Seadrill Limited Overview
FY2025 from 10-K; FY2023 and FY2024 from Google Finance / TradingView aggregators — treat as indicative only. Third-party workforce analytics (Revelio Labs) estimate ≈6,000 for "Seadrill Management", which likely includes offshore contractors and managed-rig crews; this conflicts with the 10-K figure and is not relied upon.
Seadrill is a pure-play, mid-cap offshore drilling contractor that has emerged from two Chapter 11 reorganizations (2017–18 and 2021–22) as a focused, modestly levered owner-operator of high-specification deepwater floaters. Its owned fleet of 15 units — ten drillships (eight 7th-generation-class and older 6th-generation units), four semi-submersibles and one harsh-environment jackup — is concentrated in the "Golden Triangle" basins of Brazil, the U.S. Gulf and West Africa, supplemented by management of two Sonangol-owned drillships through the Sonadrill joint venture. After shedding its benign jackup and tender-rig businesses between 2022 and 2024, Seadrill now competes as the smallest of the listed deepwater specialists against a consolidating peer set (Transocean–Valaris, Noble). Its equity story in 2026 is a repricing cycle: legacy contracts rolling to dayrates roughly USD 100,000–200,000/day higher, a backlog that rebuilt to ≈USD 2.9–3.1 billion, refinanced unsecured debt to 2034, and a guided step-change in EBITDA from USD 353 million (FY2025) to USD 420–450 million (FY2026).
Company's own description (10-K FY2025, paraphrased)
Seadrill describes itself as an offshore drilling contractor providing worldwide drilling services to the oil and gas industry, with a primary business of owning and operating drillships and semi-submersibles for shallow-to-ultra-deepwater operations in both benign and harsh environments. Rigs are contracted on a dayrate basis to oil super-majors, national oil companies (NOCs) and independents, and the company also provides management services to affiliated entities (principally the Sonadrill joint venture with Sonangol). Its stated vision is to "set the standard in deepwater oil and gas drilling" (10-K FY2025).
As of 31 December 2025 Seadrill owned 15 drilling units: 10 operating (nine benign floaters — six 7th-generation drillships, two 6th-generation drillships and one benign semi-submersible — plus one harsh-environment jackup), one undergoing capital upgrades for a Q2 2026 contract, one in repair/maintenance, and three cold-stacked. It also managed two drilling units owned by Sonangol (10-K FY2025).
Business model and revenue model
| Revenue line (USD Mn) | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Contract revenues | 764 | — | — | 1,009 | 1,089 |
| Reimbursable revenues | 35 | — | — | 70 | 58 |
| Management contract revenues | 177 | — | — | 247 | 254 |
| Leasing (bareboat charter) revenues | — | — | — | 54 | 33 |
| Other revenues (FY2021 incl. leasing 26) | 32 | — | — | 5 | 3 |
| Total operating revenues | 1,008 | — | — | 1,385 | 1,437 |
Seadrill's revenue is overwhelmingly service revenue earned under term drilling contracts. There is no product, subscription or licensing revenue. The revenue lines reported are:
Sources: 20-F FY2021 (FY2021); 8-K Q4 2025 release (FY2024, FY2025).
Contract revenues (≈76% of FY2025): dayrate income from owned rigs, plus amortized mobilization fees and contract-preparation revenue.
Management contract revenues (≈18%): fees and cost pass-through for operating Sonadrill's rigs (Sonangol Quenguela, Sonangol Libongos) and the West Gemini leased to Sonadrill. These carry offsetting "management contract expenses" (USD 232M in FY2025) and are low-margin; related-party revenue totalled USD 317M in FY2025 (8-K Q4 2025).
Leasing revenues: bareboat charter income (West Gemini to Sonadrill; formerly Qatar jackups to Gulfdrill before their June 2024 sale — which explains the drop from USD 54M to USD 33M).
Reimbursables: pass-through of customer-requested goods/services at near-zero margin; guidance excludes ≈USD 50M of reimbursables for FY2026.
Contract mechanics (10-K FY2025)
Contracts run for a fixed term or well count at an agreed dayrate; customers bear well-construction ancillary costs and subsurface economic risk. Seadrill typically does not earn dayrate during equipment-failure downtime beyond contractual allowances. Lump-sum or dayrate-based mobilization and upgrade fees are common (e.g., USD 41M mobilization on the West Tellus Petrobras contract; USD 31.5M on West Jupiter — company releases, Dec 2024). Some contracts include cost-escalation clauses linked to public indices, and some allow termination for convenience against an early-termination fee.
Value chain position and customers
| Customer (% of total operating revenues) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Petrobras | 16 | 18 | 36 |
| Sonadrill (JV, related party) | 17 | 22 | 22 |
| Talos | 7 | 2 | 11 |
| LLOG | 9 | 9 | 10 |
| Others | 51 | 49 | 21 |
Seadrill sits in the oilfield-services value chain between E&P operators (who own licenses and fund wells) and the equipment/OEM and shipyard layer (BOP, drilling-package and MPD suppliers). It is an asset-heavy, capacity-renting intermediary whose economics depend on utilization × dayrate − rig opex.
Customer concentration (10-K FY2025):
The four customers above 10% accounted for ≈79% of FY2025 revenue (10-K FY2025). Other named customers in 2025–26 include Equinor (West Saturn, West Elara), TotalEnergies (via Sonadrill), PTTEP (West Capella, Malaysia), ConocoPhillips (West Elara, Norway), Murphy and Kosmos (Sevan Louisiana), and an undisclosed operator in Indonesia (West Carina, from 2027).
End-markets
Deepwater and ultra-deepwater development and exploration drilling (Brazil pre-salt, U.S. Gulf, Angola, Southeast Asia), harsh-environment work in the Norwegian North Sea, and accommodation services (West Elara for Equinor, 2026–27).
Independent characterization
Seadrill is best characterized as a levered, concentrated bet on deepwater floater dayrates in three basins, with an unusually high share of revenue from a single NOC (Petrobras, 36%) and a meaningful but low-margin management-services annuity from Angola. Since 2022 management has simplified the portfolio (exiting jackups, tender rigs and the Qatar JV), returned ≈USD 792M via buybacks through 2024, and then absorbed a "transition" trough in 2025 as several rigs sat between contracts. The investment case now rests on (i) contract repricing — e.g., West Jupiter and West Tellus moving to three-year contracts roughly USD 200,000/day above prior rates (Q4 2025 call), and an implied ≈USD 477,000/day for the West Carina Indonesia award versus a Q2 2026 fleet average of USD 360,000 (Discovery Alert, Oct 2026; Q2 2026 release); (ii) the optionality of three stacked rigs; and (iii) scale disadvantages versus consolidating competitors.
Strategy
Stated strategy (10-K FY2025)
Seadrill frames its strategy around a vision of setting the standard in deepwater drilling, delivered through four pillars (paraphrased):
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Operational excellence — maximize asset availability via best-in-class uptime, safety and cost efficiency.
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Fleet and portfolio strength — keep "the right rigs in the right areas", invest in targeted upgrades, and actively manage the portfolio with prudent financial management.
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Customer partnership and growth — deepen long-term relationships, form mutually beneficial partnerships, and diversify revenue through value-adding services across the drilling lifecycle.
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People and performance — recruit, retain and develop talent and leadership depth.
The 10-K also cites four competitive strengths: scale and age (all units delivered after 2007), commitment to safety and environment, a technologically advanced fleet, and enduring customer relationships.
Capital allocation framework
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Target to return at least 50% of Free Cash Flow to shareholders via dividends and buybacks (10-K FY2025 risk factors).
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Target minimum cash-on-hand of USD 250M for downturn resilience (10-Q Q1–Q3 2025).
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Buyback program (USD 500M authorized May 2024, originally running two years from 25 Jun 2024) extended through 31 Dec 2026; ≈USD 20M repurchased in Q2 2026 (8-K Q2 2026). USD 208M remained available at 31 Dec 2025 (10-K FY2025); ≈USD 188M remaining after Q2 2026 (derived, assuming USD 20M executed under this authorization).
Initiatives in the last 24 months
| Initiative | Date | Description / target | Status |
|---|---|---|---|
| Portfolio simplification — Qatar exit | May–Jun 2024 | Sale of three jackups + Gulfdrill stake for USD 338M to focus on Golden Triangle deepwater | Completed |
| Exit benign jackups | Dec 2024 | West Prospero sold (USD 45M) | Completed |
| Petrobras re-contracting (West Jupiter, West Tellus) | Dec 2024 → Q2 2026 | ≈USD 1B backlog; three-year terms at ≈USD 200k/day above prior rates | Both commenced Q2 2026 |
| Contract-repricing strategy | 2,026 | Ali stated the West Carina award fulfilled the objective of moving three legacy contracts to current market rates (Inspenet, Oct 2026) | Ongoing |
| Balance-sheet refinancing | Jun 2026 | USD 700M unsecured 6.75% notes due 2034; RCF to USD 300M, maturity 2031; letter-of-credit sub-limit raised from USD 50M to USD 100M | Completed |
| Buyback resumption | Q2 2026 | Program extended to end-2026 | Active |
| MPD / technology deployment | 2,025 | Integrated riser-joint MPD on West Polaris and West Neptune | Ongoing |
| Safety leadership | 2023–2025 | SHARED Supervision program; record TRIR 0.17 in 2025 vs IADC 0.34 | Ongoing |
| Sustainability reporting | Dec 2025 | 2024 Sustainability Report aligned with SASB and guided by CSRD/ESRS | Published |
| Stacked-fleet strategy | 2,026 | West Eclipse, West Phoenix, West Aquarius — management says reactivation costs high; no decision announced (Q4 2025 call) | Pending |
| AI adoption | 2025–26 | 10-K risk factors confirm AI technologies being incorporated into processes | Early |
Guidance and medium-term targets
| FY2026 guidance (USD Mn) | Feb 2026 (initial) | May 2026 | Aug 2026 (current) |
|---|---|---|---|
| Total operating revenues (excl. ≈50 reimbursables) — low | 1,400 | 1,430 | 1,500 |
| Total operating revenues — high | 1,450 | 1,480 | 1,550 |
| Adjusted EBITDA — low | 350 | 370 | 420 |
| Adjusted EBITDA — high | 400 | 420 | 450 |
| Capex & long-term maintenance — low | 200 | 200 | 200 |
| Capex & long-term maintenance — high | 240 | 240 | 240 |
Sources: 8-K Q4 2025, Q1 2026, Q2 2026. Initial guidance included ≈USD 26M of non-cash expense in EBITDA (Quartr summary). At the February 2026 call, ≈90% of the revenue-range midpoint was covered by firm backlog.
Management has not published formal multi-year financial targets; qualitatively it expects tightening supply, longer contract durations and higher dayrates to drive a "more robust 2027" (Q4 2025 release; CEO quote).
Products & Services
Seadrill's "products" are drilling units and the crews/services that operate them. The catalog below lists every owned unit (10-K FY2025 specification table) plus managed units, with contract status assembled from 2025–2026 releases. Pricing is dayrate-based; specific dayrates are disclosed only occasionally.
Floaters — Drillships
| Unit | Built | Water depth (ft) | Drilling depth (ft) | Location (Dec 2025) | Customer / status (latest disclosed) | Disclosed economics |
|---|---|---|---|---|---|---|
| West Carina | 2,015 | 12,000 | 37,500 | Brazil | Petrobras, extended into Jun 2026; new 880-day firm contract in Indonesia (undisclosed operator) from 1H 2027, plus 880 days of priced options | ≈USD 420M firm TCV incl. mobilization (Oct 2026 release); implied ≈USD 477k/day (Discovery Alert) |
| West Jupiter | 2,014 | 12,000 | 37,500 | Brazil | Petrobras 1,095-day contract; commenced Q2 2026 after preparation completed ahead of schedule and on budget | ≈USD 493M backlog + USD 31.5M mobilization (Dec 2024 release) |
| West Neptune | 2,014 | 12,000 | 37,500 | USA (U.S. Gulf) | LLOG 120 days from May 2026, then 365-day LLOG extension from Oct 2026 | USD 48M (120-day); LLOG awards to Neptune + Vela ≈USD 260M combined (Q1 2026 release) |
| West Saturn | 2,014 | 12,000 | 37,500 | Brazil | Equinor; 365-day priced option exercised from Oct 2026, extending the original 2022 contract through Oct 2027 | USD 114M (Q4 2025 release) |
| West Tellus | 2,013 | 12,000 | 37,500 | Brazil | Petrobras Sépia/Atapu, 1,095 days from Jun 2026 to Jun 2029 | ≈USD 498M + USD 41M mobilization (Dec 2024 release) |
| West Auriga | 2,013 | 12,000 | 37,500 | Brazil | Petrobras; commenced Dec 2024 following capital project | — |
| West Vela | 2,013 | 12,000 | 37,500 | USA (U.S. Gulf) | Talos (2025); LLOG 270-day program Sep 2026–Jun 2027; new one-year U.S. Gulf contract from Jun 2027 | ≈USD 161M for 2027–28 term (Q2 2026 release) |
| West Gemini | 2,010 | 10,000 | 37,500 | Angola | Bareboat chartered to Sonadrill JV | Leasing revenue (part of USD 33M FY2025) |
| West Polaris | 2,008 | 10,000 | 37,500 | Brazil | Petrobras Búzios; 1,095-day extension from Jan 2028 | ≈USD 480M; dayrates USD 409,200 (Apr 2026–Mar 2027) and USD 454,700 (Apr 2027–Jan 2028) on current term (Apr 2026 release) |
| West Capella | 2,008 | 10,000 | 37,500 | Singapore (prep) → Malaysia | PTTEP, 440 days from Q2 2026; extensions/options now commit rig through Feb 2028 | USD 152M + USD 26M + USD 41M + ≈USD 53M (Q4 2025, Q2 2026, Oct 2026 releases) |
Floaters — Semi-submersibles (benign)
| Unit | Built | Water depth (ft) | Drilling depth (ft) | Location | Status | Economics |
|---|---|---|---|---|---|---|
| Sevan Louisiana | 2013 (cylindrical design) | 10,000 | 35,000 | U.S. Gulf | Short-term work: large IOC (2 months from Mar 2026, +45 days to Aug 2026); Kosmos 25 days from Nov 2026 | — |
| West Eclipse | 2,011 | 10,000 | 40,000 | Namibia | Cold-stacked; management describes as lower-spec with material reactivation cost (Q4 2025 call) | — |
Harsh Environment
| Unit | Type | Built | Water depth (ft) | Drilling depth (ft) | Location | Status |
|---|---|---|---|---|---|---|
| West Elara | Harsh-environment jackup | 2,011 | 492 | 35,000 | Norway | ConocoPhillips drilling (Supplier of the Year award); released by mutual agreement for Equinor ≈450-day accommodation contract Q3 2026–Q4 2027 |
| West Aquarius | Harsh-environment semi | 2,009 | 10,000 | 34,500 | Norway | Stacked; higher-spec but high reactivation cost |
| West Phoenix | Harsh-environment semi | 2,008 | 10,000 | 29,500 | Norway | Stacked through 2025; high reactivation cost |
Managed units (Sonadrill JV, Angola)
| Unit | Owner | Customer | Commitment |
|---|---|---|---|
| Sonangol Quenguela | Sonangol (via Sonadrill structure) | TotalEnergies | Extended ≈480 days into Jul 2028 (Q1 2026) |
| Sonangol Libongos | Sonangol | Not named in release | All remaining priced options exercised; committed through Jan 2030 (Oct 2026 release) |
Service offerings and enablers
Managed Pressure Drilling (MPD): offered as an additional service; West Polaris and West Neptune used integrated riser-joint MPD technology, which management said saved more than 12 hours per well on rig-up/rig-down (Q4 2025 call). Pricing: charged as additional services outside base dayrate.
Rig management services: for Sonadrill (fee + cost model).
Accommodation services: West Elara for Equinor (from Q3 2026).
Training: Seadrill Development Academy drilling-simulator suite; IWCF-aligned enhanced well-control program (10-K FY2025).
Financial Narrative
Comparability warnings: FY2021 is predecessor (pre-emergence) data as originally reported in the 20-F FY2021. FY2022 combines a predecessor stub (dominated by USD 3.7 billion of reorganization gains) and a successor period and is not economically meaningful at the net-income line. FY2023 includes nine months of Aquadrill rigs. FY2024 includes a USD 234M gain on disposals and a USD 113M tax benefit.
Income statement
Sources: FY2021 — 20-F FY2021 (revenue, operating loss, interest, net loss) and 20-F FY2022 (EPS −5.85; note the 20-F FY2023 shows −5.70 for continuing operations only — a presentation discrepancy). FY2022 — revenue ≈USD 1.0 billion as stated in the Q4 2023 release (successor + predecessor, rounded); operating income = successor 35 + predecessor 37 (20-F FY2022); pre-tax = −63 + 3,741; net income = successor 201 + predecessor 3,706 (20-F FY2023). EPS for FY2022 is reported separately for each period (successor diluted 3.88; predecessor diluted 36.92) and cannot be combined. FY2023 — revenue ≈USD 1.5 billion and operating profit USD 329M, adjusted EBITDA USD 495M (Q4 2023 release); net income USD 300M (20-F FY2023 equity statement); EPS from 20-F FY2023 XBRL. FY2024/FY2025 — 8-K Q4 2025 release.
Margins and growth
Derived. FY2022 net margin omitted as not meaningful (reorganization gain). Revenue CAGR FY2021–FY2025 = 9.3% (derived: 1,437/1,008 over four years); FY2023–FY2025 CAGR = −2.1%.
Balance sheet
No goodwill or intangible lines appear on the FY2024–FY2025 balance sheets.
Interim update (30 Jun 2026, 8-K Q2 2026): total assets USD 4,106M; cash incl. restricted USD 360M; long-term debt (book) USD 737M; gross principal debt USD 750M (USD 700M 2034 notes + USD 50M convertible notes, derived); net debt USD 390M; equity USD 2,864M; accounts receivable jumped to USD 311M (from USD 162M) on new contract commencements.
Cash flow
Sources: 8-K Q4 2025 (FY2024/FY2025); 10-K FY2024 (FY2023 repurchases USD 266M, 6.2M shares at USD 43.12 average). The 10-K FY2024 quotes FY2024 repurchases as USD 527M (11.6M shares at USD 45.31); the cash-flow statement shows USD 532M — difference reflects timing/settlement costs.
H1 2026 (10-Q/8-K Q2 2026): OCF −USD 40M (after USD 70M long-term maintenance and a USD 149M receivables build); capex USD 38M; FCF −USD 78M (Q1 −35, Q2 −43); USD 700M notes issued, USD 575M secured notes repaid, USD 25M make-whole and USD 8M fees paid; buybacks USD 17M cash.
Ratios
All derived from the tables above. The cash conversion cycle is not meaningful for a dayrate service business with no inventory turnover and is not disclosed; DSO alone was ≈41 days at end-2025 (162/1,437×365, derived) and rose to ≈63 days on annualized Q2 2026 revenue (311/(449×4)×365, derived).
Quarterly trajectory (recent six quarters)
Sources: quarterly 8-K releases Q1 2025–Q2 2026; Q2 2025 margin and utilization from Q2 2025 release summary (Fintool). Dayrate and utilization exclude the three Sonadrill-managed drillships.
Commentary — trends, inflections and drivers
Revenue. The FY2023 step-up (+≈50%) was acquisition-driven: three quarters of Aquadrill rigs (Q4 2023 release). FY2024's 7.7% decline reflected the June 2024 sale of the Qatar jackups (which removed bareboat income), scheduled contract completions for West Phoenix and West Capella, and planned out-of-service time on West Neptune; Q4 2024 revenue fell to USD 289M (Q4 2024 release). FY2025 recovered modestly (+3.8%) as West Auriga (Dec 2024) and West Polaris (Feb 2025) began Petrobras contracts at higher dayrates, partly offset by West Phoenix and West Capella being stacked for most of the year and 50 days of regulatory downtime on West Tellus in Brazil (10-Q Q2/Q3 2025). The clear inflection is Q2 2026: revenue of USD 449M (+25% QoQ) as West Jupiter and West Capella worked full quarters and the fleet average dayrate rose to USD 360,000.
Profitability. Adjusted EBITDA margin compressed from 33.0% (FY2023) to 24.6% (FY2025). Drivers: (i) idle time on rigs between contracts; (ii) USD 51M of management-contract expense recognized in Q2 2025 after the Sonadrill fees judgment, of which ≈USD 44M related to pre-2025 periods and was excluded from adjusted EBITDA (Q4 2025 reconciliation); (iii) D&A up USD 70M in FY2025 from capital projects on West Auriga and West Polaris and the end of favorable amortization of unfavorable-contract intangibles (10-K FY2025). GAAP operating income in FY2024 (USD 412M) was flattered by USD 234M of disposal gains; on a clean basis it was ≈USD 162M (derived). The Q2 2026 EBITDA margin of 33.5% ex-reimbursables marks a return to FY2023-like profitability.
Net income. FY2024's USD 446M includes the disposal gain and a USD 113M tax benefit from settlements and partial release of valuation allowances in Switzerland and Brazil (10-K FY2024). FY2025's USD 77M loss reflects the margin trough, a USD 22M impairment (Q4 2025) and USD 26M of tax expense. Q2 2026 returned to profit (USD 29M) despite a USD 35M loss on debt extinguishment recorded in H1 2026.
Balance sheet and cash. Seadrill moved from net cash of ≈USD 103M (end-2023) to net debt of USD 390M (June 2026) through USD 798M of buybacks (FY2023–FY2024), negative FCF in 2024–25, and two litigation cash outflows (USD 43M Oct 2025; USD 16M Q2 2026). Leverage remains modest (net debt/TTM adj. EBITDA ≈0.94x at June 2026, derived using TTM EBITDA of USD 415M). The refinancing lowered the coupon from 8.375% to 6.750% and removed security, extending the maturity wall to 2034. Management guided that cash flow would "inflect" from mid-2026 as lump-sum mobilization fees and new dayrates flow through (Q4 2025 call).
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View Subscription PlansFinancial Detail
Segment Overview
| Segment | Units (owned) | Content | Status highlights |
|---|---|---|---|
Floaters (benign) | West Carina, West Jupiter, West Neptune, West Saturn, West Tellus, West Auriga, West Vela, West Gemini, West Polaris, West Capella (drillships); Sevan Louisiana, West Eclipse (semis) | Ultra-deepwater and deepwater drilling | 11 of 12 contracted or bareboated; West Eclipse cold-stacked (Namibia) |
Harsh Environment | West Aquarius, West Phoenix (semis); West Elara (jackup) | North Sea / Norway | West Elara on contract (ConocoPhillips → Equinor accommodation); West Aquarius and West Phoenix stacked in Norway |
Jackups (benign) | None since sale of West Prospero (Dec 2024) | — | Exited |
Management services (not a reportable segment) | Sonangol Quenguela, Sonangol Libongos (owned by Sonangol); West Gemini (owned, leased to Sonadrill) | Operation of JV rigs in Angola | Libongos committed to Jan 2030; Quenguela to Jul 2028 |
Revenue by Segment
| Metric (USD Mn) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
Contract revenues (all owned rigs) | — | 1,009 | 1,089 |
Management contract revenues | — | 247 | 254 |
Leasing revenues | — | 54 | 33 |
Reimbursable + other revenues | — | 75 | 61 |
Total operating revenues | 1,500 | 1,385 | 1,437 |
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View Subscription PlansIncome Statement and Per-Share Data
| Metric (USD Mn unless stated) | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Total operating revenues | 1,008 | 1,000 | 1,500 | 1,385 | 1,437 |
Gross profit proxy (revenue less rig opex, reimbursable and management contract expenses) | — | — | — | 461 | 411 |
Depreciation & amortization | — | — | — | 168 | 238 |
Operating income / (loss) | -157 | 72 | 329 | 412 | 47 |
Adjusted EBITDA (company non-GAAP) | — | — | 495 | 378 | 353 |
Interest expense | 109 | — | — | 61 | 61 |
Pre-tax income / (loss) (continuing ops) | -587 | 3,678 | — | 333 | -51 |
Income tax (expense) / benefit | -5 | — | — | 113 | -26 |
Net income / (loss) | -587 | 3,907 | 300 | 446 | -77 |
EPS basic (USD) | -5.85 | — | 4.23 | 6.56 | -1.24 |
EPS diluted (USD) | -5.85 | — | 4.12 | 6.37 | -1.24 |
Dividends per share (USD) | 0 | 0 | 0 | 0 | 0 |
Margin Analysis (%)
| Metric (%) | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Gross margin proxy | — | — | — | 33.3 | 28.6 |
Operating margin | -15.6 | 7.2 | 21.9 | 29.7 | 3.3 |
Adjusted EBITDA margin | — | — | 33.0 | 27.3 | 24.6 |
Net margin | -58.2 | — | 20.0 | 32.2 | -5.4 |
Revenue growth YoY | — | -0.8 | 50.0 | -7.7 | 3.8 |
Balance Sheet
| Metric (USD Mn) | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Total assets | — | — | 4,220 | 4,156 | 3,947 |
Cash & equivalents incl. restricted | 535 | — | 728 | 505 | 365 |
Gross principal debt — short-term | — | — | 0 | 0 | 0 |
Gross principal debt — long-term | — | — | 625 | 625 | 625 |
Long-term debt (book value) | — | — | — | 610 | 613 |
Net debt (gross principal less cash incl. restricted) | — | — | -103 | 120 | 260 |
Total shareholders' equity | -3,716 | 1,702 | 2,983 | 2,918 | 2,858 |
Goodwill & intangibles | — | — | — | 0 | 0 |
Drilling units (net) | — | — | — | 2,946 | 2,969 |
Working capital (current assets less current liabilities) | — | — | — | 427 | 384 |
Cash Flow
| Metric (USD Mn) | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Net cash from operating activities | — | — | — | 88 | -28 |
Additions to long-term maintenance (within operating CF) | — | — | — | 261 | 213 |
Capex — additions to drilling units & equipment | — | — | — | 157 | 110 |
Free cash flow (company definition: OCF less additions to drilling units) | — | — | — | -69 | -138 |
Proceeds from asset disposals | — | — | — | 383 | 1 |
Share repurchases | 0 | 0 | 266 | 532 | 0 |
Dividends paid | 0 | 0 | 0 | 0 | 0 |
Interest paid | — | — | — | 54 | 53 |
Returns & Leverage Ratios (%) and Financial Ratios (x)
| Ratio | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
ROE (%, net income / avg equity) | 12.8 | 15.1 | -2.7 |
ROA (%, net income / avg assets) | — | 10.6 | -1.9 |
ROIC (%, NOPAT at 0% tax proxy: operating income / avg (equity + gross debt)) | — | 11.6 | 1.3 |
Current ratio (x) | — | 1.85 | 2.03 |
Debt / equity (x, gross principal) | 0.21 | 0.21 | 0.22 |
Net debt / Adjusted EBITDA (x) | -0.21 | 0.32 | 0.74 |
Interest coverage (Adjusted EBITDA / interest expense, x) | — | 6.2 | 5.8 |
Interest coverage (operating income / interest expense, x) | — | 6.8 | 0.8 |
Asset turnover (x, revenue / avg assets) | — | 0.33 | 0.35 |
Income Statement and Margin Analysis (%)
| Metric | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 | Q1 2026 | Q2 2026 |
|---|---|---|---|---|---|---|
Total operating revenues (USD Mn) | 335 | 377 | 363 | 362 | 358 | 449 |
Contract revenues (USD Mn) | 248 | 288 | 280 | 273 | 277 | 355 |
Net income / (loss) (USD Mn) | -14 | -42 | -11 | -10 | -7 | 29 |
Adjusted EBITDA (USD Mn) | 73 | 106 | 86 | 88 | 97 | 144 |
Adj. EBITDA margin ex-reimbursables (%) | 22.8 | 29.4 | 24.4 | 25.4 | 27.9 | 33.5 |
Average contractual dayrate (USD K) | — | 331 | 330 | 319 | 343 | 360 |
Economic utilization (%) | 83.9 | 93.4 | 91.1 | 91.0 | 94.6 | 95.5 |
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View Subscription PlansRevenue by Region (%)
| Region (% of total operating revenues) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
Brazil | — | — | 43 |
United States (U.S. Gulf) | — | — | 26 |
Angola | — | — | 23 |
Other (Norway, Asia, other) | — | — | 8 |
Region (USD Mn, derived from FY2025 %) | FY2023 | FY2024 | FY2025 |
Brazil | — | — | 618 |
United States | — | — | 374 |
Angola | — | — | 331 |
Other | — | — | 115 |
Basin Details
| Basin | Floater units (owned) | HE units | Managed | Key customers |
|---|---|---|---|---|
Brazil | West Carina, West Jupiter, West Saturn, West Tellus, West Auriga, West Polaris (6) | — | — | Petrobras, Equinor |
U.S. Gulf | West Neptune, West Vela, Sevan Louisiana (3) | — | — | LLOG (Harbour Energy), Talos, Kosmos, large IOC |
Angola | West Gemini (bareboat) | — | Sonangol Quenguela, Sonangol Libongos | Sonadrill / TotalEnergies |
Malaysia | West Capella (from Q2 2026) | — | — | PTTEP |
Norway | — | West Elara (active); West Aquarius, West Phoenix (stacked) | — | ConocoPhillips, Equinor |
Namibia | West Eclipse (stacked) | — | — | — |
Indonesia (from 1H 2027) | West Carina (relocating) | — | — | Undisclosed operator |
Data Point Details
| Data point | Value | Source / date |
|---|---|---|
Last close | USD 47.25 (USD 48.13 after hours) | CNBC, 16 Oct 2026 |
52-week high | USD 55.47 | 20 May 2026 |
52-week low | USD 28.10 | 10 Nov 2025 |
YTD return | +40.2% | Simply Wall St, 14 Oct 2026 |
1-year return | +67.3% | Simply Wall St, 14 Oct 2026 |
3-year TSR | ≈+9.7% (aggregator snapshot, date unclear) | Boardroom Alpha |
5-year return | Not meaningful — current equity created at Feb 2022 emergence; pre-2022 shares were cancelled | 10-K FY2025 |
Valuation Snapshot
| Multiple | Value | Basis |
|---|---|---|
Market capitalization | ≈USD 2.95B | 62.54M shares × USD 47.25 |
Enterprise value | ≈USD 3.34B | Market cap + USD 390M net debt (30 Jun 2026) |
EV / TTM Adjusted EBITDA | ≈8.0x | TTM EBITDA USD 415M |
EV / FY2026E Adjusted EBITDA | ≈7.7x | Guidance midpoint USD 435M |
EV / TTM sales | ≈2.2x | TTM revenue USD 1,532M |
Price / Sales (aggregator) | 1.89x vs historical median 1.87x | GuruFocus, Oct 2026 |
P / B | ≈1.03x | Equity USD 2,864M (Jun 2026) |
Shareholder returns (USD Mn)
| Shareholder returns (USD Mn) | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Dividends paid | 0 | 0 | 0 | 0 | 0 |
Share repurchases | 0 | 0 | 266 | 532 | 0 |
Capital Instruments
| Instrument | Principal (USD Mn) | Coupon | Maturity | Notes |
|---|---|---|---|---|
Senior Notes (Seadrill Finance Ltd) | 700 | 6.750% | 15 Jul 2034 | Unsecured; issued at par 30 Jun 2026; semi-annual coupons from 15 Jan 2027 |
Senior unsecured convertible notes | 50 | — | On or before 2030 (company said 2025 debt matured "through 2030") | Outstanding since emergence |
Revolving Credit Facility | Undrawn capacity 300 | Floating | 2031 | Upsized from USD 225M; LC sub-limit USD 100M; used for Hercules guarantee |
Gross principal debt | 750 | — | — | Net debt USD 390M |
Analyst Conclusions
Management guidance
FY2026 (Aug 2026): total operating revenues USD 1.50–1.55B excluding ≈USD 50M reimbursables; adjusted EBITDA USD 420–450M; capex and long-term maintenance USD 200–240M. H1 2026 delivered USD 241M of adjusted EBITDA, implying ≈USD 180–210M for H2 2026, or USD 90–105M per quarter (derived) — conservative relative to the Q2 2026 run-rate of USD 144M, which suggests either H2 downtime/mobilization effects (West Carina transition, West Vela contract change) or guidance headroom. Q3 2026 results are due 3 Nov 2026.
Consensus expectations
Directionally, management expects 2027 to be "more robust" than 2026 on higher dayrates and longer durations (Q4 2025 release), and >85% of 2027 drillship days are already contracted.
Bull case
-
Dayrate step-up compounding into 2027: the fleet average of USD 360k/day (Q2 2026) should migrate toward USD 400–480k as West Polaris (USD 454,700 from Apr 2027), West Carina (≈USD 477k implied) and other repriced contracts start, on a near-fully contracted 2027 drillship schedule.
-
Free cash flow inflection with modest leverage: with D&A of ≈USD 285M annualized and capex/LTM guided at USD 200–240M, EBITDA above USD 450M would generate meaningful FCF, while 6.75% unsecured debt to 2034 removes refinancing risk and supports the ≥50%-of-FCF return framework.
-
Asset value vs. trading multiple: shares trade at ≈1.0x book and ≈7.7x FY2026E EV/EBITDA despite a 2007+ fleet; consolidation (Transocean–Valaris) signals strategic value for high-spec drillships, and Elliott's continued accumulation (7.3%) adds a potential catalyst.
Bear case
-
Concentration and scale: Petrobras (36%) and four customers (79%) dominate revenue; a merged Transocean–Valaris can out-compete Seadrill on tenders and fleet flexibility, potentially capping dayrates on Seadrill's older 6th-generation units.
-
Persistent cash leakage: FCF has been negative for 2024, 2025 and H1 2026; litigation (≈USD 55M Hercules plus Sonadrill), stacked-rig costs and receivables build-up could keep FCF thin even as EBITDA rises, while net debt has already risen from net cash to USD 390M.
-
Cycle risk at the wrong moment: with Brent near USD 60 at end-2025, any operator capex retrenchment could hit the 2027–28 contract roll schedule, leaving three stacked rigs as sunk costs and threatening impairments (USD 22M in Q4 2025).
Key catalysts and monitorables (next 12 months)
| Catalyst / monitorable | Timing | What to watch |
|---|---|---|
| Q3 2026 results | 3–4 Nov 2026 | Guidance reaffirmation/raise; FCF turning positive; West Tellus mobilization fee receipt |
| Hercules appeal | Nov 2026 | Whether SFL or Seadrill seeks Supreme Court leave; cash settlement (≈USD 55M) |
| Buyback execution | To 31 Dec 2026 | Pace versus ≈USD 188M remaining; renewal for 2027 |
| FY2026 results and 2027 guidance | Feb 2027 | First full-year view of repriced fleet |
| Transocean–Valaris closing | 2H 2026 | Competitive behavior in Brazil and U.S. Gulf tenders |
| Stacked-rig decisions | 2026–27 | Reactivation, sale or recycling of West Eclipse, West Aquarius, West Phoenix |
| West Carina transition | 1H 2027 | Gap between Brazil exit (Jun 2026 extension) and Indonesia start |
| Brazil CBA renegotiation | From Sep 2026 | Crew cost inflation |
| Leadership | Ongoing | CCO appointment; clarity on CEO permanency |
| Credit ratings | Ongoing | Any upgrade following unsecured refinancing |
Analyst verdict
Seadrill enters late 2026 as a materially better business than the one that reported a USD 77 million loss for FY2025. The commercial reset is real and verifiable: backlog rebuilt to ≈USD 3 billion, more than 85% of 2027 drillship days contracted, legacy contracts repricing by USD 100,000–200,000 per day, and two consecutive guidance raises culminating in a USD 420–450 million FY2026 EBITDA range. The June 2026 refinancing was well executed — lower coupon, no security, nothing due until 2034 bar a small convertible — and leverage is modest at under 1x TTM EBITDA.
The constraints are equally clear. Seadrill is now the sub-scale player in a consolidating oligopoly, its revenue is concentrated in one NOC and three basins, and it has not generated positive free cash flow on an annual basis since the 2023 buyback era. Litigation has consumed roughly USD 60 million in cash over twelve months with a further ≈USD 55 million likely for Hercules, and three stacked rigs represent either latent upside or a slow drain. The abrupt CEO change in March 2026, while followed by strong execution under Samir Ali, adds governance uncertainty.
At ≈7.7x FY2026E EV/EBITDA and ≈1.0x book value, the market is pricing in the 2026 recovery but only partially the 2027 repricing. The equity's direction over the next twelve months will be determined by cash conversion rather than EBITDA: if Q3 and Q4 2026 demonstrate positive FCF and a resumption of buybacks at scale, the stock has room to re-rate toward the upper end of sell-side targets (USD 54–59). If receivables, litigation and capex continue to absorb EBITDA, the stock is likely to remain range-bound. On balance, the evidence supports a constructive but execution-dependent stance — a cyclical recovery story with improving visibility, tempered by structural scale and concentration risks.
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View Subscription PlansExecutive Leadership
Executive Leadership Team
| Name | Title | Since | Age (Feb 2026) | Prior roles | Education |
|---|---|---|---|---|---|
Samir Ali | President & CEO | 12 Mar 2026 (EVP & CCO from Aug 2022) | 40 | Diamond Offshore (8 yrs; VP IR & Corporate Development 2017–2022); Bain Capital (debt & equity PM); Simmons & Company (investment banking) | Finance & International Business, New York University (Stern) |
Grant Creed | EVP & Chief Financial Officer | May 2021 (joined 2013) | 45 | Seadrill Chief Restructuring Officer, VP M&A, VP Corporate & Commercial Finance; Deloitte M&A Transaction Services/Audit | Chartered accountant; B.Com Accounting, University of Port Elizabeth |
Torsten Sauer-Petersen | EVP; Chief Technology & Sustainability Officer | EVP Mar 2022; CTSO Aug 2025 (joined 2011) | 53 | Maersk Drilling leadership roles | MBA, IMD Lausanne |
Todd Strickler | SVP & General Counsel | Feb 2023 | 48 | GC & CAO, Wellbore Integrity Services; SVP Admin/GC, Paragon Offshore; Associate GC, Noble Drilling | BS Mechanical Engineering and JD, University of Texas |
Marcel Wieggers | SVP Operations (Seadrill Management) | Dec 2023 | 53 | 15+ years at Seadrill, from Toolpusher to VP Operations (Floaters & HE) | BEng Drilling & Production Technology, Amsterdam UAS; LBS and IMD programs |
Kevin Smith | VP Corporate Finance & Investor Relations | — | — | — | — |
“—” = not publicly disclosed.
Board of Directors
| Director | Background | Notes |
|---|---|---|
Julie J. Robertson (Chair) | Former Executive Chairman, President & CEO, Noble Corporation plc | Independent chair; ≈42.9M votes for vs 0.48M against at 2026 AGM |
Jean Cahuzac | Former CEO, Subsea 7 S.A. | — |
Jan Kjærvik | Former Interim Treasurer, GE Energy businesses (Vernova) | — |
Mark McCollum | Former President & CEO, Weatherford International plc | — |
Harry Quarls | Former Managing Director, Global Infrastructure Partners | — |
Andrew Schultz | Lawyer; turnaround investor and former executive | — |
Paul Smith | Founder & Principal, Collingwood Capital Partners | — |
Jonathan Swinney | Former CFO, EnQuest PLC | — |
Ana Zambelli | Former Managing Director, Brookfield Private Equity | Appointed Feb 2023 |
Major Shareholders
| Holder | Approx. stake (%) | Shares | Source / date |
|---|---|---|---|
BlackRock, Inc. | 7.98 | 4,986,360 | Simply Wall St (2026 snapshot); SentiSense shows 5,486,757 at 30 Jun 2026 13F |
Elliott Management / Elliott Investment Management | 7.3 | 4,558,758 | Simply Wall St; bought 509,400 shares at up to USD 32.02 on 18 Dec 2025 |
The Vanguard Group | 6.1 | 3,807,933 | Simply Wall St |
Canyon Capital Advisors | 5.99 | 3,742,062 | Simply Wall St |
Adage Capital Management | 5.58 | 3,484,940 | Simply Wall St |
Dimensional Fund Advisors | 5.17 | 3,226,446 | Simply Wall St |
UBS Asset Management | 4.77 | 2,975,846 | Simply Wall St |
Patient Capital Management | 3.29 | 2,053,797 | Simply Wall St |
Goehring & Rozencwajg Associates | 3.07 | 2,636,666 (30 Jun 2026) | Simply Wall St / SentiSense |
State Street | ≈3.0 (derived) | 1,871,511 | SentiSense, 30 Jun 2026 |
Competitive Landscape
Key Competitors
| Competitor | Segment overlap | Relative positioning vs Seadrill |
|---|---|---|
Transocean (pending combination with Valaris) | UDW drillships, harsh-environment semis; post-deal also jackups | Combined 73 rigs incl. |
Valaris | Drillships, semis, jackups | Being acquired by Transocean |
Noble Corporation (incl. former Diamond Offshore) | UDW drillships, semis, harsh-environment jackups | Westwood notes Noble held the most secured backlog days for 2027–28 pre-merger; absorbed Diamond Offshore (2024) |
Odfjell Drilling | Harsh-environment semis (Norway) | Direct competitor for West Aquarius/West Phoenix reactivation |
Northern Ocean | Harsh-environment semis | Fredriksen-linked; competes in Norway/UK |
Stena Drilling | Drillships and harsh semis | Private; global floater competitor |
Saipem (drilling offshore) | Drillships/semis | Integrated contractor; Africa, Mediterranean |
Vantage Drilling (merging with Eldorado Drilling) | Drillships, jackups | Smaller; consolidating (2026) |
Constellation Oil Services; Foresea | Brazil floaters | Local Brazilian contractors competing for Petrobras tenders |
Borr Drilling; Shelf Drilling; ADES | Jackups | No longer direct competitors after Seadrill's jackup exit (except West Elara niche) |
Peer Comparison FY2025
| Metric | Seadrill FY2025 | Transocean | Noble | Valaris |
|---|---|---|---|---|
Revenue (USD Mn) | 1,437 | — | — | — |
Revenue growth YoY (%) | 3.8 | — | — | — |
Adjusted EBITDA margin (%) | 24.6 | — | — | — |
R&D intensity (%) | — | Not disclosed separately | Not disclosed separately | Not disclosed separately |
Fleet focus | 15 owned (10 drillships) + 2 managed | Floater/harsh specialist | Diversified floater/HE jackup | Diversified, incl. jackups |
“—” = not publicly disclosed.
