Halliburton Faces Mixed Q4 With North American Weakness, But Global Gains And Cash Flow Bolster Optimism

Halliburton Company HAL shares are trading lower after the company reported mixed fourth-quarter 2024 results.              

Halliburton reported a third-quarter revenue decline of 2.3% year-over-year to $5.610 billion, missing the consensus of $5.63 billion.

Completion and Production revenue fell 4.2% YoY to $3.2 billion, with $629 million operating income. The company attributed the sequential decline in the segment results to lower stimulation activity in North America and decreased pressure pumping services in Latin America.

Drilling and Evaluation revenue increased 0.4% YoY to $2.4 billion, with $401 million in operating income, both flat sequentially.

HAL’s North America revenue declined 8.7% YoY to $2.213 billion, and also down 7% sequentially, impacted by lower stimulation, fluid, and wireline services, partially offset by stronger Gulf of Mexico fluid activity, improved U.S. drilling, and higher artificial lift and completion tool sales.

International revenue rose 3% sequentially to $3.4 billion. Latin America dropped 9% sequentially to $953 million due to lower activity in Mexico and Argentina, partially offset by growth in Brazil and the Caribbean.

Europe/Africa grew 10% sequentially to $795 million, driven by North Sea drilling and African pressure pumping. Middle East/Asia increased by 7% sequentially to $1.6 billion, led by higher stimulation, fluid services, and completion tool sales in key regions.

Operating income stood at $932 million (-11.9% YoY), with an operating margin of about 16.6%, down 182 bps YoY.

Adjusted EPS was $0.70, down from $0.86 a year ago and above the consensus of $0.69.

During the quarter, Halliburton repurchased $309 million in stock and $100 million in debt, paid $0.17 per-share dividends, and invested $33 million in SAP S4 migration.

Operating cash flow for the fiscal 2024 was $3.8 billion, and free cash flow was $2.65 billion. For the quarter, operating cash flow was $1.456 billion, and FCF was $1.104 billion.

“While we expect 2025 to be sequentially softer in North America, we begin the second half of this decade in a great position, with a transformed balance sheet, leading returns, and strong free cash flow,” commented Jeff Miller, Chairman, President and CEO.

“I am excited about the long term outlook for Halliburton. I expect to execute our value proposition, deepen our technology portfolio, and drive value through our growth engines: drilling technology, unconventionals, well intervention, and artificial lift,” concluded Miller.           

Price Action: HAL shares traded lower by 3.93% at $28.37 the last check Wednesday.

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