NOTE 14. STOCKHOLDERS' EQUITY

Stock-Based Compensation

We account for equity-based compensation expense in accordance with Accounting Standards Codification Topic 718, Compensation—Stock Compensation (“ASC 718”). Equity instruments are measured at fair value on the grant date consistent with the terms of the award. Stock-based compensation expense recorded was $3.0 million and $1.8 million for the three months ended March 31, 2026 and 2025, respectively. The compensation expense is recorded in Selling, general and administrative expenses in our Condensed Consolidated Statements of Operations and Comprehensive Income.

Share Repurchase Plan

On February 25, 2025, the Board approved the Share Repurchase Program that authorizes repurchases of up to an aggregate of $100 million of outstanding Company Common Stock. In connection with the Share Repurchase Program, all share repurchase plans previously authorized by the board of directors of Dril-Quip were terminated. The Share Repurchase Program does not require us to repurchase a specific number of shares or have an expiration date. Any shares repurchased under the Share Repurchase Program will be cancelled.

During the three months ended March 31, 2026 and 2025, we repurchased 575,000 and 36,043 shares at an average price of $24.59 and $17.95, under the Share Repurchase Program for approximately $14.1 million and $0.6 million, respectively, and have retired such shares. As of March 31, 2026, we had remaining authorization to repurchase up to approximately $76.6 million of our shares.