Key Takeaways Par Pacific earnings are projected to climb 516.2% in 2025, with strong growth momentum.Oceaneering earnings are expected to rise 57.9% in 2025 to reach $1.80 per share.TechnipFMC earnings are set to advance 20% this year, reaching $2.18 per share.Earnings per share (‘EPS’) growth is a key driver of stock performance, and in the Oil – Energy space, it often signals real strength. While the sector can be volatile, consistent EPS growth stands out. Three names worth noting — Par Pacific Holdings ...

Core Viewpoint - Oceaneering International reported strong Q2 earnings, surpassing estimates, but shares have underperformed the S&P 500 in the past month, raising questions about future performance leading up to the next earnings release [1][2]. Financial Performance - Adjusted profit for Q2 2025 was 49 cents per share, exceeding the Zacks Consensus Estimate of 42 cents and up from 28 cents in the same quarter last year [2]. - Total revenues reached $698.2 million, aligning with estimates and reflecting a 4.4% increase from $668.8 million in the previous year [2]. Segment Performance - **Subsea Robotics**: Revenues were $218.8 million, slightly up from $215 million year-over-year, but missed the estimate of $242.8 million. Operating income rose to $64.5 million from $61.8 million, beating the estimate of $63.1 million, with an EBITDA margin of 35% [4]. - **Manufactured Products**: Revenues increased to $145.1 million from $139.3 million, surpassing the estimate of $139.4 million. Operating profit grew to $18.8 million from $14.4 million, exceeding the estimate of $15.3 million [5]. - **Offshore Projects Group**: Revenues rose 3.6% to $149.3 million from $144.1 million, but fell short of the estimate of $144.6 million. Operating income improved to $21.7 million from $13.2 million, beating the estimate of $21.4 million [6][7]. - **Integrity Management & Digital Solutions**: Revenues increased to $75.4 million from $73.5 million, exceeding the estimate of $73.8 million. Operating income rose to $4.6 million from $3.5 million, beating the projection of $4.4 million [8]. - **Aerospace and Defense Technologies**: Revenues grew to $109.6 million from $97 million, surpassing the estimate of $98 million. Operating income increased to $16.3 million from $7.2 million, beating the estimate of $10 million [9][10]. Capital Expenditure & Balance Sheet - Capital expenditure for Q2 totaled $32.8 million. As of June 30, 2025, cash and cash equivalents were $434 million, with long-term debt at approximately $484.6 million, resulting in a debt-to-total capital ratio of 36.4% [11]. Analyst Sentiment - No earnings estimate revisions were made by analysts in the last two months, indicating a period of stability in expectations [12]. Investment Scores - Oceaneering International holds a Growth Score of A and a Value Score of A, placing it in the top 20% for the value investment strategy, while it lags in Momentum Score with a D. The aggregate VGM Score is A [13]. Outlook - The company has a Zacks Rank of 3 (Hold), suggesting an expectation of an in-line return from the stock in the upcoming months [14].

Core Insights - Oceaneering International, Inc. (OII) has secured an $86 million indefinite-delivery/indefinite-quantity (IDIQ) contract from the Naval Supply Systems Command Weapon Systems Support (NAVSUP WSS) for repairing valves and actuators on Virginia-class and Los Angeles-class submarines [1][2][21] Contract Details - The contract has a base value of up to $86 million for an initial two-year period, with an option for a three-year extension [2] - Work will be conducted at Oceaneering's specialized repair facilities, which are equipped with advanced engineering infrastructure and experienced personnel [2][8] Role in Submarine Support - Oceaneering is one of three selected suppliers responsible for restoring key mechanical components that ensure submarine reliability and mission success [3][9] - The contract reinforces Oceaneering's position as a long-term partner in sustaining the Navy's advanced undersea platforms [3] Corporate Component Repair Program (CCRP) - The CCRP standardizes the repair and overhaul process for high-value submarine parts, improving turnaround times and controlling maintenance costs [4] - Oceaneering has over eight years of service under the CCRP, consistently delivering high-precision repairs that meet Navy standards [5] Technical Standards and Repair Operations - Repairing valves and actuators requires exacting technical standards, including disassembly, non-destructive testing, and final performance validation [6][7] - Oceaneering's facilities are optimized for submarine systems service, featuring specialized clean rooms and high-tolerance machining environments [8] Funding and Execution - The contract is funded through Navy Working Capital Funds, ensuring uninterrupted program continuity and rapid mobilization [11][12] - Immediate execution of component servicing is guaranteed upon award, supporting maintenance cycles and mission readiness [12] Strategic Importance - The contract supports the Navy's objective to reduce life cycle costs and minimize equipment downtime, which is vital for maintaining U.S. naval superiority [15] - Oceaneering's advanced repair capabilities enhance operational excellence and ensure high-quality outcomes [16][17] Future Readiness - The IDIQ contract aligns with Oceaneering's long-term vision of providing superior lifecycle support to the U.S. military [18] - Investments in workforce training and advanced materials testing are expected to elevate repair effectiveness and reduce lead times [18][19]

Core Insights - Oceaneering International, Inc. (OII) reported an adjusted profit of 49 cents per share for Q2 2025, exceeding the Zacks Consensus Estimate of 42 cents and up from 28 cents in the same quarter last year, driven by strong operating income across its segments [1][9] - Total revenues reached $698.2 million, aligning with the Zacks Consensus Estimate and reflecting a 4.4% increase from $668.8 million in the prior year, attributed to robust revenue contributions from various segments [2][9] - Adjusted EBITDA for the quarter was $103.3 million, marking a 20.3% year-over-year increase, indicating strong operational execution [2][9] Revenue Breakdown by Segment - **Subsea Robotics**: Revenues were $218.8 million, slightly up from $215 million year-over-year, but missed the estimate of $242.8 million. Operating income increased to $64.5 million from $61.8 million, surpassing the estimate of $63.1 million, with an EBITDA margin of 35% and ROV fleet utilization at 67% [4] - **Manufactured Products**: This segment reported revenues of $145.1 million, up from $139.3 million a year ago, exceeding the estimate of $139.4 million. Operating profit rose to $18.8 million from $14.4 million, also beating the estimate of $15.3 million [5] - **Offshore Projects Group**: Revenues increased by 3.6% to $149.3 million from $144.1 million year-over-year, but fell short of the estimate of $144.6 million. Operating income improved to $21.7 million from $13.2 million, exceeding the estimate of $21.4 million [6][7] - **Integrity Management & Digital Solutions**: Revenues were $75.4 million, up from $73.5 million year-over-year, beating the estimate of $73.8 million [8] - **Aerospace and Defense Technologies**: Revenues totaled $109.6 million, an increase from $97 million in the prior year, surpassing the estimate of $98 million. Operating income rose to $16.3 million from $7.2 million, exceeding the estimate of $10 million [10][11] Financial Position - As of June 30, 2025, OII had cash and cash equivalents of $434 million and long-term debt of approximately $484.6 million, resulting in a debt-to-total capital ratio of 36.4% [12] Future Outlook - For Q3 2025, OII anticipates an increase in consolidated revenues compared to Q3 2024, with EBITDA expected to range between $100 million and $110 million. Growth is expected in Subsea Robotics and Manufactured Products, while Offshore Projects Group may see a decline in operating profitability [13][14] - For the full year 2025, consolidated revenues are projected to grow at a mid-single-digit percentage rate, with adjusted EBITDA anticipated to be between $390 million and $420 million [15]

[PART I – FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company's H1 2025 financial statements reflect revenue growth, a doubling of net income to $104.8 million, and increased equity to $848.1 million [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets slightly decreased to $2.33 billion, while total liabilities decreased to $1.48 billion, and total equity increased to $848.1 million Consolidated Balance Sheet Highlights (in thousands) | Account | Jun 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $1,392,707 | $1,387,896 | | Cash and cash equivalents | $434,048 | $497,516 | | **Total Assets** | **$2,327,582** | **$2,336,347** | | **Total Current Liabilities** | $696,863 | $796,938 | | Long-term debt | $484,648 | $482,009 | | **Total Liabilities** | $1,479,458 | $1,616,025 | | **Total Equity** | **$848,124** | **$720,322** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Q2 2025 revenue increased to $698.2 million, with net income rising to $54.4 million, and H1 2025 net income more than doubled to $104.8 million Key Operational Metrics (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $698,161 | $668,808 | $1,372,684 | $1,267,900 | | Gross margin | $148,427 | $120,211 | $283,438 | $212,595 | | Income from operations | $79,189 | $60,364 | $152,661 | $97,057 | | **Net Income** | **$54,442** | **$34,997** | **$104,819** | **$50,132** | | Diluted EPS | $0.54 | $0.34 | $1.03 | $0.49 | [Consolidated Statements of Comprehensive Income (Loss)](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Comprehensive income significantly increased to $75.3 million in Q2 2025 and $146.0 million for H1 2025, driven by higher net income and positive currency adjustments Comprehensive Income (Loss) Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $54,442 | $34,997 | $104,819 | $50,132 | | Foreign currency translation adjustments | $20,866 | $(10,525) | $41,202 | $(26,488) | | **Comprehensive income (loss)** | **$75,308** | **$24,472** | **$146,021** | **$23,644** | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operations improved to $3.5 million for H1 2025, while investing and financing activities used $52.0 million and $25.6 million respectively Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Provided by (Used in) Operating Activities | $(3,531) | $(17,094) | | Net Cash Provided by (Used in) Investing Activities | $(52,006) | $(43,211) | | Net Cash Provided by (Used in) Financing Activities | $(25,600) | $(7,002) | | **Net Increase (Decrease) in Cash** | **$(63,468)** | **$(78,693)** | | Cash and Cash Equivalents—End of Period | $434,048 | $382,873 | [Consolidated Statements of Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Equity) Total equity increased to $848.1 million by June 30, 2025, driven by net income and positive foreign currency translation adjustments - Total equity grew by **$127.8 million** in the first six months of 2025, reaching **$848.1 million**[22](index=22&type=chunk) - Key drivers for the equity increase were net income of **$104.8 million** (across two quarters) and positive other comprehensive income of **$41.2 million**[22](index=22&type=chunk) - The company purchased **$20.1 million** of treasury stock during the first six months of 2025[22](index=22&type=chunk)[19](index=19&type=chunk) [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes cover accounting policies, revenue recognition, segment performance, debt, and a subsequent event regarding new tax legislation - The company recorded inventory write-downs of **$15.1 million** in the first six months of 2025, primarily related to its theme park ride business and obsolete inventory[36](index=36&type=chunk) - Projected losses of **$4.6 million** were recognized in the first six months of 2025 for six business contracts in the Manufactured Products segment[51](index=51&type=chunk) - As of June 30, 2025, the company had **$414 million** in remaining performance obligations, with **$306 million** expected to be recognized as revenue over the next 12 months[70](index=70&type=chunk) - On July 4, 2025, the 'One Big Beautiful Bill Act' (OBBBA) was signed into law, with the company currently assessing its financial impact[117](index=117&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses improved H1 2025 operating results driven by new contracts and strong segment performance, maintaining adequate liquidity with $434 million in cash - Diluted EPS for the first six months of 2025 was **$1.03**, more than double the **$0.49** from the same period in 2024[124](index=124&type=chunk) - The cash balance decreased by **$63 million** in the first half of 2025 due to operating activities, capital expenditures (**$56 million**), and share repurchases (**$20 million**)[125](index=125&type=chunk) - The company's liquidity is considered strong, with **$434 million** in cash and **$215 million** of unused commitments under its revolving credit facility as of June 30, 2025[146](index=146&type=chunk)[147](index=147&type=chunk) - The company repurchased approximately **1.0 million shares** for **$20 million** in the first six months of 2025[155](index=155&type=chunk)[158](index=158&type=chunk) [Results of Operations](index=26&type=section&id=Results%20of%20Operations) Consolidated revenue increased to $698.2 million in Q2 2025, with H1 2025 operating income rising 57% to $152.7 million, driven by strong segment performance Segment Operating Income (Loss) Highlights (in thousands) | Segment | H1 2025 Operating Income | H1 2024 Operating Income | Change | | :--- | :--- | :--- | :--- | | Subsea Robotics | $124,137 | $105,987 | +17.1% | | Manufactured Products | $27,439 | $27,559 | -0.4% | | Offshore Projects Group | $57,329 | $14,092 | +306.8% | | Integrity Management & Digital Solutions | $8,109 | $7,088 | +14.4% | | Aerospace and Defense Technologies | $26,964 | $20,052 | +34.5% | - The Manufactured Products segment's H1 2025 operating results were negatively impacted by a **$13 million** inventory reserve related to its theme park ride business[133](index=133&type=chunk) - The Offshore Projects Group (OPG) segment's operating income increased significantly due to higher-margin international projects and improved vessel utilization[134](index=134&type=chunk) - Unallocated corporate operating expenses increased in H1 2025 to **$91.3 million** from **$77.7 million** YoY, primarily due to higher accruals for incentive-based compensation and IT costs[141](index=141&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $434 million in cash and $215 million available credit, expecting $115-120 million in 2025 capital expenditures Cash Flow Summary - Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(3,531) | $(17,094) | | Net Cash Used in Investing Activities | $(52,006) | $(43,211) | | Net Cash Used in Financing Activities | $(25,600) | $(7,002) | - The company expects to fund its 2025 capital expenditures of **$115 million** to **$120 million** using available cash[154](index=154&type=chunk) - The company's only major debt consists of **$500 million** in 6.000% Senior Notes, maturing in February 2028[156](index=156&type=chunk)[83](index=83&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages market risks from interest rate and foreign currency fluctuations, which are not considered material as of June 30, 2025 - The company does not use derivative instruments for speculative or trading purposes[162](index=162&type=chunk) - Foreign currency translation adjustments positively impacted equity by **$41 million** for H1 2025, reflecting a weakening U.S. dollar[163](index=163&type=chunk) - Foreign currency transaction gains of **$6.5 million** were recorded in other income for the first six months of 2025[164](index=164&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2025, with minor internal control modifications due to new software implementation - The principal executive and financial officers concluded that disclosure controls and procedures were effective as of June 30, 2025[166](index=166&type=chunk) - A new software application for the ADTech segment led to modifications in internal controls to enhance government contracting requirements[167](index=167&type=chunk) [PART II – OTHER INFORMATION](index=37&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ordinary course litigation, with management not expecting a material adverse effect on financial condition or results - Information regarding legal proceedings is incorporated by reference from Note 7—\"Commitments and Contingencies\"[170](index=170&type=chunk)[90](index=90&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 471,759 shares in Q2 2025 under its existing program, with 6.2 million shares remaining available for repurchase Share Repurchase Activity - Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | — | $— | | May 2025 | — | $— | | June 2025 | 471,759 | $21.42 | - The maximum number of shares that may yet be purchased under the plan is **6,223,660** as of the end of June 2025[171](index=171&type=chunk) [Item 5. Other Information](index=37&type=section&id=Item%205.%20Other%20Information) An executive officer adopted a Rule 10b5-1 trading plan for the sale of up to 65,690 shares, effective August 2025 through April 2026 - An executive officer adopted a Rule 10b5-1 trading plan for the potential sale of up to **65,690 shares**[172](index=172&type=chunk) [Item 6. Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This section indexes all exhibits filed with the Form 10-Q, including officer certifications and XBRL data files [Signatures](index=39&type=section&id=Signatures) The report was duly authorized and signed on July 24, 2025, by the principal executive and financial officers

Financial Data and Key Metrics Changes - The company reported a net income of $54.4 million, or $0.54 per share, for Q2 2025, with consolidated revenue increasing to $698 million, a 4% increase year-over-year [5][6] - Consolidated operating income rose by 31% to $79.2 million, and consolidated adjusted EBITDA grew by 20% to $103 million [6][20] - Free cash flow for the quarter was $46.9 million, with an ending cash position of $434 million and no borrowings under the secured revolving credit facility [6][7] Business Segment Performance - Subsea Robotics (SSR) saw operating income improve by 4% to $64.5 million, with revenue increasing approximately 2% and an EBITDA margin of 35% [8][9] - Manufactured Products generated operating income of $18.8 million, marking a 31% rise, with revenue growing by 4% to $145 million [10][11] - Offshore Projects Group (OPG) reported operating income of $21.7 million, with revenue increasing by 4% and operating income margin expanding to 15% [12][13] - Aerospace and Defense Technologies (AdTech) operating income increased by 125% to $16.3 million, with a 13% increase in revenue [15][17] Market Data and Key Metrics Changes - ROV revenue per day increased to $11,065, with fleet utilization at 67% [5][8] - The company maintained a 60% share of the contracted floating rig market with ROV contracts on 81 of the 136 floating rigs under contract [9] - The company anticipates continued tendering activity supportive of ROV utilization and pricing assumptions, particularly in decommissioning opportunities in Europe [9][10] Company Strategy and Industry Competition - The company remains positive about growth in both energy and aerospace and defense markets, with expectations for continued growth beyond 2025 [23] - The recent reconciliation bill is expected to positively impact all three AdTech business lines over the next five years, particularly in unmanned underwater vehicles [18][23] - The company is gearing up to increase capacity to serve the submarine maintenance and repair market due to anticipated funding increases [55] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to sustain market share and improve operational results across segments [21][22] - The outlook for Q3 2025 includes expected increases in consolidated revenue and EBITDA, with projections for SSR and AdTech showing significant growth [19][20] - Management noted that visibility into future contracts has improved, particularly with larger international contracts [49] Other Important Information - Unallocated expenses for the quarter were $46.7 million, slightly higher than guidance [19] - The company has secured order commitments totaling approximately $100 million in the first weeks of Q3 2025 [11][32] Q&A Session Summary Question: Impact of offshore rig white space on business - Management acknowledged some impact but noted that pricing improvements have offset concerns, with expectations for ROV utilization to reach 70% by year-end [26][27] Question: Orders in the manufactured product segment - Management indicated that orders are expected to be flat year-over-year, with positive signals for 2026 [30][32] Question: ROV utilization outlook - Management stated that the lower utilization outlook relates to both vessel and rig support, with increased clarity on plans for Q4 [39][40] Question: Free cash flow visibility - Management highlighted that cash flow typically rebounds in Q3 and Q4, with significant amounts sitting in receivables [42][44] Question: OPG business visibility - Management confirmed improved visibility due to securing larger contracts, which stabilizes the business [48][49] Question: Potential impact of the reconciliation bill - Management discussed the positive implications for OTEC and other business lines, particularly in defense and space sectors [50][55]

Financial Data and Key Metrics Changes - The company reported a net income of $54.4 million, or $0.54 per share, for Q2 2025, with consolidated revenue increasing to $698 million, a 4% increase year-over-year [7] - Consolidated operating income rose by 31% to $79.2 million, and consolidated adjusted EBITDA grew by 20% to $103 million [7] - Free cash flow for the quarter was $46.9 million, with an ending cash position of $434 million and no borrowings under the secured revolving credit facility [7] Business Segment Data and Key Metrics Changes - Subsea Robotics (SSR) saw operating income improve by 4% to $64.5 million, with revenue increasing approximately 2% and EBITDA margin expanding slightly to 35% [9] - Manufactured Products generated operating income of $18.8 million, marking a 31% rise over the previous year, with revenue growing by 4% to $145 million [11] - Offshore Projects Group (OPG) reported operating income of $21.7 million, with revenue increasing by 4% and operating income margin expanding to 15% [13] Market Data and Key Metrics Changes - ROV revenue per day increased to $11,065, with fleet utilization for the quarter at 67% [6][9] - The company maintained a 60% share of the contracted floating rig market with ROV contracts on 81 of the 136 floating rigs under contract [10] - The company anticipates continued tendering activity supportive of ROV utilization and pricing assumptions, particularly in decommissioning opportunities in Europe [10] Company Strategy and Development Direction - The company remains positive about growth in both energy and aerospace and defense markets, with expectations for continued growth beyond 2025 [23] - The company is focusing on integrating Global Design Innovation into its Integrity Management business and identifying pilot projects to demonstrate new capabilities [15] - The recent passage of the reconciliation bill is expected to positively impact all three AdTech business lines over the next five years [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of execution and resilience of the business, noting eight consecutive quarters of meeting or exceeding adjusted EBITDA guidance [4] - The company expects to see solid vessel utilization and activity levels for OPG based on current backlog and quotation activity [14] - Management indicated that while the macro environment is encouraging, they do not expect activity to reach the same level as Q4 2024 [15] Other Important Information - Unallocated expenses for the quarter were $46.7 million, slightly higher than guidance [19] - The company has secured order commitments totaling approximately $100 million in the first weeks of the quarter, supporting confidence in the second half forecast [12] Q&A Session Summary Question: Impact of offshore rig white space on business - Management acknowledged some impact but noted that pricing increases have offset concerns, with expectations for overall ROV utilization to reach 70% by year-end [27][28] Question: Orders in manufactured products segment - Management indicated that orders are expected to be more flattish year-over-year, with positive signals for subsea business and umbilicals [30][34] Question: ROV utilization outlook - Management stated that the lower utilization outlook relates to both vessel and rig support, with increased clarity on plans for the fourth quarter [40][41] Question: Free cash flow visibility - Management highlighted that cash generation typically rebounds in Q3 and Q4, with a good amount of cash sitting in receivables [43][44] Question: Visibility in OPG business - Management confirmed increased visibility due to securing larger international contracts, which provide a stable base for future work [48] Question: Impact of the reconciliation bill - Management discussed the positive effects on OTEC and other business lines, with expectations for increased funding and project activity in space and submarine maintenance [50][56]

Core Insights - Oceaneering International (OII) reported quarterly earnings of $0.49 per share, exceeding the Zacks Consensus Estimate of $0.42 per share, and showing an increase from $0.28 per share a year ago, resulting in an earnings surprise of +16.67% [1] - The company posted revenues of $698.16 million for the quarter ended June 2025, slightly missing the Zacks Consensus Estimate by 0.05%, but up from $668.81 million year-over-year [2] - Oceaneering International shares have declined approximately 19% since the beginning of the year, contrasting with the S&P 500's gain of 7.3% [3] Earnings Outlook - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is $0.42 on revenues of $681.84 million, and for the current fiscal year, it is $1.76 on revenues of $2.74 billion [7] Industry Context - The Oil and Gas - Field Services industry, to which Oceaneering International belongs, is currently ranked in the bottom 5% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [5]

[Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) This section provides a comprehensive overview of Oceaneering's financial results for Q2 2025, detailing overall performance and segment-specific contributions [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) Oceaneering reported strong Q2 2025 financial results, with revenue increasing 4% to $698 million and net income surging 56% Q2 2025 Financial Highlights | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :--- | :--- | :--- | :--- | | Revenue | $698M | $668.8M | +4% | | Operating Income | $79.2M | $60.4M | +31% | | Net Income | $54.4M | $35.0M | +56% | | Adjusted EBITDA | $103M | $85.9M | +20% | - The strong quarterly performance was driven by new contracts in Aerospace and Defense Technologies (ADTech), favorable service mix in Offshore Projects Group (OPG), conversion of high-margin backlog in Manufactured Products, and higher day rates for remotely operated vehicles (ROVs)[3](index=3&type=chunk) - The company generated **$77.2 million** in cash flow from operations and **$46.9 million** in free cash flow, ending the quarter with a cash position of **$434 million**[5](index=5&type=chunk) - During the quarter, **471,759 shares** were repurchased for approximately **$10.0 million**[5](index=5&type=chunk) [Second Quarter 2025 Segment Performance](index=1&type=section&id=Second%20Quarter%202025%20Segment%20Performance) All operating segments demonstrated year-over-year improvements in Q2 2025, with ADTech and OPG leading in operating income growth Q2 2025 Segment Performance | Segment | Revenue Growth (YoY) | Operating Income Growth (YoY) | Operating Margin Q2 2025 | | :--- | :--- | :--- | :--- | | Subsea Robotics (SSR) | +2% | +4% | 29% | | Manufactured Products | +4% | +31% | 13% | | Offshore Projects Group (OPG) | +4% | +64% | 15% | | Integrity Management & Digital Solutions (IMDS) | Flat | +34% | 6% | | Aerospace and Defense Technologies (ADTech) | +13% | +125% | 15% | - Subsea Robotics (SSR) EBITDA margin expanded to **35%** due to improved ROV revenue per day utilized, which increased to **$11,265**, despite a slight dip in fleet utilization to **67%**[6](index=6&type=chunk) - Manufactured Products backlog stood at **$516 million** as of June 30, 2025, with a book-to-bill ratio of **0.65** for the trailing 12 months[6](index=6&type=chunk) [Future Outlook and Guidance](index=1&type=section&id=Future%20Outlook%20and%20Guidance) This section outlines Oceaneering's financial projections and operational expectations for the third quarter and full year 2025 [Third Quarter 2025 Guidance](index=1&type=section&id=Third%20Quarter%202025%20Guidance) Oceaneering forecasts Q3 2025 consolidated EBITDA between $100 million and $110 million, with most segments anticipating improved profitability - Consolidated EBITDA for Q3 2025 is forecasted to be in the range of **$100 million to $110 million**[4](index=4&type=chunk) - Year-over-year expectations for Q3 2025 by segment: - **SSR:** Revenue and operating profitability to increase - **Manufactured Products:** Significant increase in operating profitability on higher revenue - **OPG:** Operating profitability to decrease on relatively flat revenue - **IMDS:** Significant increase in operating profitability on relatively flat revenue - **ADTech:** Significant increase in revenue and operating profitability[4](index=4&type=chunk)[10](index=10&type=chunk) - Unallocated Expenses for Q3 2025 are expected to be in the **$45 million to $50 million** range[10](index=10&type=chunk) [Updated Full-Year 2025 Guidance](index=2&type=section&id=Updated%20Full-Year%202025%20Guidance) Oceaneering updated full-year 2025 guidance, projecting consolidated adjusted EBITDA between $390 million and $420 million and mid-single digit revenue growth Full-Year 2025 Guidance | Metric | Full-Year 2025 Guidance | | :--- | :--- | | Consolidated Revenue Growth | Mid-single digit % range | | Consolidated Adjusted EBITDA | $390M - $420M | | SSR Revenue Growth | Mid-single digit % range | | ROV Fleet Utilization | Mid- to high-60% range | | IMDS Operating Income Margin | Mid-single digit % range | - The guidance for SSR revenue growth was revised downward due to lower than expected contributions from the Survey business[10](index=10&type=chunk) [Financial Statements](index=4&type=section&id=Financial%20Statements) This section presents Oceaneering's condensed consolidated balance sheets, statements of operations, and selected cash flow information [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $2.33 billion, cash decreased to $434 million, and total equity increased to $848 million Condensed Consolidated Balance Sheets | Balance Sheet Item | Jun 30, 2025 (in thousands) | Dec 31, 2024 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $434,048 | $497,516 | | Total Assets | $2,327,582 | $2,336,347 | | Total Liabilities | $1,479,458 | $1,616,025 | | Total Equity | $848,124 | $720,322 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 revenue increased to $698.2 million, gross margin improved, and net income significantly rose to $54.4 million Condensed Consolidated Statements of Operations | Income Statement Item | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | | Revenue | $698,161 | $668,808 | | Gross Margin | $148,427 | $120,211 | | Operating Income | $79,189 | $60,364 | | Net Income | $54,442 | $34,997 | | Diluted EPS | $0.54 | $0.34 | [Selected Cash Flow Information](index=6&type=section&id=Selected%20Cash%20Flow%20Information) Q2 2025 capital expenditures increased to $32.8 million, while total depreciation and amortization slightly decreased to $25.4 million Selected Cash Flow Information | Cash Flow Item | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | | Total Capital Expenditures | $32,808 | $22,858 | | Total Depreciation and Amortization | $25,400 | $25,980 | [Segment Information](index=5&type=section&id=Segment%20Information) This section provides a detailed breakdown of Oceaneering's financial performance across its various operating segments [Detailed Segment Results](index=5&type=section&id=Detailed%20Segment%20Results) Q2 2025 detailed segment results show SSR as the largest revenue contributor at $218.8 million, with ADTech and OPG demonstrating significant margin expansion Detailed Segment Results (Q2 2025) | Segment | Revenue ($M) | Operating Income ($M) | Operating Margin (%) | | :--- | :--- | :--- | :--- | | Subsea Robotics | 218.8 | 64.5 | 29% | | Manufactured Products | 145.1 | 18.8 | 13% | | Offshore Projects Group | 149.3 | 21.7 | 15% | | Integrity Management & Digital Solutions | 75.4 | 4.6 | 6% | | Aerospace and Defense Technologies | 109.6 | 16.3 | 15% | - ROV utilization for the SSR segment was **67%** in Q2 2025, down from **70%** in Q2 2024, but consistent with Q1 2025[18](index=18&type=chunk) - The backlog for the Manufactured Products segment decreased to **$516 million** at the end of Q2 2025, compared to **$713 million** at the end of Q2 2024[18](index=18&type=chunk) [Reconciliation of Non-GAAP to GAAP Financial Information](index=7&type=section&id=Reconciliation%20of%20Non-GAAP%20to%20GAAP%20Financial%20Information) This section provides detailed reconciliations of non-GAAP financial measures, including adjusted net income, EBITDA, and free cash flow, to their most directly comparable GAAP measures [Adjusted Net Income and EPS Reconciliation](index=8&type=section&id=Adjusted%20Net%20Income%20and%20EPS%20Reconciliation) Q2 2025 GAAP Net Income of $54.4 million was adjusted to $49.8 million, or $0.49 per diluted share, after various adjustments Adjusted Net Income and EPS Reconciliation | Reconciliation | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | | GAAP Net Income | $54,442 | $34,997 | | Total Adjustments | $(4,651) | $(6,431) | | **Adjusted Net Income** | **$49,791** | **$28,566** | | GAAP Diluted EPS | $0.54 | $0.34 | | **Adjusted Diluted EPS** | **$0.49** | **$0.28** | [EBITDA and Adjusted EBITDA Reconciliation](index=10&type=section&id=EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) Q2 2025 EBITDA significantly increased to $108.7 million, with Adjusted EBITDA reaching $103.3 million, a 20% year-over-year increase EBITDA and Adjusted EBITDA Reconciliation | Reconciliation | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | | Net Income | $54,442 | $34,997 | | EBITDA | $108,681 | $86,894 | | Adjustments (Foreign Currency) | $(5,430) | $(1,034) | | **Adjusted EBITDA** | **$103,251** | **$85,860** | | Adjusted EBITDA Margin | 15% | 13% | [Free Cash Flow Reconciliation](index=10&type=section&id=Free%20Cash%20Flow%20Reconciliation) Q2 2025 cash flow from operations was $77.2 million, resulting in Free Cash Flow of $46.9 million after capital expenditures Free Cash Flow Reconciliation | Reconciliation | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | | Cash flow from operating activities | $77,187 | $52,623 | | Purchases of property and equipment | $(30,272) | $(22,858) | | **Free Cash Flow** | **$46,915** | **$29,765** | [2025 EBITDA and Free Cash Flow Estimates Reconciliation](index=11&type=section&id=2025%20EBITDA%20and%20Free%20Cash%20Flow%20Estimates%20Reconciliation) Q3 2025 consolidated EBITDA is estimated at $100 million-$110 million, with full-year adjusted EBITDA projected at $390 million-$420 million 2025 Estimates | 2025 Estimates | Low (in thousands) | High (in thousands) | | :--- | :--- | :--- | | **Q3 2025 Consolidated EBITDA** | $100,000 | $110,000 | | **Full Year 2025 Adj. EBITDA** | $390,000 | $420,000 | | **Full Year 2025 Free Cash Flow** | $110,000 | $130,000 | [Segment EBITDA and Adjusted EBITDA Reconciliation](index=12&type=section&id=Segment%20EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) In Q2 2025, SSR was the largest Adjusted EBITDA contributor at $76.9 million, with all segments showing year-over-year growth Adjusted EBITDA by Segment (Q2 2025 vs Q2 2024) | Adjusted EBITDA by Segment | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | | Subsea Robotics (SSR) | $76,890 | $73,731 | | Manufactured Products (MP) | $21,513 | $17,606 | | Offshore Projects Group (OPG) | $26,326 | $18,832 | | Integrity Management & Digital Solutions (IMDS) | $6,486 | $5,276 | | Aerospace and Defense Technologies (ADTech) | $17,199 | $7,860 |

Core Viewpoint - Oceaneering International, Inc. (OII) is expected to report second-quarter earnings on July 23, with earnings estimated at 42 cents per share and revenues at $698.5 million, reflecting a year-over-year increase of 4.4% from $668.8 million in the same quarter last year [1][7]. Group 1: Recent Performance - In the last reported quarter, OII's earnings were 43 cents per share, exceeding the Zacks Consensus Estimate by 7 cents, driven by strong operating income from Subsea Robotics and Offshore Projects Group [2]. - OII's revenues for Q1 were $675 million, surpassing the Zacks Consensus Estimate by 1.7% [2]. - Over the past four quarters, OII has beaten the consensus estimate once and missed three times, with an average negative surprise of 10.2% [3]. Group 2: Revenue and Growth Factors - The anticipated revenue growth for OII in Q2 is attributed to increased demand from the offshore energy industry, particularly in deepwater exploration and production [4]. - The Subsea Robotics segment is projected to see a revenue increase of approximately 13%, contributing significantly to the overall revenue growth [5]. - OII's backlog is expected to improve by about 20% year-over-year, indicating strong future demand [5]. Group 3: Cost and Margin Considerations - OII's cost of services and products is projected to rise by 3.2% to $566 million, which may pressure profit margins [9]. - Selling, general, and administrative expenses are expected to increase from $59.8 million to $62.6 million during the same period [9]. Group 4: Market Position and Client Relationships - OII benefits from strong relationships with financially stable exploration and production companies, which provide consistent revenues and stability [6]. - The company's focus on long-term contracts helps mitigate exposure to short-term market fluctuations, contributing to a more stable revenue stream [8].