Weatherford International Plc - Q2 2026 10-Q Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2026. Weatherford International Plc is a global energy services company operating in approximately 75 countries across three segments: Drilling and Evaluation (DRE), Well Construction and Completions (WCC), and Production and Intervention (PRI). The company is currently pursuing a redomestication from Ireland to Delaware and has entered into a definitive agreement to acquire NCS Multistage Holdings, Inc.
Key Financial Metrics
| Metric | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 |
|---|---|---|---|---|
| Total Revenue | $1,105 million | $1,204 million | $2,257 million | $2,397 million |
| Operating Income | $107 million | $237 million | $230 million | $379 million |
| Net Income (Attributable to Weatherford) | $39 million | $136 million | $147 million | $212 million |
| Diluted EPS | $0.55 | $1.87 | $2.04 | $2.90 |
| Operating Cash Flow (YTD) | $311 million | $270 million | $311 million | $270 million |
| Cash & Equivalents | $1,100 million | N/A | $1,100 million | N/A |
| Total Debt (Long-term + Current) | $1,480 million | N/A | $1,480 million | N/A |
Note: Debt consists of $30 million current portion and $1,450 million long-term debt as of June 30, 2026.
Material Changes vs. Prior Period
- Revenue Decline: Q2 2026 revenue decreased 8% year-over-year (YoY), and YTD revenue decreased 6%. The decline was driven by lower activity in the Middle East/North Africa/Asia region due to the "Iran Conflict" and reduced activity in North America.
- Profitability Compression: Operating income fell 55% in Q2 and 39% YTD. This was significantly impacted by the absence of a $70 million gain on the sale of the pressure pumping business in Argentina recorded in Q2 2025.
- Cost Management: Cost of products and services decreased 7% in Q2 and 4% YTD, primarily due to lower product sales and headcount reductions. However, SG&A expenses increased 5% YoY due to higher employee incentive programs.
- Segment Performance:
- DRE: Revenue down 13% (Q2) and 11% (YTD); Adjusted EBITDA down 16% (Q2).
- WCC: Revenue down 5% (Q2) and 2% (YTD); Adjusted EBITDA down 9% (Q2).
- PRI: Revenue down 3% (Q2) and 7% (YTD); Adjusted EBITDA increased 11% in Q2 due to higher margin activity.
Outlook, Risks, and Unusual Items
- Geopolitical Risks: The "Iran Conflict" (beginning Feb 2026) has disrupted operations in the Middle East, increased logistics costs, and created supply chain volatility. The Russia-Ukraine conflict continues to impact operations, with Russia accounting for ~9-10% of revenue in the first half of 2026.
- Strategic Transactions:
- Redomestication: A proposal to redomesticate from Ireland to Delaware is pending shareholder and court approval, expected in Q4 2026. Costs of $12 million (Q2) and $21 million (YTD) were incurred.
- Acquisition: Definitive agreement signed May 31, 2026, to acquire NCS Multistage Holdings, Inc., expected to close in H2 2026.
- Customer Concentration: The largest customer in Mexico accounts for 21% of total net accounts receivable. This customer has a history of late payments, creating collection risk.
- Capital Allocation: The company returned $66 million to shareholders in the first half of 2026 via dividends ($40 million) and share repurchases ($26 million). Capital expenditures are projected at 3-5% of revenue.
Investor Verification Checklist
- Iran Conflict Impact: Verify the extent of operational disruption and revenue loss in the Middle East/North Africa/Asia region and the timeline for recovery.
- Redomestication Costs: Monitor the total costs associated with the Ireland-to-Delaware redomestication and the likelihood of shareholder approval.
- Mexico Receivables: Assess the collectability of the significant receivables from the largest Mexican customer and any potential credit impairment.
- NCS Acquisition: Track regulatory approval progress and integration costs for the proposed NCS Multistage acquisition.
- Debt Covenants: Confirm compliance with the Credit Agreement covenants, specifically the minimum liquidity covenant ($250 million) and leverage ratios, given the current cash position and debt load.