Announces NOV Inc. Reports First Quarter 2025 Results, Demonstrating Resilient Performance Amid Macro Challenges
NOV has announced its financial results for the first quarter of 2025, showing a mix of challenges and strong performances. The company generated revenues of $2.10 billion, marking a 2% decrease compared to the same period in 2024. While revenues dipped, the company’s net income declined by 39% to $73 million, translating to $0.19 per share. Operating profit also saw a 6% drop, totaling $152 million, or 7.2% of sales. Despite the revenue decrease, NOV’s adjusted EBITDA showed a positive trend, increasing by 5% year-over-year to reach $252 million, which represents 12.0% of sales.
Acknowledging Solid Execution Amid Uncertainty
Clay Williams, Chairman and CEO of NOV Announces, commented on the company’s performance during the first quarter, emphasizing the company’s ability to maintain cash flow and achieve a notable increase in adjusted EBITDA. He said, “We executed well on our large backlog of offshore production technologies, and we continued to drive accelerating adoption of our new, differentiated technologies. These efforts, alongside NOV’s continued operational improvements, allowed us to overcome a dip in revenue and boost adjusted EBITDA margins compared to Q1 2024.”
He further Announces highlighted the company’s successful focus on profitability and improved working capital efficiency, which contributed to a robust cash flow that enabled NOV to return $109 million to shareholders through share buybacks and dividends during the first quarter.
Despite the resilient performance, Announces Williams addressed the macroeconomic challenges that were impacting the global economy. These include rising trade tensions, a weakening economic outlook, and a surge in OPEC+ production, all of which contributed to increased uncertainty in the markets and caution among customers. While many customers are sticking to their strategic plans, NOV anticipates that shorter-cycle activity may experience a slowdown.
“The macroeconomic Announces conditions are pushing uncertainty across industries, and while most of our customers are proceeding with their plans, we foresee some softening in shorter-cycle activity,” stated Williams. He emphasized NOV’s readiness to navigate these challenges, thanks to the company’s strong market position, technology, and customer-centric approach.
Williams Announces expects that geopolitical and economic uncertainties will continue to create headwinds, leading to a slight reduction in activity during the latter half of the year. However, he remains confident that NOV’s technological advantages and global reach will allow the company to continue growing, with a modest revenue improvement expected for the second quarter of 2025.
Segment Performance: Mixed Results Across Key Areas
NOV’s Announces Energy Products and Services segment posted revenues of $992 million, a 2% decrease from the previous year. Operating profit for this segment declined by $38 million, amounting to $83 million, or 8.4% of sales. The adjusted EBITDA for this segment fell by $29 million, bringing it to $145 million, or 14.6% of sales. The drop in revenues was largely attributed to lower industry activity, which primarily affected the demand for shorter-cycle capital equipment. However, NOV was able to mitigate this decline by benefiting from the growing adoption of newer technologies. Despite the market challenges, the segment’s profitability was impacted by lower volumes and a less favorable sales mix.
In contrast, NOV’s Announces Energy Equipment segment generated revenues of $1.15 billion in the first quarter of 2025, marking a 3% decrease compared to Q1 2024. On a positive note, operating profit for this segment increased by $39 million, reaching $134 million, or 11.7% of sales. Additionally, adjusted EBITDA grew by $46 million, amounting to $165 million, or 14.4% of sales. This was driven by improved pricing, strong execution, and a significant increase in backlog-driven revenues. However, the segment still saw a decline in demand for aftermarket parts and services, a factor that tempered overall performance.
New orders in Energy Equipment Announces reached $437 million, an increase of $47 million compared to the $390 million in new orders recorded in Q1 2024. NOV’s backlog for capital equipment orders in this segment grew to $4.41 billion as of March 31, 2025, marking a $458 million increase from the previous year. The book-to-bill ratio stood at 80% for Q1 2025, compared to 77% during the same period in 2024, signaling a healthy order intake relative to shipments.
Outlook for Q2 2025: Navigating Economic Challenges
Looking ahead to the second quarter of 2025, NOV’s management has provided financial guidance, forecasting year-over-year revenues to decline by 1% to 4%. The company expects adjusted EBITDA to range between $250 million and $280 million. These projections reflect the continued macroeconomic and geopolitical uncertainties that are likely to affect market activity in the coming months.
Shareholder Returns and Financial Position
During the first quarter of 2025, Announces NOV repurchased 5.4 million shares of its common stock for a total of $81 million. In addition, the company returned $109 million to shareholders through a combination of dividends and stock buybacks. This reflects NOV’s commitment to delivering value to its shareholders despite the external challenges faced by the company.
As of March 31, 2025, NOV’s Announces total debt stood at $1.74 billion, with $1.50 billion available on its primary revolving credit facility. The company’s cash and cash equivalents amounted to $1.16 billion, providing a solid financial foundation to support future operations and investments.
Strategic Developments and Achievements
Amid these financial results, NOV also celebrated several significant achievements and strategic advancements in its operations:
- Partnership with Petrobras: NOV Announces signed an agreement with Petrobras to develop advanced flexible pipe solutions for deepwater applications. This collaboration focuses on creating stainless steel armoring to combat stress corrosion cracking caused by CO₂, addressing a significant challenge in subsea operations. This agreement solidifies NOV’s leadership in subsea production infrastructure and strengthens its relationship with Petrobras.
- Cable-Lay System for Japanese Customer: NOV Announces secured a contract to supply an integrated cable-lay system for a new vessel commissioned by a Japanese customer. This contract highlights NOV’s leadership in the advanced cable-lay technology sector, which is essential for offshore wind farms’ subsea infrastructure.
- Gas Dehydration Project in the Middle East: NOV was awarded a project for gas dehydration technology by a National Oil Company in the Middle East. This contract underscores NOV’s position as a key player in the natural gas development sector in the region.
- Record-Breaking Drilling Achievements: NOV’s downhole technologies played a pivotal role in two record-setting drilling runs in the Utica shale play in the U.S. These achievements were made possible by NOV’s proprietary ERT™ power section technology, showcasing the durability and performance of its products in challenging applications.
- Long-Term Supply Contracts and New Products: NOV also secured multiple long-term contracts, including the supply of XLW-S connectors for deepwater conductor casing for the GranMorgu development project in Suriname, and custom choke solutions to address production challenges for a major operator in the Middle East.
- Performance Drilling Technology: NOV’s performance drill bits, motors, and measurement-while-drilling technology have helped service companies in the Middle East achieve high drilling efficiencies, setting new records in drilling performance for both 16-inch and 12-inch hole sizes.
These achievements demonstrate NOV’s Announces continued focus on innovation and technology development, positioning the company well for future growth despite the challenges in the broader macroeconomic environment.
While NOV faces a period of economic uncertainty, the company’s strong technological capabilities, global market presence, and customer-centric approach provide a solid foundation for navigating these challenges. The company is well-positioned to drive growth, innovate, and continue delivering value to its shareholders and customers, with a modest sequential revenue improvement expected for the second quarter of 2025.
NOV will hold a conference call to discuss its first-quarter 2025 results on April 29, 2025, at 10:00 AM Central Time (11:00 AM Eastern Time). Investors and analysts are invited to join the call to gain deeper insights into the company’s performance and future outlook.
