FARO TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

Six Months Ended

(in thousands)

June 30, 2021

June 30, 2020

Cash flows from:

Operating activities:

Net loss

$

(4,397)

$

(23,755)

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

Depreciation and amortization

6,289

7,209

Stock-based compensation

5,377

4,345

Provisions for bad debts, net of recoveries

(43)

680

Loss on disposal of assets

86

299

Provision for excess and obsolete inventory

1,640

479

Deferred income tax benefit

(2,009)

(2,404)

Change in operating assets and liabilities:

Decrease (Increase) in:

Accounts receivable

3,964

26,180

Inventories

(7,495)

892

Prepaid expenses and other current assets

(982)

11,347

(Decrease) Increase in:

Accounts payable and accrued liabilities

(13,525)

(1,395)

Income taxes payable

(2,310)

(5,058)

Customer deposits

1,723

384

Unearned service revenues

(627)

(3,139)

Net cash (used in) provided by operating activities

(12,309)

16,064

Investing activities:

Purchases of property and equipment

(2,072)

(1,533)

Proceeds from asset sales

—

643

Proceeds from sale of investments

—

25,000

Payments for intangible assets

(1,780)

(673)

Acquisition of business, net of cash acquired

(33,908)

—

Net cash (used in) provided by investing activities

(37,760)

23,437

Financing activities:

Payments on finance leases

(167)

(160)

Payments for taxes related to net share settlement of equity awards

(3,779)

(2,409)

Proceeds from issuance of stock related to stock option exercises

5,165

3,854

Net cash provided by financing activities

1,219

1,285

Effect of exchange rate changes on cash and cash equivalents

(3,446)

(720)

(Decrease) Increase in cash and cash equivalents

(52,296)

40,066

Cash and cash equivalents, beginning of period

185,633

133,634

Cash and cash equivalents, end of period

$

133,337

$

173,700