Q1 2026 Seadrill Ltd Earnings Call Transcript
Key Points
- Seadrill Ltd (SDRL) reported a solid first-quarter performance with an EBITDA of $97 million, surpassing expectations.
- The company raised its full-year revenue and EBITDA guidance, reflecting strong operational execution and early contract commencements.
- Seadrill Ltd (SDRL) added approximately $860 million to its backlog, enhancing revenue visibility and reducing idle time.
- Successful reactivation and early start-up of the West Tellus and West Capella projects contributed to early revenue generation.
- The company is positioned for meaningful earnings and free cash flow growth in 2027, supported by improving market conditions and contract leverage.
- First-quarter cash flow was impacted by reactivation and contract preparations, resulting in a $35 million use of cash.
- Operating expenses were $334 million, with higher costs related to the preparation and commencement of the West Capella contract.
- The company faces challenges in reactivating stacked rigs without client funding due to a focus on free cash flow.
- Seadrill Ltd (SDRL) anticipates a softer 2026 in the US Gulf, despite contracting both drillships in a competitive environment.
- The company remains cautious about the potential need for reactivating harsh environment semis, which could be challenging in the near term.
Thank you for standing by. At this time, I would like to welcome everyone to the Seadrill first-quarter 2026 conference call. (Operator Instructions) I would now like to turn the call over to Kevin Smith. Please proceed.
Hello, and welcome to Seadrill's first-quarter 2026 earnings call. I'm Kevin Smith, Vice President of Corporate Finance and Investor Relations, and I'm joined today by Samir Ali, President and Chief Executive Officer; Grant Creed, Executive Vice President and Chief Financial Officer; and Jacob Taylor, Vice President, Commercial.
Our call will include forward-looking statements that involve risks and uncertainty. Actual results may differ materially. No one should assume these forward-looking statements remain valid later in the quarter or year, and we assume no obligation to update them, except as required by securities laws. Our filings with the US Securities and Exchange Commission provide a more detailed discussion of our forward-looking
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