any unconsolidated subsidiaries.
Cash Equivalents	Cash Equivalents Cash equivalents consist of highly liquid investments with maturities of three months or less at the date of purchase.
Restricted Cash	Restricted CashThe Company’s restricted cash is $0.1 million and $0.1 million as of June 30, 2023 and December 31, 2022, respectively. The Company’s restricted cash consists of cash that the Company is contractually obligated to maintain in accordance with the terms of its credit card program with a financial institution.
Accounts Receivable and Allowance for Credit Losses	Accounts Receivable and Allowance for Credit Losses Accounts receivable and accounts receivable, related party, arise from product sales and services and are stated at estimated net realizable value. This value incorporates an allowance for credit losses to reflect any loss anticipated on accounts receivable balances. The Company applies the current expected credit loss (CECL) model, which requires immediate recognition of expected credit losses over the contractual life of receivables and records the appropriate allowance for credit losses as a charge to operating expenses. The allowance for credit losses is based on a combination of the individual customer circumstances, credit conditions, and historical write-offs and collections. The Company writes off specific accounts receivable when they are determined to be uncollectible. The recovery of accounts receivable previously written off is recorded as a reduction to the allowance for credit losses charged to operating expense. The majority of the Company’s customers are engaged in the energy industry. The cyclical nature of the energy industry may affect customers’ operating performance and cash flows, which directly impact the Company’s ability to collect on outstanding obligations. Additionally, certain customers are located in international areas that are inherently subject to risks of economic, political, and civil instability, which can impact the collectability of receivables.
Contract Assets	Contract Assets The Company’s contract assets represent consideration issued in the form of convertible notes (Contract Consideration Convertible Notes Payable as discussed in Note 9, “Debt and Convertible Notes Payable”) and other incremental costs related to obtaining the ProFrac Agreement. The contract assets are amortized over the term of the ProFrac Agreement (10 years) based on forecasted revenues as goods are transferred to ProFrac Services, LLC, and the amortization is presented as a reduction of the transaction price included in related party revenue in the consolidated statements of operations. The contract assets are tested for recoverability on a recurring basis and the Company will recognize an impairment loss to the extent that the carrying amount of the contract assets exceeds the amount of consideration the Company expects to receive in the future for the transfer of goods under the ProFrac Agreement less the direct costs that relate to providing those goods in the future.
Inventories	Inventories Inventories consist of raw materials and finished goods and are stated at the lower of cost determined by using the weighted-average cost method, or net realizable value. Finished goods inventories include raw materials, direct labor and production overhead. The Company periodically reviews inventories on hand and current market conditions to determine if the cost of raw materials and finished goods inventories exceed current market prices and impairs the cost basis of the inventory accordingly. Obsolete inventory or inventory in excess of management’s estimated usage requirement is written down to its net realizable value if those amounts are determined to be less than cost. Write-downs or write-offs of inventory are charged to cost of sales.
Property and Equipment	Property and Equipment Property and equipment are stated at cost. The cost of ordinary maintenance and repair is charged to operating expense, while replacement of critical components and major improvements are capitalized. Depreciation or amortization of property and equipment, including operating lease right-of-use assets (“ROU”), is calculated using the straight-line method over the shorter of the lease term or the asset’s estimated useful life as follows: Buildings and leasehold improvements 2-30 years Machinery and equipment 7-10 years Furniture and fixtures 3 years Land improvements 20 years Transportation equipment 2-5 years Computer equipment and software 3-7 years Property and equipment, including ROU assets, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. If events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable, the Company first compares the carrying amount of an asset or asset group to the sum of the undiscounted future cash flows expected to result from the use and eventual disposal of the asset. If the carrying amount of an asset or asset group exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposal of the asset, the Company will determine the fair value of the asset or asset group. The amount of impairment loss recognized is the excess of the asset or asset group’s carrying amount over its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary.
Leases	Leases The Company leases certain facilities, land, vehicles, and equipment. The Company determines if an arrangement is classified as a lease at inception of the arrangement. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the related lease. Finance leases are under the current and non-current liabilities and the underlying assets are included in property and equipment on the consolidated balance sheet. As most of the Company’s leases do not provide an implicit rate of return, on a quarterly basis, the Company’s incremental borrowing rate is used, together with the lease term information available at commencement date of the lease, in determining the present value of lease payments. Operating lease liabilities include related options to extend or terminate lease terms that are reasonably certain of being exercised. Leases with an initial term of 12 months or less (“short term leases”) are not recorded on the balance sheet; and the lease expense on short-term leases is recognized on a straight-line basis over the lease term.
Liability Classified Convertible Notes Payable and Contingent Convertible Notes Payable	Convertible Notes Payable and Liability Classified Contract Consideration Convertible Notes Payable The Company accounts for the Convertible Notes Payable at amortized cost pursuant to Financial Accounting Standards Board (“FASB”) ASC Topic 470, Debt. The Company accounted for the Contract Consideration Convertible Notes Payable issued as consideration related to a related party contract (see Note 9, “Debt and Convertible Notes Payable”), as liability classified convertible instruments in accordance with FASB ASC 718, “Stock Compensation” (“ASC 718”). Under ASC 718, liability classified convertible instruments are measured at fair value at the grant date and at each reporting date (see Note 10, “Fair Value Measurements”) with the change in fair value included in the consolidated statements of operations.
Fair Value Measurements	Fair Value Measurements The Company categorizes financial assets and liabilities using a three-tier fair value hierarchy, based on the nature of the inputs used to determine fair value. Inputs refer broadly to assumptions that market participants would use to value an asset or liability and may be observable or unobservable. When determining the fair value of assets and liabilities, the Company uses the most reliable measurement available. See Note 10, “Fair Value Measurements.” Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes financial assets and liabilities into the three levels of the fair value hierarchy. The hierarchy prioritizes the inputs to valuation techniques used to measure fair value and bases categorization within the hierarchy on the lowest level of input that is available and significant to the fair value measurement. •Level 1 — Quoted prices in active markets for identical assets or liabilities; •Level 2 — Observable inputs other than Level 1, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and •Level 3 — Significant unobservable inputs that are supported by little or no market activity or that are based on the reporting entity’s assumptions about the inputs.
Revenue Recognition	Revenue Recognition The Company recognizes revenue when it satisfies performance obligations under the terms of the contract with a customer, and control of the promised goods are transferred to the customer or services are performed, in an amount that reflects the consideration the Company expects to be entitled in exchange for those goods or services. The Company recognizes revenue based on a five-step model when all of the following criteria have been met: (i) a contract with a customer exists, (ii) performance obligations have been identified, (iii) the price to the customer has been determined, (iv) the price to the customer has been allocated to the performance obligations, and (v) performance obligations are satisfied. Products and services are sold with fixed or determinable prices. Certain sales include discounts offered to customers for prompt payment and right of return provisions, which are considered when recognizing revenue and deferred accordingly. The Company does not act as an agent in any of its revenue arrangements. In recognizing revenue for products and services, the Company determines the transaction price of contracts with customers, which may consist of fixed and variable consideration. Determining the transaction price may require judgment by management, which includes identifying performance obligations, estimating variable consideration to include in the transaction price, and determining whether promised goods or services can be distinguished in the context of the contract. The majority of the CT segment revenue is chemical products that are sold at a point in time based on when control transfers to the customer determined by agreed upon delivery terms. Contracts with customers for the sale of products generally state the terms of the sale, including the quantity and price of each product purchased. Additionally, the CT segment offers various services associated to products sold which includes field services, installation, maintenance, and other functions. These services are recognized upon completion of commissioning and installation due to the short-term nature of the performance obligation when the Company has a right to invoice the customer. The DA segment recognizes revenue for sales of equipment at the time of sale based on when control transfers to the customer based on agreed upon delivery terms. Additionally, the Company offers various services associated with products sold which includes field services, installation, maintenance, and other functions. Services are recognized upon completion of commissioning and installation due to the short-term nature of the performance obligation. There may be additional performance obligations related to providing ongoing or reoccurring maintenance. Revenue for these types of arrangements is recognized ratably over time throughout the contract period. Additionally, the Company may provide subscription-type arrangements with customers in which monthly reoccurring revenue is recognized ratably over time in accordance with agreed upon terms and conditions. Customers may be invoiced for such maintenance and subscription-type arrangements, and revenue not yet recognizable is reported under accrued liabilities and deferred revenue on the consolidated balance sheets. Subscription-type arrangements were not a material revenue stream in the six months ended June 30, 2023 and June 30, 2022. Payment terms for both the CT and DA segments are customarily 30-60 days for domestic and 90-120 days for international from invoice receipt. Under revenue contracts for both products and services, customers are invoiced once the performance obligations have been satisfied, at which point payment is unconditional. Contract assets associated with incomplete performance obligations are not material. The Company applies several practical expedients including: •Sales commissions are expensed as selling, general and administrative expenses when incurred because the amortization period is generally one year or less. •The Company’s payment terms are short-term in nature with settlements of one year or less. As a result, the Company does not adjust the promised amount of consideration for the effects of a significant financing component. •In most service contracts, the Company has the right to consideration from a customer in an amount that corresponds directly with the value to the customer of the Company’s performance obligations completed to date and as such the Company recognizes revenue in the amount to which it has a right to invoice. •The Company excludes from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer. Such taxes are included in accrued liabilities on our consolidated balance sheet until remitted to the governmental agency. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of sales in our consolidated statement of operations.
Foreign Currency Translation	Foreign Currency Translation The Company’s functional currency is primarily the U.S. dollar. The Company operates principally in the United States and substantially all assets and liabilities of the Company are denominated in U.S. dollars. Financial statements of foreign subsidiaries that are not U.S. dollar functional currency are prepared using the currency of the primary economic environment of the foreign subsidiaries as the functional currency. Assets and liabilities of those foreign subsidiaries are translated into U.S. dollars at exchange rates in effect as of the end of identified reporting periods. Revenue and expense transactions are translated using the average monthly exchange rate for the reporting period. Resultant translation adjustments are recognized as other comprehensive income (loss) within stockholders’ equity.
Comprehensive Income (Loss)	Comprehensive Income (Loss) Comprehensive income (loss) encompasses all changes in stockholders’ equity, except those arising from investments and distributions to stockholders. The Company’s comprehensive income loss includes consolidated net income (loss) and foreign currency translation adjustments.
Research and Development Costs	Research and Development Costs Expenditures for research activities relating to product development and improvement are charged to expense as incurred.
Income Taxes	Income Taxes Deferred tax assets and liabilities are recognized for temporary differences between financial statement carrying amounts and the tax bases of assets and liabilities and are measured using the tax rates expected to be in effect when the differences reverse. Deferred tax assets are also recognized for operating loss and tax credit carry forwards. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is established when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The establishment of a valuation allowance requires significant judgment and is impacted by various estimates. Both positive and negative evidence, as well as the objectivity and verifiability of that evidence, is considered in determining the appropriateness of recording a valuation allowance on deferred tax assets. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company’s policy is to record interest and penalties related to uncertain tax positions as income tax expense.
Stock-Based Compensation	Stock-Based Compensation Stock-based compensation expense, related to stock options, restricted stock awards and restricted stock units, is recognized based on their grant-date fair values. The Company recognizes compensation expense, net of estimated forfeitures, on a straight-line basis over the requisite service period of the award. Estimated forfeitures are based on historical experience.
Stock Warrants	Stock Warrants The Company evaluated the Pre-Funded Warrants issued in June 2022 (the “June 2022 Warrants”) and the Pre-Funded Warrants issued in February 2023 (the “February 2023 Warrants”) (see Note 13, “Stockholders’ Equity) in accordance with ASC 815-40, “Contracts in Entity’s Own Equity” and determined that the June 2022 Warrants and the February 2023 Warrants meet the criteria to be classified within stockholders’ equity. Accordingly, the Company recorded the proceeds received for the June 2022 Warrants within additional paid in capital. In addition, the Company reclassified the balance of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable (see Note 9, “Debt and Convertible Notes Payable”) for the February 2023 Warrants within additional paid in capital upon conversion.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from these estimates. Significant items subject to estimates and assumptions include the useful lives of property and equipment; long lived asset impairment assessments; stock-based compensation expense; allowance for credit losses for accounts receivable; valuation allowances for inventories and deferred tax assets; recoverability and timing of the realization of contract assets; and fair value of liability classified Contract Consideration Convertible Notes Payable.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Changes to U.S. GAAP are established by the FASB. We evaluate the applicability and impact of all authoritative guidance issued by the FASB. Guidance not listed below was assessed and determined to be either not applicable, clarifications of items listed below, immaterial or already adopted by the Company. New Accounting Standards Issued and Adopted as of January 1, 2023 The FASB issued ASU No. 2016-13, “Measurement of Credit Losses on Financial Instruments.” This standard replaces the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects estimates of expected credit losses over their contractual life that are recorded at inception based on historical information, current conditions, and reasonable and supportable forecasts. The Company adopted this standard prospectively as of January 1, 2023 and the adoption did not have a material impact of the Company’s consolidated financial statements and related disclosures, and there was no cumulative effect on retained earnings.
Earnings (Loss) Per Share	Basic earnings (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period, which includes the February 2023 Warrants (See Note 9, “Debt and Convertible Notes Payable”, and Note 13, “Stockholders’ Equity”). Diluted earnings (loss) per common share is calculated by dividing the adjusted net income (loss) by the weighted average number of common shares outstanding combined with dilutive common share equivalents outstanding, if the effect is dilutive. Potentially dilutive common share equivalents consist of incremental shares of common stock issuable upon conversion of convertible notes payable, exercise of stock warrants and vesting and settlement of stock awards. The dilutive effect of non-vested stock issued under share‑based compensation plans, shares issuable under the Employee Stock Purchase Plan (ESPP), employee stock options outstanding, and the Pre-Funded stock warrants are computed using the treasury stock method. The dilutive effect of the Convertible Notes is computed using the if‑converted method in accordance with ASU 2020-06, which was adopted by the Company on January 1, 2022 (see Note 2, “Summary of Significant Accounting Policies”).
Segment Information	Segment Information Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the chief operating decision-maker in deciding how to allocate resources and assess performance. The operations of the Company are categorized into the following reportable segments: Chemistry Technologies. The CT segment includes green specialty chemistries, logistics and technology services, which enable its customers to pursue improved efficiencies and performance throughout the life cycle of their wells, and also helping customers improve their ESG and operational goals. Customers of the CT segment include major integrated oil and gas companies, oilfield services companies, independent oil and gas companies, national and state-owned oil companies, and international supply chain management companies. Data Analytics. The DA segment includes the design, development, production, sale and support of equipment and services that create and provide valuable information on the composition and properties of energy customers’ hydrocarbon fluids. The company markets products and services that support in-line data analysis of hydrocarbon components and properties. Customers of the DA segment span across the entire oil and gas market, from upstream production to midstream facilities to refineries and distribution networks. Performance is based upon a variety of criteria. The primary financial measure is segment operating income (loss). Various functions, including certain sales and marketing activities and general and administrative activities, are provided centrally by the corporate office. Costs associated with corporate office functions, other corporate income and expense items, and income taxes are not allocated to the reportable segments.

v3.23.2

Summary of Significant Accounting Policies (Tables)	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Schedule of property and equipment	Depreciation or amortization of property and equipment, including operating lease right-of-use assets (“ROU”), is calculated using the straight-line method over the shorter of the lease term or the asset’s estimated useful life as follows: Buildings and leasehold improvements 2-30 years Machinery and equipment 7-10 years Furniture and fixtures 3 years Land improvements 20 years Transportation equipment 2-5 years Computer equipment and software 3-7 years Property and equipment are as follows (in thousands): June 30, 2023 December 31, 2022 Land $ 886  $ 886  Land improvements 520  520  Buildings and leasehold improvements 5,356  5,356  Machinery and equipment 6,890  6,758  Furniture and fixtures 532  532  Transportation equipment 784  784  Computer equipment and software 1,556  1,425     Property and equipment 16,524  16,261  Less accumulated depreciation (11,771) (11,435) Property and equipment, net $ 4,753  $ 4,826

v3.23.2

Revenue from Contracts with Customers (Tables)	6 Months Ended
	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
Schedule of disaggregation of revenue	Total revenue disaggregated by revenue source is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Revenue: Products (1) $ 49,062  $ 28,588  $ 95,829  $ 40,787  Services 1,532  785  2,773  1,465  $ 50,594  $ 29,373  $ 98,602  $ 42,252  (1) Product revenue includes sales to related parties as described in Note 16, “Related Party Transactions.” Disaggregation of Cost of Sales The Company differentiates cost of sales based on whether the cost is attributable to tangible goods sold, cost of services sold or other costs which cannot be directly attributable to either tangible goods or services. Total cost of sales disaggregated is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Cost of sales: Tangible goods sold $ 41,878  $ 27,379  $ 83,407  $ 37,167  Services 156  105  296  53  Other 4,656  4,194  9,114  7,816  $ 46,690  $ 31,678  $ 92,817  $ 45,036  Other cost of sales represent costs directly associated with the generation of revenue but which cannot be attributed directly to tangible goods sold or services. Examples of other costs of sales are certain personnel costs and equipment rental and insurance costs. Cost of sales split between external and related party sales is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Cost of sales: Cost of sales for external customers $ 16,445  $ 13,830  $ 27,743  $ 24,598  Cost of sales for related parties 30,245  17,848  65,074  20,438  $ 46,690  $ 31,678  $ 92,817  $ 45,036

v3.23.2

Contract Assets (Tables)	6 Months Ended
	Jun. 30, 2023
Revenue Recognition [Abstract]
Schedule of outstanding contract assets	Contract assets are as follows (in thousands): June 30, 2023 December 31, 2022 Contract assets $ 83,060  $ 83,060  Less accumulated amortization (5,761) (3,371) Contract assets, net 77,299  79,689  Less current contract assets (7,716) (7,113) Contract assets, long term $ 69,583  $ 72,576  The below table reflects our estimated amortization per year (in thousands) based on the Company’s current forecasted revenues from the ProFrac Agreement. Years ending December 31, Amortization 2023 (excluding the six months ended June 30, 2023) $ 3,226  2024 8,980  2025 8,980  2026 8,980  2027 8,980  Thereafter through May 2032 38,153  Total contract assets $ 77,299

v3.23.2

Inventories (Tables)	6 Months Ended
	Jun. 30, 2023
Inventory Disclosure [Abstract]
Schedule of components of inventory	Inventories are as follows (in thousands): June 30, 2023 December 31, 2022 Raw materials $ 7,404  $ 5,800  Finished goods 18,473  18,130  Inventories 25,877  23,930  Less reserve for excess and obsolete inventory (7,480) (8,210) Inventories, net $ 18,397  $ 15,720

v3.23.2

Property and Equipment (Tables)	6 Months Ended
	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
Schedule of property and equipment	Depreciation or amortization of property and equipment, including operating lease right-of-use assets (“ROU”), is calculated using the straight-line method over the shorter of the lease term or the asset’s estimated useful life as follows: Buildings and leasehold improvements 2-30 years Machinery and equipment 7-10 years Furniture and fixtures 3 years Land improvements 20 years Transportation equipment 2-5 years Computer equipment and software 3-7 years Property and equipment are as follows (in thousands): June 30, 2023 December 31, 2022 Land $ 886  $ 886  Land improvements 520  520  Buildings and leasehold improvements 5,356  5,356  Machinery and equipment 6,890  6,758  Furniture and fixtures 532  532  Transportation equipment 784  784  Computer equipment and software 1,556  1,425     Property and equipment 16,524  16,261  Less accumulated depreciation (11,771) (11,435) Property and equipment, net $ 4,753  $ 4,826

v3.23.2

Leases (Tables)	6 Months Ended
	Jun. 30, 2023
Leases [Abstract]
Schedule of components of lease expense and supplemental cash flow information	The components of lease expense and supplemental cash flow information are as follows (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Operating lease expense $ 237  $ 220  $ 478  $ 448  Finance lease expense: Amortization of assets 4  4  7  8  Interest on lease liabilities 1  3  2  6  Total finance lease expense 5  7  9  14  Short-term lease expense 40  79  81  203  Total lease expense $ 282  $ 306  $ 568  $ 665  Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 1,550  $ 350  $ 2,915  $ 726  Operating cash flows from finance leases 7  10  17  20  Financing cash flows from finance leases 1  3  2  6
Schedule of maturities of operating leases liabilities	Maturities of lease liabilities as of June 30, 2023 are as follows (in thousands): Years ending December 31, Operating Leases Finance Leases 2023 (excluding the six months ended June 30, 2023) $ 1,843  $ 19  2024 2,624  23  2025 1,391  —  2026 1,418  —  2027 1,339  —  Thereafter 3,443  —  Total lease payments $ 12,058  $ 42  Less: Interest (2,572) (2) Present value of lease liabilities $ 9,486  $ 40
Schedule of maturities of finance leases liabilities	Maturities of lease liabilities as of June 30, 2023 are as follows (in thousands): Years ending December 31, Operating Leases Finance Leases 2023 (excluding the six months ended June 30, 2023) $ 1,843  $ 19  2024 2,624  23  2025 1,391  —  2026 1,418  —  2027 1,339  —  Thereafter 3,443  —  Total lease payments $ 12,058  $ 42  Less: Interest (2,572) (2) Present value of lease liabilities $ 9,486  $ 40
Schedule of supplemental balance sheet information	Supplemental balance sheet information related to leases is as follows (in thousands): June 30, 2023 December 31, 2022 Operating Leases Operating lease right-of-use assets $ 4,279  $ 5,900  Current portion of operating lease liabilities 2,902  3,328  Long-term operating lease liabilities 6,584  8,044  Total operating lease liabilities $ 9,486  $ 11,372  Finance Leases Property and equipment $ 147  $ 147  Accumulated depreciation (63) (55) Property and equipment, net $ 84  $ 92  Current portion of finance lease liabilities $ 37  $ 36  Long-term finance lease liabilities 3  19  Total finance lease liabilities $ 40  $ 55  Weighted Average Remaining Lease Term Operating leases 5.4 years 5.3 years Finance leases 1.0 year 1.6 years Weighted Average Discount Rate Operating leases 9.2  % 9.3  % Finance leases 8.5  % 8.9  %

v3.23.2

Accrued Liabilities (Tables)	6 Months Ended
	Jun. 30, 2023
Payables and Accruals [Abstract]
Schedule of current accrued liabilities	Current accrued liabilities are as follows (in thousands):   June 30, 2023 December 31, 2022 Severance costs $ 1,314  $ 2,617  Payroll and benefits 525  684  Legal costs 816  447  Contingent liability for earn-out provision 260  583  Deferred revenue, current 409  655  Taxes other than income taxes 946  1,884  Other 908  2,114  Total current accrued liabilities $ 5,178  $ 8,984

v3.23.2

Debt and Convertible Notes Payable (Tables)	6 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
Schedule of debt	Long-term debt, including current portion, is as follows (in thousands): June 30, 2023 December 31, 2022 Flotek PPP loan $ 328  $ 4,788  Less current maturities (179) (2,052) Total long-term debt, net of current portion $ 149  $ 2,736
Schedule of loan repayments	Loan repayments are scheduled as follows (in thousands): Years ending December 31, Repayment 2023 (excluding the six months ended June 30, 2023) $ 91  2024 180  2025 57  Total Flotek PPP loan $ 328

v3.23.2

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2023
Fair Value Disclosures [Abstract]
Schedule of fair value measurements, recurring	The following table presents the Company’s liabilities that are measured at fair value on a recurring basis and the level within the fair value hierarchy (in thousands): June 30, December 31, Level 1 Level 2 Level 3 2023 Level 1 Level 2 Level 3 2022 Contingent earnout consideration $ —  $ —  $ 260  $ 260  $ —  $ —  $ 583  $ 583  Initial ProFrac Agreement Contract Consideration Convertible Notes —  —  —  —  —  —  14,220  14,220  Amended ProFrac Agreement Contract Consideration Convertible Notes —  —  —  —  —  —  69,350  69,350  Total $ —  $ —  $ 260  $ 260  $ —  $ —  $ 84,153  $ 84,153
Schedule of valuation techniques	June 30, 2023 December 31, 2022 Risk-free interest rate 4.93  % 4.34% Expected volatility 100.0  % 100.0% Term until liquidation (years) 1.88 2.38 Stock price $0.73 $1.12 Discount rate 12.66  % 9.95% The key inputs into the Monte Carlo simulation used to estimate the fair value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable maturing February 2, 2023, as of December 31, 2022 were as follows: December 31, 2022 Risk-free interest rate 4.12% Expected volatility 100.0% Term until liquidation (years) 0.09 Stock price $1.12 Discount rate 4.12% The key inputs into the Monte Carlo simulation used to estimate the fair value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable maturing May 17, 2023, as of December 31, 2022 were as follows: December 31, 2022 Risk-free interest rate 4.59% Expected volatility 100.0% Term until liquidation (years) 0.38 Stock price $1.12 Discount rate 4.59%
Schedule of fair value, liabilities measured on recurring basis, unobservable input reconciliation	The following table presents the changes in balances of liabilities for the three and six months ended June 30, 2023 and 2022 classified as Level 3 (in thousands): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Balance - beginning of period $ 44,025  $ 14,752  $ 84,153  $ 608  Transfer of ProFrac Agreement Contract Consideration Convertible Notes Payable from Level 2 —  —  —  10,000  Issuance of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable —  69,460  —  69,460  Increase in principal of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest —  257  85  415  Increase in principal of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest 712  611  2,043  611  Change in fair value of contingent earnout consideration 35  (228) (323) (134) Change in fair value of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable —  (2,637) 786  1,255  Change in fair value of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable (3,874) (14,521) (30,755) (14,521) Conversion of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity —  —  (15,091) —  Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity (40,638) —  (40,638) —  Balance - end of period $ 260  $ 67,694  $ 260  $ 67,694

v3.23.2

Income Taxes (Tables)	6 Months Ended
	Jun. 30, 2023
Income Tax Disclosure [Abstract]
Schedule of effective income tax rate reconciliation	Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 U.S. federal statutory tax rate 21.0  % 21.0  % 21.0  % 21.0  % State income taxes, net of federal benefit 120.4  —  0.1  0.1  Non-U.S. income taxed at different rates (96.7) 3.8  —  (1.9) Increase (reduction) in tax benefit related to stock-based awards 1291.8  3.1  0.7  (2.0) Increase in valuation allowance 2284.5  (27.5) (19.8) (17.0) Permanent differences (3779.4) —  (2.1) —  Non-deductible expenses 278.8  (0.4) 0.2  0.1  Other —  3.8  —  (2.2) Effective income tax rate 120.4  % 3.8  % 0.1  % (1.9) %

v3.23.2

Stockholders’ Equity (Tables)	6 Months Ended
	Jun. 30, 2023
Equity [Abstract]
Schedule of valuation assumptions	The key inputs into the Black-Scholes Option Pricing Model used to estimate the fair value of the June 2022 Warrants as of the issuance on June 21, 2022 were as follows: Risk-free interest rate 3.21% Expected volatility 90.0% Term until liquidation (years) 2.00 Stock price $1.11 Strike price (exercise fee) $4.5 million

v3.23.2

Earnings (Loss) Per Share (Tables)	6 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
Schedule of basic and diluted	The calculation of the basic and diluted earnings (loss) per share for the three and six months ended June 30, 2023 and 2022 is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 Numerator: Net income (loss) for basic earnings per share $ (21) $ 6,240  $ 21,322  $ (4,484) Adjustments to net income available to shareholders Paid-in-Kind interest expense on convertible notes payable and Contract Consideration Convertible Notes Payable 712  1,028  2,284  1,402  Valuation (gain)/loss on Contract Consideration Convertible Notes Payable carried at FV (3,874) (13,229) (29,969) (10,228) Adjusted net loss for diluted earnings per share $ (3,183) $ (5,961) $ (6,363) $ (13,310) Denominator: Basic weighted average shares outstanding 143,433  74,861  121,244  73,476  Average number of diluted shares for convertible notes payable and Contract Consideration Convertible Notes Payable 26,067  49,474  42,921  33,610  Diluted weighted average shares outstanding 169,500  124,335  164,165  $ 107,086  Basic earnings (loss) per share —  0.08  0.18  (0.06) Diluted loss per share (0.02) (0.05) (0.04) (0.12) Anti-dilutive incremental shares excluded from denominator for diluted earnings computation Average number of diluted shares for June 2022 stock warrants 6,496  976  8,038  491  Average number of diluted shares for options and restricted stock 545  692  718  662

v3.23.2

Supplemental Cash Flow Information (Tables)	6 Months Ended
	Jun. 30, 2023
Supplemental Cash Flow Elements [Abstract]
Schedule of supplemental cash flow information	Supplemental cash flow information is as follows (in thousands):            Six months ended June 30,   2023 2022 Supplemental cash flow information: Interest paid $ 23  $ 7  Supplemental non cash financing and investing activities: Conversion of convertible notes payable to common stock 8,996  3,038  Conversion of convertible notes payable to February 2023 Warrants 11,040  —  Conversion of Initial Contract Consideration Convertible Notes Payable to February 2023 Warrants 15,092  —  Conversion of Amended Contract Consideration Convertible Notes Payable to common stock 40,638  —  Issuance of convertible notes payable as consideration for ProFrac Agreements —  79,460  Issuance cost of stock warrants included in accrued accounts payable —  1,170

v3.23.2

Business Segment, Geographic and Major Customer Information (Tables)	6 Months Ended
	Jun. 30, 2023
Segment Reporting [Abstract]
Schedule of financial information regarding reportable segments	Summarized financial information of the reportable segments is as follows (in thousands): As of and for the three months ended June 30, Chemistry Technologies Data Analytics Corporate and Other Total 2023 Revenue from external customers Products $ 15,095  $ 1,620  $ —  $ 16,715  Services 374  731  —  1,105  Total revenue from external customers 15,469  2,351  —  17,820  Revenue from related party —  Products 32,345  2  —  32,347  Services 272  155  —  427  Total revenue from related parties 32,617  157  —  32,774  Gross profit 2,603  1,301  —  3,904  Change in fair value of Contract Consideration Convertible Notes Payable (3,874) —  —  (3,874) Income (loss) from operations 3,795  129  (3,252) 672  Paid-in-kind interest on Contract Consideration Convertible Notes Payable 712  —  —  712  Depreciation 155  18  1  174  Additions to long-lived assets —  135  —  135  2022 Revenue from external customers Products $ 11,740  $ 299  $ —  $ 12,039  Services 371  414  —  785  Total revenue from external customers 12,111  713  —  12,824  Revenue from related party Products 16,549  —  —  16,549  Services —  —  —  —  Total revenue from related parties 16,549  —  —  16,549  Gross loss (1,568) (737) —  (2,305) Change in fair value of Contract Consideration Convertible Notes Payable (17,158) —  —  (17,158) Loss from operations 14,944  (1,198) (5,707) 8,039  Paid-in-kind interest on Contract Consideration Convertible Notes Payable 868  —  —  868  Paid-in-kind interest on convertible notes payable —  —  466  466  Depreciation 166  15  1  182  Additions to long-lived assets 5  —  —  5  As of and for the six months ended June 30, Chemistry Technologies Data Analytics Corporate and Other Total 2023 Revenue from external customers Products $ 23,654  $ 3,562  $ —  $ 27,216  Services 1,039  1,217  —  2,256  Total revenue from external customers 24,693  4,779  —  29,472  Revenue from related party —  Products 68,611  2  —  68,613  Services 272  245  —  517  Total revenue from related parties 68,883  247  —  69,130  Gross profit 3,038  2,747  —  5,785  Change in fair value of Contract Consideration Convertible Notes Payable (29,969) —  —  (29,969) Income (loss) from operations 27,174  587  (8,577) 19,184  Paid-in-kind interest on Contract Consideration Convertible Notes Payable 2,129  —  —  2,129  Paid-in-kind interest on convertible notes payable —  —  155  155  Depreciation 312  36  1  349  Additions to long-lived assets 30  230  32  292  2022 Revenue from external customers Products $ 20,650  $ 1,091  $ —  $ 21,741  Services 772  693  —  1,465  Total revenue from external customers 21,422  1,784  —  23,206  Revenue from related party Products 19,046  —  —  19,046  Services —  —  —  —  Total revenue from related parties 19,046  —  —  19,046  Gross loss (2,231) (553) —  (2,784) Change in fair value of Contract Consideration Convertible Notes Payable (13,266) —  —  (13,266) Loss from operations 8,887  (2,006) (9,126) (2,245) Paid-in-kind interest on Contract Consideration Convertible Notes Payable 1,026  —  —  1,026  Paid-in-kind interest on convertible notes payable —  —  793  793  Depreciation 345  31  1  377  Additions to long-lived assets 5  —  —  5  Assets of the Company by reportable segments are as follows (in thousands): June 30, 2023 December 31, 2022 Chemistry Technologies $ 139,921  $ 146,542  Data Analytics 7,382  5,645  Corporate and Other 10,727  12,623  Total assets $ 158,030  $ 164,810
Schedule of revenue by geographic location	Revenue by geographic location is as follows (in thousands):   Three months ended June 30, Six months ended June 30,   2023 2022 2023 2022 U.S. (1) $ 48,725  $ 25,955  $ 94,851  $ 36,289  UAE 1,509  3,139  2,912  4,450  Other countries 360  279  839  1,513  Total revenue $ 50,594  $ 29,373  $ 98,602  $ 42,252  (1) Includes revenue from related party
Schedule of revenue by major customers	Revenue from major customers, as a percentage of consolidated revenue, is as follows (in thousands): Three months ended June 30, Revenue % of Total Revenue 2023 Customer A (Related Party) $ 32,774  64.8  % 2022 Customer A (Related Party) $ 16,549  52.2  % Customer B 5,611  19.1  % Six months ended June 30, Revenue % of Total Revenue 2023 Customer A (Related Party) $ 69,129  70.1  % 2022 Customer A (Related Party) $ 17,657  38.9  % Customer B 8,218  19.5  %
Schedule of expenditure with major suppliers by reporting segments	Expenditure with major suppliers, as a percentage of consolidated supplier expenditure, is as follows (in thousands): Expenditure % of Total Expenditure Three months ended June 30, 2023 Supplier A $ 13,155  32.6  % Supplier B 8,049  20.0  % Supplier C 4,489  11.1  % 2022 Supplier A 7,576  31.9  % Supplier B 4,036  17.0  % Supplier C 2,679  11.3  % Expenditure % of Total Expenditure Six months ended June 30, 2023 Supplier A $ 30,109  36.4  % Supplier B 15,194  18.4  % Supplier C 8,993  10.9  % 2022 Supplier A 7,624  24.2  % Supplier B 6,154  19.5%

v3.23.2

Organization and Nature of Operations (Details)	6 Months Ended
	Jun. 30, 2023 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of operation segments (segments)	2

v3.23.2

Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accounting Policies [Abstract]
Restricted cash	$ 101	$ 100

v3.23.2

Summary of Significant Accounting Policies - Narrative (Details)	6 Months Ended
	Jun. 30, 2023
ProFrac Agreement
Debt Instrument
Amortization period	10 years

v3.23.2

Summary of Significant Accounting Policies - Property and Equipment (Details)	Jun. 30, 2023
Buildings and leasehold improvements | Minimum
Property, Plant and Equipment
Property, Plant and equipment, useful life	2 years
Buildings and leasehold improvements | Maximum
Property, Plant and Equipment
Property, Plant and equipment, useful life	30 years
Machinery and equipment | Minimum
Property, Plant and Equipment
Property, Plant and equipment, useful life	7 years
Machinery and equipment | Maximum
Property, Plant and Equipment
Property, Plant and equipment, useful life	10 years
Furniture and fixtures
Property, Plant and Equipment
Property, Plant and equipment, useful life	3 years
Land improvements
Property, Plant and Equipment
Property, Plant and equipment, useful life	20 years
Transportation equipment | Minimum
Property, Plant and Equipment
Property, Plant and equipment, useful life	2 years
Transportation equipment | Maximum
Property, Plant and Equipment
Property, Plant and equipment, useful life	5 years
Computer equipment and software | Minimum
Property, Plant and Equipment
Property, Plant and equipment, useful life	3 years
Computer equipment and software | Maximum
Property, Plant and Equipment
Property, Plant and equipment, useful life	7 years

v3.23.2

Summary of Significant Accounting Policies - Revenue Recognition (Details)	Jun. 30, 2023
Data Analytics | Minimum
Segment Reporting Information
Payment period (in days)	30 days
Data Analytics | Minimum | International
Segment Reporting Information
Payment period (in days)	90 days
Data Analytics | Maximum
Segment Reporting Information
Payment period (in days)	60 days
Data Analytics | Maximum | International
Segment Reporting Information
Payment period (in days)	120 days
Chemistry Technologies | Minimum
Segment Reporting Information
Payment period (in days)	30 days
Chemistry Technologies | Minimum | International
Segment Reporting Information
Payment period (in days)	90 days
Chemistry Technologies | Maximum
Segment Reporting Information
Payment period (in days)	60 days
Chemistry Technologies | Maximum | International
Segment Reporting Information
Payment period (in days)	120 days

v3.23.2

Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of Revenue
Total revenues	$ 50,594	$ 29,373	$ 98,602	$ 42,252
Products
Disaggregation of Revenue
Total revenues	49,062	28,588	95,829	40,787
Services
Disaggregation of Revenue
Total revenues	$ 1,532	$ 785	$ 2,773	$ 1,465

v3.23.2

Revenue from Contracts with Customers - Cost Of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of Revenue
Cost of sales	$ 46,690	$ 31,678	$ 92,817	$ 45,036
Nonrelated Party
Disaggregation of Revenue
Cost of sales	16,445	13,830	27,743	24,598
Related Party
Disaggregation of Revenue
Cost of sales	30,245	17,848	65,074	20,438
Tangible goods sold
Disaggregation of Revenue
Cost of sales	41,878	27,379	83,407	37,167
Services
Disaggregation of Revenue
Cost of sales	156	105	296
Service
Disaggregation of Revenue
Cost of sales				53
Other
Disaggregation of Revenue
Cost of sales	$ 4,656	$ 4,194	$ 9,114	$ 7,816

v3.23.2

Contract Assets - Contract Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Contract Asset
Contract assets	$ 83,060	$ 83,060
Less accumulated amortization	(5,761)	(3,371)
Total contract assets	77,299	79,689
Current contract assets	(7,716)	(7,113)
Long-term contract assets	$ 69,583	$ 72,576

v3.23.2

Contract Assets - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	May 17, 2022	Feb. 02, 2022
Disaggregation of Revenue
Contract assets	$ 83,060		$ 83,060		$ 83,060
Capitalized contract fees	3,600		3,600
Long-term contract assets	69,583		69,583		$ 72,576
Amortization of contract into revenue	$ 1,100	$ 700	$ 2,400	$ 700
ProFrac Agreement
Disaggregation of Revenue
Contract assets						$ 69,500	$ 10,000

v3.23.2

Contract Assets - Estimated Amortization (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Revenue Recognition [Abstract]
2023 (excluding the six months ended June 30, 2023)	$ 3,226
2024	8,980
2025	8,980
2026	8,980
2027	8,980
Thereafter through May 2032	38,153
Total contract assets	$ 77,299	$ 79,689

v3.23.2

Inventories - Components of inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Raw materials	$ 7,404	$ 5,800
Finished goods	18,473	18,130
Inventories	25,877	23,930
Less reserve for excess and obsolete inventory	(7,480)	(8,210)
Inventories, net	$ 18,397	$ 15,720

v3.23.2

Inventories - Narratives (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Chemistry Technologies
Inventory
Provision for excess and obsolete inventory	$ 200,000	$ 400,000	$ 400,000	$ 700,000
Data Analytics
Inventory
Provision for excess and obsolete inventory	$ 6,000	$ 49,000	$ 100,000	$ 49,000

v3.23.2

Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Components of Property, Plant and Equipment
Property and equipment	$ 16,524	$ 16,261
Less accumulated depreciation	(11,771)	(11,435)
Property and equipment, net	4,753	4,826
Land
Components of Property, Plant and Equipment
Property and equipment	886	886
Land improvements
Components of Property, Plant and Equipment
Property and equipment	520	520
Buildings and leasehold improvements
Components of Property, Plant and Equipment
Property and equipment	5,356	5,356
Machinery and equipment
Components of Property, Plant and Equipment
Property and equipment	6,890	6,758
Furniture and fixtures
Components of Property, Plant and Equipment
Property and equipment	532	532
Transportation equipment
Components of Property, Plant and Equipment
Property and equipment	784	784
Computer equipment and software
Components of Property, Plant and Equipment
Property and equipment	$ 1,556	$ 1,425

v3.23.2

Property and Equipment - Narratives (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Property, Plant and Equipment [Abstract]
Depreciation	$ 174	$ 182	$ 349	$ 377

v3.23.2

Leases - Components of Lease Expense and Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Leases [Abstract]
Operating lease expense	$ 237	$ 220	$ 478	$ 448
Finance lease expense:
Amortization of assets	4	4	7	8
Interest on lease liabilities	1	3	2	6
Total finance lease expense	5	7	9	14
Short-term lease expense	40	79	81	203
Total lease expense	282	306	568	665
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	1,550	350	2,915	726
Operating cash flows from finance leases	7	10	17	20
Financing cash flows from finance leases	$ 1	$ 3	$ 2	$ 6

v3.23.2

Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Operating Leases
2023 (excluding the six months ended June 30, 2023)	$ 1,843
2024	2,624
2025	1,391
2026	1,418
2027	1,339
Thereafter	3,443
Total lease payments	12,058
Less: Interest	(2,572)
Present value of lease liabilities	9,486	$ 11,372
Finance Leases
2023 (excluding the six months ended June 30, 2023)	19
2024	23
2025	0
2026	0
2027	0
Thereafter	0
Total lease payments	42
Less: Interest	(2)
Present value of lease liabilities	$ 40	$ 55

v3.23.2

Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Operating Leases
Operating lease right-of-use assets	$ 4,279	$ 5,900
Current portion of operating lease liabilities	2,902	3,328
Long-term operating lease liabilities	6,584	8,044
Total operating lease liabilities	9,486	11,372
Finance Leases
Property and equipment	147	147
Accumulated depreciation	(63)	(55)
Property and equipment, net	84	92
Current portion of finance lease liabilities	37	36
Long-term finance lease liabilities	3	19
Total finance lease liabilities	$ 40	$ 55
Weighted Average Remaining Lease Term
Operating leases (in years)	5 years 4 months 24 days	5 years 3 months 18 days
Finance leases (in years)	1 year	1 year 7 months 6 days
Weighted Average Discount Rate
Operating leases (in percentage)	9.20%	9.30%
Finance leases (in percentage)	8.50%	8.90%

v3.23.2

Accrued Liabilities - Schedule of Current Accrued Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accrued liabilities, current
Severance costs	$ 1,314	$ 2,617
Payroll and benefits	525	684
Legal costs	816	447
Contingent liability for earn-out provision	260	583
Deferred revenue, current	409	655
Taxes other than income taxes	946	1,884
Other	908	2,114
Total current accrued liabilities	$ 5,178	$ 8,984

v3.23.2

Debt and Convertible Notes Payable - Narratives (Details)						1 Months Ended	3 Months Ended		6 Months Ended
	May 17, 2023 USD ($) $ / shares shares	Feb. 02, 2023 USD ($) $ / shares shares	Jan. 05, 2023 USD ($)	Mar. 21, 2022 USD ($) shares	Feb. 02, 2022 USD ($) d $ / shares	Apr. 30, 2020 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jan. 04, 2023 USD ($)	Dec. 31, 2022 USD ($)	May 17, 2022 USD ($)
Debt Instrument
Other income							$ 0	$ 0	$ 4,522,000	$ 0
Debt converted instrument, face amount									40,638,000	$ 0
Convertible notes payable							0		0			$ 19,799,000
ProFrac Holdings | February 2023 Warrants | Related Party
Debt Instrument
Conversion of notes to common stock (shares) | shares		12,683,281
Unsecured Debt | Flotek PPP loan
Debt Instrument
Proceeds from debt						$ 4,800,000
Forgiveness of debt			$ 4,400,000
Principal amount							$ 328,000		328,000		$ 4,800,000	$ 4,788,000
Accrued interest forgiveness			100,000
Aggregate principal amount			$ 400,000
Repaid in monthly installments									15,000
Other income									4,500,000
Gain (loss) on extinguishment of debt, principal									4,400,000
Gain (loss) on extinguishment of debt, accrued interest									$ 100,000
Convertible Debt | February 2023 Warrants
Debt Instrument
Conversion price (in dollar per share) | $ / shares		$ 0.0001
Convertible Debt | PIPE Transaction
Debt Instrument
Aggregate principal amount					$ 21,200,000
Proceeds from convertible notes					$ 20,100,000
Debt instrument stated interest rate (percent)					10.00%
Conversion price (in dollar per share) | $ / shares					$ 1.088125
Stock price trigger (in dollars per share) | $ / shares		0.8705			2.50
Stock price trigger for trading period (in dollars per share) | $ / shares					$ 1.741
Threshold trading days | d					20
Consecutive trading days | d					30
Debt converted instrument, face amount				$ 3,000,000
Conversion of notes to common stock (shares) | shares				2,800,000
Unamortized issuance cost					$ 1,100,000
Convertible Debt | ProFrac Agreement Contract
Debt Instrument
Aggregate principal amount					$ 10,000,000
Debt instrument stated interest rate (percent)					10.00%
Conversion price (in dollar per share) | $ / shares		$ 1.19
Convertible debt, fair value disclosures		$ 15,100,000
Convertible Debt | ProFrac Agreement Contract | Related Party
Debt Instrument
Conversion of notes to common stock (shares) | shares		12,683,280
Convertible notes payable		$ 11,000,000
Paid-in-kind interest expense		1,000,000
Convertible debt, fair value disclosures		$ 15,100,000
Convertible Debt | ProFrac Agreement Contract | Estimate of Fair Value Measurement
Debt Instrument
Convertible debt, fair value disclosures					$ 10,000,000
Convertible Debt | Amended ProFrac Agreement
Debt Instrument
Aggregate principal amount													$ 50,000,000
Debt instrument stated interest rate (percent)													10.00%
Conversion price (in dollar per share) | $ / shares	$ 0.64
Convertible debt, fair value disclosures	$ 40,600,000
Convertible Debt | Amended ProFrac Agreement | Related Party
Debt Instrument
Conversion price (in dollar per share) | $ / shares	$ 0.8705
Conversion of notes to common stock (shares) | shares	63,496,922
Convertible notes payable	$ 55,300,000
Paid-in-kind interest expense	5,300,000
Convertible debt, fair value disclosures	$ 40,600,000
Convertible Debt | Amended ProFrac Agreement | Estimate of Fair Value Measurement
Debt Instrument
Convertible debt, fair value disclosures													$ 69,500,000
Convertible Notes Payable
Debt Instrument
Debt converted instrument, face amount				$ 3,000,000
Conversion of notes to common stock (shares) | shares				2,793,030
Convertible Notes Payable | Related Party
Debt Instrument
Debt converted instrument, face amount				$ 3,000,000
Conversion of notes to common stock (shares) | shares				2,793,030
Convertible Notes Payable | Other Convertible Debt
Debt Instrument
Conversion of notes to common stock (shares) | shares		10,335,840
Convertible notes payable		$ 9,000,000
Paid-in-kind interest expense		$ 800,000

v3.23.2

Debt and Convertible Notes Payable - Schedule of Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jan. 04, 2023	Dec. 31, 2022
Debt Instrument
Less current maturities	$ (179)		$ (2,052)
Unsecured Debt | Flotek PPP loan
Debt Instrument
Flotek PPP loan	328	$ 4,800	4,788
Long-term debt, net of current portion	$ 149		$ 2,736

v3.23.2

Debt and Convertible Notes Payable - Schedule of Loan Repayments (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Repayment
2023 (excluding the six months ended June 30, 2023)	$ 91
2023 (excluding the six months ended June 30, 2023)	180
Flotek PPP loan	328
2024	$ 57

v3.23.2

Fair Value Measurements - Recurring (Details) - Recurring - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Feb. 02, 2022
Fair Value, Assets and Liabilities Measured on Recurring
Contingent earnout consideration	$ 260	$ 583
Liabilities measured at fair value on a recurring basis	260	84,153
ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	14,220
Amended ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	69,350
Level 1
Fair Value, Assets and Liabilities Measured on Recurring
Contingent earnout consideration	0	0
Liabilities measured at fair value on a recurring basis	0	0
Level 1 | ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	0
Level 1 | Amended ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring
Contingent earnout consideration	0	0
Liabilities measured at fair value on a recurring basis	0	0
Level 2 | ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	0
Level 2 | Amended ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring
Contingent earnout consideration	260	583
Contract consideration, convertible notes			$ 10,000
Liabilities measured at fair value on a recurring basis	260	84,153
Level 3 | ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	0	14,220
Level 3 | Amended ProFrac Agreement
Fair Value, Assets and Liabilities Measured on Recurring
Contract consideration, convertible notes	$ 0	$ 69,350

v3.23.2

Fair Value Measurements - Monte Carlo Simulation (Details)	Jun. 30, 2023	Dec. 31, 2022
Risk-free interest rate
Fair Value Measurement Inputs and Valuation Techniques
Earn out provision, measurement input	0.0493	0.0434
Risk-free interest rate | ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		0.0412
Risk-free interest rate | Amended ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		0.0459
Expected volatility
Fair Value Measurement Inputs and Valuation Techniques
Earn out provision, measurement input	1.000	1.000
Expected volatility | ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		1.000
Expected volatility | Amended ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		1.000
Term until liquidation (years)
Fair Value Measurement Inputs and Valuation Techniques
Earn out provision, measurement input	1.88	2.38
Term until liquidation (years) | ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		0.09
Term until liquidation (years) | Amended ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		0.38
Stock price
Fair Value Measurement Inputs and Valuation Techniques
Earn out provision, measurement input	0.73	1.12
Stock price | ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		1.12
Stock price | Amended ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		1.12
Discount rate
Fair Value Measurement Inputs and Valuation Techniques
Earn out provision, measurement input	0.1266	0.0995
Discount rate | ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		0.0412
Discount rate | Amended ProFrac Agreement | Convertible Debt
Fair Value Measurement Inputs and Valuation Techniques
Debt instrument, measurement input		0.0459

v3.23.2

Fair Value Measurements - Narratives (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	May 17, 2023	Feb. 02, 2023	May 17, 2022	Feb. 02, 2022
Amended ProFrac Agreement | Convertible Debt
Assets Measured at Fair Value on a Nonrecurring Basis
Convertible debt, fair value disclosures					$ 40.6
Conversion price (in dollar per share)					$ 0.64
Change in fair value	$ (3.9)	$ (14.5)	$ (30.8)	$ (14.5)
Amended ProFrac Agreement | Estimate of Fair Value Measurement | Convertible Debt
Assets Measured at Fair Value on a Nonrecurring Basis
Convertible debt, fair value disclosures							$ 69.5
ProFrac Agreement Contract | Convertible Debt
Assets Measured at Fair Value on a Nonrecurring Basis
Convertible debt, fair value disclosures						$ 15.1
Conversion price (in dollar per share)						$ 1.19
Change in fair value	$ 0.8	$ (2.6)	$ 0.8	$ 1.3
ProFrac Agreement Contract | Estimate of Fair Value Measurement | Convertible Debt
Assets Measured at Fair Value on a Nonrecurring Basis
Convertible debt, fair value disclosures								$ 10.0
Recurring | Level 3
Assets Measured at Fair Value on a Nonrecurring Basis
Convertible debt, fair value disclosures								$ 10.0

v3.23.2

Fair Value Measurements - Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Balance - beginning of period	$ 44,025	$ 14,752	$ 84,153	$ 608
Transfer of ProFrac Agreement Contract Consideration Convertible Notes Payable from Level 2	0	0	0	10,000
Issuance of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable	0	69,460	0	69,460
Balance - end of period	260	67,694	260	67,694
ProFrac Agreement
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Increase in principal of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest	0	257	85	415
Conversion of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity	0	0	(15,091)	0
Amended ProFrac Agreement
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Increase in principal of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest	712	611	2,043	611
Change in fair value	(3,874)	(14,521)	(30,755)	(14,521)
Conversion of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity	40,638	0	$ 40,638	$ 0
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]			Debt Instrument, Realized Gain (Loss) On Fair Value Adjustment, Before Tax	Debt Instrument, Realized Gain (Loss) On Fair Value Adjustment, Before Tax
Change in fair value of contingent earnout consideration
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Change in fair value	35	(228)	$ (323)	$ (134)
Contingent Portion Of Convertible Debt
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Change in fair value	$ 0	$ (2,637)	$ 786	$ 1,255

v3.23.2

Income Taxes - Reconciliation of Effective Tax Rate (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Tax Disclosure [Abstract]
U.S. federal statutory tax rate	21.00%	21.00%	21.00%	21.00%
State income taxes, net of federal benefit	120.40%	0.00%	0.10%	0.10%
Non-U.S. income taxed at different rates	(96.70%)	3.80%	0.00%	(1.90%)
Increase (reduction) in tax benefit related to stock-based awards	1291.80%	3.10%	0.70%	(2.00%)
Increase in valuation allowance	2284.50%	(27.50%)	(19.80%)	(17.00%)
Permanent differences	(3779.40%)	0.00%	(2.10%)	0.00%
Non-deductible expenses	278.80%	(0.40%)	0.20%	0.10%
Other	0.00%	3.80%	0.00%	(2.20%)
Effective income tax rate	120.40%	3.80%	0.10%	(1.90%)

v3.23.2

Income Taxes - Narratives (Details) $ in Millions	Jun. 30, 2023 USD ($)
Operating Loss Carryforwards
Interest limitation carryforward	$ 7.1
Tax credit carryforward	3.8
Operating Loss carryforward estimated limitation on use	3.5
Tax credit valuation allowance, due to expiration	3.8
Domestic Tax Authority
Operating Loss Carryforwards
Operating loss carryforwards	196.1
State and Local Jurisdiction
Operating Loss Carryforwards
Operating loss carryforwards	119.4
Operating loss valuation allowance, due to expiration	$ 41.9

v3.23.2

Commitments and Contingencies (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Previous CEO | Former CEO Case
Other Commitments
Reduction in accrual for legal liabilities	$ 2.3	$ 2.3

v3.23.2

Stockholders’ Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands					6 Months Ended
	Feb. 02, 2023	Jun. 21, 2022	Mar. 21, 2022	Feb. 02, 2022	Jun. 30, 2023	Jun. 30, 2022	May 17, 2023	Dec. 31, 2022	May 17, 2022
Common and Preferred Stock
Convertible notes payable					$ 0			$ 19,799
Conversion of convertible notes payable to Pre-Funded Warrants					11,040
Debt converted instrument, face amount					40,638	$ 0
Convertible Notes Payable
Common and Preferred Stock
Conversion of notes to common stock (shares)			2,793,030
Debt converted instrument, face amount			$ 3,000
Debt converted, accrued interest			$ 39
Convertible Notes Payable | Other Convertible Debt
Common and Preferred Stock
Conversion of notes to common stock (shares)	10,335,840
Convertible notes payable	$ 9,000
Paid-in-kind interest expense	$ 800
Convertible Debt | ProFrac Agreement Contract
Common and Preferred Stock
Conversion price (in dollar per share)	$ 1.19
Convertible debt, fair value disclosures	$ 15,100
Exercise price of warrants or rights (in dollars per share)	$ 0.0001
Convertible Debt | ProFrac Agreement Contract | Estimate of Fair Value Measurement
Common and Preferred Stock
Convertible debt, fair value disclosures				$ 10,000
Convertible Debt | PIPE Transaction
Common and Preferred Stock
Conversion of notes to common stock (shares)			2,800,000
Conversion price (in dollar per share)				$ 1.088125
Stock price trigger (in dollars per share)	0.8705			$ 2.50
Debt converted instrument, face amount			$ 3,000
Convertible Debt | Amended ProFrac Agreement
Common and Preferred Stock
Conversion price (in dollar per share)							$ 0.64
Convertible debt, fair value disclosures							$ 40,600
Convertible Debt | Amended ProFrac Agreement | Estimate of Fair Value Measurement
Common and Preferred Stock
Convertible debt, fair value disclosures									$ 69,500
Convertible Debt | February 2023 Warrants
Common and Preferred Stock
Conversion price (in dollar per share)	0.0001
ProFrac Services, LLC | February 2023 Warrants | Affiliated Entity
Common and Preferred Stock
Exercise price of warrants or rights (in dollars per share)	$ 0.0001
Number of securities called by warrants or rights (in shares)	25,366,561
ProFrac Services, LLC | June 2022 Warrants | Affiliated Entity
Common and Preferred Stock
Exercise price of warrants or rights (in dollars per share)	$ 0.0001
Exchanged value of warrants		$ 19,500
Warrants fair value		11,100
Equity issuance costs		1,200
Conversion of convertible notes payable to Pre-Funded Warrants		$ 8,400			8,400
Number of securities called by warrants or rights (in shares)		13,104,839
Warrant exercise fee		$ 4,500
Warrant premium on average price, percent		20.00%
Payments of transaction fees of warrants					$ 1,100
Proceeds from related party debt		$ 4,500
Other receivables		$ 4,500

v3.23.2

Stockholders’ Equity - Valuation of Assumptions (Details) - June 2022 Warrants $ in Millions	Jun. 21, 2022 USD ($)
Fair Value Measurement Inputs and Valuation Techniques
Strike price (exercise fee)	$ 4.5
Risk-free interest rate
Fair Value Measurement Inputs and Valuation Techniques
Measurement input	0.0321
Expected volatility
Fair Value Measurement Inputs and Valuation Techniques
Measurement input	0.900
Term until liquidation (years)
Fair Value Measurement Inputs and Valuation Techniques
Measurement input	2.00
Stock price
Fair Value Measurement Inputs and Valuation Techniques
Measurement input	1.11

v3.23.2

Earnings (Loss) Per Share - Schedule of Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Numerator:
Net income (loss) for basic earnings per share	$ (21)	$ 6,240	$ 21,322	$ (4,484)
Anti-dilutive adjustments to net income available to shareholders excluded from Numerator for Diluted Earnings calculation
Paid-in-kind interest expense			2,284	1,819
Adjusted net loss for diluted earnings per share	$ (3,183)	$ (5,961)	$ (6,363)	$ (13,310)
Denominator:
Basic weighted average shares outstanding (in shares)	143,433	74,861	121,244	73,476
Average number of diluted shares for convertible notes payable and Contract Consideration Convertible Notes Payable (in shares)	$ 26,067	$ 49,474	$ 42,921	$ 33,610
Diluted weighted average shares outstanding (in shares)	169,500	124,335	164,165	107,086
Basic loss per share (in dollars per share)	$ 0	$ 0.08	$ 0.18	$ (0.06)
Diluted loss per share (in dollars per share)	$ (0.02)	$ (0.05)	$ (0.04)	$ (0.12)
Convertible Notes Payable
Anti-dilutive adjustments to net income available to shareholders excluded from Numerator for Diluted Earnings calculation
Paid-in-kind interest expense	$ 712	$ 1,028	$ 2,284	$ 1,402
Valuation (gain)/loss on Contract Consideration Convertible Notes Payable carried at FV	$ (3,874)	$ (13,229)	$ (29,969)	$ (10,228)
Options and Restricted
Denominator:
Anti-dilutive incremental shares excluded from denominator for diluted earnings computation	545	692	718	662
Stock Warrants
Denominator:
Anti-dilutive incremental shares excluded from denominator for diluted earnings computation	6,496	976	8,038	491

v3.23.2

Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Supplemental cash flow information:
Interest paid	$ 23	$ 7
Supplemental non cash financing and investing activities:
Conversion of convertible notes payable to common stock	40,638	0
Conversion of Initial Contract Consideration Convertible Notes Payable to February 2023 Warrants	15,092	0
Issuance of convertible notes payable as consideration for ProFrac Agreements	0	79,460
Issuance cost of stock warrants included in accrued accounts payable	0	1,170
Common Stock
Supplemental non cash financing and investing activities:
Conversion of convertible notes payable to common stock	8,996	3,038
Stock Warrants
Supplemental non cash financing and investing activities:
Conversion of convertible notes payable to common stock	$ 11,040	$ 0

v3.23.2

Related Party Transactions (Details)			3 Months Ended		6 Months Ended
	Feb. 02, 2023 USD ($) shares	Mar. 21, 2022 USD ($) shares	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Mar. 31, 2023 USD ($)	Feb. 01, 2023 fleet	Dec. 31, 2022 USD ($)	May 17, 2022 USD ($)	Feb. 02, 2022 USD ($)
Related Party Transaction
Convertible notes payable			$ 0		$ 0				$ 19,799,000
Amortization of contract into revenue			1,100,000	$ 700,000	2,400,000	$ 700,000
Debt converted instrument, face amount					40,638,000	0
Amortization of convertible note issuance cost					83,000	414,000
Convertible Debt | ProFrac Agreement Contract
Related Party Transaction
Debt instrument, face amount											$ 10,000,000
Convertible debt, fair value disclosures	$ 15,100,000
Convertible Notes Payable
Related Party Transaction
Conversion of notes to common stock (shares) | shares		2,793,030
Debt converted instrument, face amount		$ 3,000,000
Debt converted, accrued interest		$ 39,000
Related Party
Related Party Transaction
Revenue from external customers			32,774,000	16,549,000	69,130,000	19,046,000
Amortization of contract into revenue			1,100,000	700,000	2,400,000	700,000
Accounts receivable net			23,033,000		23,033,000				22,683,000
Related Party | ProFrac Agreement Contract
Related Party Transaction
Increase in number of active hydraulic fleets | fleet								30
Related Party | Convertible Debt | ProFrac Agreement Contract
Related Party Transaction
Convertible notes payable	11,000,000
Paid-in-kind interest expense	$ 1,000,000
Conversion of notes to common stock (shares) | shares	12,683,280
Convertible debt, fair value disclosures	$ 15,100,000
Related Party | Convertible Notes Payable
Related Party Transaction
Conversion of notes to common stock (shares) | shares		2,793,030
Debt converted instrument, face amount		$ 3,000,000
Debt converted, accrued interest		39,000
Amortization of convertible note issuance cost		$ 90,000
Related Party | ProFrac Services, LLC
Related Party Transaction
Revenue from external customers			32,800,000	16,500,000	69,100,000	18,900,000
Cost of sales for related parties			$ 30,200,000	17,800,000	$ 65,100,000	19,000,000
Accounts receivable net				23,000,000		23,000,000			$ 22,700,000
Related Party | PIPE Transaction | Convertible Debt
Related Party Transaction
Debt instrument, face amount											$ 10,000,000
Fleet purchase commitment percentage											33.00%
Conditional revenue shortfall rate (percent)											25.00%
Related Party | Amended ProFrac Agreement | Convertible Debt
Related Party Transaction
Debt instrument, face amount										$ 50,000,000
Fleet purchase commitment percentage										70.00%
Related Party | ProFrac Holdings | February 2023 Warrants
Related Party Transaction
Conversion of notes to common stock (shares) | shares	12,683,281
Director | Affiliated Entity | Confluence
Related Party Transaction
Cumulative Revenue From Related Party							$ 1,400,000
Cumulative Cost Of Sales From Related Party				$ 1,400,000		$ 1,400,000

v3.23.2

Business Segment, Geographic and Major Customer Information - Reportable Segments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Summarized financial information regarding reportable segments
Gross profit (loss)	$ 3,904	$ (2,305)	$ 5,785	$ (2,784)
Change in fair value of Contract Consideration Convertible Notes Payable	(3,874)	(17,158)	(29,969)	(13,266)
Income (loss) from operations	672	8,039	19,184	(2,245)
Paid-in-kind interest on Contract Consideration Convertible Notes Payable	712	868	2,129	1,026
Paid-in-kind interest on convertible notes payable		466	155	793
Depreciation	174	182	349	377
Additions to long-lived assets	135	5	292	5
Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	17,820	12,824	29,472	23,206
Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	32,774	16,549	69,130	19,046
Products | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	16,715	12,039	27,216	21,741
Products | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	32,347	16,549	68,613	19,046
Services | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	1,105	785	2,256	1,465
Services | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	427	0	517	0
Operating Segments | Chemistry Technologies
Summarized financial information regarding reportable segments
Gross profit (loss)	2,603	(1,568)	3,038	(2,231)
Change in fair value of Contract Consideration Convertible Notes Payable	(3,874)	(17,158)	(29,969)	(13,266)
Income (loss) from operations	3,795	14,944	27,174	8,887
Paid-in-kind interest on Contract Consideration Convertible Notes Payable	712	868	2,129	1,026
Paid-in-kind interest on convertible notes payable		0	0	0
Depreciation	155	166	312	345
Additions to long-lived assets	0	5	30	5
Operating Segments | Chemistry Technologies | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	15,469	12,111	24,693	21,422
Operating Segments | Chemistry Technologies | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	32,617	16,549	68,883	19,046
Operating Segments | Chemistry Technologies | Products | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	15,095	11,740	23,654	20,650
Operating Segments | Chemistry Technologies | Products | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	32,345	16,549	68,611	19,046
Operating Segments | Chemistry Technologies | Services | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	374	371	1,039	772
Operating Segments | Chemistry Technologies | Services | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	272	0	272	0
Operating Segments | Data Analytics
Summarized financial information regarding reportable segments
Gross profit (loss)	1,301	(737)	2,747	(553)
Change in fair value of Contract Consideration Convertible Notes Payable	0	0	0	0
Income (loss) from operations	129	(1,198)	587	(2,006)
Paid-in-kind interest on Contract Consideration Convertible Notes Payable	0	0	0	0
Paid-in-kind interest on convertible notes payable		0	0	0
Depreciation	18	15	36	31
Additions to long-lived assets	135	0	230	0
Operating Segments | Data Analytics | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	2,351	713	4,779	1,784
Operating Segments | Data Analytics | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	157	0	247	0
Operating Segments | Data Analytics | Products | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	1,620	299	3,562	1,091
Operating Segments | Data Analytics | Products | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	2	0	2	0
Operating Segments | Data Analytics | Services | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	731	414	1,217	693
Operating Segments | Data Analytics | Services | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	155	0	245	0
Corporate and Other
Summarized financial information regarding reportable segments
Gross profit (loss)	0	0	0	0
Change in fair value of Contract Consideration Convertible Notes Payable	0	0	0	0
Income (loss) from operations	(3,252)	(5,707)	(8,577)	(9,126)
Paid-in-kind interest on Contract Consideration Convertible Notes Payable	0	0	0	0
Paid-in-kind interest on convertible notes payable		466	155	793
Depreciation	1	1	1	1
Additions to long-lived assets	0	0	32	0
Corporate and Other | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	0	0	0	0
Corporate and Other | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	0	0	0	0
Corporate and Other | Products | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	0	0	0	0
Corporate and Other | Products | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	0	0	0	0
Corporate and Other | Services | Nonrelated Party
Summarized financial information regarding reportable segments
Revenue from external customers	0	0	0	0
Corporate and Other | Services | Related Party
Summarized financial information regarding reportable segments
Revenue from external customers	$ 0	$ 0	$ 0	$ 0

v3.23.2

Business Segment, Geographic and Major Customer Information - Assets by Reportable Segments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Segment Reporting Information
Total assets	$ 158,030	$ 164,810
Operating Segments | Chemistry Technologies
Segment Reporting Information
Total assets	139,921	146,542
Operating Segments | Data Analytics
Segment Reporting Information
Total assets	7,382	5,645
Corporate and Other
Segment Reporting Information
Total assets	$ 10,727	$ 12,623

v3.23.2

Business Segment, Geographic and Major Customer Information - Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Revenues from External Customers and Long-Lived Assets
Total assets	$ 158,030		$ 158,030		$ 164,810
Total revenues	50,594	$ 29,373	98,602	$ 42,252
Operating Segments | Chemistry Technologies
Revenues from External Customers and Long-Lived Assets
Total assets	139,921		139,921		146,542
Operating Segments | Data Analytics
Revenues from External Customers and Long-Lived Assets
Total assets	7,382		7,382		5,645
Corporate and Other
Revenues from External Customers and Long-Lived Assets
Total assets	10,727		10,727		$ 12,623
U.S.
Revenues from External Customers and Long-Lived Assets
Total revenues	48,725	25,955	94,851	36,289
UAE
Revenues from External Customers and Long-Lived Assets
Total revenues	1,509	3,139	2,912	4,450
Other countries
Revenues from External Customers and Long-Lived Assets
Total revenues	$ 360	$ 279	$ 839	$ 1,513

v3.23.2

Business Segment, Geographic and Major Customer Information - Major Customers (Details) - Customer Concentration Risk - Sales - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Customer A (Related Party)
Segment Reporting Information
Revenue	$ 32,774	$ 16,549	$ 69,129	$ 17,657
Percentage of revenue by major customers (in percentage)	64.80%	52.20%	70.10%	38.90%
Customer B
Segment Reporting Information
Revenue		$ 5,611		$ 8,218
Percentage of revenue by major customers (in percentage)		19.10%		19.50%

v3.23.2

Business Segment, Geographic and Major Customer and Supplier Information - Major Suppliers (Details) - Purchases - Cost of Goods and Service - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Supplier A
Segment Reporting Information
Supplies expense	$ 13,155	$ 7,576	$ 30,109	$ 7,624
Total spend (in percentage)	32.60%	31.90%	36.40%	24.20%
Supplier B
Segment Reporting Information
Supplies expense	$ 8,049	$ 4,036	$ 15,194	$ 6,154
Total spend (in percentage)	20.00%	17.00%	18.40%	19.50%
Supplier C
Segment Reporting Information
Supplies expense	$ 4,489	$ 2,679	$ 8,993
Total spend (in percentage)	11.10%	11.30%	10.90%

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