Nabors Industries Q2 Earnings Call Highlights

Nabors Industries Q2 Earnings Call Highlights

Nabors exceeded its Q2 outlook , reporting $222 million in adjusted EBITDA on $315 million of revenue, with EBITDA margin expanding to 27.2%. The company raised its 2026 EBITDA forecast to $920 million–$930 million and expects $20 million–$30 million in adjusted free cash flow. International and U.S. drilling operations strengthened. Saudi Arabia-led international drilling margins surpassed guidance, while Lower 48 activity rose to 73 working rigs with improved pricing and daily margins; Nabors expects further pricing gains through 2026 and into 2027. Technology growth supports profitability, but SANAD spending remains a cash-flow headwind. Drilling Solutions revenue increased 4.2% sequentially, while full-year capital spending is projected at $710 million–$730 million, including significant SANAD new-build investment. Nabors continues targeting at least $100 million of gross debt reduction in 2026.

Nabors Industries NYSE: NBR reported second-quarter 2026 adjusted EBITDA of $222 million, exceeding its prior outlook across all four reporting segments, as stronger daily margins in its U.S. Lower 48 and international drilling operations helped lift profitability. Chairman, President and Chief Executive Officer Tony Petrello said the company’s performance reflected “disciplined commercial execution, operational excellence, and outstanding work” by its global teams. Chief Financial Officer Miguel Rodriguez said consolidated revenue was $315 million, up $31 million sequentially, while EBITDA margin expanded 107 basis points to 27.2%.

The company raised its full-year EBITDA outlook to between $920 million and $930 million, citing first-half performance and continued momentum across its drilling and technology businesses. Nabors also now expects full-year adjusted free cash flow of $20 million to $30 million, including expected cash consumption of $60 million to $80 million at its SANAD joint venture.

International drilling gains led by Saudi Arabia International Drilling revenue rose 3.1% sequentially to $432 million, while segment EBITDA increased 7.6% to $131 million. Average daily rig margin increased by $654 to $17,534, exceeding the high end of the company’s guidance range. Saudi Arabia remained central to Nabors’ international strategy. The company’s SANAD joint venture placed its 16th new-build rig into service during the quarter and returned one previously suspended rig to work. SANAD now operates 55 rigs in the kingdom, representing a 28% market share, according to Petrello. Petrello said approximately 196 land rigs are operating in Saudi Arabia, up 35 from the market’s recent low in the third quarter of 2025 but still 28 below its early-2024 peak. He said SANAD has 34 rigs remaining for delivery under its 50-rig new-build program, creating a multiyear growth runway. The company expects International Drilling average rig count of 94 to 96 in the third quarter, including the deployment of SANAD’s 17th new-build rig, an idle U.S. rig moving to Argentina, and a short-term geothermal contract in Indonesia. Nabors expects international daily gross margin of $18,100 to $18,400 in the third quarter. In Argentina, Nabors operated 13 rigs at quarter-end, with another rig earning revenue under an operations and maintenance contract. The company is mobilizing an additional rig to the country, which would bring its total to 14. Petrello said Nabors holds roughly a 30% market share in Argentina and that five working rigs there had previously been idle in the Lower 48. Drilling Solutions represented about 46% of Nabors’ Argentina EBITDA in the first half, Petrello said, reflecting adopti...