HAMILTON, Bermuda, Feb.11, 2026 /PRNewswire/ -- Nabors Industries Ltd. ("Nabors" or the "Company") $(NBR)$ today reported fourth quarter 2025 operating revenues of $798 million, compared to operating revenues of $818 million in the third quarter. Net income attributable to Nabors' shareholders for the quarter was $10 million, compared to $274 million in the third quarter. This equates to earnings per diluted share of $0.17, compared to $16.85 in the third quarter. The third quarter included a one-time, after-tax gain on the disposition of Quail Tools, LLC ("Quail") of $314 million, or $20.52 per diluted share. Fourth-quarter adjusted EBITDA was $222 million, compared to $236 million in the previous quarter.
4Q 2025 Highlights
-- Nabors completed several transactions that materially reduced total debt
and significantly strengthened its leverage metrics:
-- Related to the sale of Quail, Nabors collected the $250 million
seller financing note in full.
-- The Company issued $700 million of notes due in 2032.
-- In turn, the Company redeemed the $546 million remaining balance
of its notes due in 2027.
-- In January, the Company redeemed in full the remaining outstanding
notes due in 2028.
-- These actions contributed to a reduction in Nabors' outstanding net debt
by approximately $554 million since the end of 2024. The Company's next
debt maturity is $250 million due in 2029.
-- The performance of the retained Parker Wellbore businesses improved.
Adjusted EBITDA contribution from these operations increased by 11%
sequentially, with stronger drilling activity in Canada and Indonesia.
This growth also includes additional realization of cost synergies,
reaching the $40 million synergy target for 2025.
-- The SANAD joint venture deployed one newbuild rig in the Kingdom. The
number of newbuild deployments now totals 14. Five more are scheduled for
2026, followed by one more in early 2027.
-- In the fourth quarter, Nabors installed the first unit of its new
Canrig$(R)$ automated floor wrench on a Nabors rig working in the
Haynesville Shale. This wrench represents a technological step-change for
this critical rig floor component. Its field performance demonstrates a
30% reduction in cycle time and improved positioning. Available as a
retrofit to Canrig wrenches deployed in the field, it is already
generating significant customer interest.
Anthony G. Petrello, Nabors Chairman, CEO and President, commented, "2025 proved to be a transformational year for our capital structure. Including the redemption in January, we reduced our total debt by $388 million since the end of 2024. This represents significant progress on our path to delevering. As a result of this significant reduction in debt, our annual interest expense should decline by approximately $45 million, translating into a dollar-for-dollar improvement in adjusted free cash flow.
"Nabors' fourth quarter results improved compared to the third quarter, excluding the contribution from Quail. This sequential improvement was broad-based across all segments of our operations.
"In the Lower 48 business and International Drilling segment, our average rig counts in the fourth quarter exceeded both our expectations and those of the prior quarter. Our Lower 48 count increased in the latter portion of the quarter, highlighting our success executing on opportunities to add rigs. In our International Drilling segment, SANAD added a newbuild in Saudi Arabia, two rigs were redeployed in Argentina, and three platform rigs in Mexico continued to work throughout the quarter.
"The sequential increase in Drilling Solutions' ("NDS") adjusted EBITDA was particularly encouraging. The largest contributors to this increase include casing running, managed pressure drilling, and performance software in our international markets. In the Lower 48 market, NDS's revenue on third-party drilling contractors' rigs increased sequentially by more than 10%, even as that market's rig count grew by just 1%. This performance demonstrates the value of the NDS portfolio and our success targeting the third-party rig market."
Segment Results
International Drilling adjusted EBITDA totaled $131.3 million, compared to $127.6 million in the third quarter. Average rig count increased by more than four rigs, reflecting the recent startup of rigs in Argentina, Saudi Arabia and Colombia. Daily adjusted gross margin for the fourth quarter was $17,630, partially reflecting rig startup inefficiencies and activity interruptions in certain markets.
The U.S. Drilling segment reported fourth quarter adjusted EBITDA of $93.2 million, compared to $94.2 million in the previous quarter. Results in the Lower 48 operation improved on increases in average rig count and daily gross margin. These were mainly offset by a margin decline in Alaska and Offshore which was smaller than expected.
Drilling Solutions adjusted EBITDA was $41.3 million, compared to $60.7 million in the third quarter. The segment's third quarter results included the contribution from Quail through its disposition in August. Excluding the impact of Quail from the third quarter results, Drilling Solutions adjusted EBITDA grew 2.3%.
Rig Technologies adjusted EBITDA was $4.9 million, a 31% increase from $3.8 million in the prior quarter. Sales of capital equipment improved in the quarter.
Adjusted Free Cash Flow
Consolidated adjusted free cash flow was $132 million in the fourth quarter, a significant increase from $6 million in the third quarter. Several factors contributed to this performance. In addition to stronger EBITDA, collections in Mexico improved substantially. Capital spending in the fourth quarter was below expectations, both for the SANAD newbuild rig program and in the balance of the operation. The Company also received settlements from several outstanding claims.
Miguel Rodriguez, Nabors CFO, stated, "Our achievements over the past year demonstrate that we are delivering on our commitments. Our top priority is the reduction of debt. We intend to follow the recent progress with an additional decrease this year.
"In the fourth quarter, our adjusted EBITDA exceeded our expectations. The U.S. Drilling and Drilling Solutions segments contributed to this outperformance. All three of the U.S. Drilling operations were stronger than expected. In the Lower 48, the increase in rig count late in the quarter sets us up for a positive start to 2026. Drilling Solutions' strength was evident across multiple service lines, especially in its international markets.
"Adjusted free cash flow in the fourth quarter also exceeded our expectations. Going forward, our focus will remain strengthening our capital structure, while delivering durable growth and long-term value."
Outlook
Nabors expects the following metrics for the first quarter of 2026:
U.S. Drilling
-- Lower 48 average rig count of 64 - 65 rigs -- Lower 48 daily adjusted gross margin of approximately $13,200 -- Alaska and Gulf of America combined adjusted EBITDA of $16 - $17 million
International
-- Average rig count of 91 - 92 rigs -- Daily adjusted gross margin of approximately $17,500 - $17,600
Drilling Solutions
-- Adjusted EBITDA of approximately $39 million
Rig Technologies
-- Adjusted EBITDA of approximately $2 million
Capital Expenditures
-- Capital expenditures of $170 - $180 million, including approximately $85
million for newbuilds in Saudi Arabia
Adjusted Free Cash Flow
-- First quarter adjusted free cash consumption of $80 - $90 million,
including free cash consumption at SANAD of $50 - $60 million
Nabors expects the following metrics for full-year 2026:
U.S. Drilling
-- Lower 48 average rig count of 61 - 64 rigs -- Lower 48 daily adjusted gross margin of $13,000 - $13,400 -- Alaska and Gulf of America combined adjusted EBITDA of $55 - $60 million
International
-- Average rig count of 96 - 98 rigs -- Daily adjusted gross margin of approximately $18,500
Drilling Solutions
-- Adjusted EBITDA of $160 - $170 million
Rig Technologies
-- Adjusted EBITDA of $22 - $25 million
Capital Expenditures
-- Capital expenditures of approximately $730 - $760 million, with $360 -
$380 million for SANAD newbuilds
Adjusted Free Cash Flow
-- Adjusted free cash flow excluding SANAD of $80 - $90 million, with SANAD
consuming $100 - $120 million
Mr. Petrello concluded, "The steps we have taken over the past year have significantly reduced our debt, improved our leverage metrics, and lowered our interest payments. In addition, we retain a business portfolio from Parker that contributes materially to EBITDA and free cash flow.
"Looking forward, the Lower 48 market appears to be stabilizing. At the same time, the opportunity set in our international markets looks attractive. Our diversified business portfolio is designed to capitalize on this environment."
About Nabors Industries
Nabors Industries (NYSE: NBR) is a leading provider of advanced technology for the energy industry. With presence in more than 20 countries, Nabors has established a global network of people, technology and equipment to deploy solutions that deliver safe, efficient and responsible energy production. By leveraging its core competencies, particularly in drilling, engineering, automation, data science and manufacturing, Nabors aims to innovate the future of energy and enable the transition to a lower-carbon world. Learn more about Nabors and its energy technology leadership: www.nabors.com.
Forward-looking Statements
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