3Q 2025 Earnings Presentation NABORS INDUSTRIES October 29, 2025 NABORS INDUSTRIES Forward-Looking Statements We often discuss expectations regarding our future markets, demand for our products and services, and our performance in our annual, quarterly, and current reports, press releases, and other written and oral statements. Such statements, including statements in this document that relate to matters that are not historical facts, are "forward-looking statements" within the meaning of the safe harbor pr ...

Group 1 - Two stocks in the energy sector are signaling potential warnings for momentum-focused investors as of October 29, 2025 [1] - The Relative Strength Index (RSI) is a key momentum indicator, with values above 70 indicating that a stock may be overbought [2] - Nabors Industries reported disappointing quarterly results, with a significant debt reduction of approximately $330 million from the sale of Quail Tools, leading to an expected gross debt decrease exceeding 20% [6] - Nabors Industries' stock gained around 15% over the past five days, with a current RSI value of 73 and a closing price of $47.17 [6] - Teekay Corp is set to announce its third-quarter earnings results on October 29, with its stock having gained around 13% over the past month and a current RSI value of 71.1 [6]

Group 1: Market Overview - As of October 29, 2025, two stocks in the energy sector are signaling potential warnings for momentum-focused investors [1] - The Relative Strength Index (RSI) is highlighted as a key momentum indicator, with values above 70 indicating overbought conditions [2] Group 2: Company Performance - Nabors Industries Ltd (NYSE:NBR) reported disappointing quarterly results, with a recent stock price of $47.17, reflecting a 0.2% decline [6] - The company has reduced its gross debt by approximately $330 million from the sale of Quail Tools, aiming for a total debt reduction exceeding 20% compared to June 30, 2025 [6] - The expected decrease in annual interest expense is around $45 million, which will improve adjusted free cash flow [6] - Nabors Industries' stock has gained approximately 15% over the past five days, with a 52-week high of $86.10, and an RSI value of 73 [6] Group 3: Teekay Corp Ltd - Teekay Corp Ltd (NYSE:TK) is set to announce its third-quarter earnings results on October 29 [6] - The stock has increased by around 13% over the past month, closing at $9.37 with a 52-week high of $9.47 [6] - Teekay's RSI value is reported at 71.1, indicating it is nearing overbought territory [6]

Core Insights - Nabors Industries (NBR) reported a quarterly loss of $3.67 per share, which was worse than the Zacks Consensus Estimate of a loss of $2.37, and compared to a loss of $3.35 per share a year ago, indicating a significant earnings surprise of -54.85% [1] - The company generated revenues of $818.19 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 2.79%, but showing an increase from $731.8 million in the same quarter last year [2] - Nabors shares have declined approximately 17.4% year-to-date, contrasting with the S&P 500's gain of 16.9% [3] Earnings Outlook - The future performance of Nabors' stock will largely depend on management's commentary during the earnings call and the company's earnings outlook, which includes current consensus earnings expectations for upcoming quarters [4][6] - The current consensus EPS estimate for the next quarter is -$2.20 on revenues of $824.06 million, and for the current fiscal year, it is -$5.09 on revenues of $3.24 billion [7] Industry Context - The Oil and Gas - Drilling industry, to which Nabors belongs, is currently ranked in the bottom 7% of over 250 Zacks industries, indicating a challenging environment that could impact stock performance [8] - Another company in the same industry, Seadrill (SDRL), is expected to report a quarterly earnings decline of 46.9% year-over-year, with revenues projected to decrease by 7.1% from the previous year [9][10]

Financial Performance - Nabors reported third quarter 2025 operating revenues of $818 million, a decrease from $833 million in the second quarter[2] - Net income attributable to shareholders was $274 million, compared to a net loss of $31 million in the previous quarter, resulting in earnings per diluted share of $16.85[2] - Adjusted EBITDA for the third quarter was $236 million, down from $248 million in the previous quarter[2] - Operating revenues for Q3 2025 reached $818,190, an increase of 11.8% compared to $731,805 in Q3 2024[30] - Net income attributable to Nabors for Q3 2025 was $274,198, a significant recovery from a net loss of $55,825 in Q3 2024[30] - Adjusted EBITDA for the nine months ended September 30, 2025, was $691,112, up from $660,790 for the same period in 2024, reflecting a growth of 4.5%[30] - For the three months ended September 30, 2025, the net income was $302,466, compared to a net loss of $33,087 for the same period in 2024[44] - The total adjusted EBITDA for the three months ended September 30, 2025, was $236,308, compared to $221,720 for the same period in 2024, reflecting an increase of approximately 6.5%[45] - The total adjusted operating income (loss) for the nine months ended September 30, 2025, was $201,066, compared to $183,730 for the same period in 2024, indicating a year-over-year improvement[45] Debt and Cash Flow - The sale of Quail Tools generated $625 million, with $375 million received in cash at closing, significantly reducing gross debt by approximately $330 million[4] - Adjusted free cash flow for the third quarter was $6 million, down from $41 million in the prior quarter, impacted by lower collections in Mexico[13] - Nabors expects fourth quarter 2025 adjusted free cash flow to be approximately $10 million[21] - The company reported a net debt of $1,919,905 as of September 30, 2025, down from $2,285,465 as of June 30, 2025[52] - Free cash flow for the three months ended September 30, 2025, was $5,613, compared to $9,961 in the previous quarter[54] - Adjusted free cash flow for the three months ended September 30, 2025, was $5,613, significantly lower than $40,596 in the previous quarter[54] Segment Performance - International Drilling adjusted EBITDA increased to $127.6 million, up from $117.7 million in the second quarter, driven by a higher average rig count[9] - U.S. Drilling segment adjusted EBITDA decreased to $94.2 million from $101.8 million, attributed to lower rig count and daily margin in the Lower 48[10] - U.S. Drilling segment revenues for Q3 2025 were $249,836, a slight decrease from $254,773 in Q3 2024[34] - International Drilling segment revenues increased to $407,235 in Q3 2025, up from $368,594 in Q3 2024, representing a growth of 10.4%[34] - Adjusted operating income for the U.S. Drilling segment was $31,429, while the International Drilling segment reported $45,476 for the same period[45] - The adjusted operating income (loss) for the Rig Technologies segment was $49,982 for the three months ended September 30, 2025, highlighting its contribution to overall performance[45] Operational Metrics - The company anticipates a Lower 48 average rig count of 57-59 rigs and a daily adjusted gross margin of approximately $13,000 for the fourth quarter[17] - Average rigs working in U.S. Drilling decreased to 69.2 in Q3 2025 from 74.0 in Q3 2024[34] - Daily Rig Revenue for U.S. Drilling was $39,219 in Q3 2025, compared to $37,441 in Q3 2024, indicating a growth of 4.7%[34] - The adjusted gross margin for U.S. Drilling for the three months ended September 30, 2025, was $100,680, a decrease from $115,071 in the previous quarter[46] - The adjusted gross margin for International Drilling for the three months ended September 30, 2025, was $147,231, an increase from $133,192 in the previous quarter[46] Integration and Synergies - The integration of Parker Wellbore businesses is progressing, with adjusted EBITDA contribution increasing by over 70% sequentially, aiming for $40 million in synergies by 2025[4]

, /PRNewswire/ -- Nabors Industries Ltd. ("Nabors" or the "Company") (NYSE: NBR) today reported third quarter 2025 operating revenues of $818 million, compared to operating revenues of $833 million in the second quarter. Net income attributable to Nabors' shareholders for the quarter was $274 million, compared to a net loss of $31 million in the second quarter. This equates to earnings per diluted share of $16.85, compared to a loss per diluted share of $2.71 in the second quarter. The third quarter includ ...

Core Insights - Nabors Industries Ltd. (NBR) is expected to report third-quarter 2025 earnings on October 28, with revenue estimates at $840.54 million and a projected loss of $2.37 per share [1][8] Financial Performance - In the last reported quarter, NBR's loss per share was $2.71, exceeding consensus estimates of a loss of $2.05, primarily due to lower adjusted operating income and increased costs [2] - Operating revenues for the last quarter were $832.8 million, slightly above the Zacks Consensus Estimate of $831 million, driven by stronger contributions from U.S. Drilling and Rig Technologies segments [2] Earnings Surprise History - NBR has missed the Zacks Consensus Estimate in each of the last four quarters, with an average negative surprise of 142.13% [3] - The consensus estimate for third-quarter 2025 earnings has seen a downward revision recently, indicating a year-over-year bottom-line increase of 29.25% and a revenue increase of 14.86% from the previous year [3] Revenue Drivers - NBR's revenues are influenced by demand for oil and gas services, which is affected by oil and gas prices, exploration and production activity, competition, and economic conditions [4] - The anticipated revenue for the upcoming quarter is $840.54 million, up from $743.3 million in the same quarter last year, attributed to higher contributions from International Drilling and Drilling Solutions and Rig Technologies segments [5] Cost Considerations - Direct costs are expected to rise to $466.3 million in the third quarter, an increase of $34.6 million from the previous year, while general and administrative expenses are projected to reach $74.4 million [7] - Interest expenses are also expected to increase from $159.2 million to $176.7 million during the same period [7] Earnings Prediction - The model predicts an earnings beat for NBR, supported by a positive Earnings ESP of +2.32% and a Zacks Rank of 3 (Hold) [9][10]

Market Overview - The market recovery that began in early April continued throughout the third quarter, with small and micro-cap value stocks posting their strongest quarterly returns since Q4 2023 [2] - Small caps resumed upward momentum after a four-year pause, reaching new highs and breaking the price level peak of 2021, indicating the early stages of a multi-year outperformance cycle for low valuation equities and smaller market caps [2] Technology Sector Insights - The Technology sector's weighting in the S&P 500 increased to 34.8%, significantly above its earnings contribution, indicating crowded ownership and market valuation expansion [3][6] - The Technology sector is nearing its all-time high weighting of 34.9% from March 2000, with forward price-to-earnings multiples above 30x, compared to the 20-year historical average of 18.3x [6][7] - The price-to-sales multiple for the Technology sector is approaching 10x revenue, with the "Magnificent 7" companies nearing 13x, highlighting elevated valuations [8] Valuation Discrepancies - There are significant valuation spreads between low valuation equities and longer duration/technology equities, with Deep Value Select strategy's valuation multiples at over a 70% discount to the S&P 500 Index [10][12] - The small cap sector is emerging from a multi-year earnings recession, with expected earnings growth in 2026 anticipated to outpace larger companies [12] Performance of Deep Value Strategy - The Deep Value Select strategy achieved a quarterly return of +26.50%, outperforming the S&P 1500 Value Index and S&P 600 Value Index [14] - Year-to-date, the Deep Value Select strategy net returns are +9.20%, slightly behind the S&P 1500 Value Index [14] - Ten of the twelve holdings in the strategy delivered positive double-digit returns, with Nabors Industries being the largest contributor, up 46% [16] Company-Specific Highlights - Nabors Industries is undergoing a multi-year transformation focused on technology, with over 450 patents and a strong balance sheet following the sale of its Quail Tools business for $600 million [16][19] - Bread Financial, despite a 2% decline in market share price, has improved its capital ratios and reduced debt significantly, positioning itself for long-term financial targets [20]

Core Insights - Nabors Industries Ltd. (NYSE:NBR) experienced a significant share price decline of 13.53% from October 3 to October 10, 2025, making it one of the worst-performing energy stocks during that week [1][2]. Group 1: Market Performance - The decline in Nabors Industries' stock price was attributed to escalating trade tensions between China and the United States, which also contributed to a drop in crude oil prices, with WTI oil falling below $60 per barrel for the first time since May [3]. - Nabors Industries was identified as one of the energy stocks that suffered heavily due to these market conditions [3]. Group 2: Financial Developments - On a positive note, Nabors Industries announced the receipt of full prepayment of a $250 million seller financing note from Superior Energy Services, related to the sale of Quail Tools LLC in August 2025 [4]. - The proceeds from this prepayment will be utilized for debt reduction, specifically targeting outstanding notes that are set to mature in 2028 [4].

Nabors Industries (NYSE: NBR) is a leading provider of advanced technology for the energy industry. With presence in more than 20 countries, Nabors has established a global network of people, technology and equipment to deploy solutions that deliver safe, efficient and responsible energy production. By leveraging its core competencies, particularly in drilling, engineering, automation, data science and manufacturing, Nabors aims to innovate the future of energy and enable the transition to a lower-carbon wo ...