Shearwater GeoServices (SHEARWATER) Q1 2026 earnings summary

Executive summary

• Q1 2026 saw stable marine seismic activity with 73% fleet utilization across 8.7 active vessels, supported by late 2025 project awards and strong multi-client revenue of USD 21.6 million.

• Revenue declined year-over-year, but multi-client segment remained a key profitability driver, with EBITDA at USD 35.7 million and EBIT at USD 2.0 million.

• Measures to strengthen financial flexibility included proposed amendments to secured debt facilities, a USD 40 million equity injection, and vessel divestments such as SW Baret sold at a premium to book value.

• Near-term market visibility remains soft, but long-term fundamentals are improving, with increased tendering activity and majors/NOCs signaling higher exploration spending.

• Cost reduction and efficiency program targeting USD 40 million in savings is progressing as planned.

Financial highlights

• Q1 2026 revenue was USD 120.6 million, down from USD 189.4 million in Q1 2025.

• EBITDA was USD 35.7 million (margin 30%), with marine acquisition EBITDA at USD 26.7 million and multi-client EBITDA at USD 21.6 million.

• Net loss was USD 19.1 million, compared to a net profit of USD 8.9 million in Q1 2025.

• Cash and cash equivalents at quarter-end were USD 94.2 million, with free cash flow at USD 8 million.

• CapEx was USD 5.5 million, with multi-client investments of USD 31.9 million; working capital improved through receivables sale.

Outlook and guidance

• Market conditions expected to remain soft through Q2 and Q3 2026, with activity anticipated to pick up toward year-end and into 2027.

• Multi-client revenues for 2026 are expected to exceed 2025 levels.

• Backlog at mid-May 2026 was approximately USD 260 million, providing near-term visibility.

• Increased tendering activity, especially in India, is expected to drive higher activity and absorb fleet capacity.

• Long-term fundamentals for marine seismic are strengthening, with majors and NOCs signaling increased exploration activity.