Core Insights - Nabors Industries reported first quarter 2025 operating revenues of $736 million, a slight increase from $730 million in the previous quarter, with a net income of $33 million compared to a net loss of $54 million in the fourth quarter of 2024 [1] - The first quarter included a one-time non-cash net gain of $113 million from the Parker transaction, which was partially offset by non-cash charges related to the wind-down of operations in Russia totaling $28.6 million [1] - Adjusted EBITDA for the first quarter was $206 million, down from $221 million in the previous quarter [1] Financial Performance - The U.S. Drilling segment reported adjusted EBITDA of $92.7 million, down from $105.8 million in the fourth quarter, primarily due to a reduced rig count and higher operational expenses [7] - International Drilling adjusted EBITDA totaled $115.5 million, an increase from $112 million in the previous quarter, with daily adjusted gross margin improving to $17,421 [6] - Drilling Solutions segment adjusted EBITDA was $40.9 million, with the addition of Parker operations contributing $9.6 million [8] Operational Highlights - The company experienced rig churn in the U.S., impacting rig utilization and operating expenses, but noted improvements in adding rigs in the Lower 48 after a trough in February [4] - The SANAD joint venture with Saudi Aramco began operating its tenth newbuild rig in the first quarter, with plans for additional rigs to commence operations throughout 2025 [6] - The company has planned several rig startups in international markets, including Saudi Arabia, Kuwait, Argentina, Mexico, and India, to offset the completion of some drilling programs [5] Acquisition Impact - The acquisition of Parker Wellbore is expected to significantly enhance Nabors' Drilling Solutions business, contributing approximately $130 million in incremental adjusted EBITDA for 2025 and $40 million in cost synergies [10] - The Parker acquisition is forecasted to add material free cash flow and improve leverage metrics for Nabors [11] Cash Flow and Expenditures - Consolidated adjusted free cash flow for the first quarter was a use of $71 million, with the legacy business consuming $61 million [9] - Capital expenditures for Parker operations were targeted at $60 million for 2025, with total capital expenditures expected to be approximately $770 million to $780 million [21] - The company anticipates adjusted free cash flow of approximately $80 million for 2025, excluding any impact from tariffs [16] Future Outlook - For the second quarter of 2025, Nabors expects adjusted EBITDA of approximately $75 million from U.S. Drilling, including about $43 million from Parker [14] - The company is targeting substantial improvements in free cash flow generation over the remaining quarters of the year, driven by international drilling profitability and recovery in the Lower 48 rig count [16]