Patterson-UTI Energy’s Q3 2025 results highlight resilience amid a softening U.S. completions market and cautious rig activity. While revenue eased slightly, the company maintained solid margins across drilling, completions, and product segments—thanks to strong execution, disciplined capital management, and steady demand for its high-efficiency, gas-powered frac fleets. With oil activity stabilizing and natural gas prospects improving ahead of 2026’s LNG-driven demand surge, Patterson-UTI’s diversified platform positions it well for the next phase of the cycle.
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- Revenue: $1.176B
- Net loss: $(36)M (adj. net loss $(21)M); Adj. EBITDA: $219M
- Capital returns: $64M (dividend $0.08/share + $34M buybacks); next dividend $0.08 on Dec 15, 2025 (record Dec 1).
Segment highlights
- Drilling Services: $380M revenue; $134M adj. gross profit; 95 rigs avg., 8,737 U.S. operating days. Activity steady outside Permian; directional drilling strong.
- Completion Services: $705M revenue; $111M adj. gross profit. Pricing per HHP-hr steady; lower low-margin product sales. Emerald (100% gas-powered) fleets in high demand; first direct-drive frac fleet delivered and starting long-term work in Q4. Vertex Automated Controls rolling to full deployment by year-end.
- Drilling Products (Ulterra): $86M revenue; $36M adj. gross profit. U.S./Canada outperformed activity trends; record U.S. revenue per industry rig; margins normalized after early-quarter repair costs.
Management color (paraphrased)
- Margins holding up better than past slowdowns due to integration, performance-based deals, and tech edge.
- U.S. rig activity stabilized late Q3; expecting steady activity into 2026.
- Current industry activity below what’s needed to hold U.S. oil output flat; further rig declines could pressure 2026 global supply.
- Gas outlook strengthening with LNG takeaway coming into focus, implying higher gas D&C in 2026.
Q4-2025 Outlook (guidance)
- Drilling Services: avg. rig count similar to Q3; adj. gross profit ~5% lower q/q.
- Completion Services: adj. gross profit ≈ $85M; less seasonality than last year.
- Drilling Products: slight improvement q/q; stronger international.
- Capex: ~$140M in Q4; FY-2025 < $600M (before $33M asset-sale proceeds). DD&A ≈ $225M in Q4. SG&A roughly flat q/q.
Cash & balance sheet
- Low leverage, strong liquidity; company may accelerate buybacks opportunistically. Adjusted free cash flow YTD: $146M (Op CF $564M – Capex $451M + $33M proceeds).
Investor call
- Thu, Oct 23, 2025 @ 9:00 a.m. CT (ID 5526772); webcast via Investor Relations site.
Why it matters (quick take)
- Completions tech stack (gas-powered fleets, direct-drive, closed-loop Vertex controls) is a differentiator as customers push efficiency and emissions goals.
- Macro setup: if U.S. rig count slips, supply headwinds could firm 2026 oil pricing; LNG ramp points to a gas-weighted activity rebound in 2026—tailwind for PTEN’s frac and gas-basin work.
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