FARO TECHNOLOGIES, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA

(UNAUDITED)

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

2024

2023

2024

2023

Net loss

$            (524)

$      (28,245)

$        (7,791)

$      (49,409)

Interest expense, net

761

1,003

1,592

1,838

Income tax expense

1,556

1,416

2,657

3,349

Depreciation and amortization

4,167

3,947

7,788

7,925

EBITDA

5,960

(21,879)

4,246

(36,297)

Other expense (income), net

(43)

476

(18)

256

Stock-based compensation

1,164

4,950

5,703

8,584

Restructuring and other costs ⁽¹⁾

1,361

9,244

4,072

14,712

Adjusted EBITDA

$          8,442

$        (7,209)

$        14,003

$      (12,745)

Adjusted EBITDA margin ⁽²⁾

10.3 %

1.0 %

8.4 %

(2.7) %

⁽¹⁾ On February 14, 2020, our Board of Directors approved the Restructuring Plan, which is intended to support our strategic plan in an effort to improve operating performance and ensure that we are appropriately structured and resourced to deliver increased and sustainable value to our shareholders and customers. On February 7, 2023, our Board of Directors approved the Integration Plan, which is intended to streamline and simplify operations, particularly around our recent acquisitions and the resulting redundant operations and offerings. The Restructuring and other costs primarily consist of severance and related benefits associated with the Restructuring Plan, Integration Plan, and executive transitions.

⁽²⁾ Calculated as Adjusted EBITDA as a percentage of total sales.

FARO TECHNOLOGIES, INC. AND SUBSIDIARIES

KEY SALES MEASURES

(UNAUDITED)

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

2024

2023

2024

2023

Total sales to external customers as reported

Americas ⁽¹⁾

$          40,167

$          41,358

$          77,395

$          83,701

EMEA ⁽¹⁾

24,600

24,855

50,035

49,020

APAC ⁽¹⁾

17,318

21,998

38,899

40,457

$          82,085

$          88,211

$        166,329

$        173,178

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

2024

2023

2024

2023

Total sales to external customers in constant currency ⁽²⁾

Americas ⁽¹⁾

$          40,425

$          41,482

$          77,714

$          83,210

EMEA ⁽¹⁾

24,931

24,964

50,395

47,860

APAC ⁽¹⁾

17,783

21,446

39,552

38,544

$          83,139

$          87,892

$        167,661

$        169,614

⁽¹⁾ Regions represent North America and South America ("Americas"); Europe, the Middle East, and Africa ("EMEA"); and the Asia-Pacific ("APAC").

⁽²⁾ We compare the change in the sales from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying business performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rate in effect during the last day of the prior comparable period, rather than the actual exchange rates in effect during the respective periods.