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    HAL
    Earnings call· Mar 2026(Q1 FY26)

    HALLIBURTON Q1 FY26 earnings call HAL

    Apr 21, 2026 Source

    Executive summary

    Halliburton Q1 FY26 — International Growth and North America Recovery Signs

    Halliburton reported mixed Q1 FY26 results, with strong international growth outside the Middle East and early signs of recovery in North America. The company is navigating significant geopolitical disruptions in the Middle East, which impacted earnings, but sees a fundamentally tighter global oil and gas market supporting future upstream investment. Strategic technology deployments and collaborative models are driving wins in key growth areas.

    Highlights

    5

    • International revenue increased 3% year-over-year to $3.3 billion, with mid-to-high single-digit growth expected for the full year outside the Middle East.

    • Generated $273 million of cash flow from operations and $123 million of free cash flow in Q1.

    • Secured a multibillion-dollar Integrated Completion Services award with YPF in Argentina, including ZEUS electric fracturing services.

    • Acquired Sekal, enhancing drilling automation capabilities and delivering better-than-expected drilling times in offshore Guyana.

    • North America frac calendar white space for Q2 is gone, with signs of incremental demand building in spot markets.

    Concerns

    3

    • Middle East conflict resulted in a $0.02 to $0.03 per share impact in Q1 and is expected to impact Q2 by $0.07 to $0.09 per share due to lost revenue and higher logistics costs.

    • North America revenue decreased 4% year-over-year to $2.1 billion, primarily due to lower stimulation and artificial lift activity.

    • Completion and Production division revenue decreased 3% and operating income decreased 17% year-over-year, driven by lower North America stimulation and Middle East completion tool sales.

    Guidance & targets

    18
    CategoryTargetConfidence
    Full-year International revenue growth (outside Middle East)
    mid- to high single digits
    medium materiality
    Medium
    Q2 Corporate expenses
    increase about $5 million
    low materiality
    High
    Q2 SAP expenses
    about $45 million
    low materiality
    High
    Q2 Net interest expense
    increase about $5 million
    low materiality
    High
    Q2 Other net expense
    about $35 million
    low materiality
    High
    Q2 Effective tax rate
    approximately 20%
    low materiality
    High
    Full-year Effective tax rate
    approximately 20%
    low materiality
    High
    Full-year 2026 Capital expenditures
    about $1.1 billion
    high materiality
    High
    Q2 Middle East conflict EPS impact
    approximately $0.07 to $0.09 per share
    high materiality
    High
    Q2 Completion and Production division sequential revenue
    increase 4% to 6%
    medium materiality
    High
    Q2 Completion and Production division sequential margins
    improve 50 to 100 basis points
    medium materiality
    High
    Q2 Drilling and Evaluation division sequential revenue
    flat to down 2%
    medium materiality
    High
    Q2 Drilling and Evaluation division sequential margins
    decline 75 to 125 basis points
    medium materiality
    High
    Potential additional Q2 Middle East impact
    $0.03 to $0.05 potentially
    medium materiality
    Low
    Q2 Share buyback
    higher than Q1
    medium materiality
    High
    H2 Share buyback
    higher than H1
    medium materiality
    High
    Capital expenditures as % of revenue
    5% to 6%
    medium materiality
    High
    VoltaGrid international venture capacity placement
    400 megawatts
    medium materiality
    High

    Segment performance

    9
    SegmentRevenueYoYQoQMargin
    Total Company
    		$5.4 billionflat—13% operating margin
    International
    		$3.3 billion3% increase——
    North America
    		$2.1 billion4% decrease——
    Completion and Production division
    Results primarily driven by lower stimulation activity in North America and lower completion tool sales and decreased pressure pumping services in the Middle East. Partially offsetting these decreases were higher completion tool sales in the Western Hemisphere and improved pressure pumping services in Africa.
    		$3 billion—3% decrease$439 million operating income (15% margin)
    Drilling and Evaluation division
    Results primarily driven by higher project management activity in Latin America and increased drilling-related services in Europe and the Western Hemisphere. Partially offsetting these increases were lower activity across multiple product service lines in the Middle East, lower wireline activity in the Eastern Hemisphere, and decreased fluid services in the Gulf of America.
    		$2.4 billion—4% increase$351 million operating income (15% margin)
    Europe Africa
    Increase primarily driven by increased drilling-related services and higher completion tool sales in Norway and improved pressure pumping services in Angola.
    		$858 million11% increase——
    Middle East Asia
    Decrease primarily driven by conflict-related disruptions that resulted in lower activity across multiple product lines.
    		$1.3 billion13% decrease——
    Latin America
    Increase primarily driven by higher activity across multiple product service lines in Ecuador, the Caribbean, and Brazil and improved stimulation activity in Mexico and Argentina.
    		$1.1 billion22% increase——
    North America (Geographic)
    Decline primarily driven by lower stimulation activity and decreased artificial lift activity in U.S. Land and lower stimulation activity and decreased fluid services in the Gulf of America.
    		$2.1 billion4% decrease——

    Operational metrics

    9
    Common stock repurchased
    $100 million
    Q1 2026
    Net income per diluted share
    $0.55
    Q1 2026
    Corporate and other expense
    $69 million
    Q1 2026
    SAP S/4 migration spend
    $42 million
    Q1 2026
    Net interest expense
    $82 million
    Q1 2026
    Other net expense
    $28 million
    Q1 2026
    Effective tax rate
    18.5%
    Q1 2026
    Capital expenditures
    $192 million
    Q1 2026
    Middle East conflict EPS impact
    $0.02 to $0.03
    Q1 2026

    Industry KPIs

    6
    MetricValueDetails
    FCF CAPEX leverage—
    Revenue by geomarket—
    M a integration progress—
    Orders bookings by segmentmultibillion-dollarUSD
    Segment adjusted EBITDA margin—
    Data center new energy revenue capacity400 megawattsMW

    Orderbook & backlog

    2
    YPF Integrated Completion Services Awardmultibillion-dollarQ1 FY26

    Multi-year contract for Integrated Completion Services in Argentina, including ZEUS electric fracturing services.

    VoltaGrid International Venture Capacity400 megawattsQ1 FY26

    Capacity in queue ready for placement, with lots of inbound interest globally.

    Deals & partnerships

    3
    YPFcustomer contractmultibillion-dollarmulti-year

    Award for Integrated Completion Services in Argentina, including deployment of ZEUS electric fracturing services and Octiv Auto Frac.

    Sekalacquisition

    Acquisition of a global leader in rig automation, combining Halliburton LOGIX drilling automation with Sekal's DrillTronics platform and services for closed-loop automated geo-steering.

    Petronas, Valarispartnership

    Strategic collaboration agreement to support the development of offshore assets in Suriname, bringing teams together early in the development cycle.

    Risks & headwinds

    2
    Middle East Conflict DisruptionsQ1-Q2 2026

    $0.02 to $0.03 EPS impact in Q1; estimated $0.07 to $0.09 EPS impact in Q2. Potential additional $0.03 to $0.05 EPS impact if offshore restarts are delayed.

    Mitigation: Working closely with customers to mitigate additional costs within contract terms; operational footprint intact and ready for restart.

    North America Activity DeclineQ1 2026

    North America revenue decreased 4% year-over-year.

    Mitigation: Focus on returns, not market share; improve returns of existing fleets; deploy differentiated technology.

    Q&A highlights

    7

    How does the conflict shape views on the global energy sector over the next few years, and how has this changed in the last 60 days?

    Jeff Miller stated that the supply overhang is no longer a concern, and structural demand remains intact, accelerating market rebalancing. He emphasized that energy security is now a priority, driving increased activity for several years, which is a fundamental shift.

    “I think the most important change is that the supply overhang is no longer a concern. That's swept away. And demand -- structural demand remains intact.”

    asked by John Anderson · answered by Jeffrey Miller

    2 min read6 chapters

    Detailed Narrative

    01

    Middle East Geopolitical Impact

    The ongoing conflict in the Middle East has created significant disruptions, impacting activity in offshore markets in Qatar, UAE, Saudi Arabia, and land markets in Iraq and Kuwait. Halliburton has adapted by using alternative supply chain routes, leading to increased logistics costs and price increases in materials, which are being mitigated through customer contracts. The company estimates a $0.02-$0.03 EPS impact in Q1 and a $0.07-$0.09 EPS impact in Q2 from these disruptions.

    02

    Shifting Global Energy Dynamics

    The conflict has fundamentally altered the global energy landscape, emphasizing energy security and leading to a tighter oil and gas market. Cumulative production deficits are nearing 1 billion barrels, suggesting several years of incremental demand. This backdrop is expected to support a durably stronger commodity environment and increased upstream investment, particularly in localized oil and gas developments.

    03

    International Business Momentum

    Outside the Middle East, Halliburton's international business is experiencing strong momentum, with full-year revenue growth expected in the mid-to-high single digits, led by Latin America. Key wins include a multibillion-dollar Integrated Completion Services award with YPF in Argentina, deploying ZEUS electric fracturing services and Octiv Auto Frac. The company also sees growing activity in Europe/Africa, including Norway and West Africa (Namibia, Nigeria), and a resilient Asia Pacific market.

    04

    North America Recovery Signs

    North America is showing early signs of recovery, with the frac calendar white space for Q2 now filled and an uptick in inbound calls for spot work, suggesting tightening capacity. While the market is in its early innings, premium equipment is tightening, and the commodity price is supportive. Halliburton's strategy focuses on improving returns of existing fleets and deploying differentiated technology like ZEUS IQ and iCruise.

    05

    Technological Advancements

    Halliburton continues to advance its technology portfolio, notably through the acquisition of Sekal, a leader in rig automation. This integrates Sekal's DrillTronics with Halliburton LOGIX, enabling closed-loop automated geo-steering for improved drilling times and reservoir contact, as demonstrated in offshore Guyana. The ZEUS IQ platform is also highlighted for its subsurface capabilities in improving recovery.

    06

    Offshore Market Strength

    The company is increasingly confident in its offshore outlook, driven by its drilling capabilities, collaborative model, and technology. Recent wins include a strategic collaboration agreement with Petronas in Suriname. Halliburton's ability to engage with customers earlier in the development cycle is proving successful in markets like Guyana and Suriname.

    AI-generated summary of the company’s earnings call. Not investment advice.