6-K - WPRT - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of May 2025

Commission File Number: 001-34152

WESTPORT FUEL SYSTEMS INC.

(Translation of registrant's name into English)

1691 West 75th Avenue, Vancouver, British Columbia, Canada, V6P 6P2

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

£ Form 20-F S Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

EXHIBIT INDEX

Exhibit	Description
99.1	MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE PERIOD ENDED MARCH 31, 2025
99.2	CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED MARCH 31, 2025

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

WESTPORT FUEL SYSTEMS INC.
By:	/s/ William E. Larkin
Name:	William E. Larkin
Title:	Chief Financial Officer

Date: May 13, 2025

Document

Management's Discussion and Analysis

BASIS OF PRESENTATION

This Management’s Discussion and Analysis (“MD&A”) for Westport Fuel Systems Inc. (“Westport", the “Company”, “we”, “us”, “our”) for the three months ended March 31, 2025 provides an update to our annual MD&A dated March 31, 2025 for the fiscal year ended December 31, 2024. This information is intended to assist readers in analyzing our financial results and should be read in conjunction with the audited consolidated financial statements, including the accompanying notes, for the fiscal year ended December 31, 2024 and our unaudited condensed consolidated interim financial statements ("interim financial statements") for the three months ended March 31, 2025. Our interim financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The Company’s reporting currency is the United States dollar ("U.S. dollar"). This MD&A is dated as of May 13, 2025.

Additional information relating to Westport, including our Annual Information Form (“AIF”) and Form 40-F each for the year ended December 31, 2024, is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov, respectively. All financial information is reported in U.S. dollars unless otherwise noted.

FORWARD-LOOKING STATEMENTS

This MD&A contains forward-looking statements that are based on the beliefs of management and reflects our current expectations as contemplated under the safe harbor provisions of Section 21E of the United States Securities Act of 1934, as amended. Such forward-looking statements include, but are not limited to, future strategic initiatives and future growth, future of our development programs (including those relating to HPDI and Hydrogen), our expectations for 2025 and beyond, including the demand for our products or our HPDI joint venture's products (including from the HPDI 2.0TM fuel systems), the future success of our business and technology strategies, opportunities available to sell and supply our products in North America, consumer confidence levels, our ability to strengthen our liquidity, growth in our HPDI joint venture and improvements in our light-duty original equipment manufacturer ("OEM") business and timing thereof, improved aftermarket revenues, our capital expenditures, our investments, cash and capital requirements, the intentions of our partners and potential customers, monetization of joint venture intellectual property, the performance of our products, our future market opportunities, our ability to continue our business as a going concern and generate sufficient cash flows to fund operations, the availability of funding and funding requirements, our future cash flows, our estimates and assumptions used in our accounting policies, our accruals, including warranty accruals, our financial condition, the timing of when we will adopt or meet certain accounting and regulatory standards and the alignment of our business segments.

These forward-looking statements are neither promises nor guarantees but involve known and unknown risks and uncertainties that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed in or implied by these forward-looking statements. These risks include risks related to revenue growth, operating results, liquidity, our industry and products, the general economy, conditions of the capital and debt markets, government or accounting policies and regulations, regulatory investigations, climate change legislation or regulations, technology innovations, as well as other factors discussed below and elsewhere in this report, including the risk factors contained in the Company’s most recent AIF filed on SEDAR at www.sedar.com. The forward-looking statements contained in this MD&A are based upon a number of material factors and assumptions which include, without limitation, market acceptance of our products, product development delays in contractual commitments, the ability to attract and retain business partners, competition from other technologies, conditions or events affecting cash flows or our ability to continue as a going concern, price differential between compressed natural gas, liquefied natural gas, and liquefied petroleum gas relative to petroleum-based fuels, unforeseen claims, exposure to factors beyond our control as well as the additional factors referenced in our AIF. Readers should not place undue reliance on any such forward-looking statements, which are pertinent only as of the date they were made.

Management's Discussion and Analysis

The forward-looking statements contained in this document speak only as of the date of this MD&A. Except as required by applicable legislation, Westport does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after this MD&A, including the occurrence of unanticipated events. The forward-looking statements contained in this MD&A are expressly qualified by this cautionary statement.

BUSINESS OVERVIEW

Headquartered in Vancouver, British Columbia, Canada, with operations in Europe, Asia, North America, and South America, Westport serves customers in approximately 70 countries with leading global transportation brands through a network of distributors, service providers for the aftermarket and direct to Original Equipment Manufacturers (“OEMs”) and Tier 1 and Tier 2 OEM suppliers.

With a focus on engineering, manufacturing, and supplying alternative fuel systems and components for transportation applications, Westport’s diverse product offerings, sold under a wide range of established global brands, enable the use of a number of alternative fuels in the transportation sector that provide environmental and/or economic advantages as compared to diesel, gasoline, or battery powered electric vehicles.

Westport designs, manufactures, develops, validates, certifies, and sells alternative fuel (including alternative fuels such as hydrogen (“H2”), liquefied natural gas (“LNG”), biogas, biomethane, and renewable natural gas (collectively “RNG”), compressed natural gas (“CNG”), and liquefied petroleum gas (“LPG”) components and systems for passenger cars and light-, medium- and heavy-duty commercial vehicles and off-highway applications.

Our portfolio of products includes pressure regulators, injectors, electronic control units, valves and filters, complete bi-fuel, mono-fuel and dual-fuel LPG and natural gas conversion kits and high-pressure hydrogen components. Cespira, our 55% owned joint venture (“JV”) with the Volvo Group ("Volvo"), launched in 2024, is advancing the development and commercialization of the HPDITM fuel system, a fully OEM-integrated solution that enables heavy-duty trucks to operate on natural gas, RNG, hydrogen and other alternative fuels.

Business Segments

Our diverse portfolio of technologies, products, and services are sold under a wide range of established brands. They provide the foundation for sustainable growth in existing markets and guide our expansion into new and emerging markets worldwide. Our business is operated under the following four segments:

Cespira

In June 2024, Westport and Volvo entered into a series of joint venture agreements (collectively, the "JV Agreement"), establishing Cespira to promote, develop, and commercialize the HPDI fuel system technology (see Material Contracts – Joint Venture Governance Agreements). The JV will prioritize scaling the HPDI fuel system and supporting the global transition to carbon-neutral fuel systems, particularly in heavy-duty, long-haul trucking, where multiple technologies are required to achieve substantial decarbonization. Under the terms of the agreement, Westport owns a 55% equity interest in Cespira, while Volvo owns 45%. Cespira's business operations involve supplying systems, engineering services and components, including LNG HPDI fuel system products, to engine manufacturers and commercial vehicle OEMs. The fully integrated LNG HPDI fuel systems enable diesel engines to operate predominantly on alternative fuels while delivering equivalent power, torque, and fuel efficiency as conventional compression ignition engines. The system can be a cost-effective way to reduce greenhouse gas emissions using renewable fuels such as RNG. Furthermore, the JV is engaged in adapting HPDI fuel systems for hydrogen and other alternative fuel applications in internal combustion engines.

Light-Duty

The Light-Duty segment specializes in LPG and CNG solutions, including fuel storage tanks, catering to OEM, delayed OEM (“DOEM”), and independent aftermarket (“IAM”) markets. Customers can choose from Westport IAM conversions, DOEM solutions, or OEM-manufactured mono-fuel and bi-

Management's Discussion and Analysis

fuel vehicles. The segment offers industry-leading direct injection engine technology that complies with EURO 7 and EPA 24 standards, along with lightweight, high-quality fuel storage solutions.

The Light-Duty business serves three distinct markets:

1.OEM: Systems are integrated into production lines by vehicle manufacturers.

2.DOEM: Conversions are performed at 0 km in specialized centers operated by Westport or its partners.

3.IAM: Aftermarket products, including conversion kits, support post-sale conversions through an extensive dealer and installer network operating in approximately 70 countries worldwide.

Westport works to distinguish itself as a global company that integrates and manufactures mechanical components, electronics, and fuel storage systems, providing a seamless and efficient solution for our customers.

High-Pressure Controls and Systems

Our High-Pressure Controls and Systems segment is at the forefront of the clean energy revolution, designing, developing, and producing high-demand components for transportation and industrial applications. We partner with the world's leading fuel cell, hydrogen engine and alternative fuel engine manufacturers and companies committed to decarbonizing transport, offering versatile solutions that serve a variety of fuel types. While hydrogen is key to the future decarbonization of transport, our components and solutions are already powering emission-reducing innovation today across a range of alternative fuels. While we are a small enterprise, our strategic position and innovative capabilities put us on the cusp of significant growth, ensuring we are the go-to choice for those shaping the future of clean energy, today and tomorrow.

Heavy-Duty OEM

Our Heavy-Duty OEM business represents historical results from our heavy-duty business for the period January 1, 2024, until the formation of the Cespira joint venture which occurred on June 3, 2024. In 2025, the Heavy-Duty OEM segment reflects revenue from a transitional services agreement in place with Cespira, intended to support the JV in the short-term as the organization establishes its operations.

Management's Discussion and Analysis

RISKS, LONG-TERM PROFITABILITY & LIQUIDITY

Government Regulation and Inflationary Environment

Government regulation is a key factor in driving accelerated global demand and adoption of reduced emission vehicles. Supportive government policy combined with rising corporate adherence to emission reduction goals are creating growth catalysts for Westport in some of its key markets. While we have benefited historically from certain government environmental policies, mandates and regulations around the world, there can be no assurance that these policies, mandates, and regulations will be continued. If these are discontinued, if current requirements are relaxed, or if other regulations are implemented that may impact our business, we may experience a material impact on our competitive position.

Global inflation trends remain inconsistent, with inflationary pressures easing in developed countries, while continuing to impact certain emerging and developed markets. The uncertainty around global tariffs that may impact the automotive sector is increasing inflationary pressures on sourcing of components. Westport sources its components from global suppliers and continues to face inflationary pressure on production input costs. Specifically, the cost of semiconductors, raw materials, and parts has increased, along with higher labor costs, all of which are contributing to margin compression. Furthermore, while we anticipate the global tariff situation may have limited direct impact to us, we cannot predict any secondary longer-term effects to us indirectly caused by the tariff disruption to our customers' and suppliers' businesses.

Increased Interest Rates

In response to inflationary pressures, central banks in major markets have raised interest rates to multi-decade highs. While some regions, including Canada, the United States, and Europe, have begun reducing rates, current levels remain restrictive and are having a significant impact on both the automotive and clean energy sectors.

Automotive manufacturers and OEMs are facing challenges as higher interest rates are compressing profit margins. This environment is leading to delays and cancellations of clean energy investments as companies prioritize cost-cutting measures. Additionally, elevated interest rates have contributed to a slowdown in global economic growth, particularly in emerging markets where economic conditions are already volatile, are facing heightened financial pressures, which could further dampen demand for clean energy solutions.

Hydrogen Eco-System Uncertainty

The hydrogen industry is currently facing economic challenges associated with limited load of available hydrogen which has resulted in high operational costs across the value chain. This has led to delays and cancellations of projects. Key cost factors, such as rising renewable electricity prices and increased electrolyzer costs, are having a significant impact on the economics of renewable (green) hydrogen projects. These higher costs, coupled with uncertainties surrounding fuel supply and infrastructure development, make it challenging to predict when hydrogen technology for transport will become a viable decarbonization solution.

Fuel Prices

European natural gas prices, although elevated recently, are still significantly below the record highs of 2022. Lower demand, influenced by reduced economic activity and previous mild weather, has contributed to price moderation. Additionally, the diversification of gas imports continues to be a key focus of European energy policy. Long-term forecasts suggest that natural gas prices will remain well below 2022 peaks. This outlook reinforces the fuel’s cost-effectiveness and its role in advancing the transition to natural gas-powered vehicles

Management's Discussion and Analysis

Long-term Profitability and Liquidity

We believe that we have considered all possible impacts of known events arising from the risks discussed above related to supply chain and fuel prices in the preparation of the interim financial statements for the three months ended March 31, 2025. However, changes in circumstances due to the forementioned risks could affect our judgments and estimates associated with our liquidity and other critical accounting assessments.

For the three months ended March 31, 2025, we had operating profits of $1.7 million. Cash used in operating activities was $4.9 million for the three months ended March 31, 2025 and was primarily driven by increases in working capital.

As at March 31, 2025, we had cash and cash equivalents of $32.6 million and long-term debt of $31.1 million, of which $13.2 million was current. Based on our projected capital expenditures, debt servicing obligations and operating requirements under our current business plan, we are projecting that our cash and cash equivalents will not be sufficient to fund our operations through the next twelve months from the date of the issuance of this MD&A. These conditions raise substantial doubt about Westport's ability continue as a going concern within one year after the date of this MD&A is issued.

We plan to improve our liquidity position by selling certain subsidiaries in Europe and Argentina which comprise substantially all the assets and liabilities of the Light-Duty segment and continue our cost reduction initiatives. On March 30, 2025, we entered into a share purchase agreement ("SPA") with a wholly-owned investment vehicle of Heliaca Investments, a Netherlands based investment firm supported by Ramphastos Investments Management B.V., a prominent Dutch venture capital and private equity firm, to sell all of the issued and outstanding shares of Westport Fuel Systems Italia S.r.l. The transaction provides for a base purchase price of $73.1 million (€67.7 million), subject to certain adjustments and potential earnouts of up to an estimated $6.5 million (€6.0 million) if certain conditions are achieved, in accordance with the terms of the SPA. If we are successful in closing the sale, we will receive sufficient cash to fund our operations for the next twelve months and alleviate the risk of substantial doubt identified. As of the date of issuance of the interim financial statements, we are seeking shareholder approval of the plan to complete the sale of these businesses to the buyer. As such, there can be no assurances that Westport will be successful in obtaining sufficient funding. Accordingly, we concluded under the accounting standards that these plans do not alleviate the substantial doubt about Westport's ability to continue as a going concern.

OVERVIEW OF FINANCIAL RESULTS FOR FIRST QUARTER 2025

Revenues for the three months ended March 31, 2025 decreased by 9% to $71.0 million compared to $77.6 million in the prior year, primarily driven by decreased sales volumes in our Heavy-Duty OEM and High-Pressure Controls & Systems segments. This was partially offset by increased sales in our Light-Duty segment in the quarter. In Q1 2024, our Heavy-Duty OEM segment included the financial results of HPDI business.

We reported a net loss of $2.5 million for the three months ended March 31, 2025 compared to net loss of $13.6 million in the prior year. This change was primarily the result of:

•increase in our gross profit for the three months ended March 31, 2025 by $3.5 million compared to the prior year;

•decrease in operating expenditures by $8.1 million;

•change in foreign exchange gain or loss by $2.3 million

•increase in loss from investments accounted for by the equity method of $3.8 million

Cash and cash equivalents were $32.6 million at the end of the first quarter of 2025. Cash used in operating activities was $4.9 million, with net cash used in working capital of $8.1 million, partially offset by operating income of $1.7 million. Investing activities included the collection of $10.5 million in a holdback receivable related to our previous sale of Cummins Westport Inc. ("CWI") to Cummins Inc. ("Cummins") in 2022, capital contribution into Cespira of $4.7 million and purchase of capital assets of

Management's Discussion and Analysis

$3.1 million. Cash used in financing activities was attributed to net debt repayments of $3.9 million in the quarter.

We reported adjusted EBITDA of nil , (see "Non-GAAP Measures" section in this MD&A) during the first quarter of 2025 as compared to negative adjusted EBITDA of $6.6 million in the prior year.

SELECTED FINANCIAL INFORMATION

The following table sets forth a summary of our financial results:

Selected Consolidated Statements of Operations Data


					2025			2024
(in millions of U.S. dollars, except for per share amounts and shares outstanding)
Revenue					$	71.0		$	77.6
Gross margin1					$	15.2		$	11.7
Gross margin %1					21		%	15		%
Loss from investments accounted for by the equity method	$	(3.8)	$	—
Net loss					$	(2.5)		$	(13.6)
Net loss per share - basic and diluted					$	(0.14)		$	(0.79)
Weighted average basic & diluted shares outstanding (millions)	17.3		17.2
EBIT1					$	(2.1)		$	(12.4)
EBITDA1					$	(0.1)		$	(9.2)
Adjusted EBITDA1					$	—		$	(6.6)

1These financial measures or ratios are non-GAAP financial measures or ratios. See the section 'Non-GAAP Financial Measures' for explanations and discussions of these non-GAAP financial measures or ratios.

Selected Balance Sheet Data

The following table sets forth a summary of our financial position as at March 31, 2025 and December 31, 2024:

	March 31, 2025		December 31, 2024
(in millions of U.S. dollars, except for per share amounts and shares outstanding)
Cash and cash equivalents	$	32.6	$	37.6
Net working capital1	36.5		37.7
Total assets	295.2		291.6
Long-term debt, including current portion	31.1		33.7
Other non-current liabilities1	26.6		26.3
Total liabilities	157.6		154.6
Shareholders' equity	137.6		137.0

Management's Discussion and Analysis

RESULTS FROM OPERATIONS

REPORTABLE SEGMENTS

Westport reports its results in the following four reportable segments: Light-Duty, High-Pressure Controls & Systems, Heavy-Duty OEM, and Cespira. The prior year comparatives were recast to reflect this change in reportable segments.

Segment earnings or losses before income taxes, interest, depreciation, and amortization ("Segment EBITDA") is the measure of segment profitability used by the Company. The accounting policies of our reportable segments are the same as those applied in our consolidated financial statements. Management prepared the financial results of the Company's reportable segments on basis that is consistent with the manner in which Management internally disaggregates financial information to assist in making internal operating decisions. Certain common costs and expenses, primarily corporate functions, among segments differently than we would for stand-alone financial information prepared in accordance with GAAP. These include certain costs and expenses of shared services, such as IT, human resources, legal, finance and supply chain management. Segment EBITDA is not defined under US GAAP and may not be comparable to similarly titled measures used by other companies and should not be considered a substitute for net earnings or other results reported in accordance with GAAP. Reconciliations of reportable segment information to consolidated statement of operations can be found in section "NON-GAAP FINANCIAL MEASURES & RECONCILIATIONS" within this MD&A.

	Three Months Ended March 31, 2025
	Light-Duty		High-Pressure Controls & Systems		Heavy-Duty OEM		Cespira		Total Segment
Revenue	$	64.2	$	1.4	$	5.4	$	16.7	$	87.7
Cost of revenue	50.2		1.2		4.4		16.2		72.0
Gross profit	14.0		0.2		1.0		0.5		15.7
Operating expenses:
Research & development	3.0		1.0		0.1		3.1		7.2
General & administrative	4.1		0.3		0.1		2.7		7.2
Sales & marketing	2.3		0.1		—		0.3		2.7
Depreciation & amortization	0.7		0.1		—		0.7		1.5
	10.1		1.5		0.2		6.8		18.6
Equity income	0.1		—		—		—		0.1
Add back: Depreciation & amortization	1.9		0.1		—		1.6		3.6
Segment EBITDA	$	5.9	$	(1.2)	$	0.8	$	(4.7)	$	0.8
Management's Discussion and Analysis
---			Three months ended March 31, 2024
---	---	---	---	---	---	---
	Light-Duty		High-Pressure Controls & Systems		Heavy-Duty OEM		Total Segment
Revenue	$	63.3	$	2.4	$	11.9	$	77.6
Cost of revenue	50.9		2.0		13.0		65.9
Gross profit	12.4		0.4		(1.1)		11.7
Operating expenses:
Research & development	3.6		1.3		2.8		7.7
General & administrative	3.7		0.2		1.8		5.7
Sales & marketing	2.1		0.2		0.5		2.8
Depreciation & amortization	0.6		0.1		0.1		0.8
	10.0		1.8		5.2		17.0
Equity income	—		—		—		—
Add back: Depreciation & amortization	1.5		0.1		1.4		3.0
Segment EBITDA	$	3.9	$	(1.3)	$	(4.9)	$	(2.3)

Revenue for the three months ended March 31, 2025

(in millions of U.S. dollars)	Change
	2025		2024			%
Light-Duty	$	64.2	$	63.3		1	%
High-Pressure Controls & Systems	1.4		2.4		(1.0)	(42)	%
Heavy-Duty OEM	5.4		11.9		(6.5)	(55)	%
Total Revenue	$	71.0	$	77.6		(9)	%

All values are in US Dollars.

Light-Duty

Revenue for the three months ended March 31, 2025 was $64.2 million compared with $63.3 million for the three months ended March 31, 2024.

Light-Duty revenue increased by $0.9 million compared to the prior year and was primarily driven by increase in sales in our light-duty OEM and DOEM businesses. The light-duty OEM business had an increase in sales from its Euro 6 program compared to the prior year. In the first quarter of 2024, DOEM had a significant decrease in sales to a customer. This was partially offset by lower sales in our IAM, electronics and fuel storage businesses compared to the prior year.

High-Pressure Controls & Systems

Revenue for the three months ended March 31, 2025 was $1.4 million compared with $2.4 million for the three months ended March 31, 2024.

The decrease in revenue for the three months ended March 31, 2025 compared to the prior year was primarily driven by the hydrogen industry slowdown impacting demand for hydrogen components.

Heavy-Duty OEM

Revenue for the three months ended March 31, 2025 was $5.4 million, compared to $11.9 million for the prior year.

The decrease in revenue for the three months ended March 31, 2025 is a result of the continuation of the business in Cespira. Refer to the "Selected Cespira Statement of Operations information" within

Management's Discussion and Analysis

this MD&A for more information on the performance of the HPDI business. The revenue earned in the current quarter was from our services provided under the transitional service agreement with Cespira that is expected to end by Q2 2026.

Gross profit for the three months ended March 31, 2025

(in millions of U.S. dollars)	Three months ended March 31,		% of		Three months ended March 31,		% of		Change
	2025		Revenue		2024		Revenue			%
Light-Duty	$	14.0	22	%	$	12.4	20	%		13	%
High-Pressure Controls & Systems	0.2		14	%	0.4		17	%	(0.2)	(50)	%
Heavy-Duty OEM	$	1.0	19	%	$	(1.1)	(9)	%		(191)	%
Total gross margin	$	15.2	21	%	$	11.7	15	%		30	%

All values are in US Dollars.

Light-Duty

Gross profit for the three months ended March 31, 2025 increased by $1.6 million to $14.0 million, or 22% of revenue, compared to $12.4 million, or 20% of revenue, for the same prior year period. This was primarily driven by a change in sales mix with an increase in sales to European customers and a reduction in sales to developing regions.

High-Pressure Controls & Systems

Gross profit for the three months ended March 31, 2025 decreased by $0.2 million to $0.2 million, or 14% of revenue, compared to $0.4 million, or 17% of revenue, for the same prior year period. This was primarily driven by lower sales volumes increasing the per unit manufacturing costs in the quarter.

Heavy-Duty OEM

Gross profit for the three months ended March 31, 2025 increased by $2.1 million to $1.0 million, or 19% of revenue, compared to negative $1.1 million or negative 9% of revenue, for the same prior year period. The Heavy-Duty OEM segment received $0.9 million in credits from component suppliers for inventory sold in the quarter.

Research and Development Expenses ("R&D")

(in millions of U.S. dollars)	Change
	2025		2024			%
Light-Duty	$	3.0	$	3.6		(17)	%
High-Pressure Controls & Systems	1.0		1.3		(0.3)	(23)	%
Heavy-Duty OEM	0.1		2.8		(2.7)	(96)	%
Total R&D expenses	$	4.1	$	7.7		(47)	%

All values are in US Dollars.

Light-Duty

R&D expenses for the three months ended March 31, 2025 were $3.0 million compared to $3.6 million in the prior year. This was primarily related to research and development activities for our customer programs with global OEMs for their Euro 6 and Euro 7 vehicle applications.

High-Pressure Controls & Systems

R&D expenses for the three months ended March 31, 2025 were $1.0 million compared to $1.3 million in the prior year. This was primarily related to research and development activities for our new 700 bar products, including pressure regulators, manifolds and tank valves.

Management's Discussion and Analysis

Heavy-Duty OEM

R&D expenses for the three months ended March 31, 2025 were $0.1 million, compared to $2.8 million in the prior year. R&D activities have continued in Cespira after the formation of the joint venture on June 3, 2024.

Selling, General and Administrative Expenses ("SG&A")

(in millions of U.S. dollars)	Change
	2025		2024			%
Light-Duty	$	6.4	$	5.8		10	%
High-Pressure Controls & Systems	0.4		0.4		—	—	%
Heavy-Duty OEM	0.1		2.3		(2.2)	(96)	%
Corporate	2.2		5.1		(2.9)	(57)	%
Total SG&A expenses	$	9.1	$	13.6		(33)	%

All values are in US Dollars.

Light-Duty

SG&A expenses for the three months ended March 31, 2025 were $6.4 million, compared with $5.8 million in the prior year.

High-Pressure Controls & Systems

SG&A expenses for the three months ended March 31, 2025 and 2024 were $0.4 million.

Heavy-Duty OEM

SG&A expenses for the three months ended March 31, 2025 was $0.1 million, compared to $2.3 million in the prior year. The decrease in SG&A expenses were primarily driven by the transition of the HPDI business into Cespira on June 3, 2024.

Corporate

SG&A expenses for the three months ended March 31, 2025 were $2.2 million, compared with $5.1 million in the prior year. The $2.9 million decrease in SG&A expenses was primarily driven by lower shared-based compensation, a reduction in payroll costs and outside services compared to the prior year.

Management's Discussion and Analysis

Selected Cespira Statements of Operations Data

We account for Cespira using the equity method of accounting. However, due to its significance to our long-term strategy and operating results, we disclose certain Cespira's financial information in notes 7 and 17 of our interim financial statements for the three months ended March 31, 2025.

The following table sets forth a summary of the financial results of Cespira for the three months ended March 31, 2025 .

(in millions of U.S. dollars)	Change
	2025			2024			%
Total revenue	$	16.7		$	—		—	%
Gross profit	$	0.5		$	—		—	%
Gross margin1	3		%	—		%
Operating loss	$	(7.1)		$	—		—	%
Net loss attributable to the Company	$	(3.9)		$	—		—	%

All values are in US Dollars.

1Gross margin is non-GAAP financial measure. See the section 'Non-GAAP Financial Measures' for explanations and discussions of these non-GAAP financial measures or ratios.

Revenue

Cespira revenues for the three months ended March 31, 2025 were $16.7 million. In the prior year, the Heavy-Duty OEM segment, which included our HPDI business, had revenues of $11.9 million. This change was primarily driven by an increase in HPDI fuel systems sold in the period.

Gross Profit

Gross profit was $0.5 million for the three months ended March 31, 2025. In the prior year, the Heavy-Duty OEM segment had negative $1.1 million in gross profit; which change was primarily driven by the increase in sales volumes compared to the prior year and reductions in manufacturing cost.

Operating loss

Cespira incurred operating losses of $7.1 million for the three months ended March 31, 2025. Cespira continues to incur operating losses as it scales its operations and expands into other markets.

Management's Discussion and Analysis

Other significant expense and income items for the three months ended March 31, 2025

(in millions of U.S. dollars)	Three months ended March 31,
	2025		2024
Foreign exchange (gains) loss	$	(0.5)	$	1.8
Depreciation and amortization:
Cost of sales depreciation and amortization	1.3		2.2
Operating expense depreciation and amortization	0.7		1.0
Total depreciation and amortization	$	2.0	$	3.2

Foreign exchange gains and losses reflect net realized gains and losses on foreign currency transactions and net unrealized gains and losses on our net U.S. dollar denominated monetary assets and liabilities in our Canadian operations that were mainly comprised of cash and cash equivalents, accounts receivable and accounts payable. In addition, we have foreign exchange exposure on Euro denominated monetary assets and liabilities where the functional currency of the subsidiary is not the Euro. For the three months ended March 31, 2025, we recognized a foreign exchange gain of $0.5 million, compared to a foreign exchange loss of $1.8 million for the three months ended March 31, 2024. The gain recognized in the current period primarily relates to unrealized foreign exchange gain that resulted from the translation of U.S. dollar denominated debt in our Canadian legal entities.

Depreciation and amortization for the three months ended March 31, 2025 and March 31, 2024 were $2.0 million and $3.2 million respectively. Depreciation and amortization decreased compared to prior year was primarily driven by the transition of the HPDI business into Cespira on June 3, 2024.

Income (loss) from investments accounted for by the equity method for the three months ended March 31, 2025 and March 31, 2024 were a loss of $3.8 million and income of nil, respectively. This was primarily driven by our 55% ownership interest in Cespira.

Interest on long-term debt and amortization of discount

(in millions of U.S. dollars)	Three months ended March 31,
		2025		2024
Interest expense on long-term debt		$	0.7	$	0.8

The interest expense on long-term debt for the three months ended March 31, 2025 compared to prior year decreased by $0.1 million and was primarily driven by the decrease in interest expense from our term loan with EDC.

Income tax expense was $0.6 million for the three months ended March 31, 2025 compared to income tax expense of $0.7 million in the prior year. Net change in tax expense was primarily driven by a true-up of certain 2024 deductible expenditures in Q1 2025, partially offset by an increase in tax expense from the increased profitability in our European operations.

Management's Discussion and Analysis

CAPITAL REQUIREMENTS, RESOURCES AND LIQUIDITY

Our cash and cash equivalents position decreased by $5.0 million during the first quarter of 2025 to $32.6 million from $37.6 million at December 31, 2024. The decrease in cash was primarily driven by our debt repayments and cash used in our operating activities, partially offset by cash provided by our investing activities.

Cash Flow from Operating Activities

For the three months ended March 31, 2025, net cash used in our operating activities was $4.9 million compared to net cash provided by operating activities of $0.1 million in the three months ended March 31, 2024, a $5.0 million increase in net cash used in operating activities. The increase in net cash used in operating activities was primarily driven by an increase in net working capital, specifically in inventory and accounts receivable, partially offset by our operating income in the quarter.

Cash Flow from Investing Activities

For the three months ended March 31, 2025, our net cash provided by investing activities was $2.7 million compared to net cash used in investing activities of $4.8 million for the three months ended March 31, 2024. In March 2025, we collected a total of $11.4 million from Cummins for our holdback receivable of which $10.5 million was related to the sale of CWI and the remainder was interest income included in our cash flow from operating activities. We purchased capital assets of $3.1 million, mostly for our Italian and European operations. We contributed $4.7 million into Cespira in the quarter.

Cash Flow from Financing Activities

For the three months ended March 31, 2025, our net cash used in financing activities was $3.9 million compared to net cash used in financing activities of $5.8 million for the three months ended March 31, 2024. Net payments on our operating lines of credit and long-term facilities was $3.9 million for the three months ended March 31, 2025 compared to $17.7 million in the prior year. In the prior year, we had higher payments because of the revolving financing facility that was closed in November 2024.

Management's Discussion and Analysis

CONTRACTUAL OBLIGATIONS AND COMMITMENTS

	Carrying amount		Contractual cash flows		< 1 year		1 - 3 years		4-5 years		> 5 years
Accounts payable and accrued liabilities	$	93.1	$	93.1	$	93.1	$	—	$	—	$	—
Long-term debt, principal, (1)	31.2		27.9		14.4		10.6		2.9		—
Long-term debt, interest (1)	—		5.1		2.1		2.1		0.9		—
Operating lease obligations (2)	19.3		21.9		2.2		5.2		4.3		10.2
	$	143.6	$	148.0	$	111.8	$	17.9	$	8.1	$	10.2

Notes

(1) For details of our long-term debt, principal and interest, see note 12 in the interim financial statements.

(2) For additional information on operating lease obligations, see note 11 of the interim financial statements.

SHARES OUTSTANDING

During the three months ended March 31, 2025, and March 31, 2024, the weighted average number of shares used in calculating the diluted income per share was 17,322,681 and 17,220,540, respectively. The Common Shares and Share Units (comprising of performance share units, restricted share units, and deferred share units) outstanding and exercisable as at the following dates are shown below:

(weighted average exercise prices are presented in Canadian dollars)
	March 31, 2025
	Number	Weighted average exercise price	Number	Weighted average exercise price
				$
Common Shares outstanding	17,326,732		17,326,732
Share Units
Outstanding	407,455	10.67	407,455	N/A
Exercisable	1,189	26.82	1,189	N/A

All values are in US Dollars.

Management's Discussion and Analysis

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our interim financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions that affect the amounts reported in our interim financial statements. We have identified several policies as critical to our business operations and in understanding our results of operations. These policies, which require the use of judgment, estimates and assumptions in determining their reported amounts, include the assessment of liquidity and going concern, revenue recognition, inventories, property, plant and equipment and intangible assets. The application of these and other accounting policies are described in note 3 of our annual consolidated financial statements and our MD&A for the year ended December 31, 2024, filed on March 31, 2025. Actual amounts may vary significantly from estimates used. There have been no significant changes in accounting policies applied to the March 31, 2025 interim financial statements, and we do not expect to adopt any significant changes at this time.

NEW ACCOUNTING PRONOUNCEMENTS AND DEVELOPMENTS

Upcoming accounting standards not yet adopted:

In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements in Income Tax Disclosures" to enhance the transparency and decision usefulness of income tax disclosures. This amendment requires public companies to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Additionally, under the amendment entities are required to disclose the amount of income taxes paid disaggregated by federal, state and foreign taxes, as well as disaggregated by material individual jurisdictions. Finally, the amendment requires entities to disclose income from continuing operations before income tax expense disaggregated between domestic and foreign and income tax expense from continuing operations disaggregated by federal, state and foreign. This guidance is effective for annual reporting periods beginning after December 15, 2024. While this guidance may have an impact on the disclosures, the Company does not expect this guidance to have a material impact on its financial position, operations, and cash flows.

In November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses." It requires entities to disclose, in the notes to the financial statements, specified information related to certain costs and expenses disaggregated by type. The standard improves transparency by providing more detailed information about the component of costs and expenses that would enable users to better understand the major components of an entity's income statement by referencing disclosures in the notes to financial statements. This guidance is effective for annual reporting periods beginning after December 15, 2026. While this guidance may have an impact on the disclosures, the Company does not expect this guidance to have a material impact on its financial position, operations, and cash flows.

DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROLS OVER FINANCIAL REPORTING

During the three months ended March 31, 2025, there were no changes to our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Management's Discussion and Analysis

SUMMARY OF QUARTERLY RESULTS

Our revenues and operating results can vary significantly from quarter to quarter depending on factors such as the timing of product deliveries, product mix, product launch dates, R&D project cycles, timing of related government funding, impairment charges, restructuring charges, stock-based compensation awards and foreign exchange impacts. Net income (loss) has and can vary significantly from one quarter to another depending on operating results, gains and losses from investing activities, recognition of tax benefits and other similar events.

The following table provides summary unaudited consolidated financial data for the past year as comparison:

Selected Consolidated Quarterly Operations Data

Three months ended	30-Jun-23		30-Sep-23		31-Dec-23		31-Mar-24		30-Jun-24		30-Sep-24		31-Dec-24		31-Mar-25
(in millions of United States dollars except for per share amounts)
Total revenue	$	85.0	$	77.4	$	87.2	$	77.6	$	83.4	$	66.2	$	75.1	$	71.0
Cost of revenue	$	70.6	$	64.2	$	79.2	$	65.9	$	66.3	$	51.7	$	60.8	$	55.8
Gross profit	$	14.4	$	13.2	$	8.0	$	11.7	$	17.1	$	14.5	$	14.3	$	15.2
Gross margin percentage	16.9%		17.1%		9.2%		15.1%		20.5%		21.9%		19.0%		21.4%
Net loss	$	(13.2)	$	(11.9)	$	(13.9)	$	(13.6)	$	5.8	$	(3.9)	$	(10.1)	$	(2.5)
EBITDA1	$	(10.1)	$	(8.6)	$	(10.9)	$	(9.2)	$	9.0	$	(0.3)	$	(6.1)	$	(0.1)
Adjusted EBITDA1	$	(4.0)	$	(3.0)	$	(10.0)	$	(6.6)	$	(2.0)	$	(0.8)	$	(1.8)	$	—
U.S. dollar to Euro average exchange rate	0.92		0.95		0.92		0.92		0.93		0.91		0.94		0.95
U.S. dollar to Canadian dollar average exchange rate	1.34		1.35		1.35		1.35		1.37		1.36		1.39		1.43
Loss per share
Basic	$	(0.77)	$	(0.70)	$	(0.81)	$	(0.79)	$	0.34	$	(0.22)	$	(0.57)	$	(0.14)
Diluted	$	(0.77)	$	(0.70)	$	(0.81)	$	(0.79)	$	0.33	$	(0.22)	$	(0.57)	$	(0.14)

Notes

(1) These financial measures or ratios are non-GAAP financial measures or ratios. See the section 'Non-GAAP Financial Measures' for explanations and discussion of these non-GAAP financial measures or ratios.

Management's Discussion and Analysis

Non-GAAP Financial Measures:

In addition to the results presented in accordance with U.S. GAAP, we used EBIT, EBITDA, Adjusted EBITDA, gross margin, net working capital, and other non-current liabilities (collectively, the “Non-GAAP Measures") throughout this MD&A. We believe these non-GAAP measures provide additional information that is useful to stakeholders in understanding our underlying performance and trends through the same financial measures employed by our management. We believe that EBIT, EBITDA, and Adjusted EBITDA are useful to both management and investors in their analysis of our ability to generate liquidity by producing operating cash flow to fund working capital needs, service debt obligations and fund capital expenditures. Management also uses these non-GAAP measures in its review and evaluation of the financial performance of the Company. EBITDA is also frequently used by stakeholders for valuation purposes whereby EBITDA is multiplied by a factor or "EBITDA multiple" that is based on an observed or inferred relationship between EBITDA and market values to determine the approximate total enterprise value of a company. We believe these non-GAAP financial measures also provide additional insight to stakeholders as supplemental information to our U.S. GAAP results and as a basis to compare our financial performance period-over-period and to compare our financial performance with that of other companies. We believe that these non-GAAP financial measures facilitate comparisons of our core operating results from period to period and to other companies by, in the case of EBITDA, removing the effects of our capital structure (net interest income on cash deposits, interest expense on outstanding debt and debt facilities), asset base (depreciation and amortization) and tax consequences. Adjusted EBITDA provides this same indicator of Westport's EBITDA from operations and removing such effects of our capital structure, asset base and tax consequences, but additionally excludes any unrealized foreign exchange gains or losses, stock-based compensation charges and other one-time impairments and costs that are not expected to be repeated in order to provide greater insight into the cash flow being produced from our operating business, without the influence of extraneous events. Readers should be aware that non-GAAP measures have no standardized meaning under U.S. GAAP and accordingly may not be comparable to the calculation of similar measures by other companies. Non-GAAP measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with U.S. GAAP.

Three months ended	31-Mar-24			30-Jun-24			30-Sep-24			31-Dec-24			31-Mar-25
Revenue	$	77.6		$	83.4		$	66.2		$	75.1		$	71.0
Less: Cost of revenue	65.9			66.3			51.7			60.8			55.8
Gross profit	$	11.7		$	17.1		$	14.5		$	14.3		$	15.2
Gross margin %	15.1		%	20.5		%	21.9		%	19.0		%	21.4		%
	Three months ended March 31, 2025
---	---	---	---	---	---	---
	Total Segment		Less: Cespira		Add: Corporate & unallocated		Total Consolidated
Revenue	$	87.7	$	16.7	$	—	$	71.0
Cost of revenue	72.0		16.2		—		55.8
Gross profit	15.7		0.5		—		15.2
Operating expenses:
Research & development	7.2		3.1		—		4.1
General & administrative	7.2		2.7		1.9		6.4
Sales & marketing	2.7		0.3		0.3		2.7
Depreciation & amortization	1.5		0.7		—		0.8
	18.6		6.8		2.2		14.0
Equity income (loss)	0.1		—		(3.9)		(3.8)			Management's Discussion and Analysis
---			Three months ended March 31, 2024
---	---	---	---	---
	Total Segment		Add: Corporate & unallocated		Total Consolidated
Revenue	$	77.6	$	—	$	77.6
Cost of revenue	65.9		—		65.9
Gross profit	11.7		—		11.7
Operating expenses:
Research & development	7.7		—		7.7
General & administrative	5.7		4.7		10.4
Sales & marketing	2.8		0.4		3.2
Depreciation & amortization	0.8		0.2		1.0
	17.0		5.3		22.3
Equity income	—		—		—
Reconciliation of Segment EBITDA to Loss before income taxes	Three months ended March 31,
---	---	---	---	---
	2025		2024
Total Segment EBITDA	$	0.8	$	(2.3)
Adjustments:
Depreciation & amortization1	2.0		3.0
Cespira's Segment EBITDA	(4.7)		—
Cespira's equity loss (note 7)	3.9		—
Corporate and unallocated operating expenses	2.2		5.3
Foreign exchange loss	(0.5)		1.8
Interest on long-term debt and accretion of royalty payable	0.7		0.8
Interest and other income, net of bank charges	(0.9)		(0.3)
Loss before income taxes	$	(1.9)	$	(12.9)

1Depreciation and amortization expenses used in computation for Segment EBITDA and reconciliation to consolidated loss before income taxes are included in cost of revenue and operating expenses on our statement of operations and comprehensive income (loss).

Net Working Capital

	March 31, 2025		December 31, 2024
(in millions of U.S. dollars)
Accounts receivable	$	66.6	$	73.1
Inventories	63.2		53.5
Prepaid expenses	6.6		5.7
Accounts payable and accrued liabilities	(93.1)		(88.1)
Current portion of operating lease liabilities	(2.8)		(2.6)
Current portion of warranty liability	(4.0)		(3.9)
Net working capital	$	36.5	$	37.7
Management's Discussion and Analysis
---

Other Non-current liabilities

	March 31, 2025		December 31, 2024
(in millions of U.S. dollars)
Total liabilities	$	157.6	$	154.6
Less:
Total current liabilities	113.1		109.2
Long-term debt	17.9		19.1
Non-current liabilities	$	26.6	$	26.3

EBIT and EBITDA

Three months ended	30-Jun-23		30-Sep-23		31-Dec-23		31-Mar-24		30-Jun-24		30-Sep-24		31-Dec-24		31-Mar-25
Loss before income taxes	$	(13.0)	$	(12.0)	$	(14.0)	$	(12.9)	$	6.8	$	(2.5)	$	(8.3)	$	(1.9)
Interest expense (income), net (1)	(0.1)		0.2		(0.2)		0.5		0.5		0.4		0.2		(0.2)
EBIT	(13.1)		(11.8)		(14.2)		(12.4)		7.3		(2.1)		(8.1)		(2.1)
Depreciation and amortization	3.0		3.2		3.3		3.2		1.7		1.8		2.0		2.0
EBITDA	$	(10.1)	$	(8.6)	$	(10.9)	$	(9.2)	$	9.0	$	(0.3)	$	(6.1)	$	(0.1)

Notes

(1) Interest expense, net is calculated as interest income, net of bank charges and interest on long-term debt and accretion of royalty payables.

Adjusted EBITDA

Three months ended	30-Jun-23		30-Sep-23		31-Dec-23		31-Mar-24		30-Jun-24		30-Sep-24		31-Dec-24		31-Mar-25
EBITDA	$	(10.1)	$	(8.6)	$	(10.9)	$	(9.2)	$	9.0	$	(0.3)	$	(6.1)	$	(0.1)
Stock based compensation (recovery)	0.8		(0.3)		1.4		0.3		1.2		(0.1)		—		0.3
Unrealized foreign exchange (gain) loss	2.4		1.4		(0.9)		1.8		0.1		(1.1)		5.4		(0.5)
Loss on extinguishment of royalty payable	2.9		—		—		—		—		—		—		—
Severance costs	—		4.5		—		0.5		0.2		0.1		0.1		—
Gain on deconsolidation	—		—		—		—		(13.3)		—		(1.9)		—
Loss on sale of investment	—		—		—		—		—		0.4		—		—
Restructuring costs	—		—		—		—		0.8		0.2		—		0.3
Loss on sale of assets	—		—		—		—		—		—		0.7		—
Impairment of long-term investments	—		—		0.4		—		—		—		—		—
Adjusted EBITDA	$	(4.0)	$	(3.0)	$	(10.0)	$	(6.6)	$	(2.0)	$	(0.8)	$	(1.8)	$	—

Document

Condensed Consolidated Interim Financial Statements (unaudited)

(Expressed in thousands of United States dollars)

WESTPORT FUEL SYSTEMS INC.

For the three months ended March 31, 2025 and 2024

WESTPORT FUEL SYSTEMS INC.
Condensed Consolidated Interim Balance Sheets (unaudited)
(Expressed in thousands of United States dollars, except share amounts)
March 31, 2025 and December 31, 2024			March 31, 2025		December 31, 2024
---	---	---	---	---
Assets
Current assets:
Cash and cash equivalents (including restricted cash)	$	32,637	$	37,646
Accounts receivable (note 5)	66,634		73,054
Inventories (note 6)	63,214		53,526
Prepaid expenses	6,551		5,660
Total current assets	169,036		169,886
Long-term investments (note 7)	40,052		39,732
Property, plant and equipment (note 8)	45,314		41,956
Operating lease right-of-use assets (note 11)	19,249		19,019
Intangible assets (note 9)	5,174		5,277
Deferred income tax assets	10,261		9,695
Goodwill	2,996		2,876
Other long-term assets	3,163		3,180
Total assets	$	295,245	$	291,621
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable and accrued liabilities (note 10)	$	93,127	$	88,123
Current portion of operating lease liabilities (note 11)	2,750		2,624
Current portion of long-term debt (note 12)	13,225		14,660
Current portion of warranty liability (note 13)	4,013		3,861
Total current liabilities	113,115		109,268
Long-term operating lease liabilities (note 11)	16,560		16,433
Long-term debt (note 12)	17,915		19,067
Warranty liability (note 13)	1,603		1,456
Deferred income tax liabilities	4,063		4,029
Other long-term liabilities	4,391		4,343
Total liabilities	157,647		154,596
Shareholders’ equity:
Share capital (note 14):
Unlimited common and preferred shares, no par value
17,326,732 (2024 - 17,282,934) common shares issued and outstanding	1,246,408		1,245,805
Other equity instruments	9,081		9,472
Additional paid in capital	11,516		11,516
Accumulated deficit	(1,098,726)		(1,096,275)
Accumulated other comprehensive loss	(30,681)		(33,493)
Total shareholders' equity	137,598		137,025
Total liabilities and shareholders' equity	$	295,245	$	291,621
Commitments and contingencies (note 16)

See accompanying notes to condensed consolidated interim financial statements.

Approved on behalf of the Board:	Anthony Guglielmin	Director	Daniel Sceli	Director
WESTPORT FUEL SYSTEMS INC.
---
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (unaudited)
(Expressed in thousands of United States dollars, except share and per share amounts)
Three months ended March 31, 2025 and 2024
	Three months ended March 31,
---	---	---	---	---
	2025		2024
Revenue	$	70,955	$	77,574
Cost of revenue	55,730		65,851
Gross profit	15,225		11,723
Operating expenses:
Research and development	4,052		7,693
General and administrative	6,397		10,353
Sales and marketing	2,758		3,287
Foreign exchange (gain) loss	(456)		1,820
Depreciation and amortization	740		1,043
	13,491		24,196
Income (loss) from operations	1,734		(12,473)
Income (loss) from investments accounted for by the equity method	(3,799)		31
Interest on long-term debt	(676)		(812)
Interest and other income, net of bank charges	869		341
Loss before income taxes	(1,872)		(12,913)
Income tax expense	579		735
Net loss for the period	(2,451)		(13,648)
Other comprehensive income (loss):
Cumulative translation adjustment	3,641		(430)
Ownership share of equity method investments' other comprehensive loss	(829)		—
	2,812		(430)
Comprehensive income (loss)	$	361	$	(14,078)
Loss per share:
Net loss per share - basic and diluted	$	(0.14)	$	(0.79)
Weighted average common shares outstanding:
Basic and diluted	17,322,681		17,220,540

See accompanying notes to condensed consolidated interim financial statements.

WESTPORT FUEL SYSTEMS INC.
Condensed Consolidated Interim Statements of Shareholders' Equity (unaudited)
(Expressed in thousands of United States dollars, except share amounts)
Three months ended March 31, 2025 and 2024			Common Shares Outstanding	Share capital		Other equity instruments		Additional paid in capital		Accumulated deficit		Accumulated other comprehensive loss		Total shareholders' equity
---	---	---	---	---	---	---	---	---	---	---	---	---	---
January 1, 2024	17,174,502	$	1,244,539	$	9,672	$	11,516	$	(1,074,434)	$	(30,845)	$	160,448
Issuance of common shares on exercise of share units	48,652	869		(869)		—		—		—		—
Stock-based compensation	—	—		331		—		—		—		331
Net loss for the period	—	—		—		—		(13,648)		—		(13,648)
Other comprehensive loss	—	—		—		—		—		(430)		(430)
March 31, 2024	17,223,154	$	1,245,408	$	9,134	$	11,516	$	(1,088,082)	$	(31,275)	$	146,701
	Common Shares Outstanding	Share capital		Other equity instruments		Additional paid in capital		Accumulated deficit		Accumulated other comprehensive loss		Total shareholders' equity
January 1, 2025	17,282,934	$	1,245,805	$	9,472	$	11,516	$	(1,096,275)	$	(33,493)	$	137,025
Issuance of common shares on exercise of share units	43,798	603		(603)		—		—		—		—
Stock-based compensation	—	—		212		—		—		—		212
Net loss for the period	—	—		—		—		(2,451)		—		(2,451)
Other comprehensive income	—	—		—		—		—		2,812		2,812
March 31, 2025	17,326,732	$	1,246,408	$	9,081	$	11,516	$	(1,098,726)	$	(30,681)	$	137,598

See accompanying notes to condensed consolidated interim financial statements.

WESTPORT FUEL SYSTEMS INC.
Condensed Consolidated Interim Statements of Cash Flows (unaudited)
(Expressed in thousands of United States dollars)
Three months ended March 31, 2025 and 2024
	Three months ended March 31,
---	---	---	---
		2025			2024
Operating activities:
Net loss for the period		$	(2,451)		$	(13,648)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		1,930			3,247
Stock-based compensation expense		212			331
Unrealized foreign exchange (gain) loss		(456)			1,820
Deferred income tax (recovery)		(33)			(40)
Loss (income) from investments accounted for by the equity method		3,799			(31)
Interest on long-term debt		22			22
Change in inventory write-downs		223			413
Change in bad debt expense		(33)			(121)
Other		—			(248)
Changes in operating assets and liabilities:
Accounts receivable		(2,072)			12,526
Inventories		(7,502)			(7,434)
Prepaid expenses		(415)			(400)
Accounts payable and accrued liabilities		2,840			4,725
Warranty liability		(963)			(1,020)
Net cash provided by (used in) operating activities		(4,899)			142
Investing activities:
Purchase of property, plant and equipment		(3,142)			(4,893)
Proceeds on sale of assets		82			135
Proceeds from holdback receivable (note 5)		10,450			—
Capital contributions to investments accounted for by the equity method (note 7)		(4,686)		0	—
Net cash provided by (used in) investing activities		2,704			(4,758)
Financing activities:
Repayments of operating lines of credit and long-term facilities		(3,918)			(17,689)
Drawings on operating lines of credit and long-term facilities		—			11,848
Net cash used in financing activities		(3,918)			(5,841)
Effect of foreign exchange on cash and cash equivalents		1,104			(494)
Net decrease in cash and cash equivalents		(5,009)			(10,951)
Cash and cash equivalents, beginning of period (including restricted cash)		37,646			54,853
Cash and cash equivalents, end of period (including restricted cash)		$	32,637		$	43,902
WESTPORT FUEL SYSTEMS INC.
---
Condensed Consolidated Interim Statements of Cash Flows (unaudited)
(Expressed in thousands of United States dollars)
Three months ended March 31, 2025 and 2024
	Three months ended March 31,
---	---	---	---
		2025		2024
Supplementary information:
Interest paid		$	646	$	1,114
Taxes paid, net of refunds		$	356	532

See accompanying notes to condensed consolidated interim financial statements.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars, except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Company organization and operations:

Westport Fuel Systems Inc. (the “Company”) was incorporated under the Business Corporations Act (Alberta) on March 20, 1995. Westport Fuel Systems Inc. is a global company focused on engineering, manufacturing, and supplying alternative fuel systems and components for transportation applications. The Company’s diverse product offerings sold under a wide range of established global brands enable the use of a number of alternative fuels in the transportation sector that provide environmental and/or economic advantages as compared to diesel, gasoline, batteries or fuel cell powered vehicles. The Company's fuel systems and associated components control the pressure and flow of these alternative fuels, including liquid petroleum gas ("LPG"), compressed natural gas ("CNG"), liquified natural gas ("LNG"), renewable natural gas ("RNG") or biomethane, and hydrogen. The Company supplies its products in approximately 70 countries through a network of distributors, service providers for the aftermarket and directly to original equipment manufacturers (“OEMs”) and Tier 1 and Tier 2 OEM suppliers. The Company’s products and services are available for passenger car and light-, medium- and heavy-duty commercial vehicles and off-highway applications.

```
     Liquidity and Going Concern:
```

For the three months ended March 31, 2025, the Company reported operating income of $1,734. The Company continues to use cash to support its business activities. As at March 31, 2025, the Company had cash and cash equivalents of $32,637 and long-term debt of $31,140, net of deferred financing fees, of which $13,225 was current. Under the term loan with Export Development Canada ("EDC"), the Company has a cash covenant with a consolidated cash requirement of $15,000. If the Company's cash and cash equivalents fall below the minimum cash requirement, the Company may be required to repay the outstanding amount of the term loan, which was $5,859 at March 31, 2025.

On September 13, 2024, the Company announced an at-the-market equity offering program (the "ATM Program") that allows the Company to issue up to $35,000 in common shares from treasury to the public from time to time, at the Company's discretion and subject to regulatory requirements. As at March 31, 2025, no shares were issued from treasury.

In connection with preparing consolidated financial statements for each annual and interim reporting period, the Company is required to evaluate whether there are conditions or events, considered in aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. Substantial doubt exists when conditions and events, considered in aggregate, indicate that it is probable a company will be unable to meet its obligations as they become due within one year after the date the consolidated financial statements are issued. This evaluation initially does not take into consideration the potential mitigating effect of management’s plans and actions that have not been fully implemented as of the date the consolidated financial statements are issued. When substantial doubt exists, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both: (1) it is probable the plans will be effectively implemented within one year after the date the consolidated financial statements are issued; and (2) it is probable the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued.

Based on the Company's projected capital expenditures, debt servicing obligations and operating requirements under its current business plan, management is projecting that its existing cash and cash equivalents will not be sufficient to fund its operations through the next twelve months from the date of the issuance of these condensed consolidated interim financial statements ("interim financial statements"). These conditions raise substantial doubt about the Company's ability to continue as a going concern within one year after the date these interim financial statements are issued.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars, except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Liquidity and going concern \(continued\):

Management plans to improve the Company's liquidity position by selling certain subsidiaries in Europe and Argentina, which comprise substantially all the assets and liabilities of the Light-Duty segment, and continue its cost reduction initiatives. On March 30, 2025, the Company entered into a share purchase agreement ("SPA") with a wholly-owned investment vehicle of Heliaca Investments Coöperatief U.A. ("Heliaca Investments"), a Netherlands based investment firm supported by Ramphastos Investments Management B.V., a prominent Dutch venture capital and private equity firm, to sell all of the issued and outstanding shares of Westport Fuel Systems Italia S.r.l. The transaction provides a base purchase price of $73.1 million (€67.7 million), subject to certain adjustments and potential earnouts of up to an estimated $6.5 million (€6.0 million) if certain conditions are achieved, in accordance with the terms of the SPA. If management is successful in closing the sale, the Company will receive sufficient cash to fund its operations for the next twelve months and alleviate the risk of substantial doubt identified. As of the date of issuance of these interim financial statements, management is seeking shareholder approval of the plan to complete the sale of these businesses to the buyer. As such, there can be no assurance that the Company will be successful in obtaining sufficient funding. Accordingly, management has concluded under the accounting standards that these plans do not alleviate the substantial doubt about the Company's ability to continue as a going concern.

These interim financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The interim financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that may be necessary if the Company were unable to continue as a going concern.

```
     Basis of preparation:
```

(a) Basis of presentation:

The interim financial statements have been prepared by the Company and do not include all of the information and disclosures required by accounting principles generally accepted in the United States ("GAAP"). In the opinion of management, all normal recurring accruals and adjustments considered necessary for a fair presentation have been included. The results for the three months ended March 31, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. The interim financial statements should be read in conjunction with the audited consolidated financial statements and notes to the consolidated financial statements for the year ended December 31, 2024.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the interim financial statements and accompanying notes. Actual results could differ from those estimates. Certain prior period figures have been adjusted to conform to current period presentation in the interim financial statements.

(b) Foreign currency translation:

The Company’s functional currency is the Canadian dollar and its reporting currency for its interim financial statement presentation is the United States dollar ("U.S. Dollar"). The functional currencies for the Company's significant subsidiaries include the following: U.S. dollar, Canadian dollar, Euro, Argentina Peso, Chinese Renminbi (“RMB”) and Polish Zloty. The Company translates assets and liabilities of non-U.S. dollar functional currency operations using the period end exchange rates, shareholders’ equity balances using the weighted average of historical exchange rates, and revenues and expenses using the monthly average rate for the period with the resulting exchange differences recognized in other comprehensive income (loss).

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars, except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Basis of preparation \(continued\):

Transactions that are denominated in currencies other than the functional currencies of the Company’s or its subsidiaries' operations are translated at the rates in effect on the date of the transaction. Foreign currency denominated monetary assets and liabilities are translated to the applicable functional currency at the exchange rates in effect on the balance sheet date. Non-monetary assets and liabilities are translated at the historical exchange rate. All foreign exchange gains and losses are recognized in the condensed consolidated interim statements of operations, except for the translation gains and losses arising from available-for-sale instruments, which are recorded through other comprehensive income (loss) until realized through disposal or impairment.

Except as otherwise noted, all amounts in these interim financial statements are presented in thousands of U.S. dollars. For the periods presented, the Company used the following exchange rates:

	Period ended		Average for the three months ended
	March 31, 2025	December 31, 2024	March 31, 2025	March 31, 2024
Canadian Dollar	1.44	1.44	1.43	1.35
Euro	0.93	0.96	0.95	0.92
RMB	7.26	7.30	7.27	7.20
Polish Zloty	3.87	4.12	3.99	3.96
Argentine Peso	1,072.05	1,032.12	1,054.21	850.08

```
     New accounting pronouncements
```

Upcoming accounting standards not yet adopted:

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars, except share and per share amounts)
Three months ended March 31, 2025 and 2024

```
     Accounts receivable:
```

	March 31, 2025		December 31, 2024
Customer trade receivables	$	55,116	$	52,058
Holdback receivable	—		10,737
Other receivables	6,983		6,347
Income tax receivable	620		613
Due from related parties (note 15)	7,965		7,523
Allowance for credit losses	(4,050)		(4,224)
	$	66,634	$	73,054

In 2022, a holdback receivable was recorded as part of the sale of the Company's interest in Cummins Westport Inc. to Cummins Inc. ("Cummins"). The holdback was retained by Cummins for a term of three years to satisfy any extended warranty obligations in excess of the recorded extended warranty obligation. Unused amounts were repaid to the Company at the end of the three-year term. In March 2025, the Company collected $11,365 from Cummins related to the holdback receivable, including interest accrued.

```
     Inventories:
```

	March 31, 2025		December 31, 2024
Purchased parts and materials	$	42,758	$	37,055
Work-in-progress	1,110		1,250
Finished goods	19,346		15,221
	$	63,214	$	53,526

During the three months ended March 31, 2025, the Company recorded change in write-downs to net realizable value of approximately $223 (three months ended March 31, 2024 - $413).

```
     Long-term investments:
```

	March 31, 2025		December 31, 2024
HPDI Technology LP (a)	$	25,599	$	25,494
HPDI Technology AB (a)	11,234		11,225
Minda Westport Technologies Limited ("MWTL")	3,072		2,866
Other equity-accounted investees	147		147
	$	40,052	$	39,732

(a) For three months ended March 31, 2025, the Company recognized its share of HPDI Technology's ("Cespira") losses of $3,884 as a loss from investment accounted for by the equity method. During the three months ended March 31, 2025, the Company contributed additional capital of $4,686 into Cespira.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Long-term investments \(continued\):

Combined assets, liabilities, revenue and expenses of Cespira, are as follows:

	March 31,		December 31,
	2025		2024
Current assets:
Cash and cash equivalents	$	12,130	$	10,305
Accounts receivable	21,143		21,000
Inventory	8,456		7,414
Prepaids	1,437		1,471
	43,166		40,190
Property, plant and equipment	40,627		40,901
Intangible assets	6,970		7,087
Goodwill	564		563
Total assets	$	91,327	$	88,741
Current liabilities:
Accounts payable	$	16,608	$	16,527
Current portion of provisions	2,073		2,128
Other current liabilities	1,407		1,910
	20,088		20,565
Long-term portion of provisions	518		532
Other long-term liabilities	354		569
Total liabilities	$	20,960	$	21,666
Net assets	$	70,367	$	67,075	Three months ended March 31, 2025
---	---	---
Revenue	$	16,676
Cost of revenue	16,230
Gross profit	446
Operating expenses:
Research and development	3,089
General and administrative	2,698
Sales and marketing	291
Foreign exchange loss	746
Depreciation and amortization	730
	7,554
Loss from operations	(7,108)
Interest income, net of bank charges	7
Loss before income taxes	(7,101)
Income tax expense	7
Net loss	$	(7,108)
WESTPORT FUEL SYSTEMS INC.
---
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

```
     Property, plant and equipment:
```

			Accumulated		Net Book
March 31, 2025	Cost		Depreciation		Value
Land and buildings	$	9,425	$	3,122	$	6,303
Computer equipment and software	8,006		5,732		2,274
Furniture and fixtures	6,482		4,882		1,600
Machinery and equipment	72,069		39,498		32,571
Leasehold improvements	11,186		8,620		2,566
	$	107,168	$	61,854	$	45,314
			Accumulated		Net Book
---	---	---	---	---	---	---
December 31, 2024	Cost		Depreciation		Value
Land and buildings	$	9,067	$	2,977	$	6,090
Computer equipment and software	7,596		5,599		1,997
Furniture and fixtures	6,196		4,779		1,417
Machinery and equipment	68,104		38,088		30,016
Leasehold improvements	10,973		8,537		2,436
	$	101,936	$	59,980	$	41,956

```
     Intangible assets:
```

			Accumulated		Intangible
March 31, 2025	Cost		Amortization		Assets, net
Patents and trademarks	$	19,887	$	14,733	$	5,154
Technology	4,001		3,981		20
Customer contracts	11,384		11,384		—
	$	35,272	$	30,098	$	5,174
			Accumulated		Intangible
---	---	---	---	---	---	---
December 31, 2024	Cost		Amortization		Assets, net
Patents and trademarks	$	19,136	$	13,899	$	5,237
Technology	3,840		3,800		40
Customer contracts	10,926		10,926		—
	$	33,902	$	28,625	$	5,277

     Accounts payable and accrued liabilities:

	March 31, 2025		December 31, 2024
Trade accounts payable	$	65,351	$	61,691
Accrued payroll	16,680		16,096
Taxes payable	6,501		6,146
Deferred revenue	4,595		4,190
	$	93,127	$	88,123
WESTPORT FUEL SYSTEMS INC.
---
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Operating leases right-of-use assets and lease liabilities:

The Company has entered into various non-cancellable operating lease agreements primarily for its manufacturing facilities and offices. The Company's leases have lease terms expiring between 2025 and 2038. Many leases include one or more options to renew. The Company does not assume renewals in its determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement. The average remaining lease term is approximately six years and the present value of the outstanding operating lease liability was determined applying a weighted average discount rate of 3.0% based on incremental borrowing rates applicable in each location.

The components of lease cost are as follows:


	2025		2024
Amortization of right-of-use assets	$	608	$	676
Interest	125		156
Total lease cost	$	733	$	832

The maturities of lease liabilities as at March 31, 2025 are as follows:

The remainder of 2025	$	2,088
2026	2,645
2027	2,585
2028	2,324
2029	2,005
Thereafter	10,204
Total undiscounted cash flows	21,851
Less: imputed interest	2,541
Present value of operating lease liabilities	19,310
Less: current portion	2,750
Long-term operating lease liabilities	$	16,560
WESTPORT FUEL SYSTEMS INC.
---
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

```
     Long-term debt:
```

	March 31, 2025		December 31, 2024
Term loan facilities, net of debt issuance costs	$	29,000	$	31,740
Other bank financing	390		374
Capital lease obligations	1,750		1,613
Balance, end of period	31,140		33,727
Less: current portion	13,225		14,660
Long-term portion	$	17,915	$	19,067
Term loan	Maturity date	Interest rate	March 31, 2025		December 31, 2024
---	---	---	---	---	---	---
EDC	September 15, 2026	U.S. Prime Rate plus 2.01%	$	5,859	$	6,836
UniCredit - April 2021	March 31, 2027	3-month Euribor plus 1.65%	4,060		4,399
UniCredit - May 2020	May 31, 2025	3-month Euribor plus 1.60%	279		534
UniCredit - July 2020	July 31, 2026	3-month Euribor plus 1.75%	4,088		4,663
Deutsche Bank - August 2020	August 31, 2026	3-month Euribor plus 1.70%	1,891		2,172
Banca de Credito Cooperativo - November 2023	December 31, 2028	3-month Euribor plus 1.75%	2,015		2,058
Deutsche Bank - November 2023	September 30, 2029	3-month Euribor plus 1.90%	6,275		6,352
Rabobank - December 2023	December 31, 2028	4.70%	902		1,012
UniCredit - January 2024	December 31, 2028	3-month Euribor plus 1.52%	3,631		3,714
Term loan facilities, net of debt issuance costs			$	29,000	$	31,740

On December 13, 2021, the credit facility and non-revolving term facility with EDC were refinanced into one $20,000 term loan, with quarterly principal and interest payments. On May 31, 2024, the Company amended the loan agreement with EDC to permit the asset transfer of certain property, plant, and equipment previously pledged to the loan into Cespira, removal of Fuel System Solutions Inc. as a borrower, added Westport Fuel Systems Canada Inc. as a borrower and modified the securities pledged to the loan. The loan is secured by share pledges in the Company's equity interest in Cespira.

On May 20, 2020, and July 17, 2020, the Company entered into two Euro denominated loan agreements with UniCredit. There are no securities provided on the loans as the loans were made as part of the Italian government's COVID-19 Decreto Liquidità.

On August 11, 2020, the Company entered into a Euro denominated loan agreement with Deutsche Bank. There is no security provided on the loan as the loan was made as part of the Italian government’s COVID-19 Decreto Liquidità.

On October 9, 2018, and November 28, 2019, the Company entered into two Euro denominated loan agreements with UniCredit S.p.A. (“UniCredit”). On April 29, 2021, the Company and UniCredit amended the terms of these Euro denominated loan agreements to combine the facilities into one $8,803 loan facility, with quarterly principal and interest payments.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

```
     Long-term debt $continued$:
```

On November 28, 2023, the Company entered into a Euro denominated loan agreement with Banca de Credito Cooperativo with quarterly principal and interest payments. There is no security provided on the loan as the loan was made as part of the Italian government's guarantee program administered by the Servizi Assicurativi del Commercio Estero ("SACE").

On November 29, 2023, the Company entered into a Euro denominated loan agreement with Deutsche Bank with quarterly principal and interest payments. There is no security provided on the loan as the loan was made as part of the Italian government's SACE guarantee program.

On December 4, 2023, the Company entered into a Euro denominated loan agreement with Rabobank and principal and interest are paid monthly. The loan is secured by certain property owned by the Company.

On January 10, 2024, the Company entered into a Euro denominated loan agreement with UniCredit with quarterly principal and interest payments, and the first payment is due in 2025. There is no security provided on the loan as the loan was made as part of the Italian government's SACE guarantee program.

The Company has entered into interest rate swaps with Unicredit and Deutsche Bank, which are directly associated with the Unicredit (2020 and 2021), Deutsche Bank (2020), Deutsche Bank (2023) and UniCredit (2024) term loans. These interest rate swaps serve as a hedging mechanism against potential fluctuations in future interest rates ensuring stability in loan repayments. As of March 31, 2025, the Unicredit interest rate swaps have maturity dates ranging from 2025 to 2028 and a total notional value of $11,933. Additionally, the Deutsche Bank interest rate swaps have maturity dates ranging from 2026 and 2029, with a notional value of $8,083. The notional value of these interest rate swaps is adjusted concurrently with scheduled principal payments on the corresponding loans. These interest rate swaps have been designated as cash flow hedges and have been structured to be highly effective. As of March 31, 2025, the fair value of the interest rate swap assets were $189, which is included in other long-term assets (December 31, 2024 - $253). The fair value of the interest rate swap liabilities were $156, which was included in long-term debt (December 31, 2024 - $171).

Throughout the term of certain of these financing arrangements, the Company is required to meet certain financial and non-financial covenants. As of March 31, 2025, the Company is in compliance with all covenants under the financing arrangements.

The principal repayment schedule of long-term debt is as follows as at March 31, 2025:

	Term loan facilities		Other bank financing		Capital lease obligations		Total
Remainder of 2025	$	10,574	$	130	$	112	$	10,816
2026	10,788		130		672		11,590
2027	3,692		130		405		4,227
2028	2,920		—		355		3,275
2029 and thereafter	1,026		—		206		1,232
	$	29,000	$	390	$	1,750	$	31,140
WESTPORT FUEL SYSTEMS INC.
---
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

```
     Warranty liability:
```

A continuity of the warranty liability is as follows:

	March 31, 2025		December 31, 2024
Balance, beginning of period	$	5,317	$	8,506
Warranty claims	(523)		(3,778)
Warranty accruals	169		2,127
Change in estimate	413		883
Impact of foreign exchange changes	240		(583)
Transfer to Cespira	—		(1,838)
Balance, end of period	5,616		5,317
Less: current portion	4,013		3,861
Long-term portion	$	1,603	$	1,456

     Share capital, stock options and other stock-based plans:

During the three months ended March 31, 2025, the Company issued 43,798 common shares, net of cancellations, upon exercises of share units (three months ended March 31, 2024 - 48,652 common shares). The Company issues shares from treasury to satisfy share unit exercises.

(a) Share Units (“Units”):

The value assigned to issued Units and the amounts accrued are recorded as other equity instruments. As Units are exercised or vest and the underlying shares are issued from treasury of the Company, the value is reclassified to share capital.

During the three months ended March 31, 2025, the Company recognized $285 (three months ended March 31, 2024 - $409) of stock-based compensation associated with the Westport Omnibus Plan. The Westport Omnibus Plan aims to advance the Company's interests by encouraging employees, consultants and non-employee directors to receive equity-based compensation and incentives. The plan outlines the stock-based options types, eligibility and vesting terms.

A continuity of the Units issued under the Westport Omnibus Plan are as follows:

	Three months ended March 31, 2025		Three months ended March 31, 2024
	Number of<br>Units	Weightedaveragegrantdate fairvalue(CDN )	Number of<br>Units	Weightedaveragegrantdate fairvalue(CDN )
Outstanding, beginning of period	524,322		478,643
Granted	—	—	50,000	9.31
Vested and exercised	(43,798)	19.76	(48,652)	24.08
Forfeited/expired	(73,069)	12.77	(38,406)	26.07
Outstanding, end of period	407,455		441,585
Units outstanding and exercisable, end of period	1,189		17,915

All values are in US Dollars.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Share capital, stock options and other stock-based plans \(continued\):

During the three months ended March 31, 2025, nil share units were granted to certain employees and directors (three months ended March 31, 2024 - 50,000). This included nil Restricted Share Units (“RSUs”) (three months ended March 31, 2024 - 50,000), nil Performance Share Units (“PSUs”) (three months ended March 31, 2024 - nil), and nil Deferred Share Units ("DSUs") (three months ended March 31, 2024 - nil).

Values of PSUs are determined using the Monte–Carlo Simulation Model. RSUs typically vest over a three-year period so the actual value received by the individual depends on the share price on the day such RSUs are settled for common shares, not the date of grant. Vesting of DSUs shall occur immediately prior to the resignation, retirement or termination of directorship, in accordance with the terms of Westport's Omnibus Plan.

As at March 31, 2025, $713 of compensation expense related to Units awarded has yet to be recognized in results from operations and will be recognized ratably over 1.4 years.

(b) Aggregate intrinsic values:

The aggregate intrinsic value of the Company’s share units at March 31, 2025 as follows:

	March 31, 2025
	(CDN )
Share units:
Outstanding
Exercisable	2
Exercised	237

All values are in US Dollars.

Stock-based compensation associated with the Unit plans is included in operating expenses as follows:


	2025		2024
Cost of revenue	$	—	$	41
Research and development	13		110
General and administrative	247		199
Sales and marketing	25		59
	$	285	$	409

Of the stock-based compensation expense recognized in the three months ended March 31, 2025, $212 will settle in shares and $73 will settle in cash (three months ended March 31, 2024 - $331 and $78, respectively).

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

```
     Related party transactions:
```

The Company's related parties are Cespira, Minda Westport Technologies Limited ("MWTL"), directors, officers and shareholders that own more than 10% of the Company's shares.

The Company engages in transactions with Cespira primarily through the provision of services and the sale of inventory under the transitional services agreement and cross-charges.

The Company engages in transactions with MWTL primarily through the sale of inventory.

	Sales of goods, services and other income				Inventory purchased, services and other expenses
	Three months ended March 31,
	2025		2024		2025		2024
Cespira	$	5,559	$	—	$	610	$	—
MWTL	1,319		2,081		101		57		Receivables (note 5)	Payables
---	---	---	---	---	---	---	---	---
	March 31,		December 31,		March 31,		December 31,
	2025		2024		2025		2024
Cespira	$	5,231	$	4,973	$	1,603	$	1,137
MWTL	2,734		2,550		25		48
Total	$	7,965	$	7,523	$	1,628	$	1,185

```
     Commitments and contingencies:
```

(a) Contractual commitments

The Company is a party to a variety of agreements in the ordinary course of business under which it is obligated to indemnify a third party with respect to certain matters. Typically, these obligations arise as a result of contracts for sale of the Company’s product to customers where the Company provides indemnification against losses arising from matters such as product liabilities. The potential impact on the Company’s financial results is not subject to reasonable estimation because considerable uncertainty exists as to whether claims will be made and the final outcome of potential claims. To date, the Company has not incurred significant costs related to these types of indemnifications.

(b) Contingencies

The Company is engaged in certain legal actions and tax audits in the ordinary course of business and believes that, based on the information currently available, the ultimate outcome of these actions will not have a material adverse effect on our operating results, liquidity or financial position.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

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     Segment information:
```

The Company now reports its results in the following four reportable segments: Light-Duty, High-Pressure Controls & Systems, Heavy-Duty OEM, and Cespira. The prior year comparatives were recast to reflect this change in reportable segments.

Segment earnings or losses before income taxes, interest, depreciation, and amortization ("Segment EBITDA") is the measure of segment profitability used by the Company. The accounting policies of our reportable segments are the same as those applied in our consolidated financial statements. Management prepared the financial results of the Company's reportable segments on basis that is consistent with the manner in which Management internally disaggregates financial information to assist in making internal operating decisions. Certain common costs and expenses were allocated among segments and presented differently than the Company would for stand-alone financial information prepared in accordance with GAAP. These include certain costs and expenses of shared services, such as IT, human resources, legal, finance and supply chain management. Segment EBITDA is not defined under US GAAP and may not be comparable to similarly titled measures used by other companies and should not be considered a substitute for net earnings or other results reported in accordance with GAAP.

The Company's Chief Operating Decision Maker ("CODM") uses Segment EBITDA disclosed below to evaluate the performance of its reportable segments. The Company believes Segment EBITDA is most reflective of the operational profitability or loss of its reportable segments. The CODM uses this information to drive decisions and resource allocations. Segment EBITDA is used as the key profitability measure when the Company sets its annual budget.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Segment information \(continued\):

Financial information by business segment as follows:

	Three months ended March 31, 2025
	Light-Duty		High-Pressure Controls & Systems		Heavy-Duty OEM		Cespira		Total Segment
Revenue	$	64,168	$	1,354	$	5,433	$	16,676	$	87,631
Cost of revenue	50,130		1,164		4,436		16,230		71,960
Gross profit	14,038		190		997		446		15,671
Operating expenses:
Research & development	2,976		965		111		3,089		7,141
General & administrative	4,074		319		65		2,698		7,156
Sales & marketing	2,302		140		20		291		2,753
Depreciation & amortization	637		51		—		730		1,418
	9,989		1,475		196		6,808		18,468
Equity income	85		—		—		—		85
Add back: Depreciation & amortization1	1,742		136		—		1,620		3,498
Segment EBITDA	$	5,876	$	(1,149)	$	801	$	(4,742)	$	786
	Three months ended March 31, 2024
---	---	---	---	---	---	---
	Light-Duty		High-Pressure Controls & Systems		Heavy-Duty OEM		Total Segment
Revenue	$	63,230	$	2,403	$	11,941	$	77,574
Cost of revenue	50,876		1,966		13,009		65,851
Gross profit	12,354		437		(1,068)		11,723
Operating expenses:
Research & development	3,578		1,282		2,806		7,666
General & administrative	3,682		193		1,763		5,638
Sales & marketing	2,130		266		498		2,894
Depreciation & amortization	667		60		117		844
	10,057		1,801		5,184		17,042
Equity income	31		—		—		31
Add back: Depreciation & amortization1	1,549		108		1,391		3,048
Segment EBITDA	$	3,877	$	(1,256)	$	(4,861)	$	(2,240)
WESTPORT FUEL SYSTEMS INC.
---
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Segment information \(continued\):

Reconciliations of reportable segment financial information to consolidated statement of operations:

	Three months ended March 31, 2025
	Total Segment		Less: Cespira		Add: Corporate & unallocated		Total Consolidated
Revenue	$	87,631	$	16,676	$	—	$	70,955
Cost of revenue	71,960		16,230		—		55,730
Gross profit	15,671		446		—		15,225
Operating expenses:
Research & development	7,141		3,089		—		4,052
General & administrative	7,156		2,698		1,939		6,397
Sales & marketing	2,753		291		296		2,758
Depreciation & amortization	1,418		730		52		740
	18,468		6,808		2,287		13,947
Equity income (loss)	85		—		(3,884)		(3,799)		Three months ended March 31, 2024
---	---	---	---	---
	Total Segment		Add: Corporate & unallocated		Total Consolidated
Revenue	$	77,574	$	—	$	77,574
Cost of revenue	65,851		—		65,851
Gross profit	11,723		—		11,723
Operating expenses:
Research & development	7,666		27		7,693
General & administrative	5,638		4,715		10,353
Sales & marketing	2,894		393		3,287
Depreciation & amortization	844		199		1,043
	17,042		5,334		22,376
Equity income	31		—		31
Reconciliation of Segment EBITDA to Loss before income taxes		Three months ended March 31,
---	---	---	---	---	---	---
	2025			2024
Total Segment EBITDA		$	786		$	(2,240)
Adjustments:
Depreciation & amortization1		1,930			3,048
Cespira's Segment EBITDA		(4,742)			—
Cespira's equity loss (note 7)		3,884			—
Corporate and unallocated operating expenses		2,235			5,334
Foreign exchange (gain) loss		(456)			1,820
Interest on long-term debt		676			812
Interest and other income, net of bank charges		(869)			(341)
Loss before income taxes		$	(1,872)		$	(12,913)

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Segment information \(continued\):

	March 31,		March 31,
Total additions to long-lived assets, excluding business combinations	2025		2024
Light-Duty	$	2,569	$	4,149
High-Pressure Controls & Systems	558		446
Heavy-Duty OEM	—		298
Corporate and unallocated	15		—
Total consolidated	$	3,142	$	4,893

Cespira's total additions to long-lived assets, excluding business combinations for the three months ended March 31, 2025 was $1,249.

Revenues are attributable to geographical regions based on the location of the Company’s customers and are presented as a percentage of the Company's revenues, as follows:

		% of total revenue
	Three months ended March 31,
		2025		2024
Europe		71	%	67	%
Asia		7	%	11	%
Americas		15	%	13	%
Africa		1	%	4	%
Other		6	%	5	%

The measure of segment assets evaluated by the CODM are total assets as reported on the consolidated balance sheet. Total assets are allocated as follows:

	Total assets by segment
	March 31, 2025		December 31, 2024
Light-Duty	$	215,419	$	202,820
High-Pressure Controls & Systems	9,076		8,411
Heavy-Duty OEM	11,351		9,138
Corporate & unallocated	59,399		71,252
Total consolidated assets	$	295,245	$	291,621
WESTPORT FUEL SYSTEMS INC.
---
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

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     Financial instruments:
```

Financial management risk

The Company has exposure to liquidity risk, credit risk, foreign currency risk and interest rate risk.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they are due. The Company has a history of losses and negative cash flows from operations since inception. At March 31, 2025, the Company has $32,637 of cash and cash equivalents, including $105 in restricted cash.

The following are the contractual maturities of financial obligations as at March 31, 2025:

	Carrying<br>amount		Contractual<br>cash flows		< 1 year		1-3 years		4-5 years		>5 years
Accounts payable and accrued liabilities	$	93,127	$	93,127	$	93,127	$	—	$	—	$	—
Term loan facilities (note 12)	29,000		30,905		15,895		11,536		3,474		—
Other bank financing (note 12)	390		394		134		130		130		—
Capital lease obligations (note 12)	1,750		1,750		481		1,114		155
Operating lease obligations (note 11)	19,310		21,852		2,088		5,231		4,330		10,203
	$	143,577	$	148,028	$	111,725	$	18,011	$	8,089	$	10,203

Fair value of financial instruments

As at March 31, 2025, cash and cash equivalents are measured at fair value on a recurring basis and are included in Level 1.

The carrying amounts reported in the unaudited condensed consolidated interim balance sheets for accounts receivable, and accounts payable and accrued liabilities approximate their fair values due to the short-term period to maturity of these instruments.

The long-term investments represent the Company's interests in Cespira, MWTL, and other investments. Cespira and MWTL are accounted for using the equity method. Other investments are accounted for at fair value.

The carrying values reported in the condensed consolidated interim balance sheets for obligations under capital and operating leases, which are based upon discounted cash flows, approximate their fair values.

The carrying values of the term loan facilities, and other bank financing included in the long-term debt (note 12) are carried at amortized cost, which approximate their respective fair values as at March 31, 2025. The interest rate swaps (note 12) are accounted for at fair value using quoted market prices.

WESTPORT FUEL SYSTEMS INC.
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
(Expressed in thousands of United States dollars except share and per share amounts)
Three months ended March 31, 2025 and 2024

     Financial Instruments \(continued\):

The Company categorizes its fair value measurements for items measured at fair value on a recurring basis into three categories as follows:

Level 1 –	Unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2 –	Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 –	Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

When available, the Company uses quoted market prices to determine fair value and classify such items in Level 1. When necessary, Level 2 valuations are performed based on quoted market prices for similar instruments in active markets and/or model–derived valuations with inputs that are observable in active markets. Level 3 valuations are undertaken in the absence of reliable Level 1 or Level 2 information.