Nabors(US:NBR)2026-02-13 17:32Operations and Fleet - As of December 31, 2025, Nabors' average rigs working in the U.S. drilling segment was 69.9, down from 86.3 in 2023, while international drilling average rigs increased to 88.4 from 77.6 in 2023, resulting in a total of 158.3 average rigs working[19]. - Nabors operates a fleet of 121 land rigs and 13 offshore platform rigs in the U.S. as of December 31, 2025, with a total of 242 actively marketed rigs for land-based drilling operations[21][22]. - The company introduced the PACE®-X Ultra rig in 2025, which is designed to be the most powerful rig in the Lower 48 drilling industry, enabling operators to drill longer and more challenging wells[23]. - Nabors' Drilling Solutions segment offers managed pressure drilling services and tubular running services, integrating these into rigs to improve efficiencies and reduce costs[28]. Financial Performance - Approximately 30% of Nabors' consolidated operating revenues in 2025 came from Saudi Aramco, highlighting the importance of this customer to the company's financial performance[39]. - The company derived 32% of its operating revenue from joint ventures in 2025, indicating a significant reliance on these partnerships for financial performance[110]. - The company recognized impairment charges of $26.5 million related to tangible assets and equipment in 2025[116]. - The company recorded impairments of $7.5 million and $15.4 million for its investment in Vast Renewables Limited for the years ended December 31, 2025 and 2024, respectively[118]. - As of December 31, 2025, the company's consolidated total outstanding indebtedness was $2.5 billion[120]. - The company is required to maintain an interest coverage ratio of no less than 2.75:1.00 under its 2024 Credit Agreement[119]. - The Federal Reserve raised interest rates by a total of 450 basis points from March 2022 through early 2024, impacting the company's operating costs[122]. - The company faces risks related to the volatility in prices of goods and services and interest rates, which could affect its margins in 2026[121]. Workforce and Human Capital - Nabors employed approximately 13,900 employees worldwide as of December 31, 2025, an increase from 12,400 in 2024, with 9,800 employees located outside the U.S.[40]. - The company has implemented a cloud-based Human Capital Management system across approximately 25 countries to support workforce planning and operational processes[42]. - The company faces challenges in attracting and retaining key executives and experienced technical professionals, which could harm future competitiveness and financial performance[191]. Market Conditions and Competition - The competitive landscape in the drilling services market is characterized by excess capacity, leading to significant price competition due to the oversupply of rigs and drilling-related equipment[56]. - The drilling services market is expected to remain highly competitive, with significant competitors including Helmerich & Payne Inc. and Patterson-UTI Energy Inc.[60][61]. - The company operates in a highly competitive industry with excess drilling capacity, which may negatively impact market share and financial results[87]. - The company continuously reviews strategic opportunities, including acquisitions and divestitures, to enhance its market position[63]. Risks and Challenges - Nabors' operations are influenced by the volatility of oil and natural gas prices, which can significantly affect demand for its services and overall financial performance[55]. - The company faces risks from fluctuations in oil and natural gas prices, which could adversely affect drilling activity, revenues, and profitability[75]. - The company may face increased risks of contract renegotiation or termination by customers during periods of depressed market conditions, which could adversely affect financial performance[94]. - The company’s operations are subject to various inherent risks, including weather-related risks and operational hazards, which could lead to significant financial losses[91]. - The company’s reliance on third-party suppliers exposes it to volatility in the quality, price, and availability of equipment, which could disrupt operations and increase costs[104]. - The company anticipates facing upward pressure on insurance premiums and deductibles, which could adversely affect liquidity and financial condition[92]. - The company may experience adverse effects from geopolitical risks, including conflicts and sanctions, which could impact operations and financial results[98]. - The company’s contracts with state-owned energy companies may expose it to greater risks, including potential environmental liabilities and contract termination without compensation[106]. Sustainability and Innovation - The company emphasizes sustainability as a core part of its corporate culture, linking success to the implementation of sustainable practices and technological innovations[67]. - The company has invested in technologies aimed at energy efficiency and emissions reductions, including real-time emissions monitoring and hydrogen technologies[69]. - Nabors invests in research and development to create new products and services, with a focus on innovative solutions and technologies[53]. - The company holds a significant number of patents related to its business and plans to continue filing patent applications to protect its innovations[54]. Cybersecurity - The company has a comprehensive cybersecurity program overseen by the Board of Directors, focusing on risk management and incident response[197]. - The cybersecurity strategy includes mandatory employee training, technical security controls, and regular assessments of third-party service providers[199]. - The company maintains insurance coverage for cybersecurity risks, but there is no assurance that it will be sufficient to cover potential losses from cyberattacks[142]. - The company has not experienced material cybersecurity threats that have adversely affected its business strategy or financial condition[204]. Regulatory and Compliance - Legal and regulatory risks associated with international operations include compliance with anti-corruption laws and potential penalties for non-compliance, which could adversely affect reputation and financial position[143][144]. - Environmental regulations may lead to increased operating costs and could negatively impact the company's results of operations if compliance costs rise or if production is curtailed[150]. - The company is subject to evolving laws regarding data privacy and security, with potential liabilities for non-compliance, including fines and penalties[159]. - Changes in sanctions or export controls, particularly related to geopolitical tensions, may require the company to limit business activities and incur compliance costs[161][162]. - The company is committed to compliance with applicable sanctions and has implemented policies to promote adherence, but effectiveness cannot be guaranteed[163]. Shareholder Information - The company has 32,000,000 authorized common shares, with 15,834,469 shares outstanding as of February 6, 2026, including shares reserved for stock options and employee benefit plans[174]. - The company's common shares are publicly traded on the NYSE under the symbol "NBR," with a closing price of $69.78 on February 6, 2026[212]. - The company has approximately 1,455 shareholders of record as of February 6, 2026[213]. - Future dividends will be at the discretion of the Board, depending on earnings, financial condition, and business conditions[214]. Taxation - The Company recorded a deferred tax asset of $206.9 million for Bermuda net operating losses generated from 2020 through 2024, with an offsetting valuation allowance of $206.9 million[171]. - As of December 31, 2025, the Company reported consolidated U.S. federal net operating loss carryforwards of approximately $355.4 million, with legacy Nabors' NOL carryforwards of $213.7 million subject to Section 382 limitations[172]. - The Organization for Economic Co-operation and Development (OECD) introduced BEPS Pillar 2 rules imposing a global minimum tax rate of 15%, which did not materially impact the Company's consolidated financial statements for the year ended December 31, 2025[167]. - The Inflation Reduction Act includes a 15% corporate minimum tax rate for certain large corporations, but the Company does not expect it to have a material impact[168]. - The One Big Beautiful Bill Act includes provisions that may affect the Company's effective tax rate, but it is not expected to have a material impact[169]. - Changes in tax laws and regulations could materially affect the Company's results of operations, particularly in jurisdictions where it operates[166].