[10-Q] Nabors Industries Ltd. Quarterly Earnings Report
Nabors Industries (NBR) filed its Form 10-Q for the quarter ended 30 Jun 25. Q2 operating revenue grew 13% YoY to $833 m, lifting H1 revenue 7% to $1.57 b. A $116 m bargain-purchase gain from the March Parker Drilling acquisition pushed H1 net income to $2 m versus a $67 m loss last year, but the quarter remained loss-making: Nabors posted a $31 m net loss (-$2.71/sh) versus -$32 m (-$4.29) in Q2-24.
Direct costs rose 11% while revenue climbed 13%; however, SG&A jumped 33% and interest expense increased 9% to $56 m, limiting operating leverage. The firm also booked a $26.5 m impairment on Russia-related assets; current Russian exposure is <1% of revenue and PPE.
Total assets expanded 12% to $5.04 b. Long-term debt rose 7% to $2.67 b after drawing $178 m on the new 2024 credit facility to retire Parker’s term loan; weighted-average revolver rate is 7.2%. Share issuance for the Parker deal and earnings effects boosted shareholders’ equity to $308 m from $135 m at 12/24.
Operating cash flow slipped 17% YoY to $240 m while capex jumped 48% to $344 m, turning free cash flow negative. Nabors reports covenant compliance and 15.74 m basic shares outstanding (14.58 m net of treasury) as of 29 Jul 25.
Nabors Industries (NBR) ha presentato il suo Modulo 10-Q per il trimestre terminato il 30 giugno 2025. Il fatturato operativo del secondo trimestre è cresciuto del 13% su base annua, raggiungendo 833 milioni di dollari, portando il fatturato del primo semestre a 1,57 miliardi di dollari, con un aumento del 7%. Un guadagno da acquisto vantaggioso di 116 milioni di dollari derivante dall'acquisizione di Parker Drilling di marzo ha spinto l'utile netto del primo semestre a 2 milioni di dollari, rispetto a una perdita di 67 milioni dell'anno precedente, ma il trimestre è rimasto in perdita: Nabors ha registrato una perdita netta di 31 milioni di dollari (-2,71$ per azione) contro i -32 milioni (-4,29$) del secondo trimestre 2024.
I costi diretti sono aumentati dell'11% mentre i ricavi sono saliti del 13%; tuttavia, le spese generali e amministrative (SG&A) sono aumentate del 33% e gli oneri finanziari sono cresciuti del 9%, raggiungendo 56 milioni di dollari, limitando la leva operativa. La società ha inoltre contabilizzato una perdita di valore di 26,5 milioni di dollari su attività legate alla Russia; l'esposizione attuale in Russia è inferiore all'1% sia del fatturato che delle immobilizzazioni materiali.
Il totale attivo è aumentato del 12%, raggiungendo 5,04 miliardi di dollari. Il debito a lungo termine è salito del 7% a 2,67 miliardi dopo aver utilizzato 178 milioni di dollari della nuova linea di credito 2024 per estinguere il prestito a termine di Parker; il tasso medio ponderato sul fido è del 7,2%. L'emissione di azioni per l'acquisizione di Parker e gli effetti degli utili hanno portato il patrimonio netto a 308 milioni di dollari, rispetto ai 135 milioni al 31 dicembre 2024.
Il flusso di cassa operativo è diminuito del 17% su base annua a 240 milioni di dollari, mentre il capex è aumentato del 48% a 344 milioni, rendendo il flusso di cassa libero negativo. Nabors dichiara il rispetto dei covenant e 15,74 milioni di azioni ordinarie in circolazione (14,58 milioni al netto del tesoro) al 29 luglio 2025.
Nabors Industries (NBR) presentó su Formulario 10-Q para el trimestre finalizado el 30 de junio de 2025. Los ingresos operativos del segundo trimestre crecieron un 13% interanual hasta 833 millones de dólares, elevando los ingresos del primer semestre un 7% hasta 1,57 mil millones. Una ganancia por compra ventajosa de 116 millones de dólares derivada de la adquisición de Parker Drilling en marzo impulsó el ingreso neto del primer semestre a 2 millones, frente a una pérdida de 67 millones del año pasado, pero el trimestre siguió siendo deficitario: Nabors reportó una pérdida neta de 31 millones (-2,71$ por acción) frente a -32 millones (-4,29$) en el segundo trimestre de 2024.
Los costos directos aumentaron un 11% mientras que los ingresos subieron un 13%; sin embargo, los gastos de venta, generales y administrativos (SG&A) saltaron un 33% y los gastos por intereses crecieron un 9% hasta 56 millones, limitando el apalancamiento operativo. La empresa también registró una pérdida por deterioro de 26,5 millones en activos relacionados con Rusia; la exposición actual en Rusia es inferior al 1% tanto de los ingresos como de las propiedades, planta y equipo (PPE).
El total de activos aumentó un 12% hasta 5,04 mil millones. La deuda a largo plazo subió un 7% hasta 2,67 mil millones tras utilizar 178 millones del nuevo crédito 2024 para cancelar el préstamo a plazo de Parker; la tasa promedio ponderada del crédito revolvente es del 7,2%. La emisión de acciones para la operación de Parker y los efectos de las ganancias aumentaron el patrimonio de los accionistas a 308 millones desde 135 millones al 31/12/24.
El flujo de caja operativo disminuyó un 17% interanual a 240 millones, mientras que el capex subió un 48% hasta 344 millones, volviendo el flujo de caja libre negativo. Nabors reporta cumplimiento de convenios y 15,74 millones de acciones básicas en circulación (14,58 millones netas de tesorería) al 29 de julio de 2025.
Nabors Industries (NBR)는 2025년 6월 30일 종료된 분기에 대한 Form 10-Q를 제출했습니다. 2분기 영업 수익은 전년 대비 13% 증가한 8억 3,300만 달러를 기록하며, 상반기 매출은 7% 증가한 15억 7천만 달러를 달성했습니다. 3월 Parker Drilling 인수에서 발생한 1억 1,600만 달러의 우량 매입 이익 덕분에 상반기 순이익은 200만 달러로 전년도의 6,700만 달러 손실에서 흑자로 전환되었으나, 분기별로는 여전히 손실을 기록했습니다: Nabors는 2분기 2024년의 3,200만 달러(-주당 4.29달러) 손실에 비해 3,100만 달러(-주당 2.71달러) 순손실을 기록했습니다.
직접 비용은 11% 상승한 반면 수익은 13% 증가했으나, 판매관리비(SG&A)는 33% 급증했고, 이자 비용은 9% 증가한 5,600만 달러로 운영 레버리지를 제한했습니다. 회사는 또한 러시아 관련 자산에 대해 2,650만 달러의 손상차손을 인식했으며, 현재 러시아 노출은 매출 및 유형자산(PPE)의 1% 미만입니다.
총 자산은 12% 증가한 50억 4천만 달러를 기록했습니다. 장기 부채는 Parker의 만기 대출 상환을 위해 1억 7,800만 달러를 신규 2024 신용시설에서 인출한 후 7% 증가한 26억 7천만 달러가 되었습니다; 가중평균 회전 신용 금리는 7.2%입니다. Parker 거래를 위한 주식 발행과 수익 효과로 주주 자본은 2024년 12월 31일 1억 3,500만 달러에서 3억 800만 달러로 증가했습니다.
영업 현금 흐름은 전년 대비 17% 감소한 2억 4천만 달러를 기록했고, 자본 지출(capex)은 48% 증가한 3억 4,400만 달러로 자유 현금 흐름이 마이너스로 전환되었습니다. Nabors는 2025년 7월 29일 기준으로 계약 조건 준수와 1,574만 기본 주식(자기주식 제외 1,458만 주)을 보고했습니다.
Nabors Industries (NBR) a déposé son formulaire 10-Q pour le trimestre clos le 30 juin 2025. Le chiffre d'affaires opérationnel du deuxième trimestre a augmenté de 13 % en glissement annuel pour atteindre 833 millions de dollars, portant le chiffre d'affaires du premier semestre à 1,57 milliard de dollars, soit une hausse de 7 %. Un gain d'achat avantageux de 116 millions de dollars lié à l'acquisition de Parker Drilling en mars a fait passer le résultat net du premier semestre à 2 millions de dollars contre une perte de 67 millions l'année précédente, mais le trimestre est resté déficitaire : Nabors a enregistré une perte nette de 31 millions de dollars (-2,71 $ par action) contre -32 millions (-4,29 $) au deuxième trimestre 2024.
Les coûts directs ont augmenté de 11 % tandis que le chiffre d'affaires a progressé de 13 % ; cependant, les frais de vente, généraux et administratifs (SG&A) ont bondi de 33 % et les charges d'intérêts ont augmenté de 9 % pour atteindre 56 millions, limitant l'effet de levier opérationnel. L'entreprise a également comptabilisé une dépréciation de 26,5 millions sur des actifs liés à la Russie ; l'exposition actuelle en Russie représente moins de 1 % du chiffre d'affaires et des immobilisations corporelles.
Le total des actifs a augmenté de 12 % pour atteindre 5,04 milliards. La dette à long terme a augmenté de 7 % pour atteindre 2,67 milliards après avoir tiré 178 millions sur la nouvelle facilité de crédit 2024 pour rembourser le prêt à terme de Parker ; le taux moyen pondéré du crédit renouvelable est de 7,2 %. L'émission d'actions liée à l'opération Parker et les effets des résultats ont porté les capitaux propres à 308 millions contre 135 millions au 31/12/24.
Les flux de trésorerie d'exploitation ont diminué de 17 % en glissement annuel à 240 millions, tandis que les dépenses d'investissement (capex) ont augmenté de 48 % à 344 millions, rendant le flux de trésorerie libre négatif. Nabors signale le respect des engagements et 15,74 millions d'actions ordinaires en circulation (14,58 millions nettes de trésorerie) au 29 juillet 2025.
Nabors Industries (NBR) hat seinen Form 10-Q für das Quartal zum 30. Juni 2025 eingereicht. Der Umsatz im 2. Quartal wuchs im Jahresvergleich um 13 % auf 833 Mio. USD, wodurch der Umsatz im ersten Halbjahr um 7 % auf 1,57 Mrd. USD stieg. Ein Gewinn aus günstigen Kaufbedingungen in Höhe von 116 Mio. USD aus der Übernahme von Parker Drilling im März hob den Nettoertrag im ersten Halbjahr auf 2 Mio. USD gegenüber einem Verlust von 67 Mio. USD im Vorjahr, doch das Quartal blieb verlustreich: Nabors verzeichnete einen Nettoverlust von 31 Mio. USD (-2,71 USD je Aktie) gegenüber -32 Mio. USD (-4,29 USD) im 2. Quartal 2024.
Die direkten Kosten stiegen um 11 %, während die Einnahmen um 13 % zunahmen; jedoch stiegen die Vertriebs- und Verwaltungskosten (SG&A) um 33 % und die Zinsaufwendungen um 9 % auf 56 Mio. USD, was die operative Hebelwirkung begrenzte. Das Unternehmen verbuchte außerdem eine Wertminderung von 26,5 Mio. USD auf russische Vermögenswerte; die aktuelle Russland-Exponierung liegt unter 1 % des Umsatzes und der Sachanlagen.
Die Gesamtvermögenswerte wuchsen um 12 % auf 5,04 Mrd. USD. Die langfristigen Schulden stiegen um 7 % auf 2,67 Mrd. USD, nachdem 178 Mio. USD aus der neuen Kreditfazilität 2024 aufgenommen wurden, um Parkers Terminkredit abzulösen; der gewichtete durchschnittliche Zinssatz für den revolvierenden Kredit beträgt 7,2 %. Die Aktienausgabe für den Parker-Deal und die Gewinneffekte erhöhten das Eigenkapital der Aktionäre von 135 Mio. USD zum 31.12.24 auf 308 Mio. USD.
Der operative Cashflow sank im Jahresvergleich um 17 % auf 240 Mio. USD, während die Investitionsausgaben (Capex) um 48 % auf 344 Mio. USD stiegen, wodurch der freie Cashflow negativ wurde. Nabors meldet die Einhaltung der Covenants und 15,74 Mio. ausstehende Stammaktien (14,58 Mio. netto nach Treasury-Aktien) zum 29. Juli 2025.
- Revenue growth: Q2 sales up 13% YoY; H1 up 7% despite industry volatility.
- Bargain-purchase gain: $116 m from Parker acquisition turned YTD earnings positive.
- Equity improvement: Shareholders’ equity more than doubled to $308 m on share issuance and profit lift.
- Covenant compliance: Company remains within 2024 Credit Agreement ratios with $387 m cash on hand.
- Continued quarterly loss: Q2 net loss attributable to Nabors was $31 m (-$2.71/sh).
- Operating cash flow decline: H1 OCF fell 17% while capex rose 48%, producing negative free cash flow.
- Higher leverage: Long-term debt increased 7% to $2.67 b; interest expense up 9% YoY.
- Impairment charges: $26.5 m write-down on Russia assets highlights geopolitical exposure.
Insights
TL;DR: Revenue up, YTD profit aided by bargain gain; core Q2 still loss, cash burn driven by higher capex, leverage inches higher but covenants intact.
Revenue momentum shows Nabors benefiting from stronger rig demand and the Parker acquisition. Yet the quarter’s $31 m loss underscores limited pricing power and higher SG&A. Ex-bargain gain, underlying profitability remains weak. Debt climbed to 3.3× annualised EBITDA, so execution on post-merger synergies and capex discipline are critical. Equity increase is welcome but still modest at 6% of assets. Near-term share-price reaction is likely muted; investors will focus on free-cash-flow inflection and deleveraging path.
TL;DR: Parker deal adds scale and rigs cheaply; integration risk acceptable, but rising interest and capex pressure free cash in down-cycle.
The bargain purchase indicates Nabors acquired Parker assets below replacement cost, expanding land/offshore fleet by ~10%. While strategic, integration costs and overlapping SG&A surfaced quickly, evidenced by 33% admin expense jump. Impairment in Russia is small, confirming limited geopolitical tail risk. Revolver draw highlights liquidity flexibility, yet higher floating-rate debt raises exposure to rate volatility. Success hinges on capturing Parker synergies and moderating 2025–26 capex to stabilise cash generation.
Nabors Industries (NBR) ha presentato il suo Modulo 10-Q per il trimestre terminato il 30 giugno 2025. Il fatturato operativo del secondo trimestre è cresciuto del 13% su base annua, raggiungendo 833 milioni di dollari, portando il fatturato del primo semestre a 1,57 miliardi di dollari, con un aumento del 7%. Un guadagno da acquisto vantaggioso di 116 milioni di dollari derivante dall'acquisizione di Parker Drilling di marzo ha spinto l'utile netto del primo semestre a 2 milioni di dollari, rispetto a una perdita di 67 milioni dell'anno precedente, ma il trimestre è rimasto in perdita: Nabors ha registrato una perdita netta di 31 milioni di dollari (-2,71$ per azione) contro i -32 milioni (-4,29$) del secondo trimestre 2024.
I costi diretti sono aumentati dell'11% mentre i ricavi sono saliti del 13%; tuttavia, le spese generali e amministrative (SG&A) sono aumentate del 33% e gli oneri finanziari sono cresciuti del 9%, raggiungendo 56 milioni di dollari, limitando la leva operativa. La società ha inoltre contabilizzato una perdita di valore di 26,5 milioni di dollari su attività legate alla Russia; l'esposizione attuale in Russia è inferiore all'1% sia del fatturato che delle immobilizzazioni materiali.
Il totale attivo è aumentato del 12%, raggiungendo 5,04 miliardi di dollari. Il debito a lungo termine è salito del 7% a 2,67 miliardi dopo aver utilizzato 178 milioni di dollari della nuova linea di credito 2024 per estinguere il prestito a termine di Parker; il tasso medio ponderato sul fido è del 7,2%. L'emissione di azioni per l'acquisizione di Parker e gli effetti degli utili hanno portato il patrimonio netto a 308 milioni di dollari, rispetto ai 135 milioni al 31 dicembre 2024.
Il flusso di cassa operativo è diminuito del 17% su base annua a 240 milioni di dollari, mentre il capex è aumentato del 48% a 344 milioni, rendendo il flusso di cassa libero negativo. Nabors dichiara il rispetto dei covenant e 15,74 milioni di azioni ordinarie in circolazione (14,58 milioni al netto del tesoro) al 29 luglio 2025.
Nabors Industries (NBR) presentó su Formulario 10-Q para el trimestre finalizado el 30 de junio de 2025. Los ingresos operativos del segundo trimestre crecieron un 13% interanual hasta 833 millones de dólares, elevando los ingresos del primer semestre un 7% hasta 1,57 mil millones. Una ganancia por compra ventajosa de 116 millones de dólares derivada de la adquisición de Parker Drilling en marzo impulsó el ingreso neto del primer semestre a 2 millones, frente a una pérdida de 67 millones del año pasado, pero el trimestre siguió siendo deficitario: Nabors reportó una pérdida neta de 31 millones (-2,71$ por acción) frente a -32 millones (-4,29$) en el segundo trimestre de 2024.
Los costos directos aumentaron un 11% mientras que los ingresos subieron un 13%; sin embargo, los gastos de venta, generales y administrativos (SG&A) saltaron un 33% y los gastos por intereses crecieron un 9% hasta 56 millones, limitando el apalancamiento operativo. La empresa también registró una pérdida por deterioro de 26,5 millones en activos relacionados con Rusia; la exposición actual en Rusia es inferior al 1% tanto de los ingresos como de las propiedades, planta y equipo (PPE).
El total de activos aumentó un 12% hasta 5,04 mil millones. La deuda a largo plazo subió un 7% hasta 2,67 mil millones tras utilizar 178 millones del nuevo crédito 2024 para cancelar el préstamo a plazo de Parker; la tasa promedio ponderada del crédito revolvente es del 7,2%. La emisión de acciones para la operación de Parker y los efectos de las ganancias aumentaron el patrimonio de los accionistas a 308 millones desde 135 millones al 31/12/24.
El flujo de caja operativo disminuyó un 17% interanual a 240 millones, mientras que el capex subió un 48% hasta 344 millones, volviendo el flujo de caja libre negativo. Nabors reporta cumplimiento de convenios y 15,74 millones de acciones básicas en circulación (14,58 millones netas de tesorería) al 29 de julio de 2025.
Nabors Industries (NBR)는 2025년 6월 30일 종료된 분기에 대한 Form 10-Q를 제출했습니다. 2분기 영업 수익은 전년 대비 13% 증가한 8억 3,300만 달러를 기록하며, 상반기 매출은 7% 증가한 15억 7천만 달러를 달성했습니다. 3월 Parker Drilling 인수에서 발생한 1억 1,600만 달러의 우량 매입 이익 덕분에 상반기 순이익은 200만 달러로 전년도의 6,700만 달러 손실에서 흑자로 전환되었으나, 분기별로는 여전히 손실을 기록했습니다: Nabors는 2분기 2024년의 3,200만 달러(-주당 4.29달러) 손실에 비해 3,100만 달러(-주당 2.71달러) 순손실을 기록했습니다.
직접 비용은 11% 상승한 반면 수익은 13% 증가했으나, 판매관리비(SG&A)는 33% 급증했고, 이자 비용은 9% 증가한 5,600만 달러로 운영 레버리지를 제한했습니다. 회사는 또한 러시아 관련 자산에 대해 2,650만 달러의 손상차손을 인식했으며, 현재 러시아 노출은 매출 및 유형자산(PPE)의 1% 미만입니다.
총 자산은 12% 증가한 50억 4천만 달러를 기록했습니다. 장기 부채는 Parker의 만기 대출 상환을 위해 1억 7,800만 달러를 신규 2024 신용시설에서 인출한 후 7% 증가한 26억 7천만 달러가 되었습니다; 가중평균 회전 신용 금리는 7.2%입니다. Parker 거래를 위한 주식 발행과 수익 효과로 주주 자본은 2024년 12월 31일 1억 3,500만 달러에서 3억 800만 달러로 증가했습니다.
영업 현금 흐름은 전년 대비 17% 감소한 2억 4천만 달러를 기록했고, 자본 지출(capex)은 48% 증가한 3억 4,400만 달러로 자유 현금 흐름이 마이너스로 전환되었습니다. Nabors는 2025년 7월 29일 기준으로 계약 조건 준수와 1,574만 기본 주식(자기주식 제외 1,458만 주)을 보고했습니다.
Nabors Industries (NBR) a déposé son formulaire 10-Q pour le trimestre clos le 30 juin 2025. Le chiffre d'affaires opérationnel du deuxième trimestre a augmenté de 13 % en glissement annuel pour atteindre 833 millions de dollars, portant le chiffre d'affaires du premier semestre à 1,57 milliard de dollars, soit une hausse de 7 %. Un gain d'achat avantageux de 116 millions de dollars lié à l'acquisition de Parker Drilling en mars a fait passer le résultat net du premier semestre à 2 millions de dollars contre une perte de 67 millions l'année précédente, mais le trimestre est resté déficitaire : Nabors a enregistré une perte nette de 31 millions de dollars (-2,71 $ par action) contre -32 millions (-4,29 $) au deuxième trimestre 2024.
Les coûts directs ont augmenté de 11 % tandis que le chiffre d'affaires a progressé de 13 % ; cependant, les frais de vente, généraux et administratifs (SG&A) ont bondi de 33 % et les charges d'intérêts ont augmenté de 9 % pour atteindre 56 millions, limitant l'effet de levier opérationnel. L'entreprise a également comptabilisé une dépréciation de 26,5 millions sur des actifs liés à la Russie ; l'exposition actuelle en Russie représente moins de 1 % du chiffre d'affaires et des immobilisations corporelles.
Le total des actifs a augmenté de 12 % pour atteindre 5,04 milliards. La dette à long terme a augmenté de 7 % pour atteindre 2,67 milliards après avoir tiré 178 millions sur la nouvelle facilité de crédit 2024 pour rembourser le prêt à terme de Parker ; le taux moyen pondéré du crédit renouvelable est de 7,2 %. L'émission d'actions liée à l'opération Parker et les effets des résultats ont porté les capitaux propres à 308 millions contre 135 millions au 31/12/24.
Les flux de trésorerie d'exploitation ont diminué de 17 % en glissement annuel à 240 millions, tandis que les dépenses d'investissement (capex) ont augmenté de 48 % à 344 millions, rendant le flux de trésorerie libre négatif. Nabors signale le respect des engagements et 15,74 millions d'actions ordinaires en circulation (14,58 millions nettes de trésorerie) au 29 juillet 2025.
Nabors Industries (NBR) hat seinen Form 10-Q für das Quartal zum 30. Juni 2025 eingereicht. Der Umsatz im 2. Quartal wuchs im Jahresvergleich um 13 % auf 833 Mio. USD, wodurch der Umsatz im ersten Halbjahr um 7 % auf 1,57 Mrd. USD stieg. Ein Gewinn aus günstigen Kaufbedingungen in Höhe von 116 Mio. USD aus der Übernahme von Parker Drilling im März hob den Nettoertrag im ersten Halbjahr auf 2 Mio. USD gegenüber einem Verlust von 67 Mio. USD im Vorjahr, doch das Quartal blieb verlustreich: Nabors verzeichnete einen Nettoverlust von 31 Mio. USD (-2,71 USD je Aktie) gegenüber -32 Mio. USD (-4,29 USD) im 2. Quartal 2024.
Die direkten Kosten stiegen um 11 %, während die Einnahmen um 13 % zunahmen; jedoch stiegen die Vertriebs- und Verwaltungskosten (SG&A) um 33 % und die Zinsaufwendungen um 9 % auf 56 Mio. USD, was die operative Hebelwirkung begrenzte. Das Unternehmen verbuchte außerdem eine Wertminderung von 26,5 Mio. USD auf russische Vermögenswerte; die aktuelle Russland-Exponierung liegt unter 1 % des Umsatzes und der Sachanlagen.
Die Gesamtvermögenswerte wuchsen um 12 % auf 5,04 Mrd. USD. Die langfristigen Schulden stiegen um 7 % auf 2,67 Mrd. USD, nachdem 178 Mio. USD aus der neuen Kreditfazilität 2024 aufgenommen wurden, um Parkers Terminkredit abzulösen; der gewichtete durchschnittliche Zinssatz für den revolvierenden Kredit beträgt 7,2 %. Die Aktienausgabe für den Parker-Deal und die Gewinneffekte erhöhten das Eigenkapital der Aktionäre von 135 Mio. USD zum 31.12.24 auf 308 Mio. USD.
Der operative Cashflow sank im Jahresvergleich um 17 % auf 240 Mio. USD, während die Investitionsausgaben (Capex) um 48 % auf 344 Mio. USD stiegen, wodurch der freie Cashflow negativ wurde. Nabors meldet die Einhaltung der Covenants und 15,74 Mio. ausstehende Stammaktien (14,58 Mio. netto nach Treasury-Aktien) zum 29. Juli 2025.
Table of Contents
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the Quarterly Period Ended
Commission File Number:
(Exact name of registrant as specified in its charter)
| | |
| ||
(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
(Address of principal executive office)
(
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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| Accelerated Filer ☐ | |
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Non-accelerated Filer ☐ | | Smaller reporting company |
| Emerging growth company | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
The number of common shares, par value $.05 per share, outstanding as of July 29, 2025 was 15,736,950, excluding 1,161,283 common shares held by our subsidiaries, or
Table of Contents
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
Index
| | |
PART I FINANCIAL INFORMATION | ||
| | |
Item 1. | Financial Statements | |
| | |
| Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 | 3 |
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| Condensed Consolidated Statements of Income (Loss) for the Three and Six Months Ended June 30, 2025 and 2024 | 4 |
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| Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2025 and 2024 | 5 |
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| Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 | 6 |
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| Condensed Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2025 and 2024 | 7 |
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| Notes to Condensed Consolidated Financial Statements | 9 |
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Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 27 |
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Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 37 |
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Item 4. | Controls and Procedures | 37 |
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PART II OTHER INFORMATION | ||
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Item 1. | Legal Proceedings | 38 |
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Item 1A. | Risk Factors | 38 |
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Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 39 |
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Item 3. | Defaults Upon Senior Securities | 39 |
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Item 4. | Mine Safety Disclosures | 39 |
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Item 5. | Other Information | 39 |
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Item 6. | Exhibits | 40 |
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Signatures | 40 | |
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NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| | | | | | | |
| | June 30, | | December 31, | | ||
|
| 2025 |
| 2024 |
| ||
| | (In thousands, except for |
| ||||
| | share amounts) |
| ||||
ASSETS | | | | | | | |
Current assets: | | | | | | | |
Cash and cash equivalents | | $ | | | $ | | |
Short-term investments | |
| | |
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Accounts receivable, net of allowance of $ | |
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Inventory, net | |
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Other current assets | |
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Total current assets | |
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Property, plant and equipment, net | |
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Restricted cash held in trust | |
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Deferred income taxes | |
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Other long-term assets | |
| | |
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Total assets (1) | | $ | | | $ | | |
LIABILITIES AND EQUITY | | | | | | | |
Current liabilities: | | | | | | | |
Trade accounts payable | | $ | | | $ | | |
Accrued liabilities | | | | |
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Income taxes payable | |
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Current lease liabilities | |
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Total current liabilities | |
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Long-term debt | |
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Other long-term liabilities | |
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Deferred income taxes | |
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Total liabilities (1) | |
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Commitments and contingencies (Note 9) | | | | | | | |
Redeemable noncontrolling interest in subsidiary | | | | |
| | |
| | | | | | | |
Shareholders’ equity: | | | | | | | |
Common shares, par value $ | | | | | | | |
Authorized common shares | |
| | |
| | |
Capital in excess of par value | |
| | |
| | |
Accumulated other comprehensive income (loss) | |
| ( | |
| ( | |
Retained earnings (accumulated deficit) | |
| ( | |
| ( | |
Less: treasury shares, at cost, | |
| ( | |
| ( | |
Total shareholders’ equity | |
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Noncontrolling interest | |
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Total equity | |
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Total liabilities and equity | | $ | | | $ | | |
| (1) |
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
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NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
| | | | | | | | | | | | | |
| | | Three Months Ended | | Six Months Ended | ||||||||
| |
| June 30, |
| June 30, | ||||||||
| | | 2025 | | 2024 | | 2025 | | 2024 | ||||
| (In thousands, except per share amounts) | ||||||||||||
Revenues and other income: | | | | | | | | | | | | | |
Operating revenues | | | $ | | | $ | | | $ | | | $ | |
Investment income (loss) | | |
| | |
| | |
| | |
| |
Total revenues and other income | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Costs and other deductions: | | | | | | | | | | | | | |
Direct costs | | | | | | | | | | | | | |
General and administrative expenses | | | | | | | | | | | | | |
Research and engineering | | |
| | |
| | |
| | |
| |
Depreciation and amortization | | |
| | |
| | |
| | |
| |
Interest expense | | | | | | | | | | | | | |
Gain on bargain purchase | | |
| ( | |
| — | |
| ( | | | — |
Other, net | | | | | | | | | | | | | |
Total costs and other deductions | | | | | | | | | | | | | |
Income (loss) before income taxes | | |
| | |
| | |
| | |
| |
Income tax expense (benefit): | | | | | | | | | | | | | |
Current | | |
| | |
| | |
| | |
| |
Deferred | | |
| | |
| | |
| | |
| |
Total income tax expense (benefit) | | |
| | |
| | |
| | |
| |
Net income (loss) | | |
| ( | |
| ( | |
| | |
| ( |
Less: Net (income) loss attributable to noncontrolling interest | | |
| ( | |
| ( | |
| ( | |
| ( |
Net income (loss) attributable to Nabors | | | $ | ( | | $ | ( | | $ | | | $ | ( |
| | | | | | | | | | | | | |
Earnings (losses) per share: | | | | | | | | | | | | | |
Basic | | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
Diluted | | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
| | | | | | | | | | | | | |
Weighted-average number of common shares outstanding: | | | | | | | | | | | | | |
Basic | | |
| | |
| | |
| | |
| |
Diluted | | |
| | |
| | |
| | |
| |
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
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NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)
| | | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended |
| ||||||||
|
| June 30, |
| June 30, |
| ||||||||
| | 2025 | | 2024 | | 2025 | | 2024 | | ||||
| | (in thousands) |
| ||||||||||
Net income (loss) attributable to Nabors | | $ | ( | | $ | ( | | $ | | | $ | ( | |
Other comprehensive income (loss), before tax: | | | | | | | | | | | | | |
Translation adjustment attributable to Nabors | | | ( | | | ( | | | ( | | | ( | |
Pension liability amortization and adjustment | |
| | |
| | |
| | |
| | |
Other comprehensive income (loss), before tax | |
| ( | |
| | |
| ( | |
| ( | |
Income tax expense (benefit) related to items of other comprehensive income (loss) | |
| | |
| | |
| | |
| | |
Other comprehensive income (loss), net of tax | |
| ( | |
| ( | |
| ( | |
| ( | |
Comprehensive income (loss) attributable to Nabors | |
| ( | |
| ( | |
| | |
| ( | |
Comprehensive income (loss) attributable to noncontrolling interest | |
| | |
| | |
| | |
| | |
Comprehensive income (loss) | | $ | ( | | $ | ( | | $ | | | $ | ( | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
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NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| | | | | | | |
| | Six Months Ended June 30, | | ||||
|
| 2025 |
| 2024 | | ||
| | (In thousands) | | ||||
Cash flows from operating activities: | | | | | | | |
Net income (loss) | | $ | | | $ | ( | |
Adjustments to net income (loss): | | | | | | | |
Depreciation and amortization | |
| | |
| | |
Deferred income tax expense (benefit) | |
| | |
| | |
Impairments and other charges | |
| | |
| — | |
Amortization of debt discount and deferred financing costs | | | | |
| | |
Bargain purchase gain | | | ( | |
| — | |
Losses (gains) on debt buyback | |
| ( | |
| | |
Losses (gains) on sale of long-lived assets, net | |
| ( | |
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Share-based compensation | |
| | |
| | |
Foreign currency transaction losses (gains), net | |
| | |
| | |
Mark-to-market (gain) loss on warrants | | | ( | |
| ( | |
Other | |
| | |
| | |
Changes in operating assets and liabilities, net of effects from acquisitions: | | | | | | | |
Accounts receivable | |
| ( | |
| ( | |
Inventory | |
| | |
| ( | |
Other current assets | |
| ( | |
| ( | |
Other long-term assets | |
| ( | |
| | |
Trade accounts payable and accrued liabilities | |
| ( | |
| | |
Income taxes payable | |
| ( | |
| ( | |
Other long-term liabilities | |
| ( | |
| ( | |
Net cash provided by (used for) operating activities | |
| | |
| | |
Cash flows from investing activities: | | | | | | | |
Purchase of investments | |
| ( | |
| ( | |
Cash acquired in stock based business combination, net of cash paid | |
| | |
| — | |
Capital expenditures | |
| ( | |
| ( | |
Proceeds from sales of assets | |
| | |
| | |
Other | |
| | |
| | |
Net cash (used for) provided by investing activities | |
| ( | |
| ( | |
Cash flows from financing activities: | | | | | | | |
Reduction in debt | | | ( | |
| ( | |
Debt issuance costs | |
| — | |
| ( | |
Proceeds from revolving credit facilities | |
| | |
| | |
Reduction in revolving credit facilities | | | ( | |
| ( | |
Payment of dividend to former Parker shareholders | | | ( | |
| — | |
Payments for employee taxes on net settlement of equity awards | | | ( | |
| ( | |
Dividends to common and preferred shareholders | |
| — | |
| ( | |
Distributions to noncontrolling interest | | | ( | |
| ( | |
Other | | | — | |
| ( | |
Net cash (used for) provided by financing activities | |
| ( | |
| ( | |
Effect of exchange rate changes on cash and cash equivalents | | | ( | |
| ( | |
Net increase (decrease) in cash and cash equivalents and restricted cash | |
| | | | ( | |
Cash and cash equivalents and restricted cash, beginning of period | | | | |
| | |
Cash and cash equivalents and restricted cash, end of period | | $ | | | $ | | |
| | | | | | | |
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | | | | | | | |
Cash and cash equivalents, beginning of period | | | | |
| | |
Restricted cash, beginning of period | | | | |
| | |
Cash and cash equivalents and restricted cash, beginning of period | | $ | | $ | | | |
| | | | | | | |
Cash and cash equivalents, end of period | | | | |
| | |
Restricted cash, end of period | | | | |
| | |
Cash and cash equivalents and restricted cash, end of period | | $ | | | $ | | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Capital | | Accumulated | | Retained | | | | | | | | | | | |||
| | Common Shares | | in Excess | | Other | | Earnings | | | | | Non- | | | | | |||||||
|
| |
| Par |
| of Par |
| Comprehensive |
| (Accumulated |
| Treasury |
| controlling |
| Total | | |||||||
(In thousands) | | Shares | | Value | | Value | | Income (Loss) | | Loss) | | Shares | | Interest | | Equity | | |||||||
As of March 31, 2024 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | | |
Net income (loss) | | — | | | — | | | — | | | — | | | ( | | | — | | | | | | ( | |
Other comprehensive income (loss), net of tax | | — | | | — | | | — | | | ( | | | — | | | — | | | — | | | ( | |
Share-based compensation | | | | | — | | | | | | — | | | — | | | — | | | — | | | | |
Noncontrolling interest contributions (distributions) | | — | | | — | | | — | | | — | | | — | | | — | | | ( | | | ( | |
Accrued distribution on redeemable noncontrolling interest in subsidiary | | — | | | — | | | — | | | — | | | ( | | | — | | | — | | | ( | |
Other | | — | | | — | | | — | | | — | | | | | | — | | | — | | | | |
As of June 30, 2024 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
As of March 31, 2025 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | | |
Net income (loss) | | — | | | — | | | — | | | — | | | ( | | | — | | | | | | ( | |
Other comprehensive income (loss), net of tax | | — | | | — | | | — | | | ( | | | — | | | — | | | — | | | ( | |
Share-based compensation | | | | | | | | | | | — | | | — | | | — | | | — | | | | |
Noncontrolling interest contributions (distributions) | | — | | | — | | | — | | | — | | | — | | | — | | | ( | | | ( | |
Accrued distribution on redeemable noncontrolling interest in subsidiary | | — | | | — | | | — | | | — | | | ( | | | — | | | — | | | ( | |
Other | | — | | | — | | | — | | | — | | | ( | | | — | | | — | | | ( | |
As of June 30, 2025 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | | |
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| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Capital | | Accumulated | | Retained | | | | | | | | | | |||
| | Common Shares | | in Excess | | Other | | Earnings | | | | | Non- | | | | |||||||
|
| |
| Par |
| of Par |
| Comprehensive |
| (Accumulated |
| Treasury |
| controlling |
| Total | |||||||
(In thousands) | | Shares | | Value | | Value | | Income (Loss) | | Loss) | | Shares | | Interest | | Equity | |||||||
As of December 31, 2023 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | |
Net income (loss) | | — | | | — | | | — | | | — | | | ( | | | — | | | | | | ( |
Other comprehensive income (loss), net of tax | | — | | | — | | | — | | | ( | | | — | | | — | | | — | | | ( |
Share-based compensation | | | | | | | | | | | — | | | — | | | — | | | — | | | |
Noncontrolling interest contributions (distributions) | | — | | | — | | | — | | | — | | | — | | | — | | | ( | | | ( |
Accrued distribution on redeemable noncontrolling interest in subsidiary | | — | | | — | | | — | | | — | | | ( | | | — | | | — | | | ( |
Other | | ( | | | ( | | | ( | | | — | | | ( | | | — | | | — | | | ( |
As of June 30, 2024 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | |
As of December 31, 2024 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | |
Net income (loss) | | — | | | — | | | — | | | — | | | | | | — | | | | | | |
Share issuance related to Parker acquisition | | | | | | | | | | | — | | | — | | | — | | | — | | | |
Other comprehensive income (loss), net of tax | | — | | | — | | | — | | | ( | | | — | | | — | | | — | | | ( |
Noncontrolling interest contributions (distributions) | | — | | | — | | | — | | | — | | | — | | | — | | | ( | | | ( |
Share-based compensation | | | | | | | | | | | — | | | — | | | — | | | — | | | |
Accrued distribution on redeemable noncontrolling interest in subsidiary | | — | | | — | | | — | | | — | | | ( | | | — | | | — | | | ( |
Other | | ( | | | ( | | | ( | | | — | | | ( | | | — | | | — | | | ( |
As of June 30, 2025 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | ( | | $ | | | $ | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
Table of Contents
Nabors Industries Ltd. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1 General
Unless the context requires otherwise, references in this report to “we,” “us,” “our,” “the Company,” or “Nabors” mean Nabors Industries Ltd., together with our subsidiaries. References in this report to “Nabors Delaware” mean Nabors Industries, Inc., a wholly owned subsidiary of Nabors.
Our business portfolio is comprised of our global land-based and offshore drilling rig operations and other rig related services and technologies. We provide performance tools, rental drill pipe and drilling equipment, tubular running services, directional drilling services, and innovative technologies for our own rig fleet and those operated by third parties. In addition, we design and manufacture advanced drilling equipment and provide drilling rig instrumentation. Also, we have a portfolio of technologies designed to drive energy efficiency and emissions reductions for both ourselves and third-party customers.
With operations in over
| ● |
| ● |
The short- and long-term implications of the military hostilities between Russia and Ukraine, which began in early 2022, remain difficult to predict. We continue to actively monitor this dynamic situation and evaluate the potential impact to our operations from sanctions that have been imposed against Russia by the United States, United Kingdom, the European Union, and other governments. As of June 30, 2025 and December 31, 2024,
Note 2 Summary of Significant Accounting Policies
Interim Financial Information
The accompanying unaudited condensed consolidated financial statements of Nabors have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) applicable to interim reporting. Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC” or “Commission”), certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. Therefore, these financial statements should be read together with our annual report on Form 10-K for the year ended December 31, 2024 (“2024 Annual Report”). In management’s opinion, the unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to state fairly our financial position as of June 30, 2025 and the results of operations, comprehensive income (loss), cash flows and changes in equity for the periods presented herein. Interim results for the six months ended June 30, 2025 may not be indicative of results that will be realized for the full year ending December 31, 2025.
9
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Principles of Consolidation
Our condensed consolidated financial statements include the accounts of Nabors, as well as all majority-owned and non-majority owned subsidiaries consolidated in accordance with U.S. GAAP. All significant intercompany accounts and transactions are eliminated in consolidation.
In addition to the consolidation of our majority owned subsidiaries, we also consolidate variable interest entities (“VIE”) when we are determined to be the primary beneficiary of a VIE. Determination of the primary beneficiary of a VIE is based on whether an entity has (a) the power to direct activities that most significantly impact the economic performance of the VIE and (b) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Our determination of the primary beneficiary of a VIE considers all relationships between us and the VIE. Our joint venture, SANAD, which is equally owned by Saudi Aramco and Nabors, has been consolidated. As we have the power to direct activities that most significantly impact SANAD’s economic performance, including operations, maintenance and certain sourcing and procurement, we have determined Nabors to be the primary beneficiary. See Note 4—Joint Ventures. Also, we are the co-sponsor of a special purpose acquisition company (the “SPAC”) and have determined it is a VIE. Nabors is the primary beneficiary of the SPAC as we have the power to direct activities, the right to receive benefits and the obligation to absorb losses. Therefore, the SPAC has been consolidated. See Note 14—Special Purpose Acquisition Company.
On March 11, 2025, we completed our acquisition (the “Parker acquisition”) of Parker Drilling Company (“Parker”) resulting in Parker becoming a wholly owned subsidiary of Nabors. Parker provides drilling services across global energy markets. The unaudited condensed consolidated financial statements include the results of Parker from March 12, 2025 to June 30, 2025. See Note 3—Parker Acquisition for additional details on the acquisition and merger.
Inventory
Inventory is stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out or weighted-average cost methods and includes the cost of materials, labor and manufacturing overhead. Inventory included the following:
| | | | | | | |
| | June 30, | | December 31, | | ||
|
| 2025 |
| 2024 |
| ||
| | (In thousands) |
| ||||
Raw materials | | $ | | | $ | | |
Work-in-progress | |
| | |
| | |
Finished goods | |
| | |
| | |
| | $ | | | $ | | |
Recent accounting pronouncements
Adopted
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), which enhances prior reportable segment disclosure requirements in part by requiring entities to disclose significant expenses related to their reportable segments that are regularly provided to the chief operation decision maker (“CODM”) and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss. The guidance also requires disclosure of the CODM’s position for each segment and detail of how the CODM uses financial reporting to access their segment’s performance. The new guidance is effective for fiscal years beginning after December 15, 2023. We adopted this ASU as required for the year ended December 31, 2024. The adoption requires us to provide additional disclosures related to our segments, but otherwise it does not materially impact our financial statements.
Not Yet Adopted
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, to enhance the transparency and decision usefulness of income tax disclosures. This provides qualitative and quantitative updates to the rate reconciliation and income taxes paid disclosures, including consistent categories and greater disaggregation of information in the rate reconciliation and disaggregation by jurisdiction of income taxes paid. The new
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guidance is effective for fiscal years beginning after December 15, 2024. We are currently evaluating the impact of this accounting standard update on our financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in this update require disclosure, in the notes to financial statements, of specified information about certain costs and expenses including purchases of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion and amortization recognized as part of oil and gas producing activities. This ASU is effective for fiscal years beginning after December 15, 2026. The adoption of ASU 2024-03 requires us to provide additional disclosures but will otherwise not materially impact our financial statements.
We consider the applicability and impact of all ASUs. We assessed ASUs not listed above and determined that they either were not applicable or do not have a material impact on our financial statements.
Note 3 Parker Acquisition
As discussed in Note 2—Summary of Significant Accounting Policies, on
The acquisition has been accounted for as a business combination using the acquisition method. Under the acquisition method of accounting, the fair value of the consideration transferred is allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values as of the acquisition date. The fair value of the net assets acquired amounted to approximately $
The bargain purchase gain was due to the decrease in the share price of our stock from the date the merger agreement was signed, to the closing date while the agreed upon purchase price of
The aggregate purchase price noted above was allocated to the major categories of assets acquired and liabilities assumed based on preliminary estimated fair values as of the date of the business combination. We applied significant judgement in estimating the fair value of assets acquired and liabilities assumed. The carrying amounts of cash and cash equivalents, accounts receivable, other assets, accounts payable and accrued liabilities approximate their fair values due to their nature or the short-term maturity of instruments. The fair value of property and equipment was determined using the cost approach which includes assumptions related to replacement cost, physical deterioration, economic obsolescence, and scrap value. The remaining assets acquired and liabilities assumed are based on inputs that are not observable in the market and thus represent Level 3 inputs. Assessing the overall business enterprise value, which was compared to market multiples for market participants, involved the use of assumptions with respect to future rig counts, operation and capital cost estimates and a weighted average cost of capital reflecting the cost of capital for market participants.
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We recorded the preliminary allocation of the purchase price consideration during the three months ended March 31, 2025. During the three months ended June 30, 2025, the Company recorded a measurement period adjustment which resulted in a decrease in property, plant and equipment, an increase in net lease assets and an increase in bargain purchase gain of $
The table below presents the allocation of the estimated fair value of identifiable assets acquired and liabilities assumed, and the resulting gain on bargain purchase as of the closing date:
| | | | |
|
| Fair Value |
| |
(In thousands) | | at Acquisition |
| |
Assets: | | | | |
Cash and cash equivalents | | $ | | |
Accounts receivable | |
| | |
Inventory | |
| | |
Other current assets | |
| | |
Property, plant and equipment | |
| | |
Deferred income taxes | |
| | |
Other assets | |
| | |
Total assets acquired | | | | |
| | | | |
Liabilities: | | | | |
Trade accounts payable | | $ | | |
Accrued liabilities | | | | |
Income taxes payable | | | | |
Other short-term liabilities | | | | |
Long-term debt | | | | |
Deferred income taxes | | | | |
Other liabilities | | | | |
Total liabilities assumed | | | | |
Net assets acquired | | | | |
Gain on bargain purchase | | | | |
Total consideration transferred | | $ | | |
Approximately $
Pro Forma
The following pro forma condensed combined financial information was derived from our and Parker’s historical financial statements and gives effect to the acquisition as if it had occurred on January 1, 2024. The below information reflects pro forma adjustments based on available information and certain assumptions we believe are reasonable, including the estimated tax impact of the pro forma adjustments.
The pro forma results of operations do not include any anticipated cost savings or other synergies that may result from the Parker acquisition nor do they include any estimated costs that will be incurred to integrate Parker operations. The pro forma results of operations include our merger and acquisition expenses of $
The pro forma condensed combined financial information has been included for comparative purposes and is not necessarily indicative of the results that might have actually occurred had the Parker acquisition taken place on January 1, 2024. Furthermore, the financial information is not intended to be a projection of future results. The following table summarizes our selected financial information on a pro forma basis:
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| | | | | | | | | | | | |
| | Three Months Ended |
| Six Months Ended | ||||||||
| | June 30, |
| June 30, | ||||||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
| | (In thousands) | ||||||||||
Operating revenues | | $ | | | $ | | | $ | | | $ | |
Net income (loss) | |
| ( | |
| | |
| ( | |
| |
Note 4 Joint Ventures
During 2016, we entered into an agreement with Saudi Aramco to form a joint venture known as SANAD to own, manage and operate onshore drilling rigs in the Kingdom of Saudi Arabia. SANAD is equally owned by Saudi Aramco and Nabors.
During 2017, Nabors and Saudi Aramco each contributed $
The condensed balance sheet of SANAD, as included in our condensed consolidated balance sheet, is presented below.
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
| | (In thousands) | ||||
Assets: | | | | | | |
Cash and cash equivalents | | $ | | | $ | |
Accounts receivable | |
| | |
| |
Other current assets | |
| | |
| |
Property, plant and equipment, net | |
| | |
| |
Other long-term assets | |
| | |
| |
Total assets | | $ | | | $ | |
Liabilities: | | | | | | |
Accounts payable | | $ | | | $ | |
Accrued liabilities | |
| | |
| |
Other liabilities | | | | | | |
Total liabilities | | $ | | | $ | |
Note 5 Accounts Receivable Purchase and Sales Agreements
The Company entered into an accounts receivable sales agreement (the “A/R Sales Agreement”) and an accounts receivable purchase agreement (the “A/R Purchase Agreement,” and, together with the A/R Sales Agreement, the “A/R Agreements”). As part of the A/R Agreements, the Company continuously sells designated eligible pools of receivables as they are originated by it and certain of its U.S. subsidiaries to a separate, bankruptcy-remote, special purpose entity (“SPE”) pursuant to the A/R Sales Agreement. Pursuant to the A/R Purchase Agreement, the SPE in turn sells, transfers, conveys and assigns to unaffiliated third-party financial institutions (the “Purchasers”) all the rights, title and interest in
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and to its pool of eligible receivables (the “Eligible Receivables”). The sale of the Eligible Receivables qualifies for sale accounting treatment in accordance with ASC 860 – Transfers and Servicing. During the period of this program, cash receipts from the Purchasers at the time of the sale are classified as operating activities in our consolidated statement of cash flows and the associated receivables are derecognized from the Company’s consolidated balance sheet at the time of the sale. The remaining receivables held by the SPE were pledged to secure the collectability of the sold Eligible Receivables. Subsequent collections on the pledged receivables, which have not been sold, will be classified as operating cash flows in our consolidated statement of cash flows at the time of collection. The amount of receivables pledged as collateral as of June 30, 2025 and December 31, 2024 is approximately $
In June 2022, we entered into the Third Amendment to the A/R Purchase Agreement, which extended the term of the A/R Purchase Agreement to August 13, 2024 and increased the commitments of the Purchasers under the A/R Purchase Agreement from $
In April 2024, we entered into the Fourth Amendment to the A/R Purchase Agreement, which, among other things, extended the term of the A/R Purchase Agreement to the earliest of (i) April 1, 2027 and (ii) the date that is ninety (90) calendar days prior to the occurrence of the maturity date under and as defined in the 2024 Credit Agreement.
The amount available for sale to the Purchasers under the A/R Purchase Agreement fluctuates over time based on the total amount of Eligible Receivables generated during the normal course of business after excluding excess concentrations and certain other ineligible receivables. As of June 30, 2025 and December 31, 2024, approximately $
Note 6 Debt
Debt consisted of the following:
| | | | | | | |
| | June 30, | | December 31, | | ||
|
| 2025 |
| 2024 |
| ||
| | (In thousands) |
| ||||
| $ | | | $ | | | |
| | | |
| | | |
|
| | | | | | |
|
| | | | | | |
|
| | | | | | |
2024 Credit Agreement | |
| | | | — | |
| | $ | | | $ | | |
Less: deferred financing costs | | | | | | | |
Long-term debt | | $ | | | $ | | |
During the six months ended June 30, 2025, we repurchased $
Parker Term Loan
On March 11, 2025, the Parker acquisition was completed. Prior to the acquisition, Parker was a party to a Second Lien Term Loan Credit Agreement (“Parker Term Loan”), dated March 26, 2019 (as amended in March 2021 and January 2023). The Parker Term Loan bears interest at a rate of
The Parker Term Loan carries a customary change of control provision, which was triggered by the closing of the Parker acquisition. The change of control, when triggered, required that the Parker Term Loan be repaid or refinanced within 30 days of the Closing Date or that Parker make a change of control repayment offer pursuant to which it will offer to repurchase the term loans outstanding under the facility at
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Credit Agreement
On June 17, 2024, Nabors Delaware amended and restated its existing credit agreement (as amended and restated, the “2024 Credit Agreement”). Under the 2024 Credit Agreement, the lenders have committed to provide to Nabors Delaware an aggregate principal amount of revolving loans at any time outstanding not in excess of $
The Company is required to maintain an interest coverage ratio (EBITDA/interest expense) of
Additionally, the Company is subject to covenants, which are subject to certain exceptions and include, among others, (a) a covenant restricting our ability to incur liens (subject to the additional liens basket of up to $
As of June 30, 2025, we had borrowings of $
As of the date of this report, we were in compliance with all covenants under the 2024 Credit Agreement. We expect to remain in compliance with all covenants under the 2024 Credit Agreement during the twelve-month period following the date of this report based on our current operational and financial projections. However, we can make no assurance of continued compliance if our current projections or material underlying assumptions prove to be incorrect. If we fail to comply with the covenants, the revolving credit commitment could be terminated, and any outstanding borrowings under the facility could be declared immediately due and payable.
Note 7 Shareholders’ Equity
Common share issuance
On March 11, 2025, in connection with the completion of the Parker acquisition, we issued
Common share warrants
On May 27, 2021, the Board declared a distribution of warrants to purchase its common shares (the “Warrants”) to holders of the Company’s common shares. Holders of Nabors common shares received two-fifths of a warrant per common share held as of the record date (rounded down for any fractional warrant). Nabors issued approximately
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Each Warrant represents the right to purchase
The Warrants are recognized as derivative liabilities in accordance with ASC 815-40. Accordingly, the Company recognizes the Warrant instruments as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. On June 30, 2025 and December 31, 2024, the fair value of the Warrants was approximately $
Note 8 Fair Value Measurements
Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable. We primarily apply the market approach for recurring fair value measurements and endeavor to utilize the best information available. Accordingly, we employ valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.
The use of unobservable inputs is intended to allow for fair value determinations in situations where there is little, if any, market activity for the asset or liability at the measurement date. We are able to classify fair value balances utilizing a fair value hierarchy based on the observability of those inputs.
Under the fair value hierarchy:
| ● | Level 1 measurements include unadjusted quoted market prices for identical assets or liabilities in an active market; |
| ● | Level 2 measurements include quoted market prices for identical assets or liabilities in an active market that have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets; and |
| ● | Level 3 measurements include those that are unobservable and of a subjective nature. |
Recurring Fair Value Measurements
Our financial assets that are accounted for at fair value on a recurring basis as of June 30, 2025 and December 31, 2024 consisted of short-term investments and restricted cash held in trust. During the six months ended June 30, 2025, there were no transfers of our financial assets between Level 1 and Level 2 measures. Our financial assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of June 30, 2025 and December 31, 2024, our restricted cash held in trust was carried at fair market value and totaled $
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fair market value and totaled $
Our financial liabilities that are accounted for at fair value on a recurring basis as of June 30, 2025 and December 31, 2024 consisted of the Warrants which are included in other short-term liabilities as of June 30, 2025 and other long-term liabilities as of December 31, 2024 in the accompanying consolidated financial statements. As of June 30, 2025 and December 31, 2024, the Warrants were carried at fair market value using their trading price and totaled $
Nonrecurring Fair Value Measurements
We applied fair value measurements to our nonfinancial assets and liabilities measured on a nonrecurring basis, which consist of measurements primarily related to equity method investments, other long-lived assets and assets acquired and liabilities assumed in a business combination. Based upon our review of the fair value hierarchy, the inputs used in these fair value measurements generally include Level 3 inputs but could include Level 1 and 2 inputs.
Fair Value of Debt Instruments
We estimate the fair value of our debt financial instruments in accordance with U.S. GAAP. The fair value of our long-term debt and revolving credit facilities is estimated based on quoted market prices or prices quoted from third-party financial institutions. The fair value of our debt instruments is determined using Level 2 measurements.
| | | | | | | | | | | | |
|
| | | | | |
| | | | | |
| | June 30, 2025 | | December 31, 2024 | ||||||||
| | Carrying | | Fair | | Carrying | | Fair | ||||
| | Value | | Value | | Value | | Value | ||||
| (In thousands) | |||||||||||
| $ | | | $ | |
| $ | | | $ | | |
|
| | |
| |
|
| | |
| | |
|
| | |
| |
|
| | |
| | |
|
| | |
| |
|
| | |
| | |
|
| | |
| |
|
| | |
| | |
2024 Credit Agreement |
|
| | |
| |
| | — | | | — |
| | $ | | | $ | | | $ | | | $ | |
Less: deferred financing costs | | | | | | | | | | | | |
| | $ | | | | | | $ | | | | |
The fair values of our cash equivalents, trade receivables and trade payables approximate their carrying values due to the short-term nature of these instruments.
Note 9 Commitments and Contingencies
Contingencies
Income Tax
We operate in a number of countries and our tax returns filed in those jurisdictions are subject to review and examination by tax authorities within those jurisdictions. We do not recognize the benefit of income tax positions we believe are more likely than not to be disallowed upon challenge by a tax authority. If any tax authority successfully challenges our operational structure, intercompany pricing policies or the taxable presence of our subsidiaries in certain countries, if the terms of certain income tax treaties are interpreted in a manner that is adverse to our structure, or if we lose a material tax dispute in any country, our effective tax rate on our worldwide earnings could change substantially.
In certain jurisdictions we have recognized deferred tax assets and liabilities. Judgment and assumptions are required in determining whether deferred tax assets will be fully or partially utilized. When we estimate that all or some
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portion of certain deferred tax assets such as net operating loss carryforwards will not be utilized, we establish a valuation allowance for the amount we determine to be more likely than not unrealizable. We continually evaluate strategies that could allow for future utilization of our deferred assets. Any change in the ability to utilize such deferred assets will be accounted for in the period of the event affecting the valuation allowance. If facts and circumstances cause us to change our expectations regarding future tax consequences, the resulting adjustments could have a material effect on our financial results or cash flow. At this time, we consider it more likely than not that we will have sufficient taxable income in the future that will allow us to realize the deferred tax assets that we have recognized. However, it is possible that some of our recognized deferred tax assets, relating to net operating loss carryforwards and tax credits, could expire unused or could carryforward indefinitely without utilization. Therefore, unless we are able to generate sufficient taxable income from our component operations, a substantial valuation allowance to reduce our deferred tax assets may be required, which would materially increase our tax expense in the period the allowance is recognized and materially adversely affect our results of operations and statement of financial condition.
The One Big Beautiful Bill Act was signed into law in the United States on July 4, 2025. We are currently evaluating the income tax impacts of the law, but we do not expect it to have a material impact on our financial statements.
Litigation
Nabors and its subsidiaries are defendants or otherwise involved in a number of lawsuits in the ordinary course of business. We estimate the range of our liability related to pending litigation when we believe the amount and range of loss can be estimated. We record our best estimate of a loss when the loss is considered probable. When a liability is probable and there is a range of estimated loss with no best estimate in the range, we record the minimum estimated liability related to the lawsuits or claims. As additional information becomes available, we assess the potential liability related to our pending litigation and claims and revise our estimates. Due to uncertainties related to the resolution of lawsuits and claims, the ultimate outcome may differ from our estimates. For matters where an unfavorable outcome is reasonably possible and significant, we disclose the nature of the matter and a range of potential exposure, unless an estimate cannot be made at the time of disclosure. In the opinion of management and based on liability accruals provided, our ultimate exposure with respect to these pending lawsuits and claims is not expected to have a material adverse effect on our consolidated financial position or cash flows, although they could have a material adverse effect on our results of operations for a particular reporting period.
In March 2011, the Court of Ouargla entered a judgment of approximately $
Off-Balance Sheet Arrangements (Including Guarantees)
We are a party to some transactions, agreements or other contractual arrangements defined as “off-balance sheet arrangements” that could have a material future effect on our financial position, results of operations, liquidity and capital resources. The most significant of these off-balance sheet arrangements include the A/R Facility (see Note 5—Accounts Receivable Purchase and Sales Agreements) and certain agreements and obligations under which we provide
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financial or performance assurance to third parties. Certain of these financial or performance assurances serve as guarantees, including standby letters of credit issued on behalf of insurance carriers in conjunction with our workers’ compensation insurance program and other financial surety instruments such as bonds. In addition, we have provided indemnifications, which serve as guarantees, to some third parties. These guarantees include indemnification provided by Nabors to our share transfer agent and our insurance carriers. We are not able to estimate the potential future maximum payments that might be due under our indemnification guarantees.
Management believes the likelihood that we would be required to perform or otherwise incur any material losses associated with any of these guarantees is remote.
| | | | | | | | | | | | | |
| | Maximum Amount |
| ||||||||||
|
| 2025 |
| 2026 |
| 2027 |
| Thereafter |
| Total |
| ||
| | (In thousands) |
| ||||||||||
Financial standby letters of credit and other financial surety instruments | | $ | |
| |
| |
| | | $ | | |
Note 10 Earnings (Losses) Per Share
ASC 260, Earnings per Share, requires companies to treat unvested share-based payment awards that have nonforfeitable rights to dividends or dividend equivalents as a separate class of securities in calculating earnings (losses) per share. We have granted and expect to continue to grant to employees restricted stock grants that contain nonforfeitable rights to dividends. Such grants are considered participating securities under ASC 260. As such, we are required to include these grants in the calculation of our basic earnings (losses) per share and calculate basic earnings (losses) per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. The participating security holders are not contractually obligated to share in losses. Therefore, losses are not allocated to the participating security holders.
Basic earnings (losses) per share is computed utilizing the two-class method and is calculated based on the weighted-average number of common shares outstanding during the periods presented.
Diluted earnings (losses) per share is computed using the weighted-average number of common and common equivalent shares outstanding during the periods utilizing the two-class method for stock options and unvested restricted shares and the if-converted method for the
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A reconciliation of the numerators and denominators of the basic and diluted earnings (losses) per share computations is as follows:
| | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||||||
|
| June 30, | | June 30, | ||||||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
| | (In thousands, except per share amounts) | ||||||||||
BASIC EPS: | | | | | | | | | | | | |
Net income (loss) (numerator): | | | | | | | | | | | | |
Income (loss), net of tax | | $ | ( | | $ | ( | | $ | | | $ | ( |
Less: net (income) loss attributable to noncontrolling interest | |
| ( | |
| ( | |
| ( | |
| ( |
Less: accrued distribution on redeemable noncontrolling interest in subsidiary | | | ( | | | ( | | | ( | | | ( |
Numerator for basic earnings per share: | | | | | | | | | | | | |
Adjusted income (loss), net of tax - basic | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
| | | | | | | | | | | | |
Weighted-average number of shares outstanding - basic | |
| | |
| | |
| | |
| |
Earnings (losses) per share: | | | | | | | | | | | | |
Total Basic | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
DILUTED EPS: | | | | | | | | | | | | |
Adjusted income (loss), net of tax - diluted | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
| | | | | | | | | | | | |
Weighted-average number of shares outstanding - diluted | | | | | | | | | | | | |
Earnings (losses) per share: | | | | | | | | | | | | |
Total Diluted | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
| | | | | | | | | | | | |
For all periods presented, the computation of diluted earnings (losses) per share excludes shares related to outstanding stock options with exercise prices greater than the average market price of Nabors’ common shares and shares related to the outstanding Warrants when their exercise price or exchange price is higher than the average market price of Nabors’ common shares, because their inclusion would be anti-dilutive and because they are not considered participating securities.
In any period during which the average market price of Nabors’ common shares exceeds the exercise prices of the stock options, such stock options or warrants will be included in our diluted earnings (losses) per share computation using the if-converted method of accounting. Restricted stock is included in our basic and diluted earnings (losses) per share computation using the two-class method of accounting in all periods because such stock is considered participating securities. For periods in which we experience a net loss, all potential common shares have been excluded from the calculation of weighted-average shares outstanding, because their inclusion would be anti-dilutive.
The average number of shares from options and shares related to outstanding Warrants that were excluded from diluted earnings (losses) per share that would potentially dilute earnings per share in the future were as follows (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||||||
| | June 30, | | June 30, | ||||||||
| | 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
Potentially dilutive securities excluded as anti-dilutive | | | | | | | | | | | | |
Additionally, for the three and six months ended June 30, 2025 and 2024, we excluded
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Note 11 Supplemental Balance Sheet and Income Statement Information
Accrued liabilities included the following:
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
| | (In thousands) | ||||
Accrued compensation | | $ | | | $ | |
Deferred revenue | |
| | | | |
Other taxes payable | |
| | | | |
Workers’ compensation liabilities | |
| | |
| |
Interest payable | |
| | |
| |
Litigation reserves | |
| | |
| |
Accrued professional fees | |
| | |
| |
Other accrued liabilities | |
| | |
| |
| | $ | | | $ | |
Investment income (loss) includes the following:
| | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | ||||||||
|
| June 30, | | June 30, | ||||||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
| | (In thousands) | ||||||||||
Interest and dividend income | | $ | | | $ | | | $ | | | $ | |
Gains (losses) on marketable securities | |
| ( | |
| ( | |
| ( | |
| ( |
| | $ | | | $ | | | $ | | | $ | |
Other, net included the following:
| | | | | | | | | | | | | |
| | | Three Months Ended | | Six Months Ended | ||||||||
| |
| June 30, | | June 30, | ||||||||
| |
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
| | | (In thousands) | ||||||||||
(Gains) losses on sales, disposals and involuntary conversions of long-lived assets | | | $ | ( | | $ | | | $ | ( | | $ | |
Asset impairment | | | | — | | | — | | | | | | — |
Transaction related costs | | | | | | | — | | | | | | — |
Other than temporary impairment on securities | | | | | | | — | | | | | | — |
Severance and reorganization costs | | | | | | | — | | | | | | — |
Warrant and derivative valuation | | | | ( | | | ( | | | ( | | | ( |
Litigation expenses and reserves | | |
| | | | | | | | | | |
Foreign currency transaction losses | | |
| | | | | | | | | | |
Loss (gain) on debt buyback | | | | ( | | | — | | | ( | | | |
Other losses (gains) | | |
| | | | | | | | | | |
| | | $ | | | $ | | | $ | | | $ | |
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The changes in accumulated other comprehensive income (loss), by component, included the following:
| | | | | | | | | | | | |
|
| | |
| | |
| | |
| | |
| | Gains | | Defined | | | | | | | ||
| | (losses) on | | benefit | | Foreign | | | | |||
| | cash flow | | pension plan | | currency | | | | |||
|
| hedges |
| items |
| items |
| Total | ||||
| | (In thousands (1) ) | ||||||||||
As of January 1, 2024 | | $ | | | $ | ( | | $ | ( | | $ | ( |
Other comprehensive income (loss) before reclassifications | |
| — | | | — | |
| ( | | | ( |
Amounts reclassified from accumulated other comprehensive income (loss) | |
| — | | | | | | — | | | |
Net other comprehensive income (loss) | |
| — | |
| | |
| ( | |
| ( |
As of June 30, 2024 | | $ | | | $ | ( | | $ | ( | | $ | ( |
| (1) | All amounts are net of tax. |
| | | | | | | | | | | | |
|
| | |
| | |
| | |
| | |
| | Gains | | Defined | | | | | | | ||
| | (losses) on | | benefit | | Foreign | | | | |||
| | cash flow | | pension plan | | currency | | | | |||
|
| hedges |
| items |
| items |
| Total | ||||
| | (In thousands (1) ) | ||||||||||
As of January 1, 2025 | | $ | | | $ | ( | | $ | ( | | $ | ( |
Other comprehensive income (loss) before reclassifications | |
| — | |
| — | |
| ( | |
| ( |
Amounts reclassified from accumulated other comprehensive income (loss) | |
| — | |
| | |
| — | |
| |
Net other comprehensive income (loss) | |
| — | |
| | |
| ( | |
| ( |
As of June 30, 2025 | | $ | | | $ | ( | | $ | ( | | $ | ( |
| (1) | All amounts are net of tax. |
The line items that were reclassified to net income included the following:
| | | | | | | | | | | | | |
| | | Three Months Ended | | Six Months Ended | ||||||||
| |
| June 30, | | June 30, | ||||||||
| |
| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
| (In thousands) | ||||||||||||
General and administrative expenses | | | $ | | | $ | | | $ | | | $ | |
Total income (loss) before income tax | | |
| ( | |
| ( | |
| ( | |
| ( |
Tax expense (benefit) | | | | ( | | | ( | | | ( | | | ( |
Reclassification adjustment for (gains)/ losses included in net income (loss) | | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
Note 12 Segment Information
Our business consists of
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The following table sets forth financial information with respect to our reportable operating segments:
| | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | |||||||||||||||||||
|
| June 30, 2025 | |||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | |
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Total Reportable Segments | | | Other items (1) | | | Total |
| | (In thousands) | |||||||||||||||||||
Operating revenues | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
Direct costs | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| | | | ( |
Depreciation and amortization | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | | | ( |
Other segment expenses (2) | |
| ( | | | ( | | | ( | | | ( | | | ( | | | ( | |
| ( |
Total adjusted operating income (loss) | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
| | | | | | | | | | | | | | | | | | | | | | |
| | Six Months Ended | | |||||||||||||||||||
|
| June 30, 2025 | | |||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Total Reportable Segments | | | Other items (1) | | | Total | |
| | (In thousands) | | |||||||||||||||||||
Operating revenues | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | | |
Direct costs | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| | | | ( | |
Depreciation and amortization | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | | | ( | |
Other segment expenses (2) | |
| ( | | | ( | | | ( | | | ( | | | ( | | | ( | |
| ( | |
Total adjusted operating income (loss) (2) | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | | |
| | | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | |
| | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | |||||||||||||||||||
|
| June 30, 2024 | |||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | |
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Total Reportable Segments | | | Other items (1) | | | Total |
| | (In thousands) | |||||||||||||||||||
Operating revenues | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
Direct costs | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| | | | ( |
Depreciation and amortization | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | | | ( |
Other segment expenses (2) | |
| ( | | | ( | | | ( | | | ( | | | ( | | | ( | |
| ( |
Total adjusted operating income (loss) | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
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| | | | | | | | | | | | | | | | | | | | | | |
| | Six Months Ended | | |||||||||||||||||||
|
| June 30, 2024 | | |||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | |
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Total Reportable Segments | | | Other items (1) | | | Total | |
| | (In thousands) | | |||||||||||||||||||
Operating revenues | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | | |
Direct costs | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| | | | ( | |
Depreciation and amortization | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | |
| ( | | | ( | |
Other segment expenses (2) | |
| ( | | | ( | | | ( | | | ( | | | ( | | | ( | |
| ( | |
Total adjusted operating income (loss) (2) | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | | |
| | | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | |
| | | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended | | ||||||||
|
| June 30, | | June 30, | | ||||||||
|
| 2025 |
| 2024 |
| 2025 |
| 2024 |
| ||||
| | (In thousands) | | ||||||||||
Reconciliation of segment adjusted operating income (loss) to net income (loss): | | | | | | | | | | | | | |
Net income (loss) | | $ | ( | | $ | ( | | $ | | | $ | ( | |
Income tax expense (benefit) | | | | | | | | | | | | | |
Income (loss) before income taxes | | | | | | | | | | | | | |
Investment (income) loss | |
| ( | | | ( | |
| ( | | | ( | |
Interest expense | | | | | | | | | | | | | |
Gain on bargain purchase | | | ( | | | — | | | ( | | | — | |
Other, net | | | | | | | | | | | | | |
Total adjusted operating income (loss) (3) | | $ | | | $ | | | $ | | | $ | | |
| | | | | | |
| | June 30, | | December 31, | ||
|
| 2025 |
| 2024 | ||
| | (In thousands) | ||||
Total assets: | | | | | | |
U.S. Drilling | | $ | | | $ | |
International Drilling | |
| | |
| |
Drilling Solutions | |
| | |
| |
Rig Technologies | |
| | |
| |
Total reportable segments | | | | | | |
Other reconciling items (4) | |
| | |
| |
Total | | $ | | | $ | |
| (1) | Represents the elimination of inter-segment transactions related to our Rig Technologies operating segment and unallocated corporate expenses, assets and capital expenditures. |
| (2) | Other segment expenses represent general and administrative expenses and research and engineering expenses. |
| (3) | Management evaluates the performance of our operating segments using adjusted operating income (loss), which is our segment performance measure, because it believes that this financial measure reflects our ongoing profitability and performance. In addition, securities analysts and investors use this measure as one of the metrics on which they analyze our performance. A reconciliation to income (loss) is provided in the above table. |
| (4) | Represents corporate-related assets. |
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Note 13 Revenue Recognition
We recognize revenue when control of a good or service promised in a contract (i.e., performance obligation) is transferred to a customer. Control is obtained when a customer has the ability to direct the use of and obtain substantially all of the remaining benefits from that good or service. Contract drilling revenues are recorded over time utilizing the input method based on time elapsed. The measurement of progress considers the transfer of the service to the customer as we provide daily drilling services. We receive payment after the services have been performed by billing customers periodically (typically monthly). However, a portion of our revenues are recognized at a point-in-time as control is transferred at a distinct point in time such as with the sale of our top drives and other capital equipment. Within our drilling contracts, we have identified one performance obligation in which the transaction price is allocated.
Disaggregation of revenue
In the following table, revenue is disaggregated by geographical region. The table also includes a reconciliation of the disaggregated revenue with the reportable segments:
| | | | | | | | | | | | | | | | | | |
| | Three Months Ended | ||||||||||||||||
|
| June 30, 2025 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | |
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Other | | | Total |
| | (In thousands) | ||||||||||||||||
Lower 48 | | $ | | | $ | — | | $ | | | $ | | | $ | — | | $ | |
U.S. Offshore | |
| | |
| — | |
| | |
| — | |
| — | | | |
Alaska | |
| | |
| — | |
| | |
| | |
| — | | | |
Canada | |
| — | |
| | |
| | |
| | |
| — | | | |
Middle East & Asia | |
| — | |
| | |
| | |
| | |
| — | | | |
Latin America | |
| — | |
| | |
| | |
| | |
| — | | | |
Europe, Africa & CIS | |
| — | |
| | |
| | |
| | |
| — | | | |
Eliminations & other | |
| — | | | — | | | — | | | — | | | ( | |
| ( |
Total | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | |
| | Six Months Ended | ||||||||||||||||
|
| June 30, 2025 | ||||||||||||||||
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Other | | | Total |
| | (In thousands) | ||||||||||||||||
Lower 48 | | $ | | | $ | — | | $ | | | $ | | | $ | — | | $ | |
U.S. Offshore | |
| | |
| — | |
| | |
| — | |
| — | | | |
Alaska | |
| | |
| — | |
| | |
| | |
| — | | | |
Canada | |
| — | |
| | |
| | |
| | |
| — | | | |
Middle East & Asia | |
| — | |
| | |
| | |
| | |
| — | | | |
Latin America | |
| — | |
| | |
| | |
| | |
| — | | | |
Europe, Africa & CIS | |
| — | |
| | |
| | |
| | |
| — | | | |
Eliminations & other | |
| — | | | — | | | — | | | — | | | ( | |
| ( |
Total | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | |
| | Three Months Ended | ||||||||||||||||
|
| June 30, 2024 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | |
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Other | | | Total |
| | (In thousands) | ||||||||||||||||
Lower 48 | | $ | | | $ | — | | $ | | | $ | | | $ | — | | $ | |
U.S. Offshore | |
| | |
| — | |
| | |
| — | |
| — | | | |
Alaska | |
| | |
| — | |
| | |
| — | |
| — | | | |
Canada | |
| — | |
| — | |
| | |
| | |
| — | | | |
Middle East & Asia | |
| — | |
| | |
| | |
| | |
| — | | | |
Latin America | |
| — | |
| | |
| | |
| | |
| — | | | |
Europe, Africa & CIS | |
| — | |
| | |
| | |
| | |
| — | | | |
Eliminations & other | |
| — | | | — | | | — | | | — | | | ( | |
| ( |
Total | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
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| | | | | | | | | | | | | | | | | | |
| | Six Months Ended | ||||||||||||||||
|
| June 30, 2024 | ||||||||||||||||
| | | U.S. Drilling | | | International Drilling | | | Drilling Solutions | | | Rig Technologies | | | Other | | | Total |
| | (In thousands) | ||||||||||||||||
Lower 48 | | $ | | | $ | — | | $ | | | $ | | | $ | — | | $ | |
U.S. Offshore | |
| | |
| — | |
| | |
| — | |
| — | | | |
Alaska | |
| | |
| — | |
| | |
| — | |
| — | | | |
Canada | |
| — | |
| — | |
| | |
| | |
| — | | | |
Middle East & Asia | |
| — | |
| | |
| | |
| | |
| — | | | |
Latin America | |
| — | |
| | |
| | |
| | |
| — | | | |
Europe, Africa & CIS | |
| — | |
| | |
| | |
| | |
| — | | | |
Eliminations & other | |
| — | | | — | | | — | | | — | | | ( | |
| ( |
Total | | $ | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
Contract balances
We perform our obligations under a contract with a customer by transferring goods or services in exchange for consideration from the customer. We recognize a contract asset or liability when we transfer goods or services to a customer and bill an amount which differs from the revenue allocated to the related performance obligations.
The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) on our condensed consolidated balance sheet. In general, we receive payments from customers based on dayrates as stipulated in our contracts (e.g., operating rate, standby rate, etc.). The invoices billed to the customer are based on the varying rates applicable to the operating status on each rig. Accounts receivable are recorded when the right to consideration becomes unconditional.
Dayrate contracts also may contain fees charged to the customer for up-front rig modifications, mobilization and demobilization of equipment and personnel. These fees are associated with contract fulfillment activities, and the related revenue (subject to any constraint on estimates of variable consideration) is allocated to a single performance obligation and recognized ratably over the initial term of the contract. Mobilization fees are generally billable to the customer in the initial phase of a contract and generate contract liabilities until they are recognized as revenue. Demobilization fees are generally received at the end of the contract and generate contract assets when they are recognized as revenue prior to becoming receivables from the customer.
We receive reimbursements from our customers for the purchase of supplies, equipment, personnel services and other services provided at their request. Reimbursable revenues are variable and subject to uncertainty as the amounts received and timing thereof are dependent on factors outside of our influence. Accordingly, these revenues are constrained and not recognized until the uncertainty is resolved, which typically occurs when the related costs are incurred on behalf of the customer. We are generally considered a principal in these transactions and record the associated revenues at the gross amounts billed to the customer.
The opening and closing balances of our receivables, contract assets and current and long-term contract liabilities are as follows:
| | | | | | | | | | | | | | | |
| | | | Contract | | Contract | | Contract | | Contract | |||||
| | Contract | | Assets | | Assets | | Liabilities | | Liabilities | |||||
|
| Receivables |
| (Current) |
| (Long-term) |
| (Current) |
| (Long-term) | |||||
| | (In thousands) | |||||||||||||
As of December 31, 2024 | | $ | | | $ | | | $ | | | $ | | | $ | |
As of June 30, 2025 | | $ | | | $ | | | $ | | | $ | | | $ | |
Approximately
Additionally,
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entirely to a wholly unsatisfied performance obligation or promise to transfer a distinct good or service that forms part of a single performance obligation.
Note 14 Special Purpose Acquisition Company
Nabors Energy Transition Corp. II (“NETC II”) is our SPAC co-sponsored by Nabors and Greens Road Energy II LLC. Greens Road Energy II LLC is owned by certain members of Nabors’ management team and board members. In July 2023, NETC II completed its initial public offering of
The SPAC’s funds held in a Trust Account are invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invests only in direct U.S. government treasury obligations. The funds in the Trust Account will only be released to the SPAC upon completion of a business combination or in connection with redemptions of any of the redeemable common shares, except with respect to interest earned on the funds which may be withdrawn to pay the SPAC’s taxes.
The company accounts for the non-controlling interest in the SPAC as subject to possible redemption in accordance with FASB ASC Topic 480 “Distinguishing Liabilities from Equity.” The SPAC’s common stock features certain redemption rights, which are considered to be outside the company’s control and subject to occurrence of uncertain future events. Nabors will recognize any future changes in redemption value immediately as they occur – i.e., adjusting the carrying amount of the instrument to its current redemption amount at each reporting period.
The SPAC is a consolidated VIE included in the accompanying consolidated financial statements under Restricted cash held in trust and Redeemable noncontrolling interest in subsidiary. As of June 30, 2025 and December 31, 2024, the Trust Account balance and non-controlling interest subject to possible redemption was $
The following table summarizes NETC II’s effects on changes in non-controlling interest subject to possible redemption.
| | | | | | |
|
| 2025 |
| 2024 | ||
| | (In thousands) | ||||
Balance, beginning of year | | $ | | | $ | |
Net earnings | |
| | | | |
Balance as of June 30 | | $ | | | $ | |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
We often discuss expectations regarding our future markets, demand for our products and services, and our performance in our annual, quarterly and current reports, press releases, and other written and oral statements. Statements relating to matters that are not historical facts are “forward-looking statements” within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These “forward-looking statements” are based on an analysis of currently available competitive, financial and economic data and our operating plans. They are inherently uncertain and investors should recognize that events and actual results could turn out to be significantly
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different from our expectations. By way of illustration, when used in this document, words such as “anticipate,” “believe,” “expect,” “plan,” “intend,” “estimate,” “project,” “will,” “should,” “could,” “may,” “predict” and similar expressions are intended to identify forward-looking statements.
You should consider the following key factors when evaluating these forward-looking statements:
| ● | geopolitical events, pandemics, global and regional conflicts and other macro-events and their respective and collective impact on our operations as well as oil and gas markets and prices; |
| ● | fluctuations and volatility in worldwide prices of and demand for oil and natural gas; |
| ● | fluctuations in levels of oil and natural gas exploration and development activities; |
| ● | fluctuations in the demand for our services; |
| ● | competitive and technological changes and other developments in the oil and gas and oilfield services industries; |
| ● | our ability to renew customer contracts in order to maintain competitiveness; |
| ● | the existence of operating risks inherent in the oil and gas and oilfield services industries; |
| ● | the possibility of the loss of one or a number of our large customers; |
| ● | the amount and nature of our future capital expenditures and how we expect to fund our capital expenditures; |
| ● | the occurrence of cybersecurity incidents, attacks or other breaches to our information technology systems; |
| ● | the impact of our long-term indebtedness and other financial commitments on our financial and operating flexibility; |
| ● | our access to, and the cost of, capital, including the impact of a downgrade in our credit rating, covenant restrictions, availability under our secured revolving credit facility, future issuances of debt or equity securities and the global interest rate environment; |
| ● | our dependence on our operating subsidiaries and investments to meet our financial obligations; |
| ● | our ability to retain skilled employees; |
| ● | our ability to realize the expected benefits of our acquisition of Parker Drilling Company (“Parker”) as well as other strategic transactions we may undertake; |
| ● | changes in tax laws and the possibility of changes in other laws and regulations; |
| ● | the possibility of political or economic instability, civil disturbance, war or acts of terrorism in any of the countries in which we do business; |
| ● | global views on and the regulatory environment related to energy transition and our ability to implement our energy transition initiatives; |
| ● | potential long-lived asset impairments; |
| ● | the possibility of changes to trade policies and regulations, including the imposition of trade embargoes, sanctions or tariffs, by either the U.S. or any other country in which we operate or have supply lines; |
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| ● | general economic conditions, including the capital and credit markets; |
| ● | potential adverse reactions or changes to business relationships resulting from the completion of the merger with Parker; |
| ● | our ability to retain key personnel of Nabors and Parker; |
| ● | the significant costs required to integrate Parker’s operations with our own; |
| ● | our ability to successfully integrate Parker’s business with our own and to realize the expected benefits of the merger with Parker, including expected synergies; and |
| ● | the combined company’s ability to utilize NOLs. |
Our business depends, to a large degree, on the level of spending by oil and gas companies for exploration, development and production activities. Therefore, a sustained increase or decrease in the price of oil or natural gas, that has a material impact on exploration, development and production activities, could also materially affect our financial position, results of operations and cash flows.
The above description of risks and uncertainties is by no means all-inclusive but highlights certain factors that we believe are important for your consideration. For a more detailed description of risk factors that may affect us or our industry, please refer to Item 1A. — Risk Factors in our 2024 Annual Report.
Management Overview
This section is intended to help you understand our results of operations and our financial condition. The results of operations discussed below include amounts pertaining to Parker after the merger closed on March 11, 2025. This information is provided as a supplement to, and should be read in conjunction with, our condensed consolidated financial statements and the accompanying notes thereto.
We are a leading provider of advanced technology for the energy industry. With operations in over 20 countries, Nabors has established a global network of people, technology and equipment to deploy solutions that deliver safe, efficient and sustainable 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.
Outlook
The demand for our services and products is a function of the level of spending by oil and gas companies for exploration, development and production activities. The level of exploration, development and production activities is to a large extent tied to the prices of oil and natural gas, which can fluctuate significantly, are highly volatile and tend to be highly sensitive to factors including supply and demand cycles and geopolitical uncertainties particularly those impacting large hydrocarbon-producing countries. Certain oil and gas companies may also intentionally limit their capital spending as they focus on generating returns to shareholders as opposed to maximizing hydrocarbon production. Additionally, there has recently been an increasing number of customer consolidations within the industry especially in the United States. In some cases, these transactions may have an impact on overall rig demand, as the acquiring company may apply criteria that results in a different level of demand for drilling rigs than the previous two companies would have had on a stand-alone basis.
Since late 2022 and continuing through the second quarter of 2025, global energy commodity markets have experienced sustained volatility driven by evolving geopolitical dynamics, and more recently, domestic policy changes. In the U.S., operators generally reacted to these market conditions with caution by reducing their drilling activity – particularly in the natural gas basins. This trend appears to be shifting with the expectation for higher natural gas demand in the future. Meanwhile caution has increased in the oil-driven basins.
Economic sentiment, which in early 2023 and again in early 2025 had been clouded by fears of a global recession, has gradually improved. The U.S. Federal Reserve’s extended period of elevated interest rates through late 2024
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constrained capital access for energy producers. However, with rate cuts beginning in late 2024 and continuing into early 2025, there is evidence that the capital markets are beginning to loosen. The full impact of these monetary policy changes on energy sector investment should become more apparent in the coming quarters. Despite the reduction in rig count, rig pricing discipline remained intact, and generally supportive of rig dayrates and daily rig margins.
Oil prices have been impacted by recent production actions announced by certain large international oil producers. Natural gas prices, particularly in the United States, have generally increased, in part as demand increase as LNG export facilities ramped throughput.
U.S. oil and gas production has proved resilient in the face of reduced drilling activity aided by efficiency gains. Internationally, we generally see an expansion of production capacity as well as the widespread development of unconventional resources driving an expected increase in oilfield activity broadly across those markets. In Saudi Arabia specifically, the operating rig fleet has declined even as unconventional gas development there proceeds.
Recent Developments
Acquisition of Parker Drilling Company
On March 11, 2025, Nabors completed its merger with Parker Drilling Company. At the effective time of the Merger, each share of common stock of Parker, par value $0.01 per share outstanding immediately prior to the effective time of the merger was converted into the right to receive (without interest) a pro rata share of the merger consideration, which consisted of 4.8 million Nabors common shares, par value $0.05 per share and cash payment of $0.6 million.
Comparison of the three months ended June 30, 2025 and 2024
Operating revenues for the three months ended June 30, 2025 totaled $832.8 million, representing an increase of $98.0 million, compared to the three months ended June 30, 2024. For a more detailed description of operating results, see Segment Results of Operations below.
Net loss attributable to Nabors totaled $30.9 million ($2.71 per diluted share) for the three months ended June 30, 2025 compared to a net loss attributable to Nabors of $32.3 million ($4.29 per diluted share) for the three months ended June 30, 2024, or a $1.3 million increase in net income. See Segment Results of Operations and Other Financial Information below for additional discussion.
General and administrative expenses for the three months ended June 30, 2025 totaled $82.7 million, representing an increase of $20.6 million, or 33%, compared to the three months ended June 30, 2024. This is reflective of increases in workforce costs and general operating costs as a result of the Parker acquisition, along with inflationary pressures as market conditions have changed.
Depreciation and amortization expense for the three months ended June 30, 2025 was $175.1 million, representing an increase of $14.9 million compared to the three months ended June 30, 2024. The increase is a result of the additional assets obtained in the Parker acquisition.
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Segment Results of Operations
The following tables set forth certain information with respect to our reportable segments and rig activity:
| | | | | | | | | | | |
| Three Months Ended | | | | | |
| ||||
| June 30, | | | | | | | ||||
| 2025 | | 2024 | | Increase/(Decrease) |
| |||||
| (In thousands, except percentages and rig activity) | | |||||||||
U.S. Drilling | |
|
| |
|
| |
|
|
|
|
Operating revenues | $ | 255,438 | | $ | 259,723 | | $ | (4,285) | | (2) | % |
Adjusted operating income (loss) (1) | $ | 39,788 | | $ | 45,085 | | $ | (5,297) | | (12) | % |
Average rigs working (2) |
| 72.4 | |
| 75.0 | |
| (2.6) | | (3) | % |
| | | | | | | | | | | |
International Drilling | | | | | | | | | | | |
Operating revenues | $ | 384,970 | | $ | 356,733 | | $ | 28,237 | | 8 | % |
Adjusted operating income (loss) (1) | $ | 36,051 | | $ | 23,672 | | $ | 12,379 | | 52 | % |
Average rigs working (2) |
| 85.9 | |
| 84.4 | |
| 1.5 | | 2 | % |
| | | | | | | | | | | |
Drilling Solutions | | | | | | | | | | | |
Operating revenues | $ | 170,283 | | $ | 82,961 | | $ | 87,322 | | 105 | % |
Adjusted operating income (loss) (1) | $ | 50,365 | | $ | 27,319 | | $ | 23,046 |
| 84 | % |
| | | | | | | | | | | |
Rig Technologies | | | | | | | | | | | |
Operating revenues | $ | 36,527 | | $ | 49,546 | | $ | (13,019) | | (26) | % |
Adjusted operating income (loss) (1) | $ | 1,721 | | $ | 4,860 | | $ | (3,139) |
| (65) | % |
| (1) | Adjusted operating income (loss) is our measure of segment profit and loss. See Note 12—Segment Information to the consolidated financial statements included in Item 1 of the report. |
| (2) | Represents a measure of the average number of rigs operating during a given period. For example, one rig operating 45 days during a quarter represents approximately 0.5 average rigs working for the quarter. On an annual period, one rig operating 182.5 days represents approximately 0.5 average rigs working for the year. |
U.S. Drilling
Operating revenues for our U.S. Drilling segment decreased by $4.3 million or 2% during the three months ended June 30, 2025 compared to the corresponding prior year period. Decreases in the Lower 48 land rig market for both average number of rigs working and dayrates, more than offset the incremental revenue from acquired Parker rig operations in the Alaska and U.S. Offshore markets.
International Drilling
Operating revenues for our International Drilling segment during the three months ended June 30, 2025 increased by $28.2 million or 8% compared to the corresponding prior year period. Incremental revenue from acquired Parker rig operations in international markets and the contribution of recently deployed rigs in other international markets comprise the majority of the increase.
Drilling Solutions
Operating revenues for this segment increased by $87.3 million or 105% during the three months ended June 30, 2025 compared to the corresponding prior year period. The increase in revenue is related to acquired Parker operations. This increase from Parker operations was slightly offset by a decline in results in the U.S. markets, which was driven by the reduction in drilling activity.
Rig Technologies
Operating revenues for our Rig Technologies segment decreased by $13.0 million or 26% during the three months ended June 30, 2025 compared to the corresponding prior year period due to the overall decline in activity in the U.S. as mentioned previously.
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Other Financial Information
Interest expense
Interest expense for the three months ended June 30, 2025 was $56.1 million, representing an increase of $4.6 million, or 9%, compared to three months ended June 30, 2024. The increase was primarily due to an increase in our effective interest rate levels and an increase in our outstanding debt balance throughout the three months ended June 30, 2025 as compared to the three months ended June 30, 2024.
Other, net
Other, net for the three months ended June 30, 2025 was a loss of $6.1 million compared to $12.1 million loss for the three months ended June 30, 2024 representing a $6.0 million increase in income. During the three months ended June 30, 2025, the amount primarily consisted of $2.1 million in foreign currency transaction losses, $3.8 million of other than temporary impairment on securities and $7.1 million related to severance and reorganization costs which was offset by $3.2 million of mark-to-market gains on the common share warrants and $11.7 million in gain on sales of assets. In comparison, the amount during the three months ended June 30, 2024 primarily consisted of $6.5 million in foreign currency transaction losses, $4.9 million in losses on sales of assets and $1.8 million from increases in litigation reserves which was offset by $3.9 million of mark-to-market gains on the common share warrants.
Income tax
Our worldwide tax expense for the three months ended June 30, 2025 was $23.1 million compared to $15.6 million for the three months ended June 30, 2024. The increase in tax expense was primarily attributable to the Parker acquisition, as well as the change in amount and geographic mix of our pre-tax earnings (losses).
Comparison of the six months ended June 30, 2025 and 2024
Operating revenues for the six months ended June 30, 2025 totaled $1.6 billion, representing an increase of $100.5 million, compared to the six months ended June 30, 2024. For a more detailed description of operating results, see Segment Results of Operations below.
Net income attributable to Nabors totaled $2.1 million ($1.01 loss per diluted share) for the six months ended June 30, 2025 compared to a net loss attributable to Nabors of $66.6 million ($8.83 per diluted share) for the six months ended June 30, 2024, or a $68.7 million increase in net income. $116.5 million of the increase is due to the gain on bargain purchase related to the Parker acquisition which was partially offset by $26.5 million of asset impairments related to assets held in Russia and $19.1 million of transaction related costs. See Segment Results of Operations and Other Financial Information below for additional discussion.
General and administrative expenses for the six months ended June 30, 2025 totaled $151.2 million, representing an increase of $27.3 million, or 22%, compared to the six months ended June 30, 2024. This is reflective of increases in workforce costs and general operating costs as a result of the Parker acquisition, along with inflationary pressures as market conditions have changed.
Depreciation and amortization expense for the six months ended June 30, 2025 was $329.7 million, representing an increase of $11.9 million compared to the six months ended June 30, 2024. The increase is a result of the additional assets obtained in the Parker acquisition.
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Segment Results of Operations
The following tables set forth certain information with respect to our reportable segments and rig activity:
| | | | | | | | | | | | |
| | Six Months Ended | | | | | |
| ||||
| | June 30, | | | | | | | ||||
| | 2025 | | 2024 | | Increase/(Decrease) |
| |||||
| | (In thousands, except percentages and rig activity) | ||||||||||
U.S. Drilling |
| |
|
| |
|
| |
|
|
|
|
Operating revenues | | $ | 486,184 | | $ | 531,712 | | $ | (45,528) | | (9) | % |
Adjusted operating income (loss) (1) | | $ | 71,387 | | $ | 95,614 | | $ | (24,227) | | (25) | % |
Average rigs working (2) | |
| 70.3 | |
| 76.8 | |
| (6.5) | | (8) | % |
| | | | | | | | | | | | |
International Drilling | | | | | | | | | | | | |
Operating revenues | | $ | 766,688 | | $ | 706,092 | | $ | 60,596 | | 9 | % |
Adjusted operating income (loss) (1) | | $ | 69,009 | | $ | 46,148 | | $ | 22,861 | | 50 | % |
Average rigs working (2) | |
| 85.4 | |
| 82.7 | |
| 2.7 | | 3 | % |
| | | | | | | | | | | | |
Drilling Solutions | | | | | | | | | | | | |
Operating revenues | | $ | 263,462 | | $ | 158,535 | | $ | 104,927 | | 66 | % |
Adjusted operating income (loss) (1) | | $ | 83,278 | | $ | 54,212 | | $ | 29,066 |
| 54 | % |
| | | | | | | | | | | | |
Rig Technologies | | | | | | | | | | | | |
Operating revenues | | $ | 80,692 | | $ | 99,702 | | $ | (19,010) | | (19) | % |
Adjusted operating income (loss) (1) | | $ | 6,056 | | $ | 9,069 | | $ | (3,013) |
| (33) | % |
| (1) | Adjusted operating income (loss) is our measure of segment profit and loss. See Note 12—Segment Information to the consolidated financial statements included in Item 1 of the report. |
| (2) | Represents a measure of the average number of rigs operating during a given period. For example, one rig operating 45 days during a quarter represents approximately 0.5 average rigs working for the quarter. On an annual period, one rig operating 182.5 days represents approximately 0.5 average rigs working for the year. |
U.S. Drilling
Operating revenues for our U.S. Drilling segment decreased by $45.5 million or 9% during the six months ended June 30, 2025 compared to the corresponding prior year period, Decreases in the Lower 48 land rig market for both average number of rigs working and dayrates, more than offset the incremental revenue from acquired Parker rig operations in the Alaska and U.S. Offshore markets.
International Drilling
Operating revenues for our International Drilling segment during the six months ended June 30, 2025 increased by $60.6 million or 9% compared to the corresponding prior year period. Incremental revenue from acquired Parker rig operations in international markets and the contribution of recently deployed rigs in other international markets comprise the majority of the increase.
Drilling Solutions
Operating revenues for this segment increased by $104.9 million or 66% during the six months ended June 30, 2025 compared to the corresponding prior year period. The increase in revenue is related to acquired Parker operations. This increase from Parker operations was slightly offset by a decline in results in the U.S. markets, which was driven by the reduction in drilling activity.
Rig Technologies
Operating revenues for our Rig Technologies segment decreased by $19.0 million or 19% during the six months ended June 30, 2025 compared to the corresponding prior year period due to the overall decline in activity in the U.S. as mentioned previously.
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Other Financial Information
Interest expense
Interest expense for the six months ended June 30, 2025 was $110.4 million, representing an increase of $8.5 million, or 8%, compared to the six months ended June 30, 2024. The increase was primarily due to an increase in our effective interest rate levels and an increase in our outstanding debt balance throughout the six months ended June 30, 2025 as compared to the six months ended June 30, 2024.
Gain on bargain purchase
Gain on bargain purchase for the six months ended June 30, 2025 and 2024 was $116.5 million and zero, respectively. The gain on bargain purchase was related to the Parker acquisition in the first quarter of 2025.
Other, net
Other, net for the six months ended June 30, 2025 was a loss of $50.9 million compared to $28.2 million loss for the six months ended June 30, 2024 representing a $22.7 million increase in loss. During the six months ended June 30, 2025, the amount primarily consisted of $26.5 million in asset impairments related to assets held in Russia, $19.1 million of transaction related costs and $12.2 million related to severance and reorganization costs which was offset by $7.4 million of mark-to-market gains on the common share warrants and $15.8 million in gain on sales of assets. In comparison, the amount during the six months ended June 30, 2024 primarily consisted of $17.9 million in foreign currency transaction losses, $9.5 million in losses on sales of assets, $4.3 million from increases in litigation reserves and $2.6 million of loss recognized for debt buybacks which was offset by $9.6 million of mark-to-market gains on the common share warrants.
Income tax
Our worldwide tax expense for the six months ended June 30, 2025 was $38.1 million compared to $31.6 million for the six months ended June 30, 2024. The increase in tax expense was primarily attributable to the Parker acquisition, as well as the change in amount and geographic mix of our pre-tax earnings (losses).
Liquidity and Capital Resources
Financial Condition and Sources of Liquidity
Our primary sources of liquidity are cash and investments, availability under the 2024 Credit Agreement and cash generated from operations. As of June 30, 2025, we had cash and short-term investments of $387.4 million and working capital of $527.4 million. As of December 31, 2024, we had cash and short-term investments of $397.3 million and working capital of $427.6 million.
On June 30, 2025, we had borrowings of $178.0 million and $78.8 million of letters of credit outstanding under the 2024 Credit Agreement, which has a total borrowing capacity of $350.0 million and a separate letter of credit tranche that permits us to issue letters of credit with total reimbursement obligations not to exceed $125 million. Letters of credit issued do not affect revolving loan capacity and vice versa.
The 2024 Credit Agreement requires us to maintain an interest coverage ratio (EBITDA/interest expense of 2.75:1.00) and a minimum guarantor value, requiring the guarantors (other than the Company) and their subsidiaries to own at least 90% of the consolidated property, plant and equipment of the Company. Additionally, the Company is subject to certain covenants (which are subject to certain exceptions) and include, among others, (a) a covenant restricting our ability to incur liens (subject to the additional liens basket of up to $150.0 million, among other exceptions), (b) a covenant restricting its ability to pay dividends or make other distributions with respect to its capital stock and to repurchase certain indebtedness, and (c) a covenant restricting the ability of the Company’s subsidiaries to incur debt (subject to the grower debt basket of up to $100.0 million). The facility matures on the earlier of (a) June 17, 2029 and (b) to the extent 10% or more of the respective principal amount of any of the 7.375% Senior Priority Guaranteed Notes due May 2027 or 7.50% Senior Guaranteed Notes due January 2028 or 50% or more of the principal
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amount of the 1.75% Senior Exchangeable Notes due June 2029 remains outstanding on the date that is 90 days prior to the applicable maturity date for such indebtedness, then such 90th day.
As of the date of this report, we were in compliance with all covenants under the 2024 Credit Agreement, including those regarding the required interest coverage ratio and minimum guarantor value, which were 4.30:1.00 and 99.8%, respectively, as of June 30, 2025. If we fail to perform our obligations under the covenants, the revolving credit commitments under the 2024 Credit Agreement could be terminated, and any outstanding borrowings under the facilities could be declared immediately due and payable. If necessary, we have the ability to manage our covenant compliance by taking certain actions including reductions in discretionary capital or other types of controllable expenditures, monetization of assets, amending or renegotiating the revolving credit agreement, accessing capital markets through a variety of alternative methods, or any combination of these alternatives. We expect to remain in compliance with all covenants under the 2024 Credit Agreement during the twelve-month period following the date of this report based on our current operational and financial projections, including after giving effect to the Parker acquisition. However, we can make no assurance of continued compliance if our current projections or material underlying assumptions prove to be incorrect. If we fail to comply with the covenants, the revolving credit commitment could be terminated, and any outstanding borrowings under the facility could be declared immediately due and payable.
Our ability to access capital markets or to otherwise obtain sufficient financing may be affected by our senior unsecured debt ratings as provided by the major credit rating agencies in the United States and our historical ability to access these markets as needed. While there can be no assurances that we will be able to access these markets in the future, we believe that we will be able to access capital markets or otherwise obtain financing in order to satisfy any payment obligation that might arise upon maturity, exchange or purchase of our notes and our debt facilities, loss of availability of our revolving credit facilities and our A/R Agreements (see—Accounts Receivable Purchase and Sales Agreements, below), and that any cash payment due, in addition to our other cash obligations, would not ultimately have a material adverse impact on our liquidity or financial position. The major U.S. credit rating agencies have previously downgraded our senior unsecured debt rating to non-investment grade. These and any further ratings downgrades could adversely impact our ability to access debt markets in the future, increase the cost of future debt, and potentially require us to post letters of credit for certain obligations.
We had seven letter-of-credit facilities with various banks as of June 30, 2025. Availability under these facilities as of June 30, 2025 was as follows:
| | | |
|
| June 30, | |
| | 2025 | |
| | (In thousands) | |
Credit available | | $ | 283,667 |
Less: Letters of credit outstanding, inclusive of financial and performance guarantees | |
| 122,392 |
Remaining availability | | $ | 161,275 |
As of June 30, 2025, approximately 24%, 22% and 21% of our net accounts receivable balance was related to our operations in Saudi Arabia, Mexico and U.S., respectively. Our largest customer in Mexico has a history of making late payments and, in more recent periods, has utilized third-party financial institutions to pay certain of our receivables. The balances due are not in dispute, however, additional or continued delays in customer payments in the future could differ from historical practice and management’s current expectations.
Accounts Receivable Purchase and Sales Agreements
On September 13, 2019, we entered into an accounts receivables sales agreement (the “A/R Sales Agreement”) and an accounts receivables purchase agreement (the “A/R Purchase Agreement” and, together with the A/R Sales Agreement, the “A/R Agreements”), whereby the originators, all of whom are our subsidiaries, sold or contributed, and will on an ongoing basis continue to sell or contribute, certain of their domestic trade accounts receivables to a wholly-owned, bankruptcy-remote special purpose entity (“SPE”). The SPE in turn, sells, transfers, conveys and assigns to third-party financial institutions (“Purchasers”), all the rights, title and interest in and to its pool of eligible receivables.
Over the term of the facility, we entered into a number of amendments. Most recently, on April 1, 2024, we entered into the Fourth Amendment to the A/R Purchase Agreement, which among other things, extended the term of the A/R Purchase Agreement to the earliest of (i) April 1, 2027 and (ii) the date that is ninety (90) calendar days prior to the occurrence of the maturity date under and as defined in the 2024 Credit Agreement.
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The amount available for purchase under the A/R Agreements fluctuates over time based on the total amount of eligible receivables generated during the normal course of business after excluding excess concentrations and certain other ineligible receivables. The maximum purchase commitment of the Purchasers under the A/R Agreements is $250.0 million and the amount of receivables purchased by the third-party Purchasers as of June 30, 2025 was $125.0 million.
The originators, Nabors Delaware, the SPE, and the Company provide representations, warranties, covenants and indemnities under the A/R Agreements and the Indemnification Guarantee. See further details at Note 5—Accounts Receivable Purchase and Sales Agreements.
Other Indebtedness
See Note 6—Debt, for further details about our financing arrangements, including our debt securities.
Future Cash Requirements
Our current cash and investments, projected cash flows from operations, proceeds from equity or debt issuances, the A/R Agreements and the facilities under our 2024 Credit Agreement are expected to adequately finance our purchase commitments, capital expenditures, acquisitions, scheduled debt service requirements, and all other expected cash requirements for at least the next 12 months. However, we can make no assurances that our current operational and financial projections will prove to be correct. A sustained period of highly depressed oil and natural gas prices could have a significant effect on our customers’ capital expenditure spending and therefore our operations, cash flows and liquidity.
Purchase commitments outstanding at June 30, 2025 totaled approximately $384.6 million, primarily for capital expenditures, other operating expenses and purchases of inventory. We can reduce planned expenditures if necessary or increase them if market conditions and new business opportunities warrant it. The level of our outstanding purchase commitments and our expected level of capital expenditures over the next 12 months represent a number of capital programs that are currently underway or planned.
See our discussion of guarantees issued by Nabors that could have a potential impact on our financial position, results of operations or cash flows in future periods included below under “Off-Balance Sheet Arrangements (Including Guarantees).”
There have been no material changes to the contractual cash obligations that were included in our 2024 Annual Report.
We may from time to time seek to retire or purchase our outstanding debt through cash purchases or exchanges for equity securities, both in open-market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors and may involve material amounts.
Cash Flows
Our cash flows depend, to a large degree, on the level of spending by oil and gas companies for exploration, development and production activities. Sustained decreases in the price of oil or natural gas could have a material impact on these activities and could also materially affect our cash flows. Certain sources and uses of cash, such as the level of discretionary capital expenditures or acquisitions, purchases and sales of investments, dividends, loans, issuances and repurchases of debt and of our common shares are within our control and are adjusted as necessary based on market conditions. We discuss our cash flows for the six months ended June 30, 2025 and 2024 below.
Operating Activities. Net cash provided by operating activities totaled $239.5 million during the six months ended June 30, 2025, compared to net cash provided of $288.9 million during the corresponding 2024 period. Operating cash flows are our primary source of capital and liquidity. Cash from operating results (before working capital changes) was $303.7 million for the six months ended June 30, 2025, a decrease of $40.5 million when compared to $344.3 million in the corresponding 2024 period. This was due to the decrease in activity across our business for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. Changes in working capital items such as collection of
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receivables, other deferred revenue arrangements and payments of operating payables are also significant factors affecting operating cash flows and can be highly volatile in periods of increasing or decreasing activity levels. Changes in working capital items used $64.2 million in cash flows during the six months ended June 30, 2025, a $8.8 million unfavorable change as compared to the $55.4 million in cash flows used by working capital in the corresponding 2024 period.
Investing Activities. Net cash used for investing activities totaled $210.9 million during the six months ended June 30, 2025 compared to net cash used of $227.1 million during the corresponding 2024 period. Our primary use of cash for investing activities is capital expenditures for rig-related enhancements, new construction and equipment, and sustaining capital expenditures. During the six months ended June 30, 2025 and 2024, we used cash for capital expenditures totaling $343.9 million and $232.0 million, respectively. During the six months ended June 30, 2025, we received $84.4 million in cash acquired in the Parker acquisition, net of cash paid.
Financing Activities. Net cash used by financing activities totaled $21.3 million during the six months ended June 30, 2025. During the six months ended June 30, 2025, we paid off the Parker term loan of $177.8 million and received proceeds from the Credit Agreement of $178.0 million.
Net cash used by financing activities totaled $636.3 million during the six months ended June 30, 2024. During the six months ended June 30, 2024, we repaid $631.0 million of outstanding long-term debt.
Other Matters
Recent Accounting Pronouncements
See Note 2—Summary of Significant Accounting Policies.
Off-Balance Sheet Arrangements (Including Guarantees)
We are a party to transactions, agreements or other contractual arrangements defined as “off-balance sheet arrangements” that could have a material future effect on our financial position, results of operations, liquidity and capital resources. The most significant of these off-balance sheet arrangements include the A/R Agreements (see —Accounts Receivable Purchase and Sales Agreements, above) and certain agreements and obligations under which we provide financial or performance assurance to third parties. Certain of these financial or performance assurances serve as guarantees, including standby letters of credit issued on behalf of insurance carriers in conjunction with our workers’ compensation insurance program and other financial surety instruments such as bonds. In addition, we have provided indemnifications, which serve as guarantees, to some third parties. These guarantees include indemnification provided by us to our share transfer agent and our insurance carriers. We are not able to estimate the potential future maximum payments that might be due under our indemnification guarantees. Management believes the likelihood that we would be required to perform or otherwise incur any material losses associated with any of these guarantees is remote.
The following table summarizes the total maximum amount of financial guarantees issued by Nabors:
| | | | | | | | | | | | | |
| | Maximum Amount |
| ||||||||||
|
| 2025 |
| 2026 |
| 2027 |
| Thereafter |
| Total |
| ||
| | (In thousands) |
| ||||||||||
Financial standby letters of credit and other financial surety instruments | | $ | 27,042 |
| 23,846 |
| 5,834 |
| 8,322 | | $ | 65,044 | |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We may be exposed to market risks arising from the use of financial instruments in the ordinary course of business as discussed in our 2024 Annual Report. There were no material changes in our exposure to market risk during the six months ended June 30, 2025 from those disclosed in our 2024 Annual Report.
ITEM 4. CONTROLS AND PROCEDURES
We maintain a set of disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) designed to provide reasonable assurance that information required to be disclosed in our
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reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management as appropriate to allow timely decisions regarding required disclosure.
The Company’s management, with the participation of the Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report.
There were no changes in our internal control over financial reporting during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
See Note 9 — Commitments and Contingencies — Litigation for information regarding our legal proceedings.
ITEM 1A. RISK FACTORS
In addition to the information set forth elsewhere in this report, the risk factors set forth in Part 1, Item 1A, of our 2024 Annual Report on Form 10-K should be carefully considered when evaluating us. These risks are not the only risks we face. Additional risks not presently known to us or that we currently deem immaterial may also impair our business. There have been no material changes to the risk factors set forth in Part 1, Item 1A, or our 2024 Annual Report on Form 10-K other than those listed in this section.
Voting power in some of our common shares held or controlled by our Board of Directors (“Board”) could limit a shareholder’s ability to influence our actions.
In connection with the Parker acquisition, we entered into voting and lock-up agreements (the “Voting & Lock-Up Agreements”) with certain shareholders of Parker (the “Supporting Shareholders”) that became shareholders of ours upon consummation of the acquisition. Among other things, the Voting & Lock-Up Agreements require the Supporting Shareholders to vote shares received as consideration in the acquisition and any other shares they may own in favor of any candidate nominated as a director to our Board by the Board itself or the appropriate committee, vote in favor of any other proposals to the shareholders that the Board recommends shareholders at-large vote in favor of or the Board has already approved and vote against any Board candidate not recommended or approved by the Board. The Voting & Lock-Up Agreements also contain standstill provisions.
Significant changes or developments in U.S. or other national trade policies, including tariffs, and the reactions of other countries thereto, may have a material adverse effect on our business and results of operations.
We operate in various countries across the world and source a wide range of raw materials and components from the international market. Significant changes or developments in U.S. or other national laws and policies, such as laws and policies surrounding international trade, foreign affairs, manufacturing and development and investment in the territories and countries where we or our customers operate, can materially adversely affect our business and results of operations. Policies affecting international trade, foreign investment, and energy production—such as tariffs, export controls, import restrictions and similar protectionist measures—can impact supply chain costs, the availability of key components, and overall industry profitability.
For instance, the United States has recently proposed and instituted numerous trade policies—including the termination of trade agreements, imposition of ad valorum tariffs on certain imports into the United States, and other regulations affecting trade between the United States and countries in which we conduct business and source components. In response to the measures taken by the United States, a number of other nations have proposed and implemented retaliatory tariffs and trade restrictions. While the impact of such measures, both pending and threatened, is unknown at this time, these measures could increase the cost of components and raw materials in our supply chain and, consequently, our costs. We may not be able to pass along these increased costs to our customers.
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As a result of these developments, and any similar measures threatened or implemented in the future, there may be economic disincentives on international trade that could adversely affect our business and results of operations.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
We withheld the following shares of our common shares to satisfy tax withholding obligations in connection with grants of share awards during the three months ended June 30, 2025 from the distributions described below. These shares may be deemed to be “issuer purchases” of shares that are required to be disclosed pursuant to this Item, but were not purchased as part of a publicly announced program to purchase common shares:
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|
|
| Approximated |
|
| | | | | | | Total Number | | Dollar Value of |
|
| | | | | | | of Shares | | Shares that May |
|
| | Total | | Average | | Purchased as | | Yet Be |
| |
| | Number of | | Price | | Part of Publicly | | Purchased |
| |
Period | | Shares | | Paid per | | Announced | | Under the |
| |
(In thousands, except per share amounts) |
| Repurchased |
| Share (1) |
| Program |
| Program (2) |
| |
April 1 - April 30 | | — | | $ | 30.91 | | — | | 278,914 | |
May 1 - May 31 | | — | | $ | 26.30 | | — | | 278,914 | |
June 1 - June 30 | | — | | $ | 30.12 | | — | | 278,914 | |
| (1) | Shares were withheld from employees and directors to satisfy certain tax withholding obligations due in connection with grants of shares under our 2016 Stock Plan. Each of the 2016 Stock Plan and the 1999 Stock Option Plan for Non-Employee Directors provide for the withholding of shares to satisfy tax obligations, but do not specify a maximum number of shares that can be withheld for this purpose. These shares were not purchased as part of a publicly announced program to purchase common shares. |
| (2) | In August 2015, our Board authorized a share repurchase program under which we may repurchase up to $400.0 million of our common shares in the open market or in privately negotiated transactions. The program was reaffirmed by the Board in February 2019 and in May 2025. Through June 30, 2025, we repurchased 0.3 million of our common shares for an aggregate purchase price of approximately $121.1 million under this program. As of June 30, 2025, we had $278.9 million that remained authorized under the program that may be used to repurchase shares. The repurchased shares, which are held by our subsidiaries, are registered and tradable subject to applicable securities law limitations and have the same rights as other outstanding shares. As of June 30, 2025, our subsidiaries held 1.2 million of our common shares. |
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
| (a) | None. |
| (b) | None. |
(c)
39
Table of Contents
ITEM 6. EXHIBITS
| ||
| | |
Exhibit No. |
| Description |
31.1 | | Rule 13a-14(a)/15d-14(a) Certification of Anthony G. Petrello, Chairman, President and Chief Executive Officer* |
31.2 | | Rule 13a-14(a)/15d-14(a) Certification of William Restrepo, Chief Financial Officer* |
32.1 | | Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Anthony G. Petrello, Chairman, President and Chief Executive Officer and William Restrepo, Chief Financial Officer.* |
101.INS | | Inline XBRL Instance Document* |
101.SCH | | Inline XBRL Schema Document* |
101.CAL | | Inline XBRL Calculation Linkbase Document* |
101.LAB | | Inline XBRL Label Linkbase Document* |
101.PRE | | Inline XBRL Presentation Linkbase Document* |
101.DEF | | Inline XBRL Definition Linkbase Document* |
104 | | Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document) |
*Filed herewith.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| ||
| NABORS INDUSTRIES LTD. | |
| | |
| By: | /s/ ANTHONY G. PETRELLO |
| | Anthony G. Petrello |
| | Chairman, President and |
| | Chief Executive Officer |
| | (Principal Executive Officer) |
| | |
| By: | /s/ WILLIAM RESTREPO |
| | William Restrepo |
| | Chief Financial Officer (Principal Financial Officer and Accounting Officer) |
| | |
| Date: | August 1, 2025 |
40
FAQ
How much did Nabors Industries (NBR) earn in Q2 2025?
What was the impact of the Parker Drilling acquisition on NBR's results?
How has Nabors' debt position changed?
What are Nabors Industries' current cash and liquidity levels?
Did Nabors record any impairments related to Russia or Ukraine?
How many NBR shares are outstanding after the Parker acquisition?
