Nabors Industries Ltd (NBR) Q4 2025 Earnings Call Highlights: Strategic Debt Reduction and …

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Fri, February 13, 2026 at 8:01 AM GMT+9 4 min read

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**Net Debt Reduction:** Reduced by $554 million compared to the end of 2024.

**Annualized Cash Interest Expense Reduction:** Reduced by approximately $45 million.

**Adjusted EBITDA:** $222 million for the fourth quarter.

**Full Year Revenue:** $3.2 billion, reflecting an 8.7% growth year over year.

**Fourth Quarter Revenue:** $798 million, a decrease of 2.5% sequentially.

**EBITDA Margin:** 27.8% for the fourth quarter.

**International Drilling Revenue:** $424 million, a 4.1% sequential increase.

**US Drilling Revenue:** $241 million, a 3.7% sequential decline.

**Lower 48 Rig Count:** Increased to 66 rigs by the end of the fourth quarter.

**Capital Expenditures:** $158 million for the fourth quarter.

**Adjusted Free Cash Flow:** $132 million for the fourth quarter.

**Full Year Adjusted Free Cash Flow:** Approximately $117 million.

**Debt Maturity Extension:** Extended to June 2029 with a weighted average maturity of 5.3 years.

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Release Date: February 12, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Nabors Industries Ltd (NYSE:NBR) reduced net debt by $554 million compared to the end of 2024, significantly de-risking its capital structure.

The company achieved a better-than-expected adjusted EBITDA of $222 million for the fourth quarter, driven by strong performance in the US drilling segment.

Nabors Industries Ltd (NYSE:NBR) completed significant transactions, including the acquisition of Parker Wellboard and the sale of Quil tools, enhancing its business portfolio.

The company is well-positioned in the international drilling market, with growth prospects in the Middle East, Asia Pacific, and Latin America.

Nabors Industries Ltd (NYSE:NBR) is making progress with its joint venture in Saudi Arabia, with plans to deploy additional rigs and expand its new build fleet.

Negative Points

Oil prices experienced a downward trend in the second half of 2025, impacting the broader market environment.

The company faces uncertainty around future tariff actions and geopolitical tensions, which could affect oil prices and client reactions.

Nabors Industries Ltd (NYSE:NBR) anticipates a seasonal slowdown in the Middle East and the conclusion of certain short-term high-margin activities.

The company is cautious about the second half of the year due to external market noise and potential oversupply concerns.

Nabors Industries Ltd (NYSE:NBR) expects to consume $80 to $90 million of consolidated adjusted free cash flow in the first quarter, with significant consumption from its joint venture, SAI.

 






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Q & A Highlights

Q: Can you expand on the drivers behind the increasing rig count in the lower 48, and provide more color on customer types and basins? A: Anthony Petrello, CEO: Currently, we’re running 66 rigs, with 80% being public and 20% gas rigs, which is double from before. The trend towards longer laterals is significant, with a notable increase in 3 to 4-mile laterals. Our Pace X rigs are well-suited for these wells, and we’ve improved on our base case with the Ultra. We’re bullish on the long-term gas market and focused on performance and discipline.

Q: Can you comment on the situation in Saudi Arabia regarding the SAA new build program and labor market challenges? A: Anthony Petrello, CEO: The rig count in the kingdom is about 260 rigs. We are confident in our ability to meet schedules for reactivating rigs and new builds due to our strong position and vertical integration. The large-scale resumption of rigs by Aramco signals a positive market outlook, indicating a good year ahead.

Q: Are there any negotiations to put additional rigs to work in Mexico beyond the fourth platform rig? A: Anthony Petrello, CEO: We are focused on making the current rigs profitable, but the market is more positive, especially with improved payment mechanisms. We are also supporting other rigs with services, including Pemex’s own rigs.

Q: How should we think about the CapEx run rate for the SAA new build program? A: Miguel Rodriguez, CFO: The plan for 2026 is around $360 to $380 million, with 2027 expected to decrease to $320 to $330 million. This reflects the construction milestones and the 5 rig builds.

Q: Can you elaborate on the new CanRig wrenches and their impact on cycle time improvement? A: Anthony Petrello, CEO: The new wrench is a 3-byte wrench with full automation and feedback, capable of operating in autonomous mode. It has shown excellent performance in initial tests and is well-suited for larger, more complex wells. We expect high demand for this wrench, both internally and from third parties.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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