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TechnipFMC plc (FTI)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered strong execution with revenue $2.535B, GAAP diluted EPS $0.64 and adjusted diluted EPS $0.68; adjusted EBITDA was $520.8M with a 20.5% margin, materially higher sequentially and year-over-year .
  • Subsea drove the quarter: revenue rose 14.5% q/q to $2.216B, operating margin expanded 440 bps to 17.2%, and adjusted EBITDA reached $482.9M (21.8% margin) .
  • Backlog increased to $16.646B and Subsea book-to-bill was 1.2x on $2.553B inbound; Services inbound was “one of the highest quarterly levels ever achieved,” underpinning visibility through named projects over the next 24 months .
  • Guidance: formal FY2025 ranges were maintained, but management raised the full-year total company adjusted EBITDA outlook by ~$40M to ~$1.8B and now expects Subsea and Surface margins near the top of guided ranges; Q3 outlook calls for Subsea revenue low-to-mid single-digit q/q growth and ~21.8% adjusted EBITDA margin; Surface to ~16% margin .
  • Capital returns remained robust with $271M distributed (including $250M buybacks) and FCF of $261M; net cash stood at $254M, providing flexibility to exceed the 70% FCF distribution commitment if conditions permit .

What Went Well and What Went Wrong

What Went Well

  • Subsea outperformance: revenue +14.5% q/q, operating profit +53.4% q/q to $380.3M, margin +440 bps to 17.2%; adjusted EBITDA $482.9M (+44.2% q/q) and margin 21.8% (+450 bps) .
  • Orders and backlog quality: $2.553B Subsea inbound and $15.810B Subsea backlog; management highlighted “direct awards” and a growing proprietary early-engagement list driving confidence in >$10B Subsea inbound for the year and achieving the $30B three-year target by end-2025 .
  • Cash generation and returns: CFO underscored $344M CFO, $261M FCF, and $271M shareholder distributions; reiterated intent to distribute ≥70% of FCF and noted flexibility to exceed given the balance sheet . Quote: “We have increased our full-year guidance for total company adjusted EBITDA by $40 million… we have distributed 85% of free cash flow to shareholders” .

What Went Wrong

  • Surface operating profit contracted q/q (-22.5%) to $23.4M due to $17.5M higher restructuring/impairment charges from business transformation; operating margin fell 290 bps to 7.3% despite revenue +7.1% q/q .
  • Sequential inbound moderated: total company inbound orders were $2.831B, down 8.4% vs both Q1 and prior year; Subsea inbound declined 8.3% q/q and 10.0% y/y, reflecting timing of awards (management expects announcements in coming weeks) .
  • Corporate expense poised to rise in 2H: CFO flagged timing skew from ERP upgrade spend moving into 2H, implying corporate expense near ~$120M midpoint of guidance for FY despite a softer 1H run-rate .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$2,367.3 $2,233.6 $2,534.7
Diluted EPS ($USD)$0.52 $0.33 $0.64
Adjusted Diluted EPS ($USD)$0.54 $0.33 $0.68
Adjusted EBITDA ($USD Millions)$351.0 $343.8 $520.8
Adjusted EBITDA Margin (%)14.8% 15.4% 20.5%
Net Income ($USD Millions)$224.7 $142.0 $269.5
Net Income Margin (%)9.5% 6.4% 10.6%

Segment breakdown:

Segment MetricQ2 2024Q1 2025Q2 2025
Subsea Revenue ($USD Millions)$2,009.1 $1,936.2 $2,216.3
Surface Revenue ($USD Millions)$316.5 $297.4 $318.4
Subsea Operating Profit ($USD Millions)$277.7 $247.9 $380.3
Surface Operating Profit ($USD Millions)$30.6 $30.2 $23.4
Subsea Adjusted EBITDA ($USD Millions)$356.5 $334.9 $482.9
Surface Adjusted EBITDA ($USD Millions)$46.0 $46.6 $52.3
Subsea Operating Margin (%)13.8% 12.8% 17.2%
Surface Operating Margin (%)9.7% 10.2% 7.3%
Subsea Adjusted EBITDA Margin (%)17.7% 17.3% 21.8%
Surface Adjusted EBITDA Margin (%)14.5% 15.7% 16.4%

KPIs and cash:

KPIQ4 2024Q1 2025Q2 2025
Total Inbound Orders ($USD Millions)$2,923.5 $3,089.1 $2,831.0
Subsea Inbound ($USD Millions)$2,698.5 $2,785.5 $2,553.1
Surface Inbound ($USD Millions)$225.0 $303.6 $277.9
Total Backlog ($USD Millions)$14,376.3 $15,816.0 $16,645.9
Subsea Book-to-Bill (x)1.3x 1.4x 1.2x
Cash from Operations ($USD Millions)$578.9 $441.7 $344.2
Capital Expenditures ($USD Millions)$126.2 $61.8 $83.6
Free Cash Flow ($USD Millions)$452.7 $379.9 $260.6
Share Repurchases ($USD Millions)$70.0 $250.1 $250.1

Actual vs consensus (S&P Global) comparisons:

MetricQ4 2024Q1 2025Q2 2025
Revenue Consensus Mean ($USD)$2,300.3M*$2,251.8M*$2,485.6M*
Actual Revenue ($USD)$2,367.3M $2,233.6M $2,534.7M
Primary EPS Consensus Mean ($USD)$0.357*$0.367*$0.577*
Actual Diluted EPS ($USD, GAAP)$0.52 $0.33 $0.64
Actual Adjusted Diluted EPS ($USD)$0.54 $0.33 $0.68
EBITDA Consensus Mean ($USD)$347.2M*$341.6M*$476.1M*
Actual Adjusted EBITDA ($USD)$351.0M $343.8M $520.8M

Values marked with * retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Subsea RevenueFY 2025$8.4–$8.8B $8.4–$8.8B Maintained
Subsea Adjusted EBITDA MarginFY 202519–20% 19–20%; management expects near top end Raised expectation within range
Surface RevenueFY 2025$1.2–$1.35B $1.2–$1.35B Maintained
Surface Adjusted EBITDA MarginFY 202515–16% 15–16%; management expects ~16% Raised expectation within range
Corporate Expense (net)FY 2025$115–$125M $115–$125M Maintained
Net Interest ExpenseFY 2025$45–$55M $45–$55M Maintained
Effective Tax RateFY 202528–32% 28–32% Maintained
Capital ExpendituresFY 2025~$340M ~$340M Maintained
Free Cash FlowFY 2025$1.0–$1.15B $1.0–$1.15B; management expects near top end Raised expectation within range
Total Company Adjusted EBITDAFY 2025Not explicitly disclosed~$1.8B (ex-FX), +$40M vs prior internal outlook Raised

Q3 2025 intra-year outlook:

  • Subsea: revenue low-to-mid single-digit q/q growth; adjusted EBITDA margin ~21.8% .
  • Surface: revenue low single-digit q/q growth; adjusted EBITDA margin ~16% .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
Subsea order momentum & direct awardsFY2024 Subsea orders $10.4B; >80% direct awards/iEPCI/Subsea 2.0; confident >$10B in 2025 $2.6B Subsea inbound; book-to-bill 1.2x; proprietary early-engagement list growing; confident >$10B in 2025 and $30B 3-year goal Strengthening
Subsea Services growthServices revenue growth targeted; Subsea Services expected ~$1.8B in 2025 Services inbound “one of highest ever”; confirm ~$1.8B Services revenue plan Positive/expanding
Technology differentiation (Hybrid flexible pipe, all-electric, CO2.0)CO2.0 and electrification focus; investment-grade upgrade supports strategy Detailed R&D on hybrid flexible pipe (lighter, corrosion-resistant), HISEP subsea CO2 handling, all-electric retrofits for existing fields (BP Northern Endurance) Advancing
Regional activity: Brazil, Guyana, Suriname, Mozambique, NamibiaGranMorgu iEPCI (Suriname), Brazil robust; East Med and Africa visibility Strong pipeline across Guyana, Suriname, Mozambique gas, Orange Basin Namibia; Norway, GoM active; Equinor Heidrun extension award Broadening
Surface Technologies transformation & Middle EastMiddle East ramp; portfolio optimization; sale of Measurement Solutions North America footprint reduced by ~50%; Middle East lifting revenue/margins; Q2 restructuring weighs on OP; margin outlook ~16% Mixed near term; strategic progress
Tariffs/macroTariff sensitivity largely confined to U.S. land/U.S. Gulf; impact < $20M adj. EBITDA in 2025 Tariff impact contained in updated guidance Controlled

Management Commentary

  • CEO: “Total Company revenue in the period was $2.5 billion, with adjusted EBITDA of $509 million when excluding foreign exchange impacts. We generated free cash flow of $261 million and distributed $271 million… demonstrating our commitment to return a significant portion of free cash flow to shareholders.” .
  • CEO on orders: “We achieved $2.6 billion of Subsea inbound… Subsea Services inbound was particularly robust… We have continued confidence that we will reach our three-year goal of $30 billion of Subsea inbound by the end of this year.” .
  • CFO: “When including corporate expense at the midpoint of guidance, we anticipate total company full-year adjusted EBITDA to approximate $1.8 billion when excluding foreign exchange.” .
  • CFO on capital returns: “Through the first six months of the year, we have distributed 85% of free cash flow to shareholders… we certainly have the flexibility to exceed [70%].” .

Q&A Highlights

  • Subsea services strength and sustainability: Management confirmed services revenue growth aligned with Subsea revenue (~$1.8B for 2025), driven by a growing installed base and direct awards, not one-offs .
  • Mix of inbound awards: Both public opportunity list and proprietary direct award list are growing; expect announcements to cover Q2 and Q3 awards as disclosure constraints lift .
  • Greenfield vs brownfield resilience: Operators remain committed to moving greenfield projects forward; brownfield activity is strong with attractive economics; unannounced/direct awards approaching ~$1B bucket, expanding with electrification radius 4x around existing hosts .
  • Corporate expense cadence: ERP program spend weighted to 2H, explaining lower 1H corporate expense relative to full-year guidance midpoint .
  • Subsea margin trajectory beyond 2025: Management anticipates further growth in Subsea EBITDA margin in 2026 given backlog quality and Subsea 2.0/iEPCI mix .

Estimates Context

  • Q2 2025 vs consensus: Revenue $2.535B vs $2.486B* (beat); GAAP diluted EPS $0.64 vs Primary EPS consensus $0.577* (beat); adjusted EPS $0.68 vs Primary EPS consensus $0.577* (beat); adjusted EBITDA $520.8M vs $476.1M* (beat). Bold beat margins reflect execution and backlog mix . Values marked with * retrieved from S&P Global.
  • Q1 2025: Revenue $2.234B vs $2.252B* (slight miss); EPS $0.33 vs $0.367* (miss); adjusted EBITDA $343.8M vs $341.6M* (beat) . Values marked with * retrieved from S&P Global.
  • Q4 2024: Revenue $2.367B vs $2.300B* (beat); adjusted EPS $0.54 vs $0.357* (beat); adjusted EBITDA $351.0M vs $347.2M* (beat) . Values marked with * retrieved from S&P Global.
  • Implication: Consensus likely needs to move higher for FY margins and EBITDA given management’s raised outlook to ~$1.8B adjusted EBITDA and top-end segment margin expectations .

Key Takeaways for Investors

  • Subsea-led margin expansion is the core driver; sustained direct awards, Services growth, and favorable backlog mix support high-20% Subsea EBITDA margins through 2H and into 2026 .
  • Backlog strength ($16.6B) and increasing proprietary pipeline provide multi-year visibility; near-term catalysts include award disclosures (some tied to Q2 inbound) and continued iEPCI traction .
  • Capital returns remain a central element of the thesis: with net cash ~$254M and FCF tracking near the top of guidance, buybacks and dividends should remain robust; management may exceed 70% FCF distribution .
  • Surface is undergoing transformation: expect transient margin pressure from restructuring to fade; Middle East projects and digital/automation focus should sustain ~16% margin into 2H .
  • Technology optionality (hybrid flexible pipe, all-electric retrofits, CO2.0) adds structural differentiation and potential TAM expansion across basins; consider this as a medium-term multiple support .
  • Near-term trading catalysts: Q3 Subsea margin “similar to 21.8%,” sequential revenue growth, award announcements, and any revisions to FY margin/EBITDA consensus following the raised outlook .
  • Risk monitoring: ERP spend timing on corporate expense, tariff impacts (contained within guidance), and award timing affecting quarterly inbound prints; trend still constructive per management commentary .

Additional Relevant Q2 2025 Press Releases

  • Equinor Heidrun iEPCI™ extension (Norway): “Significant” ($75–$250M) direct award following iFEED, included in Q2 inbound; supports Subsea backlog diversity and North Sea activity .

Notes on Non-GAAP Adjustments

  • Adjusted EPS ($0.68) excludes $16.4M restructuring/impairment and related tax impacts; adjusted EBITDA ($520.8M) excludes charges/credits and is also presented excluding FX ($508.7M) for comparability .
  • FX effect: GAAP results included a $12.1M FX gain pre-tax; after-tax FX loss of $6.3M; excluding FX, net income was $275.8M and adjusted EBITDA $508.7M .

Disclosures and Sources

  • Q2 2025 8-K and press release: revenue, EPS, margins, segment data, orders/backlog, cash/FCF, guidance .
  • Q2 2025 earnings call transcript: management outlook, margin trajectory, Q3 guide, services growth, technology initiatives, region commentary .
  • Q1 2025 press release: trend analysis (revenue, EPS, EBITDA, orders/backlog, FCF, guidance ranges) .
  • Q4 2024 press release: baseline trend, Subsea/Surface metrics, orders/backlog, cash/FCF .
  • Consensus estimates sourced from S&P Global (Revenue, EPS, EBITDA, # of estimates). Values marked with * retrieved from S&P Global.