Halliburton(HAL) - 2025 Q4 - Annual Report

Sustainability and Environmental Initiatives - Halliburton aims to advance a sustainable energy future by developing technologies to lower emissions intensity and grow its low carbon energy business[14]. - The company has invested in developing environmentally friendly hydraulic fracturing technologies, including a fluid system sourced entirely from the food industry[44]. - Halliburton has not been obligated to compensate any indemnified party for environmental liability arising from hydraulic fracturing to date[46]. Geographic and Market Presence - In 2025, 39% of consolidated revenue was derived from the United States, with no other country exceeding 10% of total revenue[23]. - Halliburton operates in more than 70 countries, organized into four primary geographic regions: North America, Latin America, Europe/Africa/CIS, and Middle East/Asia[22]. - The company recognizes that geopolitical factors and market conditions can impact operations, but believes geographic diversification reduces risks associated with interruptions in any single country[25]. Workforce and Employment - The company employed over 46,000 people worldwide as of December 31, 2025, with a modest voluntary turnover rate of 9%[32][34]. - In 2025, 91% of the workforce and 85% of management were on local terms in the countries where they work, reflecting a commitment to local workforce development[33]. Financial Performance - Total revenue for 2025 was $22,184 million, a decrease of 3.3% from $22,944 million in 2024[239]. - Operating income fell to $2,260 million in 2025, down 40.8% from $3,822 million in 2024[239]. - Net income attributable to the company decreased to $1,283 million in 2025, compared to $2,501 million in 2024, representing a decline of 48.7%[239]. - Basic net income per share for 2025 was $1.50, down from $2.84 in 2024, a decrease of 47.2%[239]. - Total operating costs and expenses increased to $19,924 million in 2025, up 4.2% from $19,122 million in 2024[239]. - Cash flows provided by operating activities were $2,926 million in 2025, a decrease of 24.4% from $3,865 million in 2024[245]. - Capital expenditures for 2025 were $1,254 million, down from $1,442 million in 2024, a reduction of 13.0%[245]. Assets and Liabilities - Total assets decreased to $25,010 million in 2025 from $25,587 million in 2024, a decline of 2.3%[243]. - Total liabilities decreased to $14,505 million in 2025, down from $15,039 million in 2024, a reduction of 3.5%[243]. - The allowance for credit losses increased to $805 million by the end of 2025, up from $754 million at the end of 2024[301]. - Long-term total debt remained stable at $7,158 million in 2025 compared to $7,160 million in 2024[313]. Internal Controls and Compliance - The company maintained effective internal control over financial reporting as of December 31, 2025, as confirmed by an independent audit[231]. - There have been no waivers from provisions of the company's Code of Business Conduct for the years 2023, 2024, or 2025[48]. - The company’s management concluded that its internal control over financial reporting was effective as of December 31, 2025[217]. Impairments and Charges - The company incurred impairments and other charges of $831 million in 2025, with $556 million attributed to Completion and Production and $247 million to Drilling and Evaluation[281]. - Total impairments and other charges for 2025 amounted to $831 million, which included $299 million in severance costs and $224 million for impairment of assets held for sale[275]. - Halliburton's impairment of assets held for sale related to its chemical business was $224 million in 2025, reflecting strategic shifts in operations[275]. Stock and Shareholder Information - The company repurchased $1,007 million in stock during 2025, compared to $1,005 million in 2024[245]. - The company repurchased 42.4 million shares of common stock in 2025, with approximately $2.0 billion remaining authorized for repurchases as of December 31, 2025[339]. - Stock-based compensation costs for 2025 were $213 million, with a net cost of $177 million after tax benefits[344]. Taxation and Deferred Tax Assets - Halliburton reported gross deferred tax assets of $3.6 billion with a related valuation allowance of $0.9 billion as of December 31, 2025[226]. - The total income tax provision for 2025 was $479 million on pre-tax income of $1.8 billion, resulting in an effective tax rate of 27.0%[324]. - As of December 31, 2025, total gross deferred tax assets amounted to $3.626 billion, while total gross deferred tax liabilities were $393 million[326].