#Bermuda #Hamilton #Nabors Industries #energy technology #Oilfield Services

Nabors Industries Reports Second Quarter Earnings for 2025

Nabors Industries Ltd., a leading provider of advanced technology for the energy sector, disclosed its financial results for the second quarter of 2025, showcasing a mix of progress and challenges. The company reported operating revenues amounting to $833 million, marking an increase compared to the $736 million achieved in the prior quarter. However, this performance came with a net loss of $31 million, contrasting sharply with the preceding quarter's net income of $33 million. The results reflect a significant shift influenced by a one-time net gain associated with the Parker transaction in Q1, which inflated profits by $113 million or $9.68 a share.

Despite this loss, Nabors's operational efficiency remained robust with an adjusted EBITDA of $248 million, up from $206 million in the first quarter. This performance indicates the company's capacity to generate earnings before interest, taxes, depreciation, and amortization.

Key Highlights for Q2 2025

1. Joint Venture Developments: The SANAD drilling joint venture with Saudi Aramco deployed two new rigs in the Kingdom, adding to a total of twelve operational rigs. SANAD is set to expand further with the award of a fourth tranche comprising five newbuilds, expected to begin operations between 2026 and 2027.

2. Successful International Reactivations: Operations in Kuwait saw the addition of three high-specification rigs under multiyear contracts, poised to bolster earnings from Nabors’s International Drilling segment in the upcoming months.

3. Record-Breaking Drilling Achievements: Nabors’s PACE® series SmartRigs® set new benchmarks in wellbore lengths across several major U.S. basins including the Bakken and Haynesville. Notably, a PACE®-X rig achieved a lateral well length of 20,000 feet in Haynesville, while in the Bakken, operators drilled multiple four-mile laterals.

4. Integration of Parker Operations: The integration of Parker Wellbore acquired earlier in 2025 is showing favorable results, contributing significantly to the quarter's earnings and pushing toward the anticipated cost synergies of $40 million.

Leadership Comments

Anthony G. Petrello, the Chairman and CEO, expressed optimism about the current results, emphasizing the robust nature of the Nabors portfolio, especially with the addition of Parker Wellbore's operations. He highlighted the potential for significant growth within the International Drilling segment, particularly through high-spec rigs deployed in the Middle East.

Petrello acknowledged the flat rig market in oil-focused basins but noted an uptick in natural gas drilling, suggesting the company's positioning is set to see improvements in both rig count and pricing stability into the third quarter.

Financial Summary

• - International Drilling EBITDA: Increased to $117.7 million from $115.5 million.
• - U.S. Drilling EBITDA: Rose to $101.8 million, driven by higher rig deployment and the benefits from Parker operations.
• - Drilling Solutions Adjusted EBITDA: Improved to $76.5 million, bolstered by Parker's integration into Nabors's operational framework.
• - Free Cash Flow: Adjusted free cash flow was reported at $41 million, an improvement from a cash consumption of $61 million in Q1.

Outlook for Q3 2025

Looking ahead, Nabors expects to maintain a steady operating metric through the third quarter, projecting an average rig count of 57 to 59 in the lower 48 U.S. markets and consistent daily adjusted gross margins.

Overall, while grappling with losses, Nabors Industries appears set on a trajectory of recovery and growth, driven by strategic drilling ventures and operational expansions, particularly in international markets.