Financial Data and Key Metrics Changes - Consolidated revenue for the third quarter was $818.2 million, a decrease of $14.6 million or 1.8% sequentially, primarily due to the divestiture of Quail Tools [40] - Adjusted EBITDA totaled $236.3 million, representing an EBITDA margin of 28.9%, down 96 basis points sequentially [41] - Net debt stood at approximately $1.7 billion, the lowest level in over ten years, reflecting a reduction of more than 20% this year [9][61] Business Line Data and Key Metrics Changes - International drilling revenue increased by $22.3 million or 5.8% sequentially to $407.2 million, with EBITDA for the segment rising by $10 million or 8.5% to $127.6 million [43][44] - U.S. drilling revenue decreased by 2.2% to $249.8 million, with EBITDA down 7.5% to $94.2 million, primarily due to a decline in average rig count [45][46] - Drilling Solutions segment generated revenue of $141.9 million and EBITDA of $60.7 million, resulting in a 42.7% margin [48] Market Data and Key Metrics Changes - The average rig count in the International Drilling segment increased by more than three rigs to 89, with a quarter-end exit rig count of 91 [44] - In the U.S. Lower 48, the average rig count declined by 3.2 rigs to 59.2, with a recent count of 59 rigs [46][20] - The gas-directed industry rig count in the Lower 48 has increased, indicating a positive outlook for natural gas activity [15] Company Strategy and Development Direction - The company aims to reduce gross debt and improve balance sheet leverage, with a focus on capital structure transformation following the sale of Quail Tools [38][63] - The integration of Parker Wellbore is progressing well, expected to produce approximately $55 million of EBITDA in 2025, including synergies [53] - The company is committed to deploying proceeds from asset sales to further reduce debt and enhance financial flexibility [61] Management's Comments on Operating Environment and Future Outlook - Management noted mixed effects on global drilling markets due to geopolitical factors and oil price fluctuations, with expectations for U.S. activity to stabilize and potentially increase in late 2026 [14][16] - The outlook for natural gas remains constructive, driven by expected U.S. LNG exports and large-scale developments in the Middle East and Latin America [15] - Management expressed confidence in the performance outlook for the coming quarters, supported by improved operational efficiencies and cost synergies [10][12] Other Important Information - The company completed the sale of Quail Tools for $625 million, significantly impacting its capital structure and enabling debt reduction [6][60] - Adjusted free cash flow for the third quarter was $6 million, with expectations for approximately $10 million in the fourth quarter [56][57] - The company plans to maintain capital expenditures in the range of $715 million to $725 million for the year, with a focus on newbuild programs [55] Q&A Session Summary Question: Insights on U.S. Lower 48 activity trends - Management noted that daily revenue increased sequentially by about $500 due to performance bonuses, with a focus on ensuring more of this revenue drops to the bottom line [69][70] Question: Saudi onshore activity and tendering - Management indicated that around 50% of suspended rigs may return to work, with ongoing participation in tenders for their rigs [75][76] Question: Philosophy around Aramco's new tenders - Management acknowledged that while there are no significant changes in rig requirements, there is an interest in introducing more technology and automation in operations [82][86] Question: Future leverage levels and cash flow generation - Management expects to reduce gross debt significantly and aims for net debt to reach around $1.1 billion to $1.2 billion, with strong cash flow generation anticipated from the rest of the business [90][92]