Financial Data and Key Metrics Changes - Third quarter revenue reached $473.9 million, showing substantial year-over-year growth, primarily due to two months of NV5's contribution following the acquisition [14] - On a combined basis, year-to-date growth was approximately 4.7%, with a 2.4% growth rate if the acquisition had occurred on January 1, 2024 [14] - Adjusted EBITDA for the third quarter was $77.3 million, representing an adjusted EBITDA margin of 16.3%, compared to $51.3 million with a margin of 16.9% in the prior year [17] Business Line Data and Key Metrics Changes - The inspection and mitigation segment generated approximately $293 million in revenue, down about 3% year-over-year, while the consulting engineering segment contributed approximately $122 million during the two-month period post-acquisition [15] - The geospatial segment contributed about $62 million during the same period, with a potential full quarter revenue of approximately $90 million, reflecting a 4% increase year-over-year [16] Market Data and Key Metrics Changes - The data center work for hyperscaler clients more than doubled over the trailing 12 months, driven by accelerating demand from AI and cloud infrastructure buildouts [8] - Infrastructure investments supporting grid modernization and energy transition are creating new opportunities across all three segments [9] Company Strategy and Development Direction - The company aims to expand the markets served and services provided within the TIC and engineering space, focusing on a unified platform dedicated to reliability, innovation, and service excellence [5][7] - The integration of Acuren and NV5 is expected to create meaningful synergies and enhance capabilities across critical asset lifecycle management [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth drivers, including aging infrastructure and increasing regulatory complexity, which are expected to support demand for services [25] - The company reaffirmed its full-year 2025 guidance, expecting revenue in the range of $1.530 billion to $1.565 billion and adjusted EBITDA between $240 million and $250 million [20] Other Important Information - The company completed a $250 million private placement to strengthen its balance sheet and provide flexibility for growth opportunities [18] - The integration program is progressing well, with an increased cost synergy target from $20 million to $25 million expected to be realized by mid-2027 [21][22] Q&A Session Summary Question: What is the reasonable range for annual free cash flow after integration? - Management indicated that the business is a high-free cash flow business with low CapEx and high margins, but specific guidance on free cash flow has not been provided [30] Question: Is the $400 million revenue target for data centers still in place? - Management confirmed that the data center business has seen over 100% growth year-to-date and is a significant focus area, with potential for accelerated growth due to the combination with Acuren [32][33] Question: What is the status of exiting lower-margin customer contracts? - Management noted that the softness in the third quarter was primarily timing-related and that they are actively managing relationships to improve margins [35] Question: How has the government shutdown impacted the geospatial segment? - Management reported limited impact from the government shutdown, with optimism for a quick return to normal operations [40] Question: What are the expectations for the inspection and mitigation segment's turnaround activity? - Management indicated that turnaround activity has not materially changed and is primarily affected by the timing of LNG projects [44] Question: Can you elaborate on the drivers for the increased synergy target? - Management clarified that the increased target is purely cost synergies, focusing on back-office support and organizational efficiency [48]

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].