Weatherford International plc (WFRD)

Weatherford International plc Financial Report

Report Date: 2025-04-30
Period Covered: Q1 2025 (Three months ended March 31, 2025)

Executive Summary

Weatherford International plc reported operating revenue of $1.193 billion in Q1 2025, down 12.2% year-over-year from $1.358 billion in Q1 2024. Net income attributable to Weatherford was $112 million (diluted EPS $1.03), compared with $154 million (diluted EPS $1.50) in Q1 2024. Total principal debt outstanding on the 8.625% senior notes due 2030 was $1.56 billion as of March 31, 2025, down from $1.59 billion at year-end 2024.

Profit & Debt Analysis

• Net income declined 27.3% year-over-year, driven by a 12.2% drop in revenues across all segments amid lower activity and softer commodity prices.
• Operating income fell to $142 million from $233 million, reflecting reduced volumes partially offset by lower cost of services and SG&A spending.
• Total debt decreased by ~$34 million (2.1%) as the company repurchased $34 million of its 2030 senior notes.

Key Drivers

• Commodity prices: WTI $71.84/bbl (Q1 2025) vs $77.56/bbl (Q1 2024); Brent $75.81/bbl vs $83.00/bbl; HH gas $4.15/MMBtu vs $2.13/MMBtu.
• Rig counts: Worldwide rig count of 1,706 in Q1 2025 vs 1,796 in Q1 2024.
• Segment performance: Lower Latin America and EMEA activity; Middle East-North Africa growth helped offset some declines.

Pros

• Diversified segment mix with leading technologies in drilling evaluation, well construction, and production intervention.
• Strong liquidity and access to capital markets; zero drawings on $720 million credit facility.
• Proactive cost management, deleveraging and share repurchase program.

Cons

• Revenue and margins pressured by lower global activity and commodity volatility.
• High dependence on the largest customer in Mexico, which has delayed payments and required third-party financing arrangements.
• Ongoing legal, geopolitical and supply chain uncertainties (e.g., tariffs, sanctions on Russia, regional conflicts).

Conclusion: Weatherford remains focused on cost control, deleveraging and technology differentiation while navigating a challenging macro environment. Continued margin discipline and selective capital allocation will be critical to sustain profitability and cash flow generation in 2025.

Three Months Ended March 31, 2025 vs 2024:

Segment Breakdown:

Revenue by Geography (Q1 2025): North America 21%, International 79% (MEA 42%, Latin America 20%, EMEA 17%)

Weatherford’s near-term outlook remains cautious due to subdued oilfield activity, lower commodity prices and geopolitical headwinds. The company’s deleveraging strategy through debt repurchases and disciplined capex targeting ~2% of revenue should preserve liquidity and financial flexibility. Focus on high-margin projects in the Middle East-North Africa region, ongoing cost reductions, and a leaner operating model underpin margin stabilization. However, reliance on large, concentrated customers (notably in Mexico) and exposure to legal and regulatory uncertainties present execution risks. Over the mid to long term, Weatherford’s technological offerings in digital drilling optimization and reservoir intervention position it to capture market share as E&P spending recovers. Key challenges include supply chain constraints, currency volatility, and evolving ESG and sanctions regimes. Management’s ability to sustain free cash flow, maintain covenant compliance, and deploy capital selectively will be pivotal for restoring earnings growth and shareholder returns.