FARO TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

Nine Months Ended

(in thousands)

September 30,
2021

September 30,
2020

Cash flows from:

Operating activities:

Net loss

$

(8,252)

$

(26,779)

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

Depreciation and amortization

9,560

10,631

Stock-based compensation

8,657

6,428

Provisions for bad debts, net of recoveries

33

435

Loss on disposal of assets

130

351

Provision for excess and obsolete inventory

1,955

778

Deferred income tax benefit

(3,667)

(4,961)

Change in operating assets and liabilities:

Decrease (Increase) in:

Accounts receivable

4,311

28,132

Inventories

(9,106)

5,101

Prepaid expenses and other current assets

(2,935)

9,391

(Decrease) Increase in:

Accounts payable and accrued liabilities

(14,153)

(10,006)

Income taxes payable

(1,847)

(6,109)

Customer deposits

1,966

815

Unearned service revenues

(2,223)

(3,391)

Net cash (used in) provided by operating activities

(15,571)

10,816

Investing activities:

Purchases of property and equipment

(4,845)

(2,833)

Proceeds from asset sales

—

768

Proceeds from sale of investments

—

25,000

Payments for intangible assets

(1,933)

(813)

Acquisition of business, net of cash acquired

(33,908)

(6,036)

Net cash (used in) provided by investing activities

(40,686)

16,086

Financing activities:

Payments on finance leases

(229)

(237)

Payments for taxes related to net share settlement of equity awards

(4,137)

(2,568)

Proceeds from issuance of stock related to stock option exercises

5,835

5,384

Net cash provided by financing activities

1,469

1,846

Effect of exchange rate changes on cash and cash equivalents

(5,031)

1,255

(Decrease) Increase in cash and cash equivalents

(59,819)

30,003

Cash and cash equivalents, beginning of period

185,633

133,634

Cash and cash equivalents, end of period

$

125,814

$

163,637