Halliburton Company Q4 FY2025 earnings call

• Jeff Miller was pleased with Halliburton's fourth quarter performance, noting total company revenue of $22.2 billion and adjusted operating margin of 14% for 2025. International revenue was $13.1 billion (down 2% YoY) and North America revenue was $9.1 billion (down 6% YoY).
• Macro outlook for 2026: Believes 2026 will be a year of rebalancing with supply and demand expected to rebalance medium term. International business is strong with a collaborative value proposition, advanced technology, and aligned growth engines. North America expects revenue to decline high single digits in 2026, with a strategy to maximize value through technology adoption.
• Leadership update: Shannon Slocum promoted to chief operating officer effective January 1.

Completion and Production division: Q4 2025 revenue was $3.3 billion, flat compared to Q3 2025. Operating income was $570 million, an increase of 11% compared to Q3 2025, with an operating income margin of 17%. Drilling and Evaluation division: Q4 2025 revenue was $2.4 billion, flat compared to Q3 2025. Operating income was $367 million, an increase of 5% sequentially, with an operating income margin of 15%. Geographic results: Q4 international revenue increased 7% compared to Q3 2025. Europe Africa revenue in Q4 was $928 million, an increase of 12% sequentially. Middle East Asia revenue in Q4 was $1.5 billion, an increase of 3% sequentially. Latin America revenue in Q4 was $1.1 billion, a 7% increase sequentially. North America Q4 revenue was $2.2 billion, a 7% decrease sequentially.

• North America revenue expected to decline high single digits in 2026.
• International revenue expected to be flat to up modestly in 2026.
• Q1 2026 Completion and Production division anticipates sequential revenue to decrease 7% to 9% and margins to decline about 300 basis points.
• Drilling and Evaluation division expects sequential revenue to decline 2% to 4% and margins to decline 25 to 75 basis points.
• SAP spending guidance: About $45 million per quarter in 2026, project completed in Q4 2026 with expected savings of about $100 million annually.

• Geopolitical disruptions could impact commodity prices and market activity.
• Uncertainty around Venezuela's commercial and legal terms affecting potential business growth.
• Challenges related to SAP migration and its impact on expenses and operations.

Q: Saurabh Pant from Bank of America asked about Venezuela's potential and scaling up, and SAP spending trajectory.

A: Jeff Miller said Halliburton could scale up quickly in Venezuela, working through license mechanics, and Eric Carre noted SAP spending guidance of $40 to $45 million per quarter in 2026 with project completion in Q4.

Q: Neil Mehta from Goldman Sachs asked about international breakout by market and VoltaGrid.

A: Jeff Miller discussed Latin America as a bright spot, Middle East flattish, and Asia Pacific flattish, and expressed excitement about VoltaGrid's potential.

Q: David Anderson from Barclays asked about North American stimulation market rebalancing and MultiChem sale impact.

A: Jeff Miller talked about stable pricing and Eric Carre discussed C&P margin progression and MultiChem sale impact.

Q: Arun Jayaram from JPMorgan asked about margins and Halliburton's role in emerging technologies.

A: Eric Carre spoke on margin outlook and Jeff Miller discussed Zoos IQ and technology's role.

Q: James West from Melius Research asked about international strength surprises and power market investments.

A: Jeff Miller mentioned Argentina, The Caribbean, West Africa as potential upside spots and discussed VoltaGrid's role.

Q: Stephen Gengaro from Stifel asked about US land attrition and Middle East outlook.

A: Jeff Miller talked about US land attrition and stable Middle East markets.

Q: Scott Gruber from Citigroup asked about power project returns and cash conversion.

A: Eric Carre discussed power project returns and cash conversion factors.

Q: Derek Podhaizer from Piper Sandler asked about US land fleet attrition and Middle East regions.

A: Jeff Miller talked about US land fleet stacking and stable Middle East regions.

Q: Marc Bianchi from TD Cowen asked about offshore market outlook and Venezuela timeline.

A: Jeff Miller discussed strong offshore business and Venezuela timeline and mobilization.