Core Insights - Patterson-UTI Energy, Inc. reported an average of 94 drilling rigs operating in the United States for October 2025 [1] Company Summary - The company is actively engaged in drilling operations, maintaining a significant number of rigs in operation [1]

Patterson-UTI Energy, Inc. (NASDAQ:PTEN) is included among the 11 Best High Yield Energy Stocks to Buy Now. Patterson-UTI Energy (PTEN) Gets Bullish Stance From Analyst Following Q3 Results Patterson-UTI Energy, Inc. (NASDAQ:PTEN) is a leading provider of drilling and completion services to oil and natural gas exploration and production companies in the United States and other select countries. Patterson-UTI Energy, Inc. (NASDAQ:PTEN) announced better-than-expected results for its third quarter on Octob ...

Financial Performance - Total operating revenues for Q3 2025 were $1,175,954, a decrease of 13.4% compared to $1,357,222 in Q3 2024[13] - Net loss attributable to common stockholders for Q3 2025 was $36,402, compared to a net loss of $978,761 in Q3 2024[13] - Operating income for Q3 2025 was a loss of $28,054, compared to a loss of $990,629 in Q3 2024, indicating an improvement in operational performance[13] - The company reported a comprehensive loss of $37,250 for Q3 2025, compared to a comprehensive loss of $977,737 in Q3 2024[14] - Basic net income (loss) per common share for Q3 2025 was $(0.10), compared to $(2.50) for Q3 2024, showing a significant reduction in losses per share[13] - Net income for the nine months ended September 30, 2025, was a loss of $83,857,000 compared to a loss of $915,007,000 for the same period in 2024[20] - Revenues for the three months ended September 30, 2025, were $4,599, a decrease of 41.0% compared to $7,793 for the three months ended June 30, 2025[152] - For the nine months ended September 30, 2025, total revenues from external customers reached $3,647,485, a decrease from $4,166,491 in the same period of 2024, representing a decline of approximately 12.5%[1] Assets and Liabilities - Total assets decreased to $5,533,110 as of September 30, 2025, down from $5,833,466 at December 31, 2024, representing a decline of 5.2%[10] - Current liabilities decreased to $777,773 as of September 30, 2025, from $841,993 at December 31, 2024, a reduction of 7.6%[10] - Total liabilities decreased to $2,278,025 as of September 30, 2025, from $2,357,622 at December 31, 2024, a decrease of 3.4%[10] - Cash and cash equivalents decreased to $186,913 as of September 30, 2025, down from $241,293 at December 31, 2024, a decline of 22.5%[10] - As of September 30, 2025, total accrued liabilities amounted to $283.9 million, a decrease from $385.8 million as of December 31, 2024[61] - The company's long-term debt as of September 30, 2025, was $1.22 billion, slightly down from $1.22 billion at the end of 2024[62] Cash Flow and Capital Expenditures - Cash flows from operating activities for the nine months ended September 30, 2025, were $563,693,000, down from $859,702,000 in 2024, reflecting a decrease of approximately 34.5%[20] - Capital expenditures for the nine months ended September 30, 2025, totaled $450,516, down from $538,036 in 2024, indicating a reduction of about 16.2%[2] - Capital expenditures for the nine months ended September 30, 2025, were $175,323, down 16.7% from $210,346 for the same period in 2024[155] - The company anticipates $17.4 million of capital expenditures for the remainder of 2025 related to various contractual obligations[191] Dividends and Stock Buybacks - The company declared cash dividends of $0.08 per common share for both Q3 2025 and Q3 2024, maintaining dividend consistency[13] - The company paid cash dividends of $0.08 per share, totaling $92,114,000 for the nine months ended September 30, 2025, compared to $95,593,000 in 2024[20] - The company has remaining authorization to purchase approximately $694 million of its outstanding common stock under the stock buyback program as of September 30, 2025[197] - The stock buyback program has an authorization of $1.0 billion, with approximately $694 million remaining as of September 30, 2025[91] Segment Performance - Segment operating income for Drilling Services was $37.124 million for the three months ended September 30, 2025, while Completion Services reported an operating loss of $27.722 million[114] - Revenues for Drilling Services in Q3 2025 were $380.2 million, a decrease of 5.8% from $403.8 million in Q2 2025, with adjusted gross profit declining by 10.2%[142] - Completion Services revenues were $705.3 million in Q3 2025, down 2.0% from $719.3 million in Q2 2025, but adjusted gross profit increased by 10.9%[145] - Revenues from Completion Services for the nine months ended September 30, 2025, were $2,190,687, a decrease of 15.2% from $2,581,937 for the same period in 2024[158] Impairments and Adjustments - An impairment charge of $27.8 million was recorded for Latin American drilling equipment during the second quarter of 2025 due to estimated undiscounted cash flows not exceeding its carrying value[48] - The company has not reported any impairment of goodwill for the current period, while it recorded an impairment of $885,240,000 in the previous year[204] Tax and Legal Matters - The effective income tax rate for the three months ended September 30, 2025, was 15.3%, significantly higher than 3.0% for the same period in 2024[103] - The company is involved in ongoing legal proceedings, including a claim related to a license agreement with NOV Inc., which it is vigorously defending[84] Market Conditions and Future Outlook - The company anticipates continued volatility in oil and natural gas prices, which may impact demand for its services and overall financial performance[4] - The ongoing geopolitical conflicts and economic conditions are expected to influence the company's operational environment and financial outlook[4] - The company plans to adopt new accounting standards related to income tax disclosure with its Annual Report for the year ending December 31, 2025[26]

Core Insights - Patterson-UTI Energy, Inc. (NASDAQ:PTEN) experienced a significant stock increase of 20.33% week-on-week, driven by strong earnings performance in Q3 and rising oil prices [1][3]. Financial Performance - The net loss attributable to shareholders decreased by 96% to $36.4 million from $979 million in the same period last year [2]. - Revenues fell by 14% to $1.17 billion from $1.36 billion year-on-year [3]. Management Commentary - The CEO, Andy Hendricks, highlighted the company's ability to navigate a challenging environment and focus on optimizing controllable business areas [3]. - The management believes that the outperformance is due to the focus and execution of teams across segments and the technological advantages in drilling and completion [4].

Core Insights - Patterson-UTI Energy, Inc. (PTEN) reported a third-quarter 2025 adjusted net loss of 6 cents per share, which was better than the Zacks Consensus Estimate of a 10-cent loss, attributed to a 48.7% year-over-year reduction in costs and expenses, although the bottom line declined from the previous year's breakeven level due to poor contributions from the Drilling Products segments [1][11] Financial Performance - Total revenues for the quarter were $1.2 billion, exceeding the Zacks Consensus Estimate by 1%, driven by higher-than-expected revenues from Completion Services, although this represented a 14% year-over-year decline [2][11] - Operating income was reported at $37.1 million, a significant improvement from a loss of $34.4 million in the third quarter of 2024, and surpassed the operating income estimate of $23.9 million [5] - The company declared a quarterly dividend of 8 cents per share, unchanged from the previous quarter, payable on December 15, 2025 [3][11] Segment Performance - Drilling Services revenues totaled $380.2 million, down 10% from $421.6 million in the prior-year quarter, but slightly beat the estimate of $380.1 million [4] - Completion Services revenues were $705.3 million, a 15% decrease from $831.6 million year-over-year, yet exceeded the estimate of $677 million [5] - Drilling Products revenues decreased by 4% to $85.9 million from $89.1 million year-over-year, missing the estimate of $88.8 million [6] - Other Services revenues plummeted 69% to $4.6 million from $15 million year-over-year, also missing the estimate of $10.6 million [7] Capital Expenditure & Financial Position - Capital expenditures for the quarter were $144.5 million, down from $180.6 million in the prior-year period [9] - As of September 30, 2025, the company had cash and cash equivalents of $186.9 million and long-term debt of $1.2 billion, with a debt-to-capitalization ratio of 27.3% [9] Future Outlook - For the fourth quarter, the company expects average rig count in the Drilling Services segment to remain stable, with a projected 5% decrease in adjusted gross profit compared to the third quarter [13] - In Completion Services, adjusted gross profit is anticipated to be around $85 million, with stable activity levels expected [14] - The company projects a slight improvement in adjusted gross profit for the Drilling Products segment compared to the third quarter, with steady performance expected in both the U.S. and Canada [15] - Capital expenditures for the fourth quarter are estimated to be around $140 million, with total capital expenditures for the full year expected to be under $600 million [17]

Financial Data and Key Metrics Changes - Total reported revenue for Q3 2025 was $1.176 billion, with a net loss attributable to common shareholders of $36 million or $0.10 per share, and an adjusted net loss of $21 million [22] - Adjusted EBITDA for the quarter totaled $219 million, with total CapEx of $144 million [22][27] - The company generated $146 million of adjusted free cash flow during the first three quarters of the year [22] Business Line Data and Key Metrics Changes - In the drilling services segment, Q3 revenue was $380 million with an adjusted gross profit of $134 million, and the average operating rig count was 95 rigs [23] - Completion services segment revenue totaled $705 million with an adjusted gross profit of $111 million, showing flat activity on a pump-hour basis compared to Q2 [24] - Drilling products revenue was $86 million with an adjusted gross profit of $36 million, impacted by lower activity in Saudi Arabia [25] Market Data and Key Metrics Changes - U.S. contract drilling saw 8,737 operating days, with activity flat outside the Permian Basin, which experienced a sequential decline in rig count [23][24] - International revenue declined mainly in Saudi Arabia, while revenue outside of Saudi Arabia was strong [19] - The company expects completion services adjusted gross profit to be approximately $85 million in Q4, with less seasonality compared to the previous year [25] Company Strategy and Development Direction - The company is focused on enhancing commercial strategies through service and product line integration and performance-based agreements while lowering costs [5][10] - Investments in technology are prioritized, with expectations for strong returns on incremental investments [10][11] - The company aims to return at least 50% of annual free cash flow to shareholders through dividends and share repurchases [11][30] Management's Comments on Operating Environment and Future Outlook - Management noted that while oil prices have fallen, they remain resilient, and the U.S. shale picture is more constructive than expected [5][6] - The outlook for natural gas appears favorable, with physical demand growth from LNG expected to drive higher drilling and completion activity [8] - Management expressed confidence in maintaining high-demand portions of the fleet while generating meaningful free cash flow [11][30] Other Important Information - The company closed Q3 with $187 million in cash and an undrawn $500 million revolver, with no senior note maturities until 2028 [28] - The company has repurchased 44 million shares since the NextTier merger and Altera acquisition, reducing share count by 9% [23] Q&A Session Summary Question: Completion services pricing trends - Management highlighted that their teams are executing high-end work, which has allowed them to maintain pricing without significant pressure to reduce it [35][37] Question: Fleet renewal programs for 2026 - Management discussed the excitement around 100% natural gas direct-drive systems and indicated a focus on high-end investments while allowing lower-tier equipment to attrition [38][39] Question: Power market opportunities - Management acknowledged their expertise in power generation but noted that entering larger power markets would require careful consideration of capital and returns [44][47] Question: Customer discussions on drilling and completion - Management indicated that customers are seeking to maintain production levels despite a softer commodity environment, leading to requests for more technology and efficiency [56][58] Question: Capital allocation strategy - Management emphasized the importance of maintaining a strong balance sheet while committing to returning capital to shareholders, with a focus on performance driving pricing [76][80]

Financial Data and Key Metrics Changes - Total reported revenue for Q3 2025 was $1.176 billion, with a net loss attributable to common shareholders of $36 million or $0.10 per share, and an adjusted net loss of $21 million [22] - Adjusted EBITDA for the quarter totaled $219 million, with total CapEx of $144 million [22][27] - The company generated $146 million of adjusted free cash flow in the first three quarters of the year, with expectations for strong free cash flow in Q4 [22][29] Business Line Data and Key Metrics Changes - Drilling services segment revenue was $380 million with an adjusted gross profit of $134 million, while completion services segment revenue totaled $705 million with an adjusted gross profit of $111 million [23][24] - The drilling products segment reported revenue of $86 million with an adjusted gross profit of $36 million, impacted by higher bit repair expenses [25][26] - The company expects adjusted gross profit in drilling services to decline approximately 5% in Q4 compared to Q3 [24] Market Data and Key Metrics Changes - U.S. contract drilling saw an average operating rig count of 95 rigs, with activity stabilizing as the company exited Q3 [23][11] - In Canada, revenue showed strong recovery post-spring breakup, while international revenue declined mainly in Saudi Arabia [18] - The company noted that the completions market remains competitive, but operational quality is proving to be a major differentiator [14] Company Strategy and Development Direction - The company is focused on enhancing commercial strategies through service and product line integration, while lowering cost structures [5][6] - Investments in technology are prioritized, with expectations for lower capital expenditures in 2026 compared to 2025 [9][10] - The company aims to return at least 50% of annual free cash flow to shareholders through dividends and share repurchases [10][23] Management's Comments on Operating Environment and Future Outlook - Management highlighted resilience in the business despite challenges, with a constructive outlook for U.S. shale activity [5][6] - The company anticipates that any further activity reductions could negatively impact future U.S. output, affecting global oil supply in 2026 [7] - Management expressed confidence in maintaining strong free cash flow and a solid balance sheet, with expectations for continued capital flexibility [10][33] Other Important Information - The company has repurchased 44 million shares since the NextTier merger and Altera acquisition, reducing share count by 9% [23] - The company closed Q3 with $187 million in cash and an undrawn $500 million revolver, with no senior note maturities until 2028 [28] Q&A Session Summary Question: Completion services pricing trends - Management noted that their teams are executing high-end work, which has allowed them to maintain pricing without significant pressure to reduce it [36] Question: Fleet renewal programs for 2026 - Management discussed the excitement around 100% natural gas direct-drive systems and the strategy of investing at the high end while allowing lower-tier equipment to attrition [37][38] Question: Power market opportunities - Management acknowledged their expertise in power generation but indicated that entering larger power markets would require careful consideration of capital returns [44][46] Question: Macro uncertainty and customer behavior - Management observed that customers are seeking to maintain production levels despite a softer commodity environment, leading to requests for more technology [56] Question: Pricing expectations for completion market - Management indicated that while there may be some movement in pricing, they do not foresee significant headwinds due to steady demand for natural gas-powered equipment [73] Question: Capital allocation strategy - Management emphasized the importance of maintaining a strong balance sheet while committing to returning capital to shareholders, with a focus on performance-driven pricing [75][79]

Financial Data and Key Metrics Changes - Total reported revenue for Q3 2025 was $1.176 billion, with a net loss attributable to common shareholders of $36 million or $0.10 per share, and an adjusted net loss of $21 million [20] - Adjusted EBITDA for the quarter totaled $219 million, with total CapEx at $144 million [20][26] - The company generated $146 million of adjusted free cash flow during the first three quarters of the year [20] Business Line Data and Key Metrics Changes - In the drilling services segment, Q3 revenue was $380 million with an adjusted gross profit of $134 million, while completion services revenue totaled $705 million with an adjusted gross profit of $111 million [22][23] - The drilling products segment reported revenue of $86 million with an adjusted gross profit of $36 million, impacted by higher bit repair expenses [24][26] Market Data and Key Metrics Changes - The U.S. contract drilling business saw an average operating rig count of 95 rigs, with activity stabilizing as the company exited Q3 [22][23] - In Canada, there was a strong recovery in revenue post-spring breakup, while international revenue declined mainly in Saudi Arabia [17] Company Strategy and Development Direction - The company is focused on enhancing commercial strategies through service and product line integration, performance-based agreements, and lowering cost structures [4][5] - Investments are being made in technologies that are in high demand, with expectations of strong returns [8][9] - The company aims to return at least 50% of annual free cash flow to shareholders through dividends and share repurchases [9][20] Management's Comments on Operating Environment and Future Outlook - Management noted that while oil prices have fallen, they have remained more resilient than expected, with long-term global demand growth continuing [5] - The outlook for natural gas appears favorable, with physical demand growth from LNG starting to come online [6] - The company expects lower capital expenditures in 2026 compared to 2025, while still maintaining high-demand fleet and investing in new technologies [8][9] Other Important Information - The company closed Q3 with $187 million in cash and an undrawn $500 million revolver, indicating strong liquidity [9][26] - The company has repurchased 44 million shares since the NextTier merger and Altera acquisition, reducing share count by 9% [21][22] Q&A Session Summary Question: Completion services pricing trends - Management highlighted that their teams are executing high-end work, which has allowed them to maintain pricing without significant pressure to reduce it [34] Question: Fleet renewal programs for 2026 - The company is excited about the 100% natural gas direct-drive emerald systems and plans to continue investing in high-end equipment while allowing lower-tier equipment to attrition [36] Question: Power market opportunities - Management acknowledged their expertise in power generation but noted that entering larger power markets would require significant capital and may not align with immediate shareholder value [42][45] Question: Completion optimization software - The EOS Completions platform is being rolled out across all fleets, which is expected to improve performance and reliability [46] Question: Customer discussions amid macroeconomic uncertainty - Customers are seeking to maintain production levels despite a softer commodity environment, leading to requests for more technology and efficiency [54] Question: Pricing expectations for 2026 - Management indicated that while there may be some pricing movement, overall demand for natural gas services remains strong, which should support pricing stability [70]

Financial Data and Key Metrics Changes - Total reported revenue for Q3 2025 was $1,176 million, with a net loss attributable to common shareholders of $36 million or $0.10 per share, and an adjusted net loss of $21 million [23] - Adjusted EBITDA for the quarter totaled $219 million, with total operating expenses of $23 million, including $20 million related to personal injury claims [23] - The company generated $146 million of adjusted free cash flow during the first three quarters of the year [23] Business Line Data and Key Metrics Changes - Drilling Services segment revenue for Q3 was $380 million, with an adjusted gross profit of $134 million; the average operating rig count was 95 rigs [25] - Completion Services segment revenue totaled $705 million with an adjusted gross profit of $111 million, showing flat activity on a pump hour basis compared to Q2 [26] - Drilling Products revenue was $86 million with an adjusted gross profit of $36 million, impacted by lower activity in Saudi Arabia [27] Market Data and Key Metrics Changes - U.S. contract drilling activity stabilized, with recent revenue per day for drilling rigs remaining in the low to mid-$30,000 range [13] - International revenue declined mainly in Saudi Arabia, while revenue outside of Saudi Arabia was strong, with expectations for an increase in Q4 [20] - The company noted a strong recovery in Canadian revenue post-spring breakup, despite total industry activity being slightly below expectations [20] Company Strategy and Development Direction - The company is focused on enhancing commercial strategies through service and product line integration and performance-based agreements while lowering costs [5] - Investments are being made in technologies that are in high demand, with expectations of strong returns on incremental investments [11] - The company aims to maintain high demand portions of its fleet while investing in new technologies and returning at least 50% of annual free cash flow to shareholders [11][12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the unique challenges of the current business environment but expressed confidence in the company's ability to adapt and generate healthy free cash flow [6] - The outlook for natural gas appears favorable, with anticipated growth in LNG demand driving higher drilling and completion activity [8] - Management expects lower capital expenditures in 2026 compared to 2025 while maintaining operational quality and competitive edge [11][12] Other Important Information - The company closed Q3 with $187 million in cash and an undrawn $500 million revolving credit facility, with no senior note maturities until 2028 [30] - The fourth quarter is expected to deliver the strongest free cash flow of the year, enhancing capital flexibility heading into 2026 [12][30] - The company has returned $162 million to shareholders through dividends and share repurchases in 2025 [30] Q&A Session Summary Question: Completion services pricing trends - Management noted that their teams are executing well, with high-end work driving performance and minimizing pressure to reduce pricing [40][41] Question: Fleet renewal programs for 2026 - The company is excited about the 100% natural gas direct drive systems and plans to continue investing in high-end equipment while allowing lower-tier equipment to attrition [42][43] Question: Power market opportunities - Management discussed their expertise in power generation but emphasized a cautious approach to entering larger power markets due to competitive dynamics [48][50] Question: Customer discussions amid macro uncertainty - Customers are seeking to maintain production levels despite a softer commodity environment, leading to requests for more technology and efficiency [62][63] Question: Pricing in the completion market for next year - Management indicated that while there may be some pricing movement, overall demand for natural gas services is strong, which should support pricing stability [81] Question: Capital allocation strategy - The company remains committed to returning at least 50% of free cash flow to shareholders while also investing in technology and maintaining a strong balance sheet [87][88]

Core Insights - Patterson-UTI reported a quarterly loss of $0.06 per share, which was better than the Zacks Consensus Estimate of a loss of $0.10, marking a 40% earnings surprise [1] - The company generated revenues of $1.18 billion for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 0.47%, but down from $1.36 billion year-over-year [2] - The stock has underperformed, losing approximately 27% year-to-date compared to the S&P 500's gain of 14.5% [3] Company Performance - Over the last four quarters, Patterson-UTI has surpassed consensus EPS estimates two times and topped revenue estimates three times [2] - The current consensus EPS estimate for the upcoming quarter is -$0.15 on revenues of $1.09 billion, and for the current fiscal year, it is -$0.38 on revenues of $4.75 billion [7] Industry Context - The Oil and Gas - Drilling industry, to which Patterson-UTI belongs, is currently ranked in the bottom 11% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Patterson-UTI's stock performance [5][6]