Seadrill posts Q3 net loss on legal provision impact
Overview
Deepwater drilling firm's Q3 operating revenue beat analyst expectations
Adjusted EBITDA for Q3 also beat analyst expectations
Company posted net loss due to legal provision and repurchased $22 mln of shares
Outlook
Seadrill raises 2026 total operating revenue guidance to $1.56-$1.58 bln, excluding $90 mln reimbursables
Company lifts 2026 adjusted EBITDA guidance to $440-$460 mln
Seadrill narrows 2026 capital expenditure and long-term maintenance guidance to $210-$230 mln
Result Drivers
FEWER OPERATING DAYS - Co said lower Q3 revenue was mainly due to fewer operating days for West Carina, which completed its contract in Q2, and downtime between contracts for West Vela, West Elara, and Sevan Louisiana
INCREASED OPERATING DAYS - Revenue decline was partially offset by more operating days for West Tellus, which began a long-term contract in June
LEGAL PROVISION - Net loss in Q3 included the impact of a legal provision booked during the quarter
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Operating Revenue | Beat | $428 mln | $378.21 mln (6 Analysts) |
Q3 Loss Per Share | $0.49 | ||
Q3 Net Loss | $30 mln | ||
Q3 Adjusted EBITDA | Beat | $121 mln | $100.21 mln (6 Analysts) |
Q3 Adjusted EBITDA Margin | 29.70% | ||
Q3 Operating Profit | $44 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the oil & gas drilling peer group is "buy"
Wall Street's median 12-month price target for Seadrill Limited is $55.50, about 16.3% above its November 2 closing price of $47.73
The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 20 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)