Helmerich & Payne (HP) Q1 2026 earnings summary

Executive summary

• Adjusted EBITDA for the quarter was $230 million, exceeding expectations, with strong performance in North America, offshore, and international segments, and margin improvements in Saudi Arabia and the Jafurah Gas Field.

• Revenue surpassed $1 billion for the third consecutive quarter, driven by robust execution and a significant acquisition.

• Net loss of $97 million, or $0.98 per share, primarily due to a $103 million non-cash impairment charge and higher expenses from acquisition.

• CEO transition from John Lindsay to Trey Adams, with a focus on continuity, innovation, and global expansion.

• FlexRobotics Technology successfully deployed in the Permian Basin, with plans for broader rollout and growing customer interest.

Financial highlights

• Revenue for the quarter was $1.02 billion, with free cash flow at $126 million and capital expenditures between $57 million and $68 million.

• Adjusted EBITDA margin was 22–23%, and free cash flow conversion reached 55%.

• Net loss attributable to the company was $97 million, with adjusted net loss at $14–$16 million after excluding non-recurring items.

• $260 million of a $400 million term loan was repaid by January, with full repayment targeted by end of Q3 2026.

• $25 million returned to shareholders via dividends during the quarter.

Outlook and guidance

• North America Solutions direct margin expected between $205 million and $230 million in Q2, with 132–138 contracted rigs.

• International Solutions margin guidance for Q2 is $12 million–$30 million, reflecting reactivation costs; margins expected to materially improve in Q3 and Q4.

• Offshore Solutions margin guidance for Q2 is $20 million–$30 million, with full-year guidance of $100 million–$115 million.

• 2026 gross capital expenditure budget trimmed to $270 million–$310 million, a 30%+ reduction vs. FY'25.

• Free cash flow expected to remain strong, supporting further debt reduction and dividends.