Nabors Announces Fourth Quarter and Full-Year 2025 Results

Core Insights - Nabors Industries reported fourth quarter 2025 operating revenues of $798 million, a decrease from $818 million in the third quarter, with net income attributable to shareholders dropping to $10 million from $274 million in the previous quarter [1][3] - The company completed significant debt reduction transactions, including redeeming $546 million of notes due in 2027 and issuing $700 million of notes due in 2032, resulting in a total debt reduction of $388 million since the end of 2024 [1][2] - Adjusted free cash flow for the fourth quarter was $132 million, a substantial increase from $6 million in the third quarter, driven by improved EBITDA and lower capital spending [1][2] Financial Performance - Fourth quarter adjusted EBITDA was $222 million, down from $236 million in the previous quarter, while adjusted operating income was $62.4 million compared to $76 million in the third quarter [1][3] - The U.S. Drilling segment reported adjusted EBITDA of $93.2 million, slightly down from $94.2 million, while International Drilling adjusted EBITDA increased to $131.3 million from $127.6 million [1][3] - Drilling Solutions adjusted EBITDA decreased to $41.3 million from $60.7 million, but grew 2.3% when excluding the impact of Quail Tools [1][3] Operational Highlights - Average rig counts in the Lower 48 and International Drilling segments exceeded expectations, with the Lower 48 count increasing towards the end of the quarter [1][2] - The company successfully added rigs in various international markets, including Saudi Arabia, Argentina, and Mexico, contributing to improved operational performance [1][2] - The introduction of the new Canrig® automated floor wrench is expected to enhance efficiency, demonstrating a 30% reduction in cycle time [2] Outlook - For the first quarter of 2026, Nabors anticipates U.S. Drilling adjusted EBITDA of $16 - $17 million and a Lower 48 average rig count of 64 - 65 rigs [2] - Full-year 2026 expectations include U.S. Drilling adjusted EBITDA of $55 - $60 million and capital expenditures of approximately $730 - $760 million [2] - The company aims to continue reducing debt and improving leverage metrics while focusing on delivering long-term value [1][2]