HALLIBURTON CO (HAL) Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 revenue was $5.51B (+2% q/q; -5.5% y/y) and diluted EPS was $0.55; operating income was $727M with a 13% operating margin .
• Versus S&P Global consensus, revenue beat ($5.51B vs $5.41B*) while EPS was essentially in line ($0.55 vs $0.554*); Q1 had also modestly topped revenue estimates while EPS matched adjusted levels* [Values retrieved from S&P Global].
• Management struck a cautious tone: CEO noted the oilfield services market “softer than previously expected,” guiding Q3 sequential declines in both segments and lowering the FY25 outlook qualitatively (NA revenue to decline low double digits; international to contract mid-single digits) .
• Cash generation remained strong (CFO $896M; FCF $582M), with $250M buybacks and a $0.17 dividend; tariffs impacted Q2 by $27M and are expected to be ~$35M (≈$0.04/share) in Q3 .

What Went Well and What Went Wrong

• What Went Well

  • Solid sequential top-line and cash flow: revenue +2% q/q to $5.51B; CFO $896M; FCF $582M .
  • Technology differentiation and wins: Zeus IQ closed-loop fracturing deployments, EarthStar 3DX launch, and automation milestones with Nabors; management emphasized differentiation and collaboration as drivers of returns .
  • International bright spots: Latin America +9% q/q to $977M on Mexico/Brazil; Europe/Africa +6% q/q led by Norway; growth engines cited in unconventionals/drilling/production services/artificial lift .

• What Went Wrong

  • Softer outlook and pricing pressure: CEO expects a softer market near- to medium-term; C&P margins pressured by US land pricing; guidance calls for Q3 C&P revenue -1% to -3% and margin -150–200 bps .
  • Middle East pullback: Lower activity in Saudi/Kuwait weighed on both segments; Saudi frac slowdown ahead of new tender called out by CFO .
  • Artificial lift softness in US land and tariff headwinds: Summit ESP weaker domestically; tariffs cost $27M in Q2 and expected $35M in Q3 ($0.04 EPS) .

Financial Results

Segment performance

Geography

KPIs

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “What I see tells me the oilfield services market will be softer than I previously expected over the short to medium term… we remain fully committed to our shareholder returns framework.” – Jeff Miller, CEO .
• “In North America… I expect Halliburton to continue to outpace our competitors… technology and service execution are key.” – Jeff Miller .
• “We will not work equipment where it does not earn economic returns… we will reduce our variable and fixed cash costs… and remain focused on free cash flow and returns.” – Jeff Miller .
• “In C&P… Q3 revenue to decrease 1%–3%, margins down 150–200 bps; in D&E… revenue down 1%–3%, margins up 125–175 bps.” – Eric Carre, CFO .
• “Tariffs impacted our business by $27M in Q2. For Q3, we currently expect a negative impact of about $35M, or about 4 cents per share.” – Eric Carre .
• “We now forecast full-year North America revenue to decline low double digits year over year… international revenue will contract mid-single digits.” – Jeff Miller .

Q&A Highlights

• C&P margin softness drivers: US land stimulation pricing pressure and Saudi frac slowdown ahead of a new tender; Q3 guide reflects NA activity reductions and fewer completion tool deliveries internationally .
• North America capacity/pricing discipline: Management will stack fleets and avoid uneconomic work, prioritizing returns over share; expects visible “white space” in frac calendars in H2 .
• D&E margin recovery: Improvement in Q3 and Q4 driven by software sales seasonality, directional drilling performance, and lower mobilization costs versus Q2 .
• Artificial lift divergence: US land softer; international ESP strong with a large Middle East NOC award; tariffs primarily impact artificial lift; supply chain rewiring underway .
• Capital intensity/Zeus: Zeus build program is demand-driven and likely to slow after reaching ~50% fleet penetration; capex targeted toward lower end if demand softens .

Estimates Context

• Q2 2025: revenue beat (+1.9% vs $5.41B*), EPS essentially in line/slight miss ($0.004 below*); Q1 2025 similarly beat revenue with in-line EPS*. Values retrieved from S&P Global. Actuals: revenue and EPS from company filings .

Key Takeaways for Investors

• Mixed print with healthy cash generation and a revenue beat, but a clearly softer outlook: Q3 sequential declines and margin compression in C&P, with NA FY25 revenue now seen down low double digits and international contracting mid-single digits .
• Stock narrative likely driven by H2 activity “white space,” Saudi timing (Jafura tender), and tariff headwinds (~$35M in Q3); watch for pace of fleet stacking and pricing discipline .
• Technology remains a differentiator (Zeus IQ, EarthStar 3DX, automation), supporting share and returns even in softer markets; deployment breadth by year-end is a key proof point .
• Segment trajectory: Expect C&P to bear the brunt near term (pricing/activity), while D&E margins benefit from software seasonality and reduced startup/mobilization costs .
• Capital returns intact with ongoing buybacks/dividends; 2025 FCF reset to $1.8–$2.0B still supports the framework, but below 2024 levels; monitor capex flexibility and Zeus cadence .
• Regional mix: Latin America and Europe/Africa remain relative bright spots; Middle East/Asia softness (Saudi/Kuwait) weighs for now .
• Risk/reward hinges on duration of NA softness, Saudi tendering outcomes, tariff progression, and timing of international reacceleration; disciplined capacity management is a positive offset .

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Supporting details and sources:

• Q2 2025 results, segment/geography, cash flow, and KPIs: .
• Q1 2025 results and comparables: .
• Q4 2024 reference context: .
• Q2 2025 call guidance, tariffs, segment color, and FCF outlook: .
• Technology and press highlights in Q2 window: .