XPEL reports $16.34 million net income for Q3 2026

Cover page 2 changes

3 unchanged paragraphs

For the quarterly period ended June September 30, 2026

21 unchanged paragraphs

The registrant had 27,570,748 27,516,898 shares of common stock outstanding as of August 7, November 6, 2026.

1 unchanged paragraph

Financial statements 177 changes

2 unchanged paragraphs

June September 30, 2026 December 31, 2025

1 unchanged paragraph

Accounts receivable, net 53,613 59,081 49,846

Prepaid expenses and other current assets 4,601 6,105 6,651

Income tax receivable — 1,300 581

2 unchanged paragraphs

Goodwill 61,316 59,277

Total assets $ 472,648 $ 382,526

Income tax payable 2,233 —

Right-of-use lease assets 17,422 19,811 21,561

Intangible assets, net 53,702 56,327 49,620

Deferred tax asset, net 1,776 1,572 —

Other non-current assets 7,072 7,190 5,574

Goodwill 71,225 59,277

Total assets $ 495,627 $ 382,526

Short-term debt $ 1,344 1,792 $ 59

Current portion lease liabilities 5,373 5,466 6,094

Accounts payable and accrued liabilities 57,157 67,508 54,289

Other short-term liabilities 20,828 20,676 10,558

Total current liabilities 86,935 95,442 71,000

1 unchanged paragraph

Total liabilities 154,092 97,341

Other long-term liabilities 10,324 8,343 9,511

Non-current portion of lease liabilities 13,377 15,573 16,710

Long-term debt 43,456 42,560 —

Total liabilities 161,918 97,341

Commitments and Contingencies (Note 12) 13)

2 unchanged paragraphs

Retained earnings 293,723 265,339

Stockholders' equity 306,125 280,282

Common stock, $ 0.001 par value; 100,000,000 shares authorized; 27,717,393 27,722,793 and 27,682,807 issued, respectively

Additional paid-in-capital 19,822 20,897 18,049

Accumulated other comprehensive loss ( 1,510 1,141 ) ( 135 )

Retained earnings 310,064 265,339

Treasury stock, 146,645 206,777 and 78,624 shares at cost, respectively ( 5,938 8,937 ) ( 2,999 )

Stockholders' equity 320,911 280,282

Non-controlling interest 12,431 12,798 4,903

Total stockholders' equity 318,556 333,709 285,185

Total liabilities and stockholders' equity $ 472,648 495,627 $ 382,526

3 unchanged paragraphs

June 30, Six Months Ended

Product revenue $ 111,674 $ 94,795 $ 200,388 $ 173,507

Service revenue 31,379 29,918 60,019 55,011

Total revenue 143,053 124,713 260,407 228,518

Cost of product sales 65,462 58,190 117,828 106,630

Cost of service 14,451 13,006 28,209 24,475

Total cost of sales 79,913 71,196 146,037 131,105

Gross Margin 63,140 53,517 114,370 97,413

Sales and marketing 15,386 11,862 30,549 23,737

General and administrative 24,539 22,357 47,595 43,258

Total operating expenses 39,925 34,219 78,144 66,995

Operating Income 23,215 19,298 36,226 30,418

Interest expense 262 7 266 83

Foreign currency exchange gain ( 403 ) ( 1,039 ) ( 683 ) ( 1,275 )

Income before income taxes 23,356 20,330 36,643 31,610

Income tax expense 5,053 4,122 7,836 6,816

Net income 18,303 16,208 28,807 24,794

September 30, Nine Months Ended

Product revenue $ 108,715 $ 95,459 $ 309,103 $ 268,966

Service revenue 29,094 29,956 89,113 84,967

Total revenue 137,809 125,415 398,216 353,933

Cost of product sales 62,175 59,838 180,003 166,468

Cost of service 14,125 13,153 42,334 37,629

Total cost of sales 76,300 72,991 222,337 204,097

Gross Margin 61,509 52,424 175,879 149,836

Sales and marketing 14,997 13,794 45,546 37,531

General and administrative 25,434 21,879 73,029 65,136

Total operating expenses 40,431 35,673 118,575 102,667

Operating Income 21,078 16,751 57,304 47,169

Interest expense 408 1 674 83

Other (income) expense ( 261 ) — ( 261 ) —

Foreign currency exchange (gain) loss ( 243 ) 110 ( 926 ) ( 1,164 )

Income before income taxes 21,174 16,640 57,817 48,250

Income tax expense 4,466 3,505 12,303 10,321

Net income 16,708 13,135 45,514 37,929

Net income (loss) attributed to non-controlling interest 264 ( 82 ) 423 ( 82 ) 367 195 789 113

Net income attributable to stockholders of the Company $ 18,039 16,341 $ 16,290 12,940 $ 28,384 44,725 $ 24,876 37,816

1 unchanged paragraph

Basic $ 0.65 $ 0.59 $ 1.03 $ 0.90

Diluted $ 0.65 $ 0.59 $ 1.03 $ 0.90

Basic $ 0.59 $ 0.47 $ 1.62 $ 1.37

Diluted $ 0.59 $ 0.47 $ 1.62 $ 1.37

1 unchanged paragraph

Basic 27,562 27,666 27,576 27,660

Diluted 27,643 27,673 27,654 27,675

Basic 27,542 27,675 27,565 27,665

Diluted 27,638 27,701 27,650 27,683

2 unchanged paragraphs

1 unchanged paragraph

1 unchanged paragraph

2 unchanged paragraphs

3 unchanged paragraphs

2 unchanged paragraphs

4 unchanged paragraphs

1 unchanged paragraph

2 unchanged paragraphs

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

2 unchanged paragraphs

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

and 97 more changes in the filing

Note 1: INTERIM FINANCIAL INFORMATION 1 change

The accompanying (a) condensed consolidated balance sheet as of December 31, 2025, which has been derived from our audited consolidated financial statements as of and for the year ended December 31, 2025, and (b) unaudited interim condensed consolidated financial statements as of June September 30, 2026 and for the three and six nine months ended June September 30, 2026 and 2025 have been prepared by XPEL, Inc. ("XPEL" or the "Company") in accordance with accounting principles generally accepted in the United States of America for interim financial information, pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Pursuant to these rules and regulations, certain financial information and footnote disclosures normally included in the financial statements have been condensed or omitted. However, in the opinion of management, the financial statements include all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the financial position, results of operations and cash flows of the interim periods presented. Operating results for the interim periods presented are not necessarily indicative of results to be expected for the full year or for any other interim period, due to variability in customer purchasing patterns and seasonal, operating and other factors.

1 unchanged paragraph

Note 2: SIGNIFICANT ACCOUNTING POLICIES 2 changes

Nature of Business - The Company is based in San Antonio, Texas and manufactures, sells, distributes, and installs protective films and coatings, including automotive paint protection film, surface protection film, automotive and commercial/architectural window films and ceramic coatings. The Company was incorporated in the state of Nevada, U.S.A. in October 2003.

2 unchanged paragraphs

Goodwill - Goodwill represents the excess purchase price over the fair value of tangible net assets acquired in acquisitions after amounts have been allocated to intangible assets. Goodwill is tested for impairment at the reporting unit level on an annual basis (at December 31) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. The Company recognized no goodwill impairment during the three and six months ended June 30, 2026 and 2025, and there is no significant accumulated impairment of goodwill from prior periods. Refer to Note 6, Goodwill for more information related to goodwill. nine

Note 3: ACQUISITIONS OF BUSINESSES 15 changes

Our valuation models related to inventory and other working capital, identified tangible assets, identified intangible assets, and goodwill included in this acquisition are not yet finalized and these figures are presented on a preliminary basis. Valuation of these items will be finalized within 12 months of the acquisition date. Accordingly, the total preliminary purchase price allocation for the acquisition of assets of the China Manufacturer completed during the six months ended June 30, 2026, is as follows (in thousands):

Aggregate Purchase Price

Contingent consideration —

Aggregate Allocation

Property and equipment 9,916

Customer Relationships 2

1 Total cash consideration is comprised of amounts paid on closing dates plus holdback amounts to be paid in the future.

2 The weighted average useful life of acquired amortizable intangible assets is 9 years.

3 The full value of this acquired goodwill is expected to be tax deductible.

The aggregate revenue and the net income from the acquisition completed in the six months ended June 30, 2026 that has been consolidated into our condensed consolidated financial statements was $ 1.6 million and $ 0.1 million, respectively. The following unaudited pro forma financial information presents our results, including expenses relating to the amortization of intangibles purchased, as if this acquisition had occurred on January 1, 2026 and 2025, respectively (in thousands):

Revenue $ 275,234 $ 240,525

Net income $ 29,363 $ 24,807

In May 2026, the Company acquired certain assets from a manufacturer in China (the "China Manufacturer") through the formation of a new majority-owned subsidiary, "NQL", in which the Company obtained a 75 % controlling interest, for a purchase price of $ 21.4 21.0 million. The minority interest in this transaction was acquired primarily through a contribution of fixed assets. This acquisition was completed as part of our strategy to invest in the manufacturing and supply chain and to expand our manufacturing presence in China. Transaction-related costs incurred in connection with this acquisition were not material to the condensed consolidated financial statements.

In August 2026, the Company acquired 100 % of a business that manufactures vehicle graphics and related products. This acquisition was completed as part of our market expansion strategy. The purchase price of the acquisition was $ 6.5 million.

Transaction-related costs incurred in connection with these acquisitions were not material to the consolidated financial statements.

Note 4: REVENUE 6 changes

8 unchanged paragraphs

Based upon the nature of the products the Company sells, its customers have limited rights of return and those that do occur have been immaterial. Discounts provided by the Company to customers at the time of sale are recognized as a reduction in sales as the products are sold.

Warranty obligations associated with the sale of our products are assurance-type warranties that are a guarantee of the product's intended functionality and, therefore, do not represent a distinct performance obligation within the context of the contract. Warranty expense is included in cost of sales.

We apply a practical expedient to expense direct costs of obtaining a contract when incurred because the amortization period would be one year or less.

Under its contracts with customers, the Company stands ready to deliver product upon receipt of a purchase order. Accordingly, the Company has no performance obligations under its contracts until its customers submit a purchase order. The Company does not enter into commitments to provide goods or services that have terms greater than one year. In limited cases, the Company does require payment in advance of shipping product. Typically, product is shipped within a few days after prepayment is received. Additionally, in some cases, customers pay for services in advance of their performance. These prepayments are recorded as contract liabilities on the condensed consolidated balance sheet and are included in accounts payable and accrued liabilities (Note 9). As the performance obligation is part of a contract that has an original expected duration of less than one year, the Company has applied the practical expedient under the Accounting Standards Codification Topic 606 ("ASC 606") to omit disclosures regarding remaining performance obligations.

When the Company transfers goods or provides services to a customer, payment is due, subject to normal terms, and is not conditional on anything other than the passage of time. Typical payment terms range from due upon receipt to due within 30 days, depending on the type of customer and relationship.

Based upon the nature of the products the Company sells, its customers have limited rights of return, and returns that have occurred have been immaterial. The Company offers certain customers discounts and rebates, including volume-based rebates tied to purchase thresholds over a specified period. Discounts and rebates are recognized as a reduction of revenue when the related sales are recognized. The Company estimates rebates at the time of sale using an expected value method, based on contractual terms, historical experience and each customer's actual and projected purchases over the

Note 5: PROPERTY AND EQUIPMENT, NET 14 changes

1 unchanged paragraph

Equipment 23,816 6,294

June September 30, 2026 December 31, 2025

Furniture and fixtures $ 5,316 5,357 $ 5,155

Computer equipment 6,233 6,565 5,892

Vehicles 1,118 1,559 1,178

Equipment 13,896 6,294

Leasehold improvements 11,535 11,667 14,067

Plotters 6,459 6,644 5,990

Construction in Progress 27,112 28,086 1,097

Total property and equipment $ 128,708 120,987 $ 39,673

Less: accumulated depreciation 24,248 25,864 23,876

Property and equipment, net $ 104,460 95,123 $ 15,797

1 unchanged paragraph

Depreciation expense for the three months ended June September 30, 2026 and 2025 was $ 1.8 1.7 million and $ 1.6 million, respectively. For the six nine months ended June September 30, 2026 and 2025, depreciation expense w as $ 3.4 5.1 million a nd $ 3.1 4.7 million, respectively.

During the nine months ended September 30, 2026, the Company acquired four commercial properties in San Antonio, Texas (the "Properties") for approximately $ 61.3 million, which consisted of land of $ 10.2 million, buildings of $ 36.9 million, and a vacant building of $ 14.2 million classified as construction in progress pending its intended use. The remaining construction in progress balance of $ 13.8 million relates primarily to manufacturing equipment, which is expected to be completed and placed in service during 2027.

Note 6: INTANGIBLE ASSETS, NET 11 changes

1 unchanged paragraph

Trademarks $ 2,264 $ 1,663

Software 9,876 9,108

June September 30, 2026 December 31, 2025

Trademarks $ 1,799 $ 1,663

Software 10,452 9,108

Trade name 1,136 1,134 2,240

Contractual and customer relationships 70,976 75,821 63,944

Total at cost $ 85,405 90,383 $ 78,124

Less: Accumulated amortization 31,703 34,056 28,504

Intangible assets, net $ 53,702 56,327 $ 49,620

Amortization expense for the three months ended June September 30, 2026 and 2025 was $ 2.2 2.3 million and $ 1.5 1.7 million, respectively. For the six nine months ended June September 30, 2026 and 2025, amortization expense was $ 4.2 6.5 million and $ 3.1 4.7 million, respectively.

Note 7: GOODWILL 6 changes

The following table summarizes goodwill transactions for the six nine months ended June September 30, 2026 and the twelve months ended December 31, 2025 (in thousands):

1 unchanged paragraph

Balance at June 30, 2026 $ 61,316

Additions and purchase price allocation adjustments 2,350 11,990

Foreign exchange ( 311 42 )

Balance at September 30, 2026 $ 71,225

4 unchanged paragraphs

For details related to acquisitions and purchase price allocations completed during the six nine months ended June September 30, 2026, refer to Note 16, 3, Acquisitions of Businesses.

Note 8: INVENTORIES 5 changes

June 30, 2026 December 31, 2025

Raw materials $ 19,825 $ 15,618

Work in process 4,115 1,826

Finished goods 104,071 105,311

The components of inventory are summarized as follows as of the dates set forth below (in thousands):

Note 9: DEBT 3 changes

The Company has U.S. and Canadian revolving credit facilities and Harvest Ventures Holding Company ("Harvest"), a wholly-owned subsidiary of the Company, has a term loan which it incurred in connection with the purchase of the Properties.

1 unchanged paragraph

On September 11, 2025, the Company entered into the First Amendment (the "First Amendment") to its Credit Agreement, dated April 6, 2023 (as amended, the "Credit Agreement") with Wells Fargo Bank, N.A., as Administrative Agent, and other lenders party thereto. The Amendment, among other things, extended the maturity of the Credit Agreement from April 6, 2026 to September 11, 2028. The Credit Agreement provides for secured revolving loans and letters of credit in an aggregate amount of up to $ 125 million, which is subject to the terms of the Credit Agreement. As of June September 30, 2026 and December 31, 2025, the Company had no outstanding balances under the Credit Agreement. All capitalized terms in this description of the Credit Agreement, that are not otherwise defined in this Report, have the meaning assigned to them in the Credit Agreement.

Borrowings under the Credit Agreement bear interest, at XPEL's option, at a rate equal to either (a) Base Rate or (b) Adjusted Term SOFR. In addition to the applicable interest rate, the Credit Agreement includes a commitment fee ranging from 0.20 % to 0.25 % per annum for the unused portion of the aggregate commitment and an applicable margin ranging from 0.00 % to 0.50 % for Base Rate Loans and 1.00 % to 1.50 % for Adjusted Term SOFR Loans. At June September 30, 2026, these rates were 6.8 7.0 % and 4.7 4.8 %, respectively. Both the margin applicable to the interest rate and the commitment fee are dependent on XPEL's Consolidated Total Leverage Ratio. The Credit Agreement's maturity date is September 11, 2028.

5 unchanged paragraphs

Notes to the financial statements 5 changes

On May 15, 2026, the Company entered into a second amendment (the "Second Amendment") to the Credit Agreement with Wells Fargo Bank, N.A. (the "Credit Facility Amendment"). The Second Amendment was made in connection with the purchase of four properties located in San Antonio, Texas the Properties made by Harvest. Ventures Holding Company ("Harvest"), a wholly-owned subsidiary of The Company. The Credit Facility Amendment permits permitted Harvest to incur indebtedness under the term loan described below (the "Term Loan") and the Company to (a) guarantee the Term Loan, (b) assign the real estate purchase agreement for the properties to Harvest, and (c) make an equity investment of up to $ 18.0 million in Harvest and in Harvest Industrial Corporation (a wholly-owned subsidiary of the Company formed to hold an air permit required by the Texas Commission on Environmental Quality) in connection with the acquisition of the Properties and certain other expenditures related to the Properties.

The Company also has a CAD $ 4.5 million (approximately $ 3.2 million USD as of June September 30, 2026) revolving credit facility through a financial institution in Canada, and is maintained by XPEL Canada Corp., a wholly-owned subsidiary of XPEL. This Canadian facility is utilized to fund the Company's working capital needs in Canada. This facility bears interest at the Royal Bank of Canada's prime rate plus 0.25 % per annum and is guaranteed by the parent company. As of June September 30, 2026 and December 31, 2025, no balance was outstanding on this line of credit.

On May 15, 2026, Harvest entered into a $ 44.8 million term loan agreement (the "Term Loan") with PNC Bank, N.A. ("PNC"), secured by the Properties and a guaranty (the "Guaranty") by the Company.

Borrowings outstanding bear interest at the sum of (a) the Term SOFR Rate in effect on each Reset Date (defined as the closing date or the last day of every month thereafter, unless the last day falls on a non-business day, upon which the Reset Date shall be the first business day after the last day of the month), plus (b) 125 basis points ( 1.25 %), matures ten years from the closing date on May 15, 2036, and amortizes over a twenty-five year period. The interest rate at closing was 4.7 % per annum. At June September 30, 2026, the interest rate was 4.9 5.0 %.

The Term Loan is secured by the assets owned by Harvest and is subject to customary representations, warranties, covenants, and events of default. Upon the occurrence of an event of default, PNC may, among other remedies, accelerate the outstanding principal balance and accrued interest and foreclose on the Properties. As of June September 30, 2026, $ 44.8 44.4 million in principal was outstanding, $ 1.3 1.8 million of which was classified as current and $ 43.5 42.6 million as long-term on the Condensed Consolidated Balance Sheet. Debt issuance costs incurred in connection with this the Term Loan were not material to the condensed consolidated financial statements.

4 unchanged paragraphs

Note 10: ACCOUNTS PAYABLE AND ACCRUED LIABILITIES 8 changes

1 unchanged paragraph

Trade payables $ 37,892 $ 37,771

Payroll liabilities 6,159 7,814

Contract liabilities 9,072 4,795

June September 30, 2026 December 31, 2025

Trade payables $ 43,405 $ 37,771

Payroll liabilities 8,626 7,814

Contract liabilities 10,689 4,795

Other liabilities 4,034 4,788 3,909

Note 11: OTHER SHORT-TERM LIABILITIES 4 changes

1 unchanged paragraph

June September 30, 2026 December 31, 2025

Contingent consideration - acquisitions $ 6,382 6,143 $ 10,530

Acquisition holdback payments 14,446 14,533 28

The contingent consideration - acquisitions represents the estimated value of acquired inventory that may be sold above its net realizable value and liabilities related to future internal performance milestones. Acquisition holdback payments refer to portions of the acquisition purchase price that are deferred beyond the closing date, including installment payments payable on a scheduled basis, as well as amounts withheld to address potential post-closing adjustments, obligations, or other amounts otherwise payable.

Note 12: FAIR VALUE MEASUREMENTS 16 changes

2 unchanged paragraphs

Level 2 – Inputs other than the quoted prices in active markets that are observable either directly or indirectly, including: quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Unobservable inputs that are supported by little or no market data and require the reporting entity to develop its own assumptions.

Financial instruments include cash and cash equivalents, accounts receivable, accounts payable, our lines of credit, and long-term debt. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, our lines of credit, long-term debt and short-term borrowings approximate fair value because of the near-term maturities of these financial instruments. The carrying value of the Company's debt approximates fair value due to the relatively short-term nature and interest rates of the notes. The carrying value of the Company's long-term debt approximates fair value due to the interest rates being market rates.

The estimated fair value of debt is based on market quotes for instruments with similar terms and remaining maturities.

The Company has contingent liabilities related to future internal performance milestones and the estimated value of acquired inventory that may be sold above its net realizable value. The fair value of these liabilities was determined using discounted cash flow analyses and Monte Carlo Simulations based on the probability and timing of certain future payments under these arrangements. These liabilities are accounted for as Level 3 liabilities within the fair value hierarchy.

Level 3 liabilities measured at fair value on a recurring basis as of the dates set forth below are as follows (in thousands):

September 30, 2026 December 31, 2025

Contingent Liabilities $ 13,709 $ 19,966

The following table presents a summary of the changes in fair value of Level 3 liabilities for the nine months ended September 30, 2026 and the twelve months ended December 31, 2025, respectively (in thousands):

September 30, 2026 December 31, 2025

Beginning balance $ 19,966 $ 1,816

New acquisitions and measurement adjustments 775 25,037

Recognized contingent liabilities ( 8,114 ) ( 6,341 )

Fair value adjustments 23 ( 613 )

Effect of foreign currency translation 1,059 67

Ending balance $ 13,709 $ 19,966

Note 14: CAPITAL STOCK 3 changes

Common stock shares issued at June September 30, 2026 and December 31, 2025 were 27,717,393 27,722,793 and 27,682,807 , respectively. Common stock shares outstanding at June September 30, 2026 and December 31, 2025 were 27,570,748 27,516,016 and 27,604,183 , respectively. Par value of these shares for these same dates was $ 0.03 million.

At June September 30, 2026 and December 31, 2025 there were no shares of preferred stock shares issued and outstanding.

1 unchanged paragraph

During the six nine months ended June September 30, 2026, the Company repurchased 68,021 128,153 shares on the open market at an average price of $ 43.23 46.34 per share, for a total amount of $ 2.9 5.9 million, excluding brokerage commissions and accrued excise tax. No shares were repurchased during the six nine months ended June September 30, 2025. As of June September 30, 2026 and December 31, 2025, $ 44.1 41.1 million and $ 47.0 million were available for share repurchases under the program, respectively.

Note 15: EARNINGS PER SHARE 12 changes

2 unchanged paragraphs

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

1 unchanged paragraph

Weighted average basic shares 27,562 27,666 27,576 27,660

Weighted average diluted shares 27,643 27,673 27,654 27,675

Basic $ 0.65 $ 0.59 $ 1.03 $ 0.90

Diluted $ 0.65 $ 0.59 $ 1.03 $ 0.90

Net income attributable to stockholders of the Company $ 18,039 16,341 $ 16,290 12,940 $ 28,384 44,725 $ 24,876 37,816

Weighted average basic shares 27,542 27,675 27,565 27,665

Dilutive effect of restricted stock units 81 7 78 15 96 26 85 18

Weighted average diluted shares 27,638 27,701 27,650 27,683

Basic $ 0.59 $ 0.47 $ 1.62 $ 1.37

Diluted $ 0.59 $ 0.47 $ 1.62 $ 1.37

Note 16: SEGMENT INFORMATION 1 change

1 unchanged paragraph

The CODM reviews balance sheet information on a consolidated basis which is reflected in the Company's Condensed Consolidated Balance Sheets as of June September 30, 2026 and December 31, 2025. The CODM uses gross margin and income from operations to evaluate return on total assets in deciding whether to invest in the development and expansion of our condensed consolidated operations or into strategic transactions, such as acquisitions. Both metrics are also used to monitor budget versus actual results, perform competitive benchmarking analyses, and are considered in evaluating our executives' compensation.

Forward-looking statements 200 changes

6 unchanged paragraphs

• Our planned investment in manufacturing and supply chain assets exposes us to regulatory and execution risks.

28 unchanged paragraphs

We are a supplier of manufacture, sell, distribute, and install protective films, coatings and related services primarily to the automobile aftermarket, new car dealerships and automobile original equipment manufacturers, or OEMs. The majority of our revenue is derived from the sale of our automotive products and related services while the remainder of our revenue is derived from non-automotive products including architectural window film and marine and flat surface protection films.

The Company began as a software company designing vehicle patterns used to produce cut-to-fit protective film for headlights and painted surfaces of automobiles. In 2007, we began selling automotive paint protection film products to complement our software business. As paint protection film technology improved and became more durable, awareness and adoption of paint protection film has continued to increase, driving significant industry growth over the last several years. Initial adoption of paint protection film came primarily from luxury car enthusiasts in the United States and Canada. These enthusiasts were primarily served by a growing automotive aftermarket of independent installers of automotive paint protection and window films. Internationally, nascent demand began to build as awareness and adoption in the United States and Canada continued to increase. Over the last few years, new car dealership interest in the product has increased due to their exposure to the aftermarket installer network, while OEM interest in the product has increased through their exposure to the new car dealerships who were selling sell the product.

6 unchanged paragraphs

The following table is a reconciliation of Net Income to EBITDA for the three and six nine months ended June September 30, 2026 and 2025 (in thousands):

1 unchanged paragraph

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

1 unchanged paragraph

Net Income $ 18,303 $ 16,208 12.9 % $ 28,807 $ 24,794 16.2 %

Interest 262 7 3642.9 % 266 83 220.5 %

Taxes 5,053 4,122 22.6 % 7,836 6,816 15.0 %

Depreciation 1,780 1,557 14.3 % 3,402 3,093 10.0 %

Amortization 2,161 1,538 40.5 % 4,220 3,059 38.0 %

EBITDA $ 27,559 $ 23,432 17.6 % $ 44,531 $ 37,845 17.7 %

Net Income $ 16,708 $ 13,135 27.2 % $ 45,514 $ 37,929 20.0 %

Interest 408 1 40700.0 % 674 83 712.0 %

Taxes 4,466 3,505 27.4 % 12,303 10,321 19.2 %

Depreciation 1,702 1,640 3.8 % 5,104 4,733 7.8 %

Amortization 2,299 1,663 38.2 % 6,519 4,722 38.1 %

EBITDA $ 25,583 $ 19,944 28.3 % $ 70,114 $ 57,788 21.3 %

4 unchanged paragraphs

Total revenue $ 143,053 100.0 % $ 124,713 100.0 % $ 18,340 14.7 %

Total cost of sales 79,913 55.9 % 71,196 57.1 % 8,717 12.2 %

Gross margin 63,140 44.1 % 53,517 42.9 % 9,623 18.0 %

Total operating expenses 39,925 27.9 % 34,219 27.4 % 5,706 16.7 %

Operating income 23,215 16.2 % 19,298 15.5 % 3,917 20.3 %

Other (income) expense, net (141) (0.1) % (1,032) (0.8) % 891 (86.3) %

Income tax 5,053 3.5 % 4,122 3.3 % 931 22.6 %

Net income $ 18,303 12.8 % $ 16,208 13.0 % $ 2,095 12.9 %

Six Months Ended June 30, 2026 %

Total revenue $ 260,407 100.0 % $ 228,518 100.0 % $ 31,889 14.0 %

Total cost of sales 146,037 56.1 % 131,105 57.4 % 14,932 11.4 %

Gross margin 114,370 43.9 % 97,413 42.6 % 16,957 17.4 %

Total operating expenses 78,144 30.0 % 66,995 29.3 % 11,149 16.6 %

Operating income 36,226 13.9 % 30,418 13.3 % 5,808 19.1 %

Other (income) expense, net (417) (0.2) % (1,192) (0.5) % 775 (65.0) %

Income tax 7,836 3.0 % 6,816 3.0 % 1,020 15.0 %

Net income $ 28,807 11.1 % $ 24,794 10.8 % $ 4,013 16.2 %

The following tables summarize the Company's consolidated results of operations for the three and six nine months ended June September 30, 2026 and 2025 (dollars in thousands):

Three Months Ended June September 30, 2026 %

of Total Revenue Three Months Ended June September 30, 2025 %

Total revenue $ 137,809 100.0 % $ 125,415 100.0 % $ 12,394 9.9 %

Total cost of sales 76,300 55.4 % 72,991 58.2 % 3,309 4.5 %

Gross margin 61,509 44.6 % 52,424 41.8 % 9,085 17.3 %

Total operating expenses 40,431 29.3 % 35,673 28.4 % 4,758 13.3 %

Operating income 21,078 15.3 % 16,751 13.4 % 4,327 25.8 %

Other (income) expense, net (96) (0.1) % 111 0.1 % (207) (186.5) %

Income tax 4,466 3.2 % 3,505 2.8 % 961 27.4 %

Net income $ 16,708 12.1 % $ 13,135 10.5 % $ 3,573 27.2 %

Nine Months Ended September 30, 2026 %

of Total Revenue Six Nine Months Ended June September 30, 2025 %

Total revenue $ 398,216 100.0 % $ 353,933 100.0 % $ 44,283 12.5 %

Total cost of sales 222,337 55.8 % 204,097 57.7 % 18,240 8.9 %

Gross margin 175,879 44.2 % 149,836 42.3 % 26,043 17.4 %

Total operating expenses 118,575 29.8 % 102,667 29.0 % 15,908 15.5 %

Operating income 57,304 14.4 % 47,169 13.3 % 10,135 21.5 %

Other (income) expense, net (513) (0.1) % (1,081) (0.3) % 568 (52.5) %

Income tax 12,303 3.1 % 10,321 2.9 % 1,982 19.2 %

Net income $ 45,514 11.4 % $ 37,929 10.7 % $ 7,585 20.0 %

The following tables summarize revenue results for the three and six nine months ended June September 30, 2026 and 2025 (dollars in thousands):

June September 30, % % of Total Revenue

1 unchanged paragraph

Paint protection film $ 74,822 $ 62,666 19.4 % 52.3 % 50.2 %

Window film 32,459 27,959 16.1 % 22.7 % 22.4 %

Other 4,393 4,170 5.3 % 3.1 % 3.4 %

Total $ 111,674 $ 94,795 17.8 % 78.1 % 76.0 %

Software $ 2,258 $ 2,180 3.6 % 1.6 % 1.7 %

Cutbank credits 1,918 4,523 (57.6) % 1.3 % 3.6 %

Installation labor 25,328 22,448 12.8 % 17.7 % 18.0 %

Training and other 1,875 767 144.5 % 1.3 % 0.7 %

Total $ 31,379 $ 29,918 4.9 % 21.9 % 24.0 %

Total $ 143,053 $ 124,713 14.7 % 100.0 % 100.0 %

Paint protection film $ 73,536 $ 63,531 15.7 % 53.4 % 50.7 %

Window film 30,894 27,640 11.8 % 22.4 % 22.0 %

Other 4,285 4,288 (0.1) % 3.1 % 3.4 %

Total $ 108,715 $ 95,459 13.9 % 78.9 % 76.1 %

Software $ 2,797 $ 2,208 26.7 % 2.0 % 1.8 %

Cutbank credits 957 4,257 (77.5) % 0.7 % 3.4 %

Installation labor 24,276 22,125 9.7 % 17.6 % 17.6 %

Training and other 1,064 1,366 (22.1) % 0.8 % 1.1 %

Total $ 29,094 $ 29,956 (2.9) % 21.1 % 23.9 %

Total $ 137,809 $ 125,415 9.9 % 100.0 % 100.0 %

Six Nine Months Ended June September 30, % % of Total Revenue

1 unchanged paragraph

Paint protection film $ 136,486 $ 119,106 14.6 % 52.4 % 52.1 %

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

1 unchanged paragraph

5 unchanged paragraphs

4 unchanged paragraphs

4 unchanged paragraphs

and 120 more changes in the filing

Market risk 1 change

We have operations that expose us to currency risk in the British Pound Sterling, the Canadian Dollar, the Euro, the Mexican Peso, the New Taiwanese Dollar, the Australian Dollar, the Indian Rupee, the Chinese Yuan Renminbi, the Japanese Yen, and the Thai Baht, and the Brazilian Real. Amounts invested in our foreign operations are translated into U.S. Dollars at the exchange rates in effect at the balance sheet date. The resulting translation adjustments are recorded as accumulated other comprehensive income, a component of stockholders' equity in our condensed consolidated balance sheets. We do not currently hedge our exposure to potential foreign currency translation adjustments.

2 unchanged paragraphs

Unregistered sales of stock 7 changes

2 unchanged paragraphs

During the three months ended June September 30, 2026 the Company did not repurchase any repurchased shares of our common stock, as indicated in the table below:

3 unchanged paragraphs

April 1-30 — $ — — $ 44,059,160

June 1-30 — — — 44,059,160

shares (or units) that may yet be purchased under the plans or programs (d)(e) (in thousands)

May July 1-31 — $ — — 44,059,160 $ 44,059

August 1-31 60,132 $ 49.87 60,132 41,061

September 1-30 — — — 41,061

4 unchanged paragraphs

Exhibits 18 changes

2 unchanged paragraphs

10.1* Loan Agreement, dated May 15, 2026, by and between Harvest Ventures Holding Company and PNC Bank, National Association

Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.2 Term Note dated May 15, 2026, by Harvest Ventures Holding Company payable to the Order of PNC Bank, National Association

Incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.3* G uara nty Agreement, dated May 15, 2026, by XPEL, Inc. in favor of PNC Bank, National Association

Incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.4* Second Amendment to Credit Agreement, dated May 15, 2026, by and among XPEL, Inc., the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent

Incorporated by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.5* Standard Purchase and Sale Agreement, dated effective as of January 29, 2026, by and between SL Industrial, LP and XPEL, Inc.

Incorporated by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.6* F irst Amendment to Standard Purchase and Sale Agreement, dated effective as of March 4, 2026, by and be t ween SL Industrial, LP and XPEL, Inc.

Incorporated by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.7 A ssignment and Assumption Agreement , dated as of April 9, 2026, by and between XPEL, Inc. and Harvest Ventures Holding Company

Incorporated by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on May 15, 2026

10.8 S econd Amendment to Standard Purchase and Sale Agreement, dated effective as of April 23, 2026, by and between SL Industrial, LP and Harvest Ventures Holding Company

Incorporated by reference to Exhibit 10.8 to the Company's Current Report on Form 8-K filed on May 15, 2026

4 unchanged paragraphs

101 The following materials from XPEL's Quarterly Report on Form 10-Q for the fiscal quarter ended June September 30, 2026, formatted in Inline XBRL (Extensible Business Reporting Language): (i) the unaudited Condensed Consolidated Balance Sheets, (ii) the unaudited Condensed Consolidated Statements of Operations, (iii) the unaudited Condensed Consolidated Statements of Comprehensive Income, (iv) the unaudited Condensed Consolidated Statements of Equity, (v) the unaudited Condensed Consolidated Statements of Cash Flows, and (vi) Notes to Condensed Consolidated Financial Statements

5 unchanged paragraphs

August 7, November 6, 2026 (Authorized Officer and Principal Financial and Accounting Officer)