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Halliburton(HAL) - 2025 Q3 - Earnings Call Transcript
2025-10-21 14:02
Financial Data and Key Metrics Changes - Total company revenue for Q3 2025 was $5.6 billion, a 2% increase compared to Q2 2025 [17] - Adjusted operating margin was 13%, with adjusted operating income of $748 million [17] - Cash flow from operations was $488 million, and free cash flow was $276 million [5][17] - Net income per diluted share was $0.02, while adjusted net income per diluted share was $0.58 [16] Business Line Data and Key Metrics Changes - Completion and Production division revenue was $3.2 billion, a 2% increase from Q2 2025, with operating income flat at $514 million [17] - Drilling and Evaluation division revenue was $2.4 billion, also a 2% increase from Q2 2025, with operating income rising 12% to $348 million [19] - Increased completion tool sales and higher artificial lift activity in North America were noted, while lower completion tool sales internationally impacted results [18] Market Data and Key Metrics Changes - International revenue was $3.2 billion, a decrease of 2% year over year, while North America revenue was flat at $2.4 billion [5] - Europe, Africa revenue was $828 million, flat sequentially, while Middle East Asia revenue decreased by 3% to $1.4 billion [20] - Latin America revenue increased by 2% to $996 million, driven by higher project management activity [20] Company Strategy and Development Direction - The company is focused on maintaining a strong cost structure, with expected savings of approximately $100 million per quarter [5][15] - Capital expenditures for 2026 are expected to decline by almost 30% to around $1 billion [7] - The company is prioritizing technology development and maintaining a competitive position in the market [7][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth of oil and gas demand, despite near-term volatility in commodity prices [6][15] - The company anticipates a cautious posture from customers in North America due to market conditions [6] - Management highlighted the importance of ongoing investment in technology and international growth engines [15] Other Important Information - The company repurchased approximately $250 million of its common stock during the quarter [5][17] - The partnership with VoltaGrid aims to deliver distributed power solutions for data centers internationally, expanding growth opportunities [14][96] Q&A Session Summary Question: Insights on VoltaGrid's market evolution and strategic collaboration - Management highlighted the significant demand for power and AI, emphasizing the collaboration with VoltaGrid to leverage strengths in project economics and execution [29][31] Question: Drivers of North American revenue outperformance - Management noted less whitespace than expected and strong customer programs as key drivers for the 5% sequential revenue increase in North America [32] Question: Margins and cost reductions impact - Management indicated that half of the margin beat came from earlier-than-expected labor cost reductions, with strong performance in international markets contributing to overall results [42][44] Question: Halliburton's role in the VoltaGrid partnership - Management clarified that Halliburton brings industrial scale, project management, and customer relationships to the partnership, enhancing execution capabilities [46][68] Question: 2026 outlook and customer conversations - Management described 2026 as flattish with some bright spots, emphasizing the importance of OPEC Plus barrels and production levels in North America [38][108] Question: Growth engines and market share - Management expressed confidence in the growth engines, indicating they are on track to outgrow the industry internationally [73][76] Question: Brazil's market outlook - Management remains positive about Brazil, highlighting strong positions with both IOC work and Petrobras [77] Question: Idling equipment and market dynamics - Management confirmed that idling decisions are based on economic viability, with expectations for tightness in pricing as underperforming assets remain idle [100][101]
Halliburton(HAL) - 2025 Q3 - Earnings Call Transcript
2025-10-21 14:00
Halliburton (NYSE:HAL) Q3 2025 Earnings Call October 21, 2025 09:00 AM ET Speaker1Good morning and thank you for standing by. At this time, I would like to welcome everyone to the Halliburton Company's Third Quarter 2025 Earnings Conference Call. All lines have been placed on mute to prevent any background noise, and after the speaker remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keyp ...