Core Viewpoint - NOV Inc. reported a decline in revenues and net income for the second quarter of 2025, primarily due to previous year's gains from business sales and current market challenges affecting customer orders and margins [3][4][6]. Financial Performance - Revenues for Q2 2025 were $2.19 billion, a decrease of 1% year-over-year, but up 4% sequentially [3][9]. - Net income fell 52% to $108 million, or $0.29 per share, with operating profit down 54% to $143 million, representing 6.5% of sales [3][9]. - Adjusted EBITDA decreased 10% year-over-year to $252 million, or 11.5% of sales [3][9]. Segment Performance - **Energy Products and Services**: Generated revenues of $1.03 billion, down 2% from the previous year, with operating profit decreasing to $83 million (8.1% of sales) [7]. - **Energy Equipment**: Revenues remained flat at $1.21 billion, but operating profit decreased significantly due to prior year gains, while adjusted EBITDA increased to $158 million (13.1% of sales) [8]. Market Conditions - The company faced macroeconomic uncertainties, including OPEC+ production changes and geopolitical conflicts, leading to cautious customer behavior and deferred orders [4][5]. - North American customers reduced oil-directed drilling, partially offset by slight increases in gas drilling, while offshore activity remained strong despite project delays [5]. Future Outlook - The company anticipates continued lower industry activity levels through the second half of 2025, with expectations for offshore activity growth resuming in 2026 [6]. - Long-term demand for secure and cost-effective energy sources is expected to drive investment in core markets [6]. Capital Management - NOV returned $176 million to shareholders through share repurchases and dividends during the quarter [12]. - The company repurchased approximately 5.5 million shares for $69 million [12]. Order and Backlog - New orders totaled $420 million, a decrease of $557 million compared to the same quarter in 2024, with a book-to-bill ratio of 66% [10]. - As of June 30, 2025, the backlog for capital equipment orders was $4.30 billion, down $31 million from the previous year [10].

Core Viewpoint - NOV Inc. is expected to report second-quarter 2025 results on July 28, 2025, with earnings estimated at 30 cents per share and revenues at $2.1 billion, reflecting a year-over-year decline in both metrics [1][9]. Group 1: Recent Performance - In the last reported quarter, NOV missed the consensus earnings estimate, reporting adjusted earnings per share of 19 cents against an expected 25 cents, while revenues were $2.1 billion, a slight increase of 0.2% from the consensus [2]. - Over the trailing four quarters, NOV has beaten the Zacks Consensus Estimate twice and missed twice, with an average surprise of 12.6% [3]. Group 2: Revenue and Cost Expectations - The Zacks Consensus Estimate predicts a revenue decline for the second quarter, projecting revenues to decrease from $2.2 billion in the previous year to $2.1 billion [5][9]. - The Energy Products and Services segment is expected to generate revenues of $966 million, down from $1,050 million in the year-ago period, while the cost of goods sold is projected to rise to $1,674.8 million, indicating a 3% increase from the previous year [5][9]. Group 3: Segment Performance - Revenues from the Energy Equipment segment are anticipated to reach $1,216.6 million, an increase from $1,204 million in the year-ago period, with a strong backlog expected to rise by 13.1% year-over-year [6]. Group 4: Earnings Prediction Model - The Zacks model does not predict an earnings beat for NOV this quarter, as the Earnings ESP is -5.38%, and the company currently holds a Zacks Rank of 5 (Strong Sell) [7][8].

Core Viewpoint - Nov Inc. (NOV) is expected to report a year-over-year decline in earnings due to lower revenues for the quarter ended June 2025, with the consensus outlook indicating a significant earnings drop [1][3]. Earnings Expectations - The consensus EPS estimate for Nov Inc. is $0.30 per share, reflecting a year-over-year decrease of 47.4% [3]. - Revenues are projected to be $2.15 billion, which is a 3% decline from the same quarter last year [3]. Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised down by 2.6%, indicating a bearish sentiment among analysts regarding the company's earnings prospects [4]. - The Most Accurate Estimate for Nov Inc. is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -5.38% [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive or negative reading indicates the likely deviation of actual earnings from the consensus estimate, with a positive reading being a strong predictor of an earnings beat [9][10]. - Nov Inc. currently holds a Zacks Rank of 4 (Sell), complicating the prediction of an earnings beat [12]. Historical Performance - In the last reported quarter, Nov Inc. was expected to post earnings of $0.25 per share but only achieved $0.19, resulting in a surprise of -24.00% [13]. - Over the past four quarters, Nov Inc. has beaten consensus EPS estimates two times [14]. Industry Comparison - Solaris Energy Infrastructure, Inc. (SEI), another player in the oil and gas industry, is expected to report earnings of $0.15 per share for the same quarter, indicating a year-over-year increase of 15.4% [18]. - SEI's revenues are anticipated to be $123.23 million, up 66.8% from the previous year, although its consensus EPS estimate has been revised down by 10% in the last 30 days [19].

Group 1 - NOV Inc. holds a unique position in the oil industry with a balanced revenue-generating portfolio based on proprietary technologies [1] - The company's flexibility allows it to serve every segment and player in the oil sector [1]

Company Announcement - NOV Inc. will hold a conference call to discuss its second quarter 2025 results on July 29, 2025, at 10 a.m. Central Time [1] - A press release with the company's results will be issued after the market closes on July 28, 2025 [1] - The conference call will be webcast live on the company's investor relations website [1] Company Overview - NOV delivers technology-driven solutions to empower the global energy industry [2] - The company has over 150 years of experience in pioneering innovations that enable safe and abundant energy production while minimizing environmental impact [2] - NOV's expertise and technology are essential for improving oilfield operations and advancing the energy transition towards sustainability [2]

Core Insights - NOV Inc. has experienced a 24% decline in stock price over the past year, raising concerns among investors about its future performance [1][2] Financial Performance - In Q1 2025, NOV reported adjusted earnings of 19 cents per share, missing the Zacks Consensus Estimate of 25 cents, primarily due to margin challenges in the Energy Equipment division [3] - The company's net income for Q1 2025 was $73 million, a 39% decrease from $119 million in Q1 2024, attributed to lower equity income, unfavorable tax adjustments, and higher corporate costs [4] Risks and Challenges - Macroeconomic uncertainties, including trade wars and OPEC's decision to increase oil supply, are expected to negatively impact oilfield activity, particularly in North America, Mexico, and Saudi Arabia [5] - NOV anticipates $8-$10 million in unavoidable tariff expenses in Q2 2025, increasing to $15 million per quarter thereafter, which could erode margins despite mitigation efforts [6] - The Energy Products and Services segment saw a 2% revenue decline year over year, with EBITDA dropping by $29 million, indicating ongoing challenges in demand for drilling-related equipment [7] - NOV's exposure to North America's market volatility is significant, with 40% of revenues tied to this region, making it vulnerable to lower commodity prices and E&P spending cuts [8] Backlog and Order Trends - The Energy Equipment backlog grew 12% year over year to $4.41 billion, but management warned of potential delays in project awards due to macroeconomic uncertainty [9] - The book-to-bill ratio of 80 in Q1 suggests slowing order momentum, indicating potential future revenue challenges [10] Cost Pressures - Unallocated corporate costs rose significantly in Q1, contributing to the earnings miss, with expectations for these costs to remain elevated at $45-$55 million in Q2 [11] - Although Q1 free cash flow was positive at $51 million, it was below the $426 million returned to shareholders over the past 12 months, raising concerns about future cash-flow sustainability [12] Market Performance - NOV's stock has underperformed compared to the Zacks Oil and Energy sector and its peers, with a 24.4% decline over the past 12 months, while competitors like Kodiak Gas Services and Natural Gas Services Group saw gains of 35.6% and 43.6%, respectively [14]

Core Viewpoint - Nov Inc. has experienced a 2.5% increase in share price over the past month, underperforming the S&P 500, raising questions about the sustainability of this trend leading up to the next earnings release [1] Estimates Movement - Estimates for Nov Inc. have trended downward over the past month, with a consensus estimate shift of -5.21% [2] VGM Scores - Nov Inc. currently holds an average Growth Score of C, a Momentum Score of F, and a Value Score of B, resulting in an aggregate VGM Score of C, indicating a mixed performance across different investment strategies [3] Outlook - The downward trend in estimates suggests a negative outlook for Nov Inc., reflected in its Zacks Rank of 5 (Strong Sell), indicating expectations of below-average returns in the coming months [4]

Financial Data and Key Metrics Changes - For Q1 2025, NOV reported revenues of $2.1 billion, a 2% decrease year over year, with net income of $73 million or $0.19 per fully diluted share [4][14] - Adjusted EBITDA was $252 million, representing a 5% increase, with EBITDA margins expanding by 80 basis points to 12% [5][14] - The company generated $135 million in cash from operations and $51 million in free cash flow, with a cash balance increase of $689 million over the last twelve months [15][16] Business Line Data and Key Metrics Changes - The Energy Products and Services segment generated revenue of $992 million, a 2% decrease year over year, with EBITDA declining to $145 million or 14.6% of sales [16][18] - The Energy Equipment segment reported revenue of $1.15 billion, down 3% from the previous year, but EBITDA increased by $46 million to $165 million, resulting in a margin of 14.4% [21][24] - Capital equipment sales accounted for 57% of the Energy Equipment segment's revenues, with bookings for Q1 at $437 million, a 12% year-over-year increase [22][24] Market Data and Key Metrics Changes - International revenues decreased from 65% to 61% of total revenues, attributed to seasonal factors, but the international market is expected to grow as a share of the business [60] - North American activity is anticipated to decline in the double-digit range, while international markets, particularly in unconventional resources, are expected to perform better [60][68] Company Strategy and Development Direction - The company is focusing on operational efficiencies and careful cost management in light of emerging macroeconomic headwinds [6][9] - NOV is well-positioned for long-term growth, emphasizing the importance of deepwater and international shale production as future sources of incremental oil supply [11][41] - The company is actively diversifying supply chains to mitigate tariff impacts and is leveraging its U.S. manufacturing footprint to enhance competitiveness [30][39] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the geopolitical and macroeconomic environment, anticipating challenges in the second half of 2025 [29][41] - The outlook for offshore production remains robust, with expectations for more awards for FPSOs in 2025 compared to previous years [24][50] - Management highlighted the importance of technological advancements in improving drilling and production efficiencies, particularly in deepwater projects [45][46] Other Important Information - The company plans to pay a supplemental dividend of around $80 million, subject to Board approval, to align returns to 50% of excess free cash flow for 2024 [15] - NOV's backlog of capital equipment and projects has grown steadily, with margins improving significantly over the past four years [8][9] Q&A Session Summary Question: Guidance on 2025 margins relative to 2024 - Management indicated that EBITDA margins are expected to be flattish from the first half to the second half of 2025, with modest growth anticipated [56] Question: International revenues decrease - Management acknowledged a seasonal pullback but expects international revenues to grow as a share of the business going forward [60] Question: Capital equipment order activity - Management noted strong confidence in the offshore deepwater market, with potential FPSO awards in 2025, despite some macroeconomic uncertainties [66][68] Question: Tariff mitigation efforts and CapEx - Most mitigation plans do not require significant CapEx, focusing instead on operational efficiency and vendor collaboration [80] Question: M&A opportunities in the current economic environment - Management remains open to opportunistic M&A but emphasized the need for deals to make industrial sense and provide high returns [86][89]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-12317 NOV INC. (Exact name of registrant as specified in its charter) Washington, D.C. 20549 FORM 10-Q Delaware 76-0475815 (State or other jurisdiction of incorporation or organization) (IRS Employ ...

Financial Data and Key Metrics Changes - For Q1 2025, NOV reported revenues of $2.1 billion, a net income of $73 million, and an EBITDA of $252 million, representing a margin increase of 80 basis points year on year [5][6][15] - Consolidated revenue decreased by 2% year on year, while adjusted EBITDA increased by 5%, marking the fourteenth consecutive quarter of year-over-year EBITDA margin improvement [15][18] - Operating cash flow was strong, generating $135 million in cash from operations and $51 million in free cash flow after capital expenditures of $84 million [16][18] Business Line Data and Key Metrics Changes - The Energy Products and Services segment generated revenue of $992 million, a 2% decrease year on year, with EBITDA declining to $145 million or 14.6% of sales [18][19] - The Energy Equipment segment reported revenue of $1.15 billion, down 3% year on year, but EBITDA increased by $46 million to $165 million, resulting in a margin of 14.4% [22][24] - Capital equipment sales accounted for 57% of the Energy Equipment segment's revenues, with bookings for Q1 at $437 million, a 12% year-over-year increase [23][24] Market Data and Key Metrics Changes - International revenues decreased from 65% to 61% of total revenues, attributed to seasonal pullbacks, but the international market is expected to grow as a share of the business going forward [59][60] - North American activity is anticipated to decline in the double-digit range, while international markets, particularly in unconventional resources, are expected to perform better [60][70] Company Strategy and Development Direction - The company is focusing on operational efficiencies and cost management in light of emerging macroeconomic headwinds, including a potential trade war and lower oilfield activity [8][10] - NOV is well-positioned for long-term growth, emphasizing the importance of deepwater and international shale production as future sources of incremental oil supply [12][41] - The company is actively working to mitigate tariff impacts by diversifying supply chains and leveraging its U.S. manufacturing footprint [29][30] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the geopolitical and macroeconomic environment, indicating that while there are potential upsides, the outlook remains skewed to the downside [29][41] - The company expects modest growth in Q2 2025, with consolidated revenue anticipated to decline by 1% to 4% compared to the same period in 2024 [28][60] - Management highlighted the resilience of international and offshore customers, who continue to press ahead with strategic plans despite market uncertainties [9][10] Other Important Information - The backlog of capital equipment and projects has grown steadily over the past four years, with margins improving significantly [10][22] - The company plans to pay a supplemental dividend of around $80 million, subject to board approval, to align returns to 50% of excess free cash flow for 2024 [17][18] Q&A Session Summary Question: Guidance on 2025 margins relative to 2024 - Management indicated that EBITDA margins are expected to be flattish from the first half to the second half of 2025, with modest growth anticipated [56][58] Question: International revenues and future growth - Management confirmed that international revenues are expected to grow as a share of the business, driven by resilience in unconventional shale and deepwater offshore activity [59][60] Question: Capital equipment order activity - Management noted that while there is uncertainty, confidence in the deepwater offshore market remains strong, with potential FPSO awards expected in 2025 [68][69] Question: Exposure to the flexibles market and Petrobras agreement - Management expressed optimism about the flexibles market and highlighted a new agreement with Petrobras to address stress corrosion issues, which could significantly benefit the business [74][75] Question: Tariff mitigation efforts and CapEx - Management clarified that most tariff mitigation efforts do not require significant CapEx, focusing instead on operational efficiency improvements [80][81] Question: M&A opportunities in the current economic environment - Management stated that while there may be opportunities due to the economic soft patch, they remain cautious about pursuing M&A unless it aligns with their strategic goals [88][90]