Financial Data and Key Metrics Changes - In Q4 2025, the company reported an Adjusted EBITDA of $385 million and free cash flow of $321 million, with a year-on-year increase in Adjusted EBITDA of nearly 20% to $1.37 billion and free cash flow rising to $626 million [4][5] - The company retired approximately $1.3 billion in debt during the year, reducing annual interest expense by nearly $90 million and enhancing financial flexibility [5][6] - Total liquidity at the end of Q4 was approximately $1.5 billion, including $620 million in unrestricted cash and cash equivalents [16] Business Line Data and Key Metrics Changes - The company achieved record uptime performance just shy of 98% across its fleet, with zero operational integrity events and zero lost time incidents [6] - The company executed five major planned out-of-service projects on time and on budget, and recycled six rigs in 2025 [6] Market Data and Key Metrics Changes - The outlook for deepwater offshore drilling is strengthening, with expectations for deepwater utilization to exceed 90% through 2027 [10] - In the US Gulf, long-term demand remains robust, driven by new lease awards and improved fiscal terms [10] - The rig count in Africa is expected to increase from roughly 15 to at least 20 over the next couple of years, with significant multi-year program awards anticipated [11] Company Strategy and Development Direction - The company aims to optimize the value of its differentiated assets and generate industry-leading free cash flow, with a backlog of approximately $6 billion [7][8] - The recent acquisition of Valaris is seen as transformational, expected to create cost synergies exceeding $200 million and enhance shareholder returns [8][9] - The company is focused on establishing a stronger capital structure to weather business cycles and improve operational efficiencies [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming inflection point for offshore drilling, supported by customer conversations and increasing tender activity [33][34] - The company anticipates a pivot back towards traditional hydrocarbon sources among producers, indicating a shift in focus from renewables to offshore drilling [74][75] Other Important Information - The company has identified opportunities for rig movements to capitalize on demand in various regions, including Africa and Asia [42][46] - The guidance for 2026 reflects some idle time on specific rigs, but management expects free cash flow to be in line with or better than 2025 levels [18][67] Q&A Session Summary Question: Impact of Valaris acquisition on chartering strategy - Management indicated that the acquisition allows for cost efficiencies and improved service provision to customers, enhancing project execution reliability [22][24] Question: Confidence in offshore drilling inflection timing - Management cited customer conversations and increasing tender activity as key indicators of confidence in the timing of the market inflection [33][34] Question: Petrobras blend-and-extend negotiations - Management stated that the guidance reflects their best estimates and does not include significant upside from these negotiations [38] Question: Fleet placement and rig movements - Management noted that opportunities are developing in Africa and Asia, and rigs can be moved to meet demand in various regions [42][46] Question: Customer feedback on Valaris acquisition - Management reported overwhelmingly positive feedback from customers regarding the acquisition and its potential benefits [53][55]

Transocean (NYSE:RIG) Q4 2025 Earnings call February 20, 2026 09:00 AM ET Company ParticipantsDavid Keddington - VP and TreasurerKeelan Adamson - President and CEORoddie Mackenzie - Chief Commercial OfficerThad Vayda - CFOConference Call ParticipantsDoug Becker - AnalystEddie Kim - AnalystFredrik Stene - AnalystGreg Lewis - AnalystKeith Beckmann - AnalystNoel Parks - AnalystOperatorHello, and welcome everyone joining today's Q4 2025 Transocean earnings call. At this time, all participants are in a listen-on ...

Transocean (NYSE:RIG) Q4 2025 Earnings call February 20, 2026 09:00 AM ET Speaker8Hello, and welcome everyone joining today's Q4 2025 Transocean earnings call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. To register to ask a question at any time, please press star one on your telephone keypad. Please note, this call is being recorded. We are standing by if you should need any assistance. It is now my ...

Core Insights - Transocean reported revenue of $1.04 billion for the quarter ended December 2025, reflecting a 9.6% increase year-over-year and a slight revenue surprise of +0.44% over the Zacks Consensus Estimate [1] - The company's EPS was $0.02, a significant improvement from -$0.09 in the same quarter last year, although it fell short of the consensus estimate of $0.09 by -76.47% [1] Financial Performance - Total fleet average rig utilization was 85.8%, exceeding the average estimate of 82.2% from three analysts [4] - Ultra-Deepwater Floaters achieved a utilization rate of 82.1%, surpassing the average estimate of 77.5% [4] - Average daily revenue for Harsh Environment Floaters was $449.8 thousand, slightly above the estimated $445.6 thousand [4] - Total fleet average daily revenue was reported at $461.3 thousand, compared to the average estimate of $460.69 thousand [4] - Average daily revenue for Ultra Deepwater Floaters was $466 thousand, marginally below the estimated $467.12 thousand [4] - Utilization for Harsh Environment Floaters was 96.6%, slightly below the average estimate of 97.2% [4] Contract Drilling Revenues - Contract drilling revenues for Ultra-Deepwater Floaters reached $724 million, exceeding the estimated $715.42 million and representing a year-over-year increase of +7.3% [4] - Contract drilling revenues for Harsh Environment Floaters were $319 million, significantly higher than the estimated $265.02 million, marking a +15.2% increase compared to the previous year [4] Stock Performance - Transocean's shares have returned +34.3% over the past month, contrasting with a -0.8% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Viewpoint - Transocean reported quarterly earnings of $0.02 per share, missing the Zacks Consensus Estimate of $0.09 per share, representing a significant earnings surprise of -76.47% compared to a loss of $0.09 per share a year ago [1] Financial Performance - The company posted revenues of $1.04 billion for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 0.44%, and showing an increase from year-ago revenues of $952 million [2] - Over the last four quarters, Transocean has exceeded consensus revenue estimates four times [2] Stock Performance - Transocean shares have increased approximately 50.6% since the beginning of the year, significantly outperforming the S&P 500's gain of 0.5% [3] Future Outlook - The company's earnings outlook will be crucial for determining the stock's immediate price movement, with current consensus EPS estimates at $0.05 for the coming quarter and $0.19 for the current fiscal year [4][7] - The Zacks Rank for Transocean is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Oil and Gas - Drilling industry is currently ranked in the bottom 27% of over 250 Zacks industries, suggesting that the industry's outlook could materially impact Transocean's stock performance [8]

Financial Performance - Operating revenues for 2025 were $3.965 billion, a 13% increase from $3.524 billion in 2024[5] - Adjusted EBITDA for 2025 was $1.37 billion, up 19% from $1.148 billion[5] - Cash flows from operations increased by $302 million, reaching $749 million, a 68% rise[5] - Free cash flow for 2025 was $626 million, up from $193 million, representing a $433 million increase[5] - Contract drilling revenues for 2025 reached $3,965 million, a 12.5% increase from $3,524 million in 2024 and a 40% increase from $2,832 million in 2023[26] - Adjusted EBITDA for YTD December 31, 2025, was $1,370 million, with an adjusted EBITDA margin of 34.6%, compared to $1,148 million and a margin of 32.5% for the same period in 2024[38] Debt and Liquidity - Total principal amount of debt was reduced to $5.686 billion, down $1.258 billion or 18%[5] - Total liquidity as of 2025 was $1.507 billion, including an undrawn revolving credit facility[5] - Long-term debt decreased to $5,212 million in 2025 from $6,195 million in 2024[28] - Debt repayments YTD amounted to $(1,556) million, with $(1,106) million in the most recent quarter[44] - Debt repayments for the previous YTD reached $(2,103) million, with $(30) million in the most recent quarter[44] - Debt repayments paid from debt proceeds for the previous YTD were $1,748 million, indicating a strong reliance on debt financing[44] Losses and Impairments - The net loss attributable to controlling interest for 2025 was $2.915 billion, or $3.04 per diluted share[6] - The total operating loss for 2025 was $2,337 million, compared to a loss of $417 million in 2024 and $325 million in 2023[26] - Net loss attributable to controlling interest for 2025 was $2,915 million, significantly higher than the $512 million loss in 2024 and $954 million in 2023[26] - The company reported a loss on impairment of assets of $3,049 million in 2025, compared to $772 million in 2024 and $57 million in 2023[26] - Loss on impairment of assets for YTD December 31, 2025, was $3,049 million, significantly higher than the $772 million reported for the same period in 2024[38] - The company experienced a profit margin of (73.5)% for YTD December 31, 2025, compared to (14.5)% for the same period in 2024[38] Operational Efficiency - The company achieved a revenue efficiency of 96.5%, up from 94.5% in 2024[5] - Average daily revenue for ultra-deepwater floaters in Q4 2025 was $466,000, up from $460,200 in Q3 2025 and $428,200 in Q4 2024[32] - Total fleet average rig utilization in Q4 2025 was 85.8%, an increase from 76.0% in Q3 2025 and 66.8% in Q4 2024[32] - Revenue efficiency for the total fleet in Q4 2025 was 96.2%, compared to 97.5% in Q3 2025 and 93.5% in Q4 2024[32] Future Projections - For 2026, the company projects contract drilling revenues between $3.800 billion and $3.950 billion[11] - The company added $839 million in contract backlog at a weighted average dayrate of $453,000[5] Tax and Interest - The effective tax rate for the three months ended December 31, 2025, was 68.8%, with an adjusted effective tax rate of 72.3% excluding discrete items[40] - Interest expense for YTD December 31, 2025, was $515 million, up from $312 million in the same period of 2024[38] Cash Flow Analysis - Cash provided by operating activities for the year-to-date (YTD) reached $749 million, with a quarterly total (QTD) of $349 million[44] - Free Cash Flow YTD was $626 million, showing a significant increase compared to $321 million QTD[44] - Levered Free Cash Flow YTD was reported at $(438) million, indicating a decline from $(293) million QTD[44] - Capital expenditures YTD totaled $(123) million, with $(28) million spent in the latest quarter[44] - Cash provided by operating activities for the previous year-to-date (YTD) was $447 million, with a quarterly total (QTD) of $206 million[44] - Free Cash Flow for the previous YTD was $193 million, compared to $177 million QTD[44] - Levered Free Cash Flow for the previous YTD was $(162) million, with a positive $147 million in the latest quarter[44]

Core Viewpoint - Transocean Ltd. reported its financial results for the fourth quarter and full year of 2025, highlighting significant improvements in operational efficiency and financial restructuring, despite a substantial net loss attributable to controlling interest. Financial Performance Summary - Contract drilling revenues for 2025 reached $3.965 billion, a 13% increase from $3.524 billion in 2024 [7] - Adjusted EBITDA was $1.37 billion, up 19% from $1.148 billion in 2024, with an adjusted EBITDA margin of 34.6% [5][7] - Net loss attributable to controlling interest was $2.915 billion, translating to a basic and diluted loss per share of $3.04 [7][21] - Cash flows from operations were $749 million, an increase of 68% compared to the previous year [7] - Free cash flow improved to $626 million, up from $193 million in 2024 [7] Operational Highlights - The company achieved a revenue efficiency of 96.5%, up from 94.5% in 2024 [7] - The total principal amount of debt was reduced to $5.686 billion, down $1.258 billion or 18% [7] - The company added $839 million in contract backlog at a weighted average dayrate of $453,000 [7] Fourth Quarter Performance - In Q4 2025, contract drilling revenues were $1.043 billion, a 1.5% increase from the prior quarter [11] - Net income attributable to controlling interest for Q4 was $25 million, compared to a loss of $1.923 billion in Q3 [11] - Adjusted EBITDA for Q4 was $385 million, slightly down from $397 million in Q3 [11] Future Outlook - For Q1 2026, contract drilling revenues are expected to be between $1.020 billion and $1.050 billion, with full-year guidance set at $3.800 billion to $3.950 billion [10] - The company aims to maintain a revenue efficiency of 96.5% for the full year of 2026 [10] Strategic Initiatives - The company announced a definitive agreement to combine with Valaris, which is expected to enhance fleet capabilities and financial flexibility [5] - The primary objective for 2026 is to exceed customer expectations by delivering safe and efficient operations [4]

Wall Street analysts expect Transocean (RIG) to post quarterly earnings of $0.09 per share in its upcoming report, which indicates a year-over-year increase of 200%. Revenues are expected to be $1.04 billion, up 9.1% from the year-ago quarter.The current level reflects no revision in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial projections over this period.Prior to a company's earnings rele ...

Transocean (NYSE:RIG), an offshore rig company, closed Tuesday at $6.14, down 6.12%. Today’s drop could be a result of profit-taking after last week’s 52-week high or a reassessment of its all-stock Valaris (NYSE:VAL) acquisition. Trading volume reached 80.8 million shares, about 98% above its three-month average of 40.9 million shares. Transocean IPO'd in 1993 and has fallen 61% since going public. How the markets moved today The S&P 500 (SNPINDEX:^GSPC) added 0.10% to finish Tuesday at 6,843, while th ...

Group 1: Stock Performance and Market Sentiment - Transocean Ltd shares are experiencing a decline as investors lock in gains after reaching a 52-week high, with the energy sector currently underperforming, down approximately 1.5% [1] - The stock is trading 6.8% below its 20-day simple moving average (SMA) and 4.5% below its 100-day SMA, indicating a bearish short-term trend [4] - Over the past 12 months, shares have increased by 72.95%, reflecting strong long-term performance [4] - At the time of publication, Transocean shares were down 6.12% at $6.15 [7] Group 2: Contract Awards and Backlog - Transocean secured significant contract fixtures for two harsh environment semisubmersibles in Norway, enhancing its backlog visibility [2] - The Transocean Encourage received a seven-well contract extension, estimated to provide around $152 million in backlog, while the Transocean Enabler has two one-well options exercised, contributing an additional $32 million [2] - These contracts are set to commence in the first quarter of 2027, extending operational commitments through December 2027 [3] Group 3: Technical Indicators and Analyst Consensus - The Relative Strength Index (RSI) is at a neutral level, indicating the stock is neither overbought nor oversold, while the MACD is below its signal line, suggesting bearish pressure [5] - The stock carries a Hold Rating with an average price target of $6.44, with recent analyst actions including a Buy rating from BTIG, raising the target to $10.00 [7][8] - Key resistance is identified at $6.50 and key support at $5.50, with EPS estimates at 8 cents and revenue estimates at $1.04 billion [8]