Nabors Announces Second Quarter 2025 Results
HAMILTON, Bermuda, July 29, 2025 /PRNewswire/ -- Nabors Industries Ltd. ("Nabors" or the "Company") (NYSE:NBR) today reported second quarter 2025 operating revenues of $833 million, compared to operating revenues of $736 million in the first quarter. Net loss attributable to Nabors shareholders for the quarter was $31 million, compared to net income of $33 million in the first quarter. This equates to a loss per diluted share of $2.71, compared to earnings per diluted share of $2.18 in the first quarter. The first quarter included a one-time, non-cash net gain on the Parker transaction of $113.0 million, or $9.68 per diluted share. Second-quarter adjusted EBITDA was $248 million, compared to $206 million in the previous quarter.
2Q 2025 Highlights
The SANAD drilling joint venture with Saudi Aramco deployed two newbuild rigs in the Kingdom. These bring the total number of deployments to twelve. Two more units are scheduled to start operations over the balance of this year.
Saudi Aramco awarded the fourth tranche of newbuilds to SANAD. This award of five rigs marks the next step in SANAD's 50-rig newbuild program. The first rigs of this tranche are scheduled to commence operating in 2026, with the final one in 2027.
Several impactful international rig reactivations were completed in Kuwait. All three previously announced awards have commenced operations, one of which began in early July. These high-specification rigs are working under multiyear contracts and are expected to contribute materially to the International Drilling segment earnings during the second half of 2025 and beyond.
Nabors' high-specification PACE® series SmartRigs® set several milestones extending lateral wellbore lengths.
In the Bakken, a PACE®-X rig followed up drilling an operator's first four-mile lateral in the formation with two more four-mile lateral wells.
Also in the Bakken, another operator utilizing a PACE®-B rig drilled back-to-back four-mile lateral wells.
In the Haynesville a PACE®-X rig drilled the basin's longest lateral at 20,000 feet; the well reached a total depth of 32,000 feet.
In the Eagle Ford, a PACE®-M rig drilled a record well in the basin, at 32,525 feet, including a 22,500-foot lateral section.
Significant progress was made on the integration of the Parker Wellbore businesses acquired in March. These contributed materially to Nabors financial results in the second quarter. Cost synergies realized during the quarter support the $40 million previously targeted for 2025.
Anthony G. Petrello, Nabors Chairman, CEO and President, commented, "Our second quarter results demonstrated the strength of the Nabors portfolio while reflecting a full quarter contribution from the acquisition of Parker Wellbore. In total, EBITDA from the legacy Nabors businesses increased sequentially. I am pleased with the performance of the Parker operations, and our progress to realize expected cost synergies.
"Recent deployments of high-spec rigs in the Middle East along with those scheduled over the balance of 2025 should drive growth in our International Drilling segment. The SANAD newbuild program is a key element of our future value creation. The award of the fourth five-rig tranche cements SANAD's growth prospects into 2027.
"Before the impact from Parker, adjusted EBITDA grew sequentially in all three of the business lines in our U.S. Drilling segment. The Lower-48 rig market in oil focused basins remains flat to down, and we are working to mitigate the impact of the current industry rig count and dayrates. At the same time, natural gas drilling has moved upwards. We see our rig count and leading-edge pricing stabilizing in the third quarter and through the end of the year.
"Our U.S. Offshore and Alaska operations are performing well. Including the contributions of Parker, these two businesses comprise a growing portion of our overall U.S. Drilling segment. In particular, our Alaska fleet is poised to capitalize on growth in that market.
"With the addition of Parker's operations, Nabors Drilling Solutions now comprises over 25% of adjusted EBITDA from our operating segments. The Parker product lines in NDS, the largest being Quail Tools, outperformed our expectations in the second quarter. These results highlight the potential that led us to the acquisition."
Segment Results
International Drilling adjusted EBITDA totaled $117.7 million, compared to $115.5 million in the first quarter. Average rig count increased by one, primarily reflecting the startup of newbuild rigs in Saudi Arabia and Kuwait, offset by the conclusion of contracts for a rig each in Papua New Guinea and Mexico. Daily adjusted gross margin for the second quarter improved to $17,534, driven primarily by the high-margin additions.
The U.S. Drilling segment reported second quarter adjusted EBITDA of $101.8 million, compared to $92.7 million in the previous quarter. All three of the U.S. Drilling segment's operations drove this improvement. In the Lower 48, the higher rig count more than offset a decline in daily margins. Improvements in Nabors legacy Alaska and Offshore were augmented by the contribution of a full quarter of the corresponding Parker operations.
Drilling Solutions adjusted EBITDA was $76.5 million, compared to $40.9 million in the first quarter. The legacy Nabors business was down slightly, while the addition of Parker accounted for the sequential increase. This segment's gross margin, at 53%, improved moderately.
Rig Technologies adjusted EBITDA was $5.2 million, compared to $5.6 million in the prior quarter. A decline in capital equipment deliveries, primarily in the Middle East, contributed to the sequential decrease in adjusted EBITDA.
Adjusted Free Cash Flow
In the second quarter, consolidated adjusted free cash flow was $41 million. This compares to free cash consumption of $61 million in the prior quarter. These figures exclude transaction costs related to the acquisition of Parker Wellbore. Lower quarterly cash interest payments and improved collections from customers contributed to the improved adjusted free cash flow in the second quarter, even as capital expenditures increased. Although receivable collections during the second quarter from Nabors' main customer in Mexico were significantly lower than expected, the company benefited from higher payments from other clients. The recently announced a $7 - $10 billion capital raise sponsored by the Mexico government is intended to address the issue of overdue vendor liabilities.
William Restrepo, Nabors CFO, stated, "The current economic backdrop appears to be stabilizing, as markets digest recent developments on foreign trade, Federal Reserve policy, and geopolitical conflicts. Favorable trends in employment and inflation indicate a relatively constructive environment, for both our potential capital markets activities and our global operations. These factors have already had a positive impact on credit spreads. Interest rate actions by the Fed and a further narrowing of spreads later this year should benefit us, as we look to refinance our senior notes.
"Our results for the second quarter were solid. In addition to the higher adjusted EBITDA contribution from Parker Wellbore, our legacy drilling rig business improved. Legacy Drilling Solutions and Rig Technologies declined slightly.
"We are encouraged by our relatively stable Lower 48 rig count as we enter the second half and expect our rig count to continue at approximately its current level through year end. This outlook assumes some continued weakness in oil-focused activity, offset by anticipated strength in natural gas drilling. At the same time, our leading-edge daily revenue has remained resilient in the low $30,000 range, providing support to our daily gross margin. This environment gives us confidence about our expected pace of cash flow generation and debt reduction during the balance of 2025.
"Adjusted free cash flow generated by our operations of $41 million in the second quarter improved by more than $100 million as compared to the first quarter. In the third quarter, we expect progress on our collections in Mexico. Assuming these materialize, we forecast similar adjusted free cash flow in the third quarter and anticipate reaching our $80 million target for the full year.
"Parker Wellbore has exceeded our expectations as it grew sequentially on a comparable basis. Margins were high and cash flow generation was better than anticipated. In addition, our synergy capture post-closing has exceeded our targets."
Outlook
Nabors expects the following metrics for the third quarter of 2025:
U.S. Drilling
Lower 48 average rig count of 57 - 59 rigs
Lower 48 daily adjusted gross margin of approximately $13,300
Alaska and Gulf of America combined adjusted EBITDA of approximately $26 million
International
Average rig count of 87 - 88 rigs
Daily adjusted gross margin of approximately $17,900
Drilling Solutions
Adjusted EBITDA approximately in line with the second quarter
Rig Technologies
Adjusted EBITDA up approximately $2 - $3 million from the second quarter
Capital Expenditures
Capital expenditures of $200 - $210 million, including $110 - $115 million for the newbuilds in Saudi Arabia
Full-year capital expenditures of $700 - $710 million, with $300 million for the SANAD newbuilds and $60 million for Parker Wellbore
Adjusted Free Cash Flow
Adjusted free cash flow should be in line with the second quarter
Mr. Petrello concluded, "Challenge and change are constants in the oilfield services business. The current environment is no exception. Our strategy to diversify by service line and by geography continues to position Nabors for success throughout the cycle. The Parker business adds key complementary elements to our portfolio.
"With the award of another tranche of newbuild rigs, the outlook for significant free cash flow at SANAD is solidified. We are confident this growth in SANAD will drive significant value creation."
About Nabors Industries
Nabors Industries (NYSE:NBR) is a leading provider of advanced technology for the energy industry. With presence in more than 20 countries, Nabors has established a global network of people, technology and equipment to deploy solutions that deliver safe, efficient and responsible energy production. By leveraging its core competencies, particularly in drilling, engineering, automation, data science and manufacturing, Nabors aims to innovate the future of energy and enable the transition to a lower-carbon world. Learn more about Nabors and its energy technology leadership: www.nabors.com.
Forward-looking Statements
The information included in this press release includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such forward-looking statements are subject to a number of risks and uncertainties, as disclosed by Nabors from time to time in its filings with the Securities and Exchange Commission. As a result of these factors, Nabors' actual results may differ materially from those indicated or implied by such forward-looking statements. The forward-looking statements contained in this press release reflect management's estimates and beliefs as of the date of this press release. Nabors does not undertake to update these forward-looking statements.
Non-GAAP Disclaimer
This press release presents certain "non-GAAP" financial measures. The components of these non-GAAP measures are computed by using amounts that are determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Adjusted operating income (loss) represents income (loss) from continuing operations before income taxes, interest expense, investment income (loss), gain on bargain purchase, and other, net. Adjusted EBITDA is computed similarly, but also excludes depreciation and amortization expenses. In addition, adjusted EBITDA and adjusted operating income (loss) exclude certain cash expenses that the Company is obligated to make. Net debt is calculated as total debt minus the sum of cash, cash equivalents and short-term investments.
Adjusted free cash flow represents net cash provided by operating activities less cash used for capital expenditures, net of proceeds from sales of assets, and before cash paid for acquisition-related costs. Management believes that adjusted free cash flow is an important liquidity measure for the company and that it is useful to investors and management as a measure of the company's ability to generate cash flow, after reinvesting in the company for future growth, that could be available for paying down debt or other financing cash flows, such as dividends to shareholders. Adjusted free cash flow does not represent the residual cash flow available for discretionary expenditures. Adjusted free cash flow is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, cash flow from operations reported in accordance with GAAP.
Each of these non-GAAP measures has limitations and therefore should not be used in isolation or as a substitute for the amounts reported in accordance with GAAP. However, management evaluates the performance of its operating segments and the consolidated Company based on several criteria, including Adjusted EBITDA, adjusted operating income (loss), net debt, and adjusted free cash flow, because it believes that these financial measures accurately reflect the Company's ongoing profitability, performance and liquidity. Securities analysts and investors also use these measures as some of the metrics on which they analyze the Company's performance. Other companies in this industry may compute these measures differently. Reconciliations of consolidated adjusted EBITDA and adjusted operating income (loss) to income (loss) from continuing operations before income taxes, net debt to total debt, and adjusted free cash flow to net cash provided by operations, which are their nearest comparable GAAP financial measures, are included in the tables at the end of this press release. We do not provide a forward-looking reconciliation of our outlook for Segment Adjusted EBITDA, Segment Gross Margin or Adjusted Free Cash Flow, as the amount and significance of items required to develop meaningful comparable GAAP financial measures cannot be estimated at this time without unreasonable efforts. These special items could be meaningful.
Investor Contacts: William C. Conroy, CFA, Vice President of Corporate Development & Investor Relations, +1 281-775-2423 or via e-mail or Kara Peak, Director of Corporate Development & Investor Relations, +1 281-775-4954 or via email To request investor materials, contact Nabors' corporate headquarters in Hamilton, Bermuda at +441-292-1510 or via e-mail
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
(In thousands, except per share amounts)
2025
2024
2025
2025
2024
Revenues and other income:
Operating revenues
$ 832,788
$ 734,798
$ 736,186
$ 1,568,974
$ 1,468,502
Investment income (loss)
6,129
8,181
6,596
12,725
18,382
Total revenues and other income
838,917
742,979
742,782
1,581,699
1,486,884
Costs and other deductions:
Direct costs
488,881
440,225
447,300
936,181
877,302
General and administrative expenses
82,726
62,154
68,506
151,232
123,905
Research and engineering
12,722
14,362
14,035
26,757
28,225
Depreciation and amortization
175,061
160,141
154,638
329,699
317,826
Interest expense
56,081
51,493
54,326
110,407
101,872
Gain on bargain purchase
(3,500)
-
(112,999)
(116,499)
-
Other, net
6,074
12,079
44,790
50,864
28,187
Total costs and other deductions
818,045
740,454
670,596
1,488,641
1,477,317
Income (loss) before income taxes
20,872
2,525
72,186
93,058
9,567
Income tax expense (benefit)
23,077
15,554
15,007
38,084
31,598
Net income (loss)
(2,205)
(13,029)
57,179
54,974
(22,031)
Less: Net (income) loss attributable to noncontrolling interest
(28,705)
(19,226)
(24,191)
(52,896)
(44,557)
Net income (loss) attributable to Nabors
$ (30,910)
$ (32,255)
$ 32,988
$ 2,078
$ (66,588)
Earnings (losses) per share:
Basic
$ (2.71)
$ (4.29)
$ 2.35
$ (1.01)
$ (8.83)
Diluted
$ (2.71)
$ (4.29)
$ 2.18
$ (1.01)
$ (8.83)
Weighted-average number of common shares outstanding:
Basic
14,083
9,207
10,460
12,271
9,191
Diluted
14,083
9,207
11,671
12,271
9,191
Adjusted EBITDA
$ 248,459
$ 218,057
$ 206,345
$ 454,804
$ 439,070
Adjusted operating income (loss)
$ 73,398
$ 57,916
$ 51,707
$ 125,105
$ 121,244
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30,
March 31,
December 31,
(In thousands)
2025
2025
2024
ASSETS
Current assets:
Cash and short-term investments
$ 387,355
$ 404,109
$ 397,299
Accounts receivable, net
537,071
549,626
387,970
Other current assets
272,465
245,083
214,268
Total current assets
1,196,891
1,198,818
999,537
Property, plant and equipment, net
3,063,033
3,074,789
2,830,957
Other long-term assets
778,739
776,077
673,807
Total assets
$ 5,038,663
$ 5,049,684
$ 4,504,301
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable
$ 364,846
$ 375,440
321,030
Other current liabilities
304,599
292,205
250,887
Total current liabilities
669,445
667,645
571,917
Long-term debt
2,672,820
2,685,169
2,505,217
Other long-term liabilities
249,728
251,493
220,829
Total liabilities
3,591,993
3,604,307
3,297,963
Redeemable noncontrolling interest in subsidiary
806,342
795,643
785,091
Equity:
Shareholders' equity
307,984
342,660
134,996
Noncontrolling interest
332,344
307,074
286,251
Total equity
640,328
649,734
421,247
Total liabilities and equity
$ 5,038,663
$ 5,049,684
$ 4,504,301
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
SEGMENT REPORTING
(Unaudited)
The following tables set forth certain information with respect to our reportable segments and rig activity:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
(In thousands, except rig activity)
2025
2024
2025
2025
2024
