John Anderson

John Anderson with William Blair inquired about the impact of portfolio optimization on sales for the fourth quarter and fiscal 2026, the macro environment's influence on J&J Snack Foods' 2026 outlook for top-line and margins, and the company's updated capital allocation strategy, specifically regarding share repurchases and the M&A pipeline.

Answer

CEO Dan Fachner explained that portfolio optimization, a continuation of bakery group efforts, could impact overall sales by 1-1.5% against a mid-single-digit growth rate, with benefits expected to be near full run rate by Q2 2026. He noted a cautious consumer sentiment in the macro environment but expressed optimism for 2026 due to plant closure benefits, innovation, and a rebounding theater industry, highlighting strong second-half 2025 EBITDA performance. CFO Shawn Munsell clarified that plant closure benefits of $15 million would be near full annualized run rate by Q2, with other savings layering in later. Regarding capital allocation, Shawn Munsell stated the intent to accelerate stock buybacks in the current quarter, with approximately $42 million remaining on authorization, and Dan Fachner clarified that recent M&A pipeline considerations were conservative and nothing imminent.

John Anderson inquired about J&J Snack Foods' capital allocation strategy, specifically the increased focus on share repurchases and the anticipated acceleration.

Answer

CFO Shawn Munsell stated the company intends to accelerate stock buybacks in the current quarter, noting approximately $42 million remaining on the current authorization. CEO Dan Fachner clarified that a previous pullback on buybacks was a conservative approach due to M&A considerations, but nothing imminent is expected on the M&A front.

John Anderson inquired about the cost structure of the Bossier City plant versus Chinese imports, the potential for customer order pull-forwards ahead of tariffs, and the company's confidence in passing on higher costs.

Answer

CEO Scott Bender clarified that Bossier City is a fast-turnaround facility for ensuring delivery, not a low-cost operation. He confirmed the company has denied all customer requests to pull forward orders to maintain fairness. Bender expressed high confidence that customer support will help maintain absolute profitability despite temporary margin compression from tariffs.

John Anderson inquired about the outlook for international versus North American spending amid an expected overall decline and how this aligns with SLB's second-half growth guidance. He also asked for an update on Saudi Arabia's activity trajectory, considering recent rig drops and the country's focus on unconventional gas.

Answer

CFO Stephane Biguet confirmed that global upstream spending is projected to decline. CEO Olivier Le Peuch added that SLB is well-positioned due to its strategic mix, emphasizing resilience in offshore, digital, and production segments, which mitigates exposure to short-cycle North American land activity. For Saudi Arabia, Le Peuch acknowledged a recent activity decline following a revision of production capacity targets but stated that the Kingdom's long-term gas ambitions should drive a rebound in activity into 2026, suggesting the worst of the decline has passed.

John Anderson asked for a simplified view of the international upstream spending outlook, requesting the top regions with upside and downside potential for SLB. He also inquired about the future growth trajectory of the production-driven business, considering recent acquisitions.

Answer

CEO Olivier Le Peuch identified the Middle East as a key growth area, with long-term gas and oil capacity projects in the UAE, Iraq, and Kuwait offsetting declines elsewhere. He also expressed long-term optimism for deepwater despite a near-term slowdown. Le Peuch confirmed the production recovery business is a strategic growth area with long-term earnings potential, which will be enhanced by the ChampionX acquisition.

John Anderson asked if deepwater development can drive growth beyond 2025 as the cycle plateaus, and questioned what the next growth drivers for the digital business will be after reaching its $3 billion revenue target.

Answer

CEO Olivier Le Peuch confirmed that long-cycle deepwater projects remain a key growth engine, with offshore FIDs expected to exceed $500 billion cumulatively from 2023 to 2026, driving activity beyond 2025. For digital, he identified three future growth legs: the ongoing cloud platform transition for customers, the expansion of digital operations in drilling and production, and the emergence of new data and AI capabilities like the Lumi platform.

John Anderson inquired about the potential for project deferrals in the U.S. Gulf of Mexico due to commodity price fluctuations and asked what TechnipFMC can offer clients in an uncertain market beyond its iEPCI model.

Answer

CEO Douglas Pferdehirt responded that clients are not deferring projects and, in some cases, are accelerating timelines to secure capacity. He highlighted that in a lower price environment, brownfield tie-backs in the Gulf become even more economical. Pferdehirt corrected the notion of an offshore "downturn," emphasizing that the opportunity set remains robust and the company's significant, high-quality backlog provides a strong buffer against short-term market volatility.

John Anderson of Barclays asked about the margin progression in the IET segment, questioning the drivers for expansion beyond Q1 and the achievability of the 18% margin target for 2025 and 20% for 2026, given new headwinds.

Answer

CFO Ahmed Moghal explained that Q2 margin expansion would be more modest due to one-time project closeout benefits in Q1 and tariff pressures on the Industrial Tech business. However, he affirmed that the full-year 18% EBITDA margin target for 2025 is still achievable, as tariff impacts should be largely offset by executing the higher-margin Gas Tech Equipment backlog and ongoing productivity gains. He added that the path to 20% margin in 2026 is 'still there'.

John Anderson inquired about the interconnectivity between Baker Hughes' Industrial & Energy Technology (IET) equipment and its services business, asking how the services segment is expected to evolve with the changing mix of LNG and non-LNG projects.

Answer

Lorenzo Simonelli, Chairman and CEO, described the services business as a 'razor, razor blade' model that generates 1-2x the original equipment revenue over its life at higher margins. He noted that the current 20% growth forecast for the installed base by 2030, driven by a 70% increase in LNG capacity, will structurally grow the high-margin services revenue stream for the next decade. Simonelli confirmed that LNG projects have a higher service attachment rate and value compared to other projects.

John Anderson inquired about the resilience of international markets, particularly in the Middle East, amid growing uncertainty and asked for an assessment of the potential duration and severity of the current market downturn.

Answer

President and CEO Girish Saligram acknowledged the uncertainty but noted that international markets, especially MENA, tend to be more stable. He stated that while they are preparing for a range of outcomes, they haven't seen definitive spending cuts from customers yet. Saligram characterized the downturn as milder than previous cycles, not universal, and likely shorter-lived, with positivity for offshore activity in 2026 and 2027.

John Anderson of Evercore ISI inquired about Weatherford's M&A strategy, the contributions of its four recent small acquisitions, and future plans regarding scale. He also asked for clarification on what management means by "isolating growth pockets" and the nature of the scheduling shifts in the Middle East and North Africa.

Answer

Girish Saligram, an executive at Weatherford, explained that the company is pleased with its current portfolio and is not pursuing M&A for scale's sake, but rather for selective, strategic enhancements like the Probe and Ardyne acquisitions. He confirmed that "isolating growth pockets" refers to using technology to gain share and create new opportunities in a stable market. Regarding the Middle East, he clarified that scheduling shifts are temporary delays of one or two quarters due to a more cautious customer approach, not project cancellations.

John Anderson inquired about the 2025 spending outlook for the Middle East, the potential for Saudi Arabia to alter production, and NESR's specific business mix and positioning within the Kingdom, particularly regarding the Jafurah unconventional gas project. He also asked about the company's capital allocation priorities between M&A and internal technology development.

Answer

Chairman and CEO Sherif Foda projected moderate single-digit growth for the MENA region in 2025, with Kuwait being a high-growth area. He clarified that Saudi Arabia's oil capacity decisions are aimed at market stability, while its unconventional gas program continues to expand. Foda confirmed NESR's deep involvement in the Jafurah project and stated that capital allocation will prioritize enhancing the ROYA and NEDA technology platforms over large geographical M&A, with shareholder returns to be evaluated in the second half of the year.

John Anderson inquired about the current market dynamics in Saudi Arabia, including the shift from offshore to onshore activity, the focus on gas, and the 12-month activity outlook. He also asked for specifics on NESR's role in the Jafurah unconventional gas project and any upcoming tenders.

Answer

Sherif Foda, Chairman and CEO, explained that Saudi Arabia's decision to maintain its 12 million bpd capacity postponed offshore expansion, leading to rig releases. However, he highlighted that the Jafurah unconventional gas project is a major growth area with an increasing rig count, which should offset declines in oil-focused activity. Foda confirmed NESR's strong position in Jafurah with cementing and new directional drilling contracts, and anticipates growth for NESR in 2025. He noted Jafurah's frac stage count is expected to grow from ~9,000 to 25,000 annually, creating opportunities for new tenders next year.

John Anderson asked about Halliburton's North America performance, questioning how C&P margins remained resilient in 2024 despite revenue declines, and what changed to cause margin pressure from lower negotiated prices in 2025. He also inquired how Halliburton gets paid for its completion efficiencies, like Zeus and Octiv Auto Frac, and if this can offset deflationary trends, referencing the recent Coterra announcement.

Answer

Chairman, President and CEO Jeffrey Miller explained that while efficiencies and technology like Zeus helped manage through 2024, the company is not immune to pricing pressure. For 2025, he noted all fleets are contracted, providing visibility, and the strategy remains focused on creating outsized value. Miller stated that Halliburton's technology creates differential value by improving efficiency and providing 'answer products' that optimize recovery, which offsets pricing impacts and drives a different conversation with customers.