NOV's Q2 revenue falls but beats expectations

Overview

• NOV Q2 revenue of $2.19 bln beats analyst expectations, per LSEG data

• Net income for Q2 down 52% yr/yr, impacted by prior year's business sale gain

• Adjusted EBITDA for Q2 down 10% yr/yr due to macroeconomic uncertainties

Outlook

• Company expects Q3 2025 revenue to decline 1-3% year-over-year

• NOV projects Q3 2025 Adjusted EBITDA between $230 mln and $250 mln

• Company anticipates lower industry activity levels through H2 2025

• NOV sees offshore activity growth resuming in 2026

Result Drivers

• MACROECONOMIC UNCERTAINTY - NOV cites macroeconomic uncertainty and unwinding of OPEC+ quotas as factors leading to deferred orders and lower revenues

• SALES MIX SHIFT - Increase in capital equipment revenues offset by decline in spare part and product sales, impacting margins

• DRILLING ACTIVITY - Lower global drilling activity reduced demand for consumable products, affecting Energy Products and Services segment

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 11 "strong buy" or "buy", 9 "hold" and 2 "sell" or "strong sell"

• The average consensus recommendation for the oil related services and equipment peer group is "buy"

• Wall Street's median 12-month price target for Nov Inc is $16.00, about 11.5% above its July 28 closing price of $14.16

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 10 three months ago

Press Release: ID:nGNX3B4GR3