NOV Inc. - Quarter Report: 2025 June (Form 10-Q)

10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM

(Mark one)


	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED


	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number

(Exact name of registrant as specified in its charter)

(State or other jurisdiction

of incorporation or organization)

(IRS Employer

Identification No.)

(Address of principal executive offices)

()

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


	☑	Accelerated filer	☐	Non-accelerated filer	☐
Smaller reporting company		Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

As of July 25, 2025 the registrant had shares of common stock, par value $0.01 per share, outstanding.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

NOV INC.

CONSOLIDATED BALANCE SHEETS

(In millions, except share data)


	June 30,			December 31,
	2025			2024
ASSETS	(Unaudited)
Current assets:
Cash and cash equivalents	$			$
Receivables, net
Inventories, net
Contract assets
Prepaid and other current assets
Total current assets
Property, plant and equipment, net
Lease right-of-use assets, operating
Lease right-of-use assets, financing
Deferred income taxes
Goodwill
Intangibles, net
Investment in unconsolidated affiliates
Other assets
Total assets	$			$
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$			$
Accrued liabilities
Contract liabilities
Current portion of lease liabilities
Current portion of long-term debt
Accrued income taxes
Total current liabilities
Long-term debt
Lease liabilities
Deferred income taxes
Other liabilities
Total liabilities
Commitments and contingencies
Stockholders’ equity:
Common stock - par value $; billion shares authorized; and shares issued and outstanding at June 30, 2025 and December 31, 2024
Additional paid-in capital
Accumulated other comprehensive loss		(	)		(	)
Retained deficit		(	)		(	)
Total Company stockholders’ equity
Noncontrolling interests
Total stockholders’ equity
Total liabilities and stockholders’ equity	$			$

See notes to unaudited consolidated financial statements.

NOV INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(In millions, except per share data)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2025			2024			2025			2024
Revenue	$			$			$			$
Cost of revenue
Gross profit
Selling, general and administrative
Operating profit
Interest and financial costs		(	)		(	)		(	)		(	)
Interest income
Equity income in unconsolidated affiliates
Other expense, net		(	)		(	)		(	)		(	)
Net income before income taxes
Provision for income taxes
Net income
Net income (loss) attributable to noncontrolling interests					(	)					(	)
Net income attributable to Company	$			$			$			$
Net income attributable to Company per share:
Basic	$			$			$			$
Diluted	$			$			$			$
Cash dividends per share	$			$			$			$
Weighted average shares outstanding:
Basic
Diluted

See notes to unaudited consolidated financial statements.

NOV INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(In millions)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2025	2024			2025	2024
Net income	$	$			$	$
Currency translation adjustments			(	)			(	)
Changes in derivative financial instruments, net of tax
Changes in defined benefit plans, net of tax							(	)
Comprehensive income
Comprehensive income (loss) attributable to noncontrolling interests			(	)			(	)
Comprehensive income attributable to Company	$	$			$	$

See notes to unaudited consolidated financial statements.

NOV INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In millions)


	Six Months Ended
	June 30,
	2025			2024
Cash flows from operating activities:
Net income	$			$
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
Deferred income taxes
Equity income in unconsolidated affiliates		(	)		(	)
Dividend from unconsolidated affiliate		—
Stock-based compensation
Gain on business divestiture		—			(	)
Other, net
Change in operating assets and liabilities, net of acquisitions:
Receivables
Inventories		(	)
Contract assets		(	)		(	)
Prepaid and other current assets		(	)		(	)
Accounts payable		(	)		(	)
Accrued liabilities		(	)		(	)
Contract liabilities					(	)
Income taxes payable					(	)
Other assets/liabilities, net					(	)
Net cash provided by operating activities	$
Cash flows from investing activities:
Purchases of property, plant and equipment		(	)		(	)
Business acquisitions, net of cash acquired		—			(	)
Business divestitures, net of cash disposed		—
Other
Net cash used in investing activities	$	(	)	$	(	)
Cash flows from financing activities:
Borrowings against lines of credit and other debt		—
Payments against lines of credit and other debt		(	)		(	)
Cash dividends paid		(	)		(	)
Share repurchases		(	)		(	)
Financing leases		(	)		(	)
Other		(	)		(	)
Net cash used in financing activities		(	)		(	)
Effect of exchange rates on cash					(	)
Increase (decrease) in cash and cash equivalents		(	)
Cash and cash equivalents, beginning of period
Cash and cash equivalents, end of period	$			$

Supplemental disclosures of cash flow information:
Cash payments during the period for:
Interest	$			$
Income taxes	$			$

See notes to unaudited consolidated financial statements.

NOV INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

(In millions)

Shares Issued
and
Outstanding

Common
Stock

Additional
Paid-in
Capital

Accumulated
Other
Comprehensive
Loss

Retained
Deficit

Total
Company
Stockholders’
Equity

Noncontrolling
Interests

Total
Stockholders’
Equity

Balance at December 31, 2024

(

)

(

)

Net income

—

Other comprehensive income

—

Cash dividends, $ per common share

—

(

)

(

)

—

(

)

Stock-based compensation

—

Common stock issued

—

Withholding taxes

(

)

—

(

)

—

(

)

—

(

)

Share repurchases

(

)

—

(

)

—

(

)

—

(

)

Other

(

)

—

(

)

—

(

)

—

Balance at March 31, 2025

(

)

(

)

Net income

—

Other comprehensive income

—

Cash dividends, $ per common share

—

(

)

(

)

—

(

)

Transactions with non-controlling interests

—

(

)

(

)

Stock-based compensation

—

Share repurchases

(

)

—

(

)

—

(

)

—

(

)

Other

—

(

)

—

(

)

(

)

(

)

Balance at June 30, 2025

(

)

(

)

Shares Issued
and
Outstanding

Common
Stock

Additional
Paid-in
Capital

Accumulated
Other
Comprehensive
Loss

Retained
Deficit

Total
Company
Stockholders’
Equity

Noncontrolling
Interests

Total
Stockholders’
Equity

Balance at December 31, 2023

(

)

(

)

Net income

—

Other comprehensive loss

—

(

)

—

(

)

—

(

)

Cash dividends, $ per common share

—

(

)

(

)

—

(

)

Transactions with non-controlling interests

—

(

)

—

Stock-based compensation

—

Common stock issued

—

Withholding taxes

(

)

—

(

)

—

(

)

—

(

)

Other

—

Balance at March 31, 2024

(

)

(

)

Net income

—

(

)

Other comprehensive loss

—

(

)

—

(

)

—

(

)

Cash dividends, $ per common share

—

(

)

(

)

—

(

)

Transactions with non-controlling interests

—

(

)

—

(

)

(

)

(

)

Stock-based compensation

—

Share repurchases

(

)

—

(

)

—

(

)

—

(

)

Other

—

Balance at June 30, 2024

(

)

(

)

See notes to unaudited consolidated financial statements.

NOV INC.

Notes to Consolidated Financial Statements (Unaudited)

Work in process

Finished goods and purchased products

Less: Inventory reserve

(

)

(

)

Total

Vendor costs

Taxes (non-income)

Warranties

Insurance

Commissions

Interest

Fair value of derivatives

Other

Total

)

(

)

(

)

(

)

Accumulated other comprehensive income before
reclassifications

—

Amounts reclassified from accumulated other comprehensive
loss

Balance at June 30, 2025

(

)

(

)

(

)

—

Tax effect

—


	Six Months Ended
	June 30,
	2025											2024
		Currency		Derivative			Employee					Currency		Derivative		Employee
		Translation		Financial			Benefit					Translation		Financial		Benefit
		Adjustments		Instruments			Plans		Total			Adjustments		Instruments		Plans		Total
Revenue		$	—	$			$	—	$			$	—	$		$	—	$
Cost of revenue			—					—					—				—
Selling, general and administrative					—								—		—		—		—
Tax effect			—		(	)		—		(	)		—		—		—		—
		$		$			$		$			$	—	$		$	—	$

The Company’s reporting currency is the U.S. dollar. A majority of the Company’s international entities in which there is a substantial investment have the local currency as their functional currency. As a result, currency translation adjustments resulting from the process of translating the entities’ financial statements into the reporting currency are reported in other comprehensive income (loss).

The effect of changes in the fair values of derivatives designated as cash flow hedges are accumulated in other comprehensive loss, net of tax, until the underlying transactions are realized. The movement in other comprehensive loss from period to period will be the combination of: 1) changes in fair value of open derivatives of $ million and $ million during the three and six months ended June 30, 2025; and, 2) the outflow of other comprehensive loss related to cumulative changes in the fair value of derivatives that have settled in the current period, which were and $ million for the three and six months ended June 30, 2025.

reportable segments, Energy Products and Services, and Energy Equipment, based on the products and services provided, customer base, and operating environment. These reportable segments are determined as those businesses for which results are reviewed regularly by our Chief Executive Officer, who is identified as the Chief Operating Decision Maker, in allocating resources and assessing performance.

—

Intersegment revenue

(

)

—

(

)

—

Total revenue

(

)

(

)

Less:

Cost of revenue (2)

(

)

(

)

Selling, general, and administrative (2)

Depreciation and amortization

(Gain) loss on sales of fixed assets

—

(

)

—

Operating profit

(

)

(

)

Reconciliation to income before income taxes:

Interest and financial costs

—

(

)

(

)

—

(

)

(

)

Interest income

—

Equity income (loss) in unconsolidated affiliates

(

)

—

Other expenses, net

—

(

)

(

)

—

(

)

(

)

Income before income taxes

(

)

(

)

Other segment information:

Capital expenditures


	Six Months Ended
	June 30,
	2025												2024
	Energy Products and Services			Energy Equipment			Eliminations and corporate costs (1)			Total			Energy Products and Services			Energy Equipment		Eliminations and corporate costs (1)			Total
Revenue from external customers	$			$			$	—		$			$			$		$	—		$
Intersegment revenue								(	)		—								(	)		—
Total revenue								(	)										(	)

Less:
Cost of revenue (2)								(	)										(	)
Selling, general, and administrative (2)
Depreciation and amortization
(Gain) loss on sales of fixed assets		(	)		(	)								(	)		—		—			(	)
Operating profit	$			$			$	(	)	$			$			$		$	(	)	$

Reconciliation to income before income taxes:
Interest and financial costs		—			—			(	)		(	)		—			—		(	)		(	)
Interest income		—			—									—			—
Equity income (loss) in unconsolidated affiliates		(	)					—											—
Other expenses, net		—			—			(	)		(	)		—			—		(	)		(	)
Income before income taxes	$			$			$	(	)	$			$			$		$	(	)	$

Other segment information:
Capital expenditures	$			$			$			$			$			$		$			$
Investment in unconsolidated affiliates	$			$			$	—		$			$			$		$	—		$
Goodwill	$			$			$	—		$			$			$		$	—		$
Intangibles, net	$			$			$	—		$			$			$		$	—		$
Total assets	$			$			$			$			$			$		$			$

million and $ million, respectively, reported in “Cost of Revenue,” primarily related to severance and other restructuring costs. Operating profit included charges of $ million and $ million for the three and six months ended June 30, 2025, respectively, reported in “Selling, General, and Administrative.” These charges were primarily related to streamlining our business processes during the second quarter of 2025, and the deconsolidation of the Company’s Russian subsidiaries in the first quarter of 2025. Operating profit for the three and six months ended June 30, 2024, included a credit of $ million and $ million, respectively, reported in “Cost of Revenue,” primarily attributed to a pre-tax gain on the sale of a business during the second quarter of 2024.


	Three Months Ended
	June 30,
	2025							2024
	Energy Products and Services		Energy Equipment		Corporate		Total	Energy Products and Services		Energy Equipment			Corporate		Total
Other Items included in:
Cost of revenue	$		$		$	—	$	$		$	(	)	$	—	$	(	)
Selling, general, and administrative		—		—					—		—			—		—
Total	$		$		$		$	$		$	(	)	$	—	$	(	)


	Six Months Ended
	June 30,
	2025					2024
	Energy Products and Services	Energy Equipment		Corporate	Total	Energy Products and Services		Energy Equipment			Corporate		Total
Other Items included in:
Cost of revenue	$	$		$	$	$		$	(	)	$		$	(	)
Selling, general, and administrative			—				—		—			—		—
Total	$	$		$	$	$		$	(	)	$		$	(	)

—

International

—

Intersegment revenue

(

)

(

)

(

)

(

)

Land

—

Offshore

—

Intersegment revenue

(

)

(

)

(

)

(

)

—

International

—

Intersegment revenue

(

)

(

)

(

)

(

)

Land

—

Offshore

—

Intersegment revenue

(

)

(

)

(

)

(

)

Capital equipment

Product sales

Intersegment revenue

Total

Energy Equipment:

Capital equipment

Aftermarket

Intersegment revenue

Total

Eliminations

(

)

(

)

Total consolidated


	Six Months Ended
	June 30,
	2025			2024
Energy Products and Services:
Services & rental	$			$
Capital equipment
Product sales
Intersegment revenue
Total

Energy Equipment:
Capital equipment
Aftermarket
Intersegment revenue
Total

Eliminations		(	)		(	)

Total consolidated	$			$

million for the six months ended June 30, 2025 primarily due to change orders.

Remaining performance obligations represent the transaction price of firm orders for all revenue streams for which work has not been performed on contracts with original expected duration of one year or more. We do not disclose the remaining performance obligations of royalty contracts, service contracts for which there is a right to invoice, and short-term contracts that are expected to have a duration of one year or less. As of June 30, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $ million. Although numerous factors can affect timing of revenue recognized on performance obligations, such as customer change orders and supplier accelerations or delays, the Company expects to recognize approximately $ million in revenue for the remaining performance obligations in the remainder of 2025, $ million in 2026, $ million in 2027, and $ million thereafter.

Contract Assets and Liabilities

Contract assets include unbilled amounts when revenue recognized exceeds the amount billed to the customer under contracts where revenue is recognized over-time. Contract liabilities consist of customer billings in excess of revenue recognized under over-time contracts, customer advance payments and deferred revenue.

Billings

(

)

Revenue recognized

(

)

Currency translation adjustments and other

Balance at June 30, 2025

Royalty Revenue

The Company recognizes royalty revenue due under various licenses for the Company’s intellectual property, including for technology related to drill bits. The Company recognized revenue for drill bit licenses of approximately $ million and $ million for the three and six months ended June 30, 2025, and $ million and $ million for the three and six months ended June 30, 2024. The Company is currently pursuing litigation against certain non-paying licensees, which will impact our ability to collect the receivables timely. As such, revenue and the related receivables are recorded at a discount to reflect the delayed timing of future cash collections. As of June 30, 2025, the receivables of $ million, net of allowances of $ million for credit losses and $ million for the remaining timing related discount, are included in Other assets on the Consolidated Balance Sheets. These allowances do not impact the amount the Company is entitled to recover on its claims from the licensees in litigation. While we continue to believe it is probable the Company will collect all or substantially all of the consideration to which it is entitled pursuant to the terms of the licensing agreements, the Company will also continue to evaluate the credit quality of the receivables. See Note 15 for discussion of the ongoing litigation.

Allowance for Credit Losses

The Company estimates its allowance for credit losses using information about past events, current conditions and risk characteristics of each customer, and reasonable and supportable forecasts relevant to assessing risk associated with the collectability of receivables and contract assets. The Company’s customer base, mostly in the oil and gas industry, have generally similar collectability risk characteristics, although larger and state-owned customers may have lower risk than smaller independent customers. As of June 30, 2025, the allowance for credit losses totaled $ million.

Provision for expected credit losses

Recoveries collected

(

)

Reclass for long-term receivables

(

)

Write-offs

(

)

Other

(

)

Balance at June 30, 2025

Financing

Total

June 30,

December 31,

2025

2024

Long-term portion of lease liabilities:

Operating

Financing

Total

billion in Senior Notes, interest at % payable
semiannually, principal due on

$ billion in Senior Notes, interest at % payable
semiannually, principal due on

Other debt

Total debt

Less current portion

Long-term debt

The Company has a revolving credit facility with a borrowing capacity of $ billion through September 12, 2029. The Company has the right to increase the aggregate commitments under this agreement to an aggregate amount of up to $ billion upon the consent of only those lenders holding any such increase. Interest under the multicurrency facility is based upon plus % subject to a ratings-based grid or the U.S. prime rate. The credit facility contains a financial covenant establishing a maximum debt-to-capitalization ratio of %. As of June 30, 2025, the Company was in compliance with a debt-to-capitalization ratio of % and had outstanding borrowings or letters of credits issued under the facility, resulting in $ billion of available funds.

A consolidated joint venture of the Company borrowed $ million against a $ million bank line of credit, payable by , for the construction of a facility in Saudi Arabia. Interest under the bank line of credit is based upon SOFR plus %. The bank line of credit contains a financial covenant regarding maximum debt-to-equity ratio of %. As of June 30, 2025, the joint venture was in compliance and will not have future borrowings on the line of credit. As of June 30, 2025, the Company has $ million in borrowings related to this line of credit. The carrying value of debt under the Company’s consolidated joint venture approximates fair value because the interest rates are variable and reflective of current market rates. The Company has $ million in payments related to this line of credit due in the next twelve months. The Company can repay the entire outstanding facility balance without penalty at its sole discretion.

Other debt at June 30, 2025 included $ million of amounts owed to current and former minority interest partners of NOV consolidated joint ventures, of which $ million is due in the next twelve months.

The Company had $ million of outstanding letters of credit at June 30, 2025, primarily in Norway and the United States, that are under various bilateral letter of credit facilities. Letters of credit are issued as bid bonds, advanced payment bonds and performance bonds.

million and $ million, respectively. The fair value of the Company’s debt is estimated using Level 2 inputs in the GAAP fair value hierarchy and is based on quoted prices for those of similar instruments. At June 30, 2025 and December 31, 2024, the carrying value of the Company’s unsecured Senior Notes approximated $ million and $ million, respectively.

% and %, respectively, compared to % and % for the same period in 2024. The U.S. statutory tax rate was % for the periods presented. The effective tax rate for the six months ended June 30, 2025 was positively impacted by the release of previously recorded reserves for uncertain tax positions of $ million, partially offset by an increase to reserves for uncertain tax positions of $ million, unfavorable adjustments related to the carrying value of deferred tax assets of $ million, changes in certain foreign currency exchange rates of $ million, and a mix of earnings in higher tax rate jurisdictions. The effective tax rate for the six months ended June 30, 2024 was negatively impacted by a mix of earnings in higher tax rate jurisdictions, losses in certain jurisdictions with no tax benefit, and adjustments to the carrying value of deferred tax assets, partially offset by the reduction of valuation allowances related to U.S. and state deferred tax assets.

million. At June 30, 2025, approximately million shares remained available for future grants under the NOV Plan. The Company also has outstanding awards under its former stock-based compensation plan known as the National Oilwell Varco, Inc. Long-Term Incentive Plan (the “Former Plan”); however, the Company is no longer granting new awards under the Former Plan.

On May 20, 2025, the Company granted restricted stock units with a fair value of $ per share. The awards were granted to non-employee members of the board of directors and vest on the first anniversary of the grant date.

Total expense for all stock-based compensation arrangements was $ million and $ million for the three and six months ended June 30, 2025, respectively, and $ million and $ million for the three and six months ended June 30, 2024, respectively.

The total income tax expense (benefit) recognized in the Consolidated Statements of Income for stock-based compensation arrangements was $() million and $ million for the three and six months ended June 30, 2025, respectively, and $() million and $ million for the three and six months ended June 30, 2024, respectively.

COP

South Korean Won

KRW

Norwegian Krone

NOK

Japanese Yen

JPY

U.S. Dollar

USD

Mexican Peso

MXN

Euro

EUR

South African Rand

ZAR

Singapore Dollar

SGD

British Pound Sterling

GBP

—

Danish Krone

DKK

Canadian Dollar

CAD

—

CAD

Cash Flow Hedging Strategy

To protect against the volatility of forecasted foreign currency cash flows resulting from forecasted revenues and expenses, the Company maintains a cash flow hedging program. For derivative instruments that are designated and qualify as a cash flow hedge, the gain or loss on the derivative instrument is recorded in accumulated other comprehensive loss and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period or periods during which the hedged transaction affects earnings (e.g., in “revenues” when the hedged transactions are cash flows associated with forecasted revenues). The Company includes time value in hedge relationships.

The Company expects accumulated other comprehensive income of $ million will be reclassified into earnings within the next twelve months.

Non-designated Hedging Strategy

The Company enters into forward exchange contracts to hedge certain nonfunctional currency monetary accounts. The gain or loss on the derivative instrument is recognized in earnings in other income (expense), together with the changes in the hedged nonfunctional monetary accounts.

The amount of gain recognized in Other Expense, net was $ million and $ million for the three and six months ended June 30, 2025, respectively, and $ million and $ million for the three and six months ended June 30, 2024, respectively.

Accrued liabilities

Foreign exchange contracts

Other assets

—

Other liabilities

—

Designated total

Derivatives not designated as hedging
instruments under ASC Topic 815

Foreign exchange contracts

Prepaid and other current assets

Accrued liabilities

Foreign exchange contracts

Other assets

—

Other liabilities

Non-designated total

Total

Denominator:

Basic—weighted average common shares outstanding

Dilutive effect of employee stock options and other
unvested stock awards

Diluted—weighted average common shares outstanding

Net income attributable to Company per share:

Basic

Diluted

Cash dividends per share

The Company had stock options outstanding that were anti-dilutive totaling million and million shares for the three and six months ended June 30, 2025, respectively, compared to million shares for each of the three and six months ended June 30, 2024, respectively.

million and $ million for the three and six months ended June 30, 2025, compared to $ million and $ million for the three and six months ended June 30, 2024. The declaration and payment of future dividends is at the discretion of the Company’s Board of Directors and will be dependent upon the Company’s results of operations, financial condition, capital requirements and other factors deemed relevant by the Company’s Board of Directors.

billion of the currently outstanding shares of the Company’s common stock over a period of months. Under the share repurchase program, the Company may repurchase shares from time to time through open market purchases, in privately negotiated transactions or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, in accordance with applicable securities laws and other restrictions, including Rule 10b-18. The timing and total amount of any stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices and other considerations.

The Company intends to fund the repurchases using its available U.S. cash balances, which may involve the repatriation of foreign earnings not indefinitely reinvested. However, depending on U.S. cash balances, the Company may choose to borrow against its revolving credit facility or issue new debt to finance the repurchases. As shares are repurchased, they are constructively retired and returned to an unissued state. During the three months ended June 30, 2025, the Company repurchased approximately million shares of common stock under the program for an aggregate amount of $ million. During the six months ended June 30, 2025, the Company repurchased million shares of common stock under the program for an aggregate amount of $ million.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Introduction

NOV is a leading independent equipment and technology provider to the global energy industry. NOV and its predecessor companies have spent over 160 years helping transform oil and gas development and improving its cost-effectiveness, efficiency, safety, and environmental impact. Over the past few decades, the Company has pioneered and refined key technologies to improve the economic viability of frontier resources, including unconventional and deepwater oil and gas. More recently, by applying its deep expertise and technology, the Company has developed solutions to improve the economics of alternate energy sources.

NOV’s extensive proprietary technology portfolio supports the industry’s drilling, completion, and production needs. With unmatched cross-segment capabilities, scope, and scale, NOV continues to develop and introduce technologies that further enhance the economics and efficiencies of energy production, with a focus on digital solutions, including automation, predictive analytics, and condition-based maintenance.

NOV serves major-diversified, national, and independent service companies, contractors, and energy producers in 57 countries. NOV operates under two segments, Energy Products and Services and Energy Equipment.

Results of operations are presented in accordance with GAAP. Certain reclassifications have been made to prior period financial information in order to conform with current period presentation. The Company discloses Adjusted EBITDA (defined as operating profit excluding depreciation, amortization, gains and losses on sales of fixed assets and, when applicable, Other Items) in its periodic earnings press releases and other public disclosures to provide investors additional information about the results of ongoing operations. See “Non-GAAP Financial Measures and Reconciliations in Results of Operations” for an explanation of our use of non-GAAP financial measures and reconciliations to their corresponding measures calculated in accordance with GAAP.

Energy Products and Services

The Company’s Energy Products and Services segment primarily designs, manufactures, rents, and sells products and equipment used in drilling, intervention, completion, and production activities. Products include drill bits, downhole tools, premium drill pipe, drilling fluids, managed pressure drilling, integral and weld-on connectors for conductor strings and surface casing, completion tools, and artificial lift systems. The segment also designs, manufactures, and delivers high-end composite pipe, tanks, and structures engineered to solve both corrosion and weight challenges in a wide variety of applications, including oil and gas, chemical, industrial, wastewater, fuel handling, marine and offshore, and rare earth mineral extraction.

In addition to product and equipment sales, the segment provides services, software, and digital solutions to improve drilling and completion operational performance. Services include tubular inspection and coating, solids control, waste management, and managed pressure drilling. Software and digital solutions offered include drilling and completion optimization and remote monitoring (via downhole and surface instrumentation), wired drill pipe services, software controls and applications, and data management and analytics services at the edge and in the cloud.

Energy Products and Services serves oil and gas companies, drilling contractors, oilfield service companies, oilfield equipment rental companies and developers of geothermal energy. Demand for the segment’s products and services primarily depends on the level of oilfield drilling activity by oil and gas companies, drilling contractors, and oilfield service companies. Demand for the segment’s composite solutions serving applications outside of oil and gas are driven by industrial activity, infrastructure spend, and population growth.

Energy Equipment

The Company’s Energy Equipment segment manufactures and supports the capital equipment and integrated systems needed for oil and gas exploration and production, both onshore and offshore, as well as for other marine-based, industrial and renewable energy markets.

The segment designs, manufactures, and integrates technologies for drilling and producing oil and gas wells. This includes equipment and technologies needed for drilling, including land rigs, offshore drilling equipment packages, drilling rig components, and software control systems that mechanize and automate the drilling process and rig functionality; hydraulic fracture stimulation; well intervention, including coiled tubing units, coiled tubing, and wireline units and tools; cementing products; onshore production, including fluid processing, and surface transfer as well as progressive cavity pumps; offshore production, including integrated production systems and subsea production technologies; and aftermarket support of these technologies, providing spare parts, service, and repair.

Energy Equipment primarily serves contract drillers, oilfield service companies, and oil and gas companies. Demand for the segment’s products primarily depends on capital spending plans by drilling contractors, service companies, and oil and gas companies, and secondarily on the overall level of oilfield drilling, completions, and workover activity which drives demand for equipment, spare parts, service, and repair for the segment’s large installed base of equipment.

The segment also serves marine and offshore markets, where it designs and builds equipment for wind turbine installation and cable lay vessels, and offers heavy lift cranes and jacking systems; industrial markets, where the segment provides pumps and mixers for a wide breadth of industrial end markets; and other energy transition markets, where it is applying its gas processing expertise to provide solutions that aid in wind power development, hydrogen production and carbon sequestration.

Critical Accounting Policies and Estimates

In our annual report on Form 10-K for the year ended December 31, 2024, we identified our most critical accounting policies. In preparing the financial statements, we make assumptions, estimates and judgments that affect the amounts reported. We periodically evaluate our estimates and judgments that are most critical in nature which are related to revenue recognition under long-term construction contracts, impairment of goodwill and other indefinite-lived intangible assets, and income taxes. Our estimates are based on historical experience and on our future expectations that we believe are reasonable. The combination of these factors forms the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results are likely to differ from our current estimates and those differences may be material.

EXECUTIVE SUMMARY

For the second quarter ended June 30, 2025, the Company generated revenues of $2.19 billion, a decrease of one percent compared to the second quarter of 2024. Net income decreased 52 percent to $108 million, or $0.29 per share, and operating profit decreased 54 percent to $143 million, or 6.5 percent of sales. The decline in net income and operating profit is primarily attributed to a pre-tax gain of approximately $130 million on the sale of a business during the second quarter of 2024. The Company recorded $19 million within Other Items during the second quarter of 2025, primarily related to severance costs, facility closures and streamlining our business processes. Adjusted EBITDA (operating profit excluding depreciation, amortization, gains and losses on sales of fixed assets and, when applicable, Other Items) decreased 10 percent year-over-year to $252 million, or 11.5 percent of sales.

Segment Performance

Energy Products and Services

Energy Products and Services generated revenues of $1.03 billion in the second quarter of 2025, a decrease of two percent from the second quarter of 2024. Operating profit decreased $45 million from the prior year to $83 million, or 8.1 percent of sales, and included $6 million in Other Items. Adjusted EBITDA decreased $38 million from the prior year to $146 million, or 14.2 percent of sales. The decline in revenue was due to lower levels of global drilling activity affecting demand for the segment’s shorter cycle consumable products, partially offset by higher sales from the segment’s capital equipment offerings. Profitability was impacted by a less favorable sales mix, tariffs and other inflationary pressures, and certain charges in Latin America.

Energy Equipment

Energy Equipment generated revenues of $1.21 billion in the second quarter of 2025, flat when compared to the second quarter of 2024. Operating profit was $122 million, or 10.1 percent of sales, and included $9 million in Other Items. Operating profit decreased $110 million from the prior year primarily attributed to a pre-tax gain of approximately $130 million on the sale of a business during the second quarter of 2024. Adjusted EBITDA increased $16 million from the prior year to $158 million, or 13.1 percent of sales. Higher revenue out of backlog offset lower sales of aftermarket parts and services. Improved profitability was driven by strong execution on higher-margin backlog.

New orders booked during the quarter totaled $420 million, a decrease of $557 million when compared to the $977 million of new orders booked during the second quarter of 2024. Orders shipped from backlog in the second quarter of 2025 were $632 million, representing a book-to-bill of 66 percent, compared to $553 million orders shipped and a book-to-bill of 177 percent in the second quarter of 2024. As of June 30, 2025, backlog for capital equipment orders for Energy Equipment was $4.30 billion, a decrease of $31 million from the second quarter of 2024.

Oil & Gas Equipment and Services Market and Outlook

Macroeconomic uncertainties have recently intensified due to geopolitical conflicts, rapidly evolving changes to trade policies, and the decision by OPEC+ to return larger than anticipated quantities of oil to the market. These changes are raising concerns for both supply and demand related challenges to global commodity markets, resulting in lower oil prices, significant market volatility, and greater uncertainty.

Current market conditions present a difficult environment for making capital investment decisions, and the outlook remains uncertain, with clearer downside risk than upside. However, management does not expect near-term volatility to affect broader industry trends including: (1) offshore and international resources becoming the primary source for future incremental supplies of oil to meet global demand; (2) growing focus on natural gas from deepwater and unconventional resources to meet growing global demand for power; and (3) the application of emerging technologies to drive efficiencies and productivity in energy operations.

NOV remains focused on the development and commercialization of innovative products and services that lower the marginal cost and environmental footprint of energy production. We believe this strategy along with continued efforts to improve organizational efficiencies will further advance the Company’s competitive position in any market environment.

Operating Environment Overview

The Company’s results are dependent on, among other things, the level of worldwide oil and gas drilling, well remediation activity, the prices of crude oil and natural gas, capital spending by exploration and production companies and drilling contractors, worldwide oil and gas inventory levels and, to a lesser degree, the level of investment in wind and geothermal energy projects. Key industry indicators for the second quarter of 2025 and 2024, and the first quarter of 2025 include the following:


							% increase (decrease)
							2Q25 v			2Q25 v
	2Q25*		2Q24*		1Q25*		2Q24			1Q25
Active Drilling Rigs:
U.S.		571		602		588		(5.1	%)		(2.9	%)
Canada		129		137		216		(5.8	%)		(40.3	%)
International		897		956		904		(6.2	%)		(0.8	%)
Worldwide		1,597		1,695		1,708		(5.8	%)		(6.5	%)

West Texas Intermediate Crude Prices (per barrel)	$	64.63	$	81.71	$	71.84		(20.9	%)		(10.0	%)

Natural Gas Prices ($/mmbtu)	$	3.19	$	2.08	$	4.15		53.4	%		(23.1	%)

* Averages for the quarters indicated. See sources below.

The Company is engaged with a variety of energy projects, including wind, geothermal, and carbon capture and sequestration. Management expects to see continued growth in these areas.

The following table details the U.S., Canadian, and international rig activity and West Texas Intermediate Crude Oil prices for the past nine quarters ended June 30, 2025, on a quarterly basis:

Source: Rig count: Baker Hughes, Inc. (www.bakerhughes.com); West Texas Intermediate Crude Oil and Natural Gas Prices: US Department of Energy, Energy Information Administration (www.eia.doe.gov).

The worldwide quarterly average rig count decreased 6 percent (from 1,708 to 1,597) in the second quarter of 2025 when compared to the first quarter of 2025. The average per barrel price of West Texas Intermediate Crude Oil decreased 10 percent (from $71.84 per barrel to $64.63 per barrel) and natural gas prices decreased 23 percent (from $4.15 per mmbtu to $3.19 per mmbtu) in the second quarter of 2025 compared to the first quarter of 2025.

On July 25, 2025, there were 724 rigs actively drilling in North America, comprised of U.S. and Canada, which increased when compared to the second quarter average of 700 rigs. The price for West Texas Intermediate Crude Oil was $65.16 per barrel at July 25, 2025, an increase of 1 percent from the second quarter of 2025 average. The price for natural gas was $3.16 per mmbtu at July 25, 2025, a decrease of 1 percent from the second quarter of 2025 average.

Results of Operations

Financial results by operating segment are as follows (in millions):


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2025			2024			2025			2024
Revenue:
Energy Products and Services	$	1,025		$	1,050		$	2,017		$	2,067
Energy Equipment		1,207			1,204			2,353			2,382
Eliminations		(44	)		(38	)		(79	)		(78	)
Total revenue	$	2,188		$	2,216		$	4,291		$	4,371

Operating profit:
Energy Products and Services	$	83		$	128		$	166		$	249
Energy Equipment		122			232			256			327
Eliminations and corporate costs		(62	)		(47	)		(127	)		(101	)
Total operating profit	$	143		$	313		$	295		$	475

Energy Products and Services

three and six months ended June 30, 2025 and 2024. Revenue from Energy Products and Services was $1,025 million for the three months ended June 30, 2025, compared to $1,050 million for the three months ended June 30, 2024, a decrease of $25 million or 2 percent. For the six months ended June 30, 2025, revenue from Energy Products and Services was $2,017 million compared to $2,067 million for the six months ended June 30, 2024, a decrease of $50 million or 2 percent. The decline in revenue was primarily driven by lower levels of global drilling activity on a 6 percent year-over-year decrease in the worldwide rig count, which impacted demand for the segment’s shorter-cycle consumable products and led to a decline in sales by 20 percent on a quarter-to-date basis and 17 percent year-to-date. The decrease in the quarter-to-date period was partially offset by higher sales in the segment’s capital equipment offerings, which saw a 3 percent quarter-to-date increase in sales.

Operating profit from Energy Products and Services was $83 million for the three months ended June 30, 2025, compared to an operating profit of $128 million for the three months ended June 30, 2024, a decrease of $45 million. For the six months ended June 30, 2025, operating profit from Energy Products and Services was $166 million compared to operating profit of $249 million for the six months ended June 30, 2024, a decrease of $83 million. The decrease in profitability was impacted by a less favorable sales mix, tariffs and other inflationary pressures, and certain charges in Latin America.

Energy Equipment

three and six months ended June 30, 2025 and 2024. Revenue from Energy Equipment was $1,207 million for the three months ended June 30, 2025, compared to $1,204 million for the three months ended June 30, 2024, an increase of $3 million. For the six months ending June 30, 2025, revenue from Energy Equipment was $2,353 million compared to $2,382 million for the six months ending June 30, 2024, a decrease of $29 million or 1 percent. Revenue remained relatively flat in the second quarter of 2025 compared to prior year, as a 14 percent increase in revenue out of backlog offset a 17 percent decline in sales of aftermarket parts and services. Year-to-date, the reduced activity levels in the North American land market contributed to a 6 percent decline in sales. Additionally, lower demand for aftermarket parts and services contributed to a 14 percent decline in sales.

Operating profit from Energy Equipment was $122 million for the three months ended June 30, 2025, compared to an operating profit of $232 million for the three months ended June 30, 2024, a decrease of $110 million. For the six months ended June 30, 2025, operating profit from Energy Equipment was $256 million compared to operating profit of $327 million for the six months ended June 30, 2024, a decrease of $71 million. Lower profitability is attributed to a pre-tax gain of approximately $130 million on the sale of a business during the second quarter of 2024. Excluding this gain, the segment experienced improved profitability, which was driven by strong execution on higher-margin backlog.

The Energy Equipment segment monitors its capital equipment backlog to plan its business. New orders are added to backlog only when the Company receives a firm written order for major completion and production components or a contract related to a construction project. The capital equipment backlog was $4,300 million at June 30, 2025, a decrease of $31 million from backlog of $4,331 million at June 30, 2024. Although numerous factors can affect the timing of revenue out of backlog (including, but not limited to, customer change orders and supplier accelerations or delays), the Company reasonably expects approximately 27 percent of backlog to become revenue during the rest of 2025 and the remainder thereafter. At June 30, 2025, approximately 52 percent of the capital equipment backlog was for offshore products and approximately 92 percent of the capital equipment backlog was destined for international markets.

Eliminations and corporate costs

Eliminations and corporate costs were $62 million and $127 million for the three and six months ended June 30, 2025, compared to $47 million and $101 million for the three and six months ended June 30, 2024.

Sales from one segment to another generally are priced at estimated equivalent commercial selling prices; however, segments originating an external sale are credited with the full profit to the company. Eliminations include intercompany transactions conducted between the two reporting segments that are eliminated in consolidation. Intrasegment transactions are eliminated within each segment. Eliminations increased 11 percent when compared to the second quarter of 2024 due to higher intrasegment activity, while eliminations remained flat year-to-date.

Corporate costs increased 35 percent from the second quarter of 2024 primarily due to higher legal costs, self-insured property losses, and corporate reserves. For the six months ended June 30, 2025, corporate costs increased 31 percent year-over-year due to the non-recurring charge of $5 million related to the deconsolidation of our Russian subsidiaries in the first quarter of 2025, higher legal costs, self-insured property losses, and corporate reserves.

Interest and financial costs and Interest Income

Interest and financial costs were $22 million and $44 million for the three and six months ended June 30, 2025, compared to $22 million and $46 million for the three and six months ended June 30, 2024. The year-over-year decrease for the six month period was primarily due to debt borrowings on the revolving credit facility in the first half of 2024.

Interest income was $10 million and $21 million for the three and six months ended June 30, 2025, compared to $8 million and $16 million for the three and six months ended June 30, 2024. The increase was primarily related to interest earned on larger cash balances in the current year compared to prior year.

Equity income in unconsolidated affiliates

Equity income in unconsolidated affiliates was $1 million for each of the three and six months ended June 30, 2025, compared to $8 million and $37 million for the three and six months ended June 30, 2024. Sales for our largest investment in unconsolidated affiliates declined 21 percent for the second quarter of 2025 when compared to the second quarter of 2024. For the six months ended June 30, 2025, sales declined 39 percent year-over-year. The decline in sales is primarily due to pricing pressures and lower volume for oil country tubular goods, as well as higher cost for labor and materials, which led to lower profitability year-over-year.

Other expense, net

Other expense, net was $17 million and $37 million for the three and six months ended June 30, 2025, compared to $14 million and $24 million for the three and six months ended June 30, 2024, respectively. The change in expense was primarily due to larger foreign currency fluctuations in the current year, particularly with the devaluation of the U.S. Dollar.

Provision for income taxes

The effective tax rate was 0.9% and 20.3% for the three and six months ended June 30, 2025, respectively, compared to 23.9% and 24.9% for the three and six months ended June 30, 2024. The effective tax rate for the six months ended June 30, 2025 was positively impacted by the release of previously recorded reserves for uncertain tax positions of $58 million, partially offset by an increase to reserves for uncertain tax positions of $23 million, unfavorable adjustments related to the carrying value of deferred tax assets of $14 million, changes in certain foreign currency exchange rates of $4 million, and a mix of earnings in higher tax rate jurisdictions. The effective tax rate for the six months ended June 30, 2024 was negatively impacted by a mix of earnings in higher tax rate jurisdictions, losses in certain jurisdictions with no tax benefit, and adjustments to the carrying value of deferred tax assets, partially offset by the reduction of valuation allowances related to U.S. and state deferred tax assets.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. We are currently evaluating the full effects of the legislation on our consolidated financial statements. As the legislation was signed into law after the close of our second quarter, the impacts are not included in our operating results for the six months ended June 30, 2025.

Non-GAAP Financial Measures and Reconciliations

This Form 10-Q contains certain non-GAAP financial measures that management believes are useful tools for internal use and the investment community in evaluating NOV’s overall financial performance. These non-GAAP financial measures are broadly used to value and compare companies in the oilfield services and equipment industry. Not all companies define these measures in the same way. In addition, these non-GAAP financial measures are not a substitute for financial measures prepared in accordance with GAAP and should therefore be considered only as supplemental to such GAAP financial measures.

The Company defines Adjusted EBITDA as operating profit excluding depreciation, amortization, gains and losses on sales of fixed assets and, when applicable, Other Items. Adjusted EBITDA % is a ratio showing Adjusted EBITDA as a percentage of sales. Management believes this is important information to provide because it is used by management to evaluate the Company’s operational performance and trends between periods and manage the business. Management also believes this information may be useful to investors and analysts to gain a better understanding of the Company’s results of ongoing operations. Adjusted EBITDA and Adjusted EBITDA % are not intended to replace GAAP financial measures, such as Net Income and Operating Profit %.

Additionally, Excess Free Cash Flow is defined as cash flows from operations less capital expenditures and other investments, including acquisitions and divestitures. Excess Free Cash Flow does not represent the Company’s residual cash flow available for discretionary expenditures, as the calculation of these measures does not account for certain debt service requirements or other non-discretionary expenditures.

The following tables set forth the reconciliation of Adjusted EBITDA to its most comparable GAAP financial measure (in millions):


	Three Months Ended									Six Months Ended
	June 30,						March 31,			June 30,
	2025			2024			2025			2025			2024
Operating profit:
Energy Products and Services	$	83		$	128		$	83		$	166		$	249
Energy Equipment		122			232			134			256			327
Eliminations and corporate costs		(62	)		(47	)		(65	)		(127	)		(101	)
Total operating profit	$	143		$	313		$	152		$	295		$	475

Operating profit %:
Energy Products and Services		8.1	%		12.2	%		8.4	%		8.2	%		12.0	%
Energy Equipment		10.1	%		19.3	%		11.7	%		10.9	%		13.7	%
Eliminations and corporate costs		—			—			—			—			—
Total operating profit %		6.5	%		14.1	%		7.2	%		6.9	%		10.9	%

Other items, net:
Energy Products and Services	$	6		$	1		$	5		$	11		$	1
Energy Equipment		9			(119	)		3			12			(123	)
Corporate		4			—			5			9			1
Total other items	$	19		$	(118	)	$	13		$	32		$	(121	)

(Gain) loss on sales of fixed assets:
Energy Products and Services	$	—		$	—		$	(2	)	$	(2	)	$	(1	)
Energy Equipment		(1	)		—			—			(1	)		—
Corporate		4			—			—			4			—
Total (gain) loss on sales of fixed assets	$	3		$	—		$	(2	)	$	1		$	(1	)

Depreciation & amortization:
Energy Products and Services	$	57		$	55		$	59		$	116		$	109
Energy Equipment		28			29			28			56			57
Corporate		2			2			2			4			3
Total depreciation & amortization	$	87		$	86		$	89		$	176		$	169

Adjusted EBITDA:
Energy Products and Services	$	146		$	184		$	145		$	291		$	358
Energy Equipment		158			142			165			323			261
Eliminations and corporate costs		(52	)		(45	)		(58	)		(110	)		(97	)
Total Adjusted EBITDA	$	252		$	281		$	252		$	504		$	522

Adjusted EBITDA %:
Energy Products and Services		14.2	%		17.5	%		14.6	%		14.4	%		17.3	%
Energy Equipment		13.1	%		11.8	%		14.4	%		13.7	%		11.0	%
Eliminations and corporate costs		—			—			—			—			—
Total Adjusted EBITDA %		11.5	%		12.7	%		12.0	%		11.7	%		11.9	%

Reconciliation of Adjusted EBITDA:
GAAP net income attributable to Company	$	108		$	226		$	73		$	181		$	345
Noncontrolling interests		6			(3	)		1			7			(1	)
Provision for income taxes		1			70			47			48			114
Interest and financial costs		22			22			22			44			46
Interest income		(10	)		(8	)		(11	)		(21	)		(16	)
Equity income in unconsolidated affiliates		(1	)		(8	)		—			(1	)		(37	)
Other expense, net		17			14			20			37			24
(Gain) loss on sales of fixed assets		3			—			(2	)		1			(1	)
Depreciation and amortization		87			86			89			176			169
Other items, net		19			(118	)		13			32			(121	)
Total Adjusted EBITDA	$	252		$	281		$	252		$	504		$	522

Liquidity and Capital Resources

Overview

At June 30, 2025, the Company had cash and cash equivalents of $1,080 million and total debt of $1,728 million. At December 31, 2024, cash and cash equivalents were $1,230 million and total debt was $1,740 million. As of June 30, 2025, approximately $594 million of the $1,080 million of cash and cash equivalents was held by our foreign subsidiaries and the earnings associated with this cash could be subject to foreign withholding taxes and incremental U.S. taxation if transferred among countries or repatriated to the U.S. If opportunities to invest in the U.S. are greater than available cash balances that are not subject to income tax, rather than repatriating cash, the Company may choose to borrow against its revolving credit facility.

The Company has a revolving credit facility with a borrowing capacity of $1.5 billion through September 12, 2029. The Company has the right to increase the aggregate commitments under this agreement to an aggregate amount of up to $2.5 billion upon the consent of only those lenders holding any such increase. Interest under the multicurrency facility is based upon Secured Overnight Financing Rate (SOFR), Euro Interbank Offered Rate (EURIBOR), Sterling Overnight Index Average (SONIA), Canadian Overnight Repo Rate Average (CORRA), or Norwegian Interbank Offered Rate (NIBOR), plus 1.25% subject to a ratings-based grid or the U.S. prime rate. The credit facility contains a financial covenant establishing a maximum debt-to-capitalization ratio of 60%. As of June 30, 2025, the Company was in compliance with a debt-to-capitalization ratio of 23.4% and had no borrowings or letters of credits issued under the facility, resulting in $1.5 billion of available funds.

A consolidated joint venture of the Company borrowed $120 million against a $150 million bank line of credit, payable by June 2032, for the construction of a facility in Saudi Arabia. Interest under the bank line of credit is based upon SOFR plus 1.40%. The bank line of credit contains a financial covenant regarding maximum debt-to-equity ratio of 75%. As of June 30, 2025, the joint venture was in compliance and will not have future borrowings on the line of credit. As of June 30, 2025, the Company had $89 million in borrowings related to this line of credit. The Company has $11 million in payments related to this line of credit due in the next twelve months. The Company can repay the entire outstanding facility balance without penalty at its sole discretion.

Other debt at June 30, 2025 included $50 million of amounts owed to current and former minority interest partners of NOV consolidated joint ventures, of which $27 million is due in the next twelve months.

The Company’s outstanding debt at June 30, 2025 also consisted of $1,091 million in 3.95% Senior Notes, maturing on December 1, 2042, and $497 million in 3.60% Senior Notes, maturing on December 31, 2029. The Company was in compliance with all covenants at June 30, 2025. Long-term lease liabilities totaled $540 million at June 30, 2025.

The Company had $679 million of outstanding letters of credit at June 30, 2025, primarily in Norway and the United States, that are under various bilateral letter of credit facilities. Letters of credit are issued as bid bonds, advanced payment bonds and performance bonds.

The following table summarizes our net cash provided by (used in) continuing operating activities, continuing investing activities and continuing financing activities for the periods presented (in millions):


	Six Months Ended
	June 30,
	2025			2024
Net cash provided by operating activities	$	326		$	354
Net cash used in investing activities		(162	)		(226	)
Net cash used in financing activities		(333	)		(113	)

Significant uses and sources of cash during the first six months of 2025

•

Cash flows provided by operating activities were $326 million, primarily driven by net income before depreciation and amortization and changes in the primary components of our working capital (receivables, inventories, accounts payable, and accrued liabilities).

•

Capital expenditures were $167 million.

•

Dividend payments to our shareholders were $135 million.

•

Share repurchases were $150 million.

Other

The effect of the change in exchange rates on cash flows was an increase of $19 million for the first six months of 2025, and a decrease of $4 million for the first six months of 2024.

We believe that cash on hand, cash generated from operations and amounts available under our credit facilities and from other sources of debt will be sufficient to fund operations, lease payments, working capital needs, capital expenditure requirements, dividends and financing obligations.

During the three months ended June 30, 2025, the Company repurchased approximately 5.5 million shares of common stock under its share repurchase program for an aggregate amount of $69 million. During the six months ended June 30, 2025, the Company repurchased 10.9 million shares of common stock under the program for an aggregate amount of $150 million. The Company expects to return at least 50% of Excess Free Cash Flow (defined as cash flow from operations less capital expenditures and other investments, including acquisitions and divestitures), through a combination of quarterly base dividends, opportunistic stock buybacks, and an annual supplemental dividend to true-up returns to shareholders on an annual basis.

We may pursue additional acquisition candidates, but the timing, size or success of any acquisition effort and the related potential capital commitments cannot be predicted. We continue to expect to fund future cash acquisitions primarily with cash flow from operations and borrowings, including the unborrowed portion of the revolving credit facility or new debt issuances, but may also issue additional equity either directly or in connection with acquisitions. There can be no assurance that additional financing for acquisitions will be available at terms acceptable to us.

Cautionary Note Regarding Forward-Looking Statements

This document contains, or has incorporated by reference, statements that are not historical facts, including estimates, projections, and statements relating to our business plans, objectives, and expected operating results that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements often contain words such as “may,” “can,” “likely,” “believe,” “plan,” “predict,” “potential,” “will,” “intend,” “think,” “should,” “expect,” “anticipate,” “estimate,” “forecast,” “expectation,” “goal,” “outlook,” “projected,” “projections,” “target,” and other similar words, although some such statements are expressed differently. Other oral or written statements we release to the public may also contain forward-looking statements. Forward-looking statements involve risk and uncertainties and reflect our best judgment based on current information. You should be aware that our actual results could differ materially from results anticipated in such forward-looking statements due to a number of factors, including but not limited to changes in oil and gas prices, customer demand for our products, potential catastrophic events related to our operations, protection of intellectual property rights, compliance with laws, and worldwide economic activity, including matters related to recent Russian sanctions and changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs and their related impacts on the economy. Given these uncertainties, current or prospective investors are cautioned not to place undue reliance on any such forward-looking statements. We undertake no obligation to update any such factors or forward-looking statements to reflect future events or developments. You should also consider carefully the statements under “Risk Factors,” as disclosed in our most recent Annual Report on Form 10-K, as updated in Part II, Item 1A of our most recent Quarterly Report on Form 10-Q, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our most recent Annual Report on Form 10-K, which address additional factors that could cause our actual results to differ from those set forth in such forward-looking statements, as well as additional disclosures we make in our press releases and other securities filings. We also suggest that you listen to our quarterly earnings release conference calls with financial analysts.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to changes in foreign currency exchange rates and interest rates. Additional information concerning each of these matters follows:

Foreign Currency Exchange Rates

We have extensive operations in foreign countries. The net assets and liabilities of these operations are exposed to changes in foreign currency exchange rates, although such fluctuations have a muted effect on net income since the functional currency for the majority of them is the local currency. These operations also have net assets and liabilities not denominated in the functional currency, which exposes us to changes in foreign currency exchange rates that impact income. We recorded a foreign exchange loss in our income statement of $31 million in the first six months of 2025, compared to a $17 million foreign exchange loss in the same period of the prior year. Gains and losses are primarily due to exchange rate fluctuations related to monetary asset balances denominated in currencies other than the functional currency and adjustments to our hedged positions as a result of changes in foreign currency exchange rates. Currency exchange rate fluctuations may create losses in future periods to the extent we maintain net monetary assets and liabilities not denominated in the functional currency of the NOV operation.

Some of our revenues in foreign countries are denominated in U.S. dollars, and therefore, changes in foreign currency exchange rates impact our earnings to the extent that costs associated with those U.S. dollar revenues are denominated in the local currency. Similarly, some of our revenues are denominated in foreign currencies, but have associated U.S. dollar costs, which also give rise to foreign currency exchange rate exposure. In order to mitigate that risk, we may utilize foreign currency forward contracts to better match the currency of our revenues and associated costs. We do not use foreign currency forward contracts for trading or speculative purposes.

The Company had other financial market risk sensitive instruments (cash balances, overdraft facilities, accounts receivable and accounts payable) denominated in foreign currencies with transactional exposures totaling $543 million and translation exposures totaling $322 million as of June 30, 2025. The Company estimates that a hypothetical 10% movement of all applicable foreign currency exchange rates on the transactional exposures could affect net income by $43 million and the translational exposures could affect Other Comprehensive Income by $32 million.

The counterparties to forward contracts are major financial institutions. The credit ratings and concentration of risk of these financial institutions are monitored on a continuing basis. Because these contracts are net-settled the Company’s credit risk with the counterparties is limited to the foreign currency rate differential at the end of the contract.

Interest Rate Risk

At June 30, 2025, borrowings consisted of $1,091 million in 3.95% Senior Notes, $497 million in 3.60% Senior Notes, and other debt of $140 million. At June 30, 2025, there were no outstanding letters of credit issued under the Company’s revolving credit facility, resulting in $1.5 billion of available funds. Additionally, the Company’s joint venture has outstanding borrowings of $89 million under a $150 million bank line of credit for the construction of a facility in Saudi Arabia. Interest under the bank line of credit is based upon SOFR plus 1.40%. Occasionally a portion of borrowings under our credit facility could be denominated in multiple currencies which could expose us to market risk with exchange rate movements. These instruments carry interest at a pre-agreed upon percentage point spread from either SOFR, EURIBOR, SONIA, CORRA, or NIBOR, or at the U.S. prime rate. Under our credit facility, we may, at our option, fix the interest rate for certain borrowings based on a spread over SOFR, EURIBOR, SONIA, CORRA or NIBOR for one month to six months. Our objective is to maintain a portion of our debt in variable rate borrowings for the flexibility obtained regarding early repayment without penalties and lower overall cost as compared with fixed-rate borrowings.

Item 4. Controls and Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. The Company’s disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by the Company in the reports it files under the Exchange Act is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures and is recorded, processed, summarized and reported within the time period specified in the rules and forms of the Securities and Exchange Commission. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective as of the end of the period covered by this report at a reasonable assurance level.

There has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1A. Risk Factors

As of the date of this filing, the Company and its operations continue to be subject to the risk factors previously disclosed in Part I, Item 1A “Risk Factors” in our 2024 Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Item 2. Purchases of Equity Securities by the Issuer and Affiliated Purchasers


Period	Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs(1)		Approximate dollar value of shares that may yet be purchased under the plans or programs
April 1 through April 30, 2025		2,342,118	$	12.65		2,342,118	$	660,432,440
May 1 through May 31, 2025		1,332,472		12.50		1,332,472		643,789,329
June 1 through June 30, 2025		1,759,922		13.12		1,759,922		620,696,132
Total		5,434,512	$	12.77		5,434,512

(1) On April 25, 2024, the Company established a share repurchase program for up to $1 billion of the currently outstanding shares of the Company’s common stock over a period of 36 months.

Item 4. Mine Safety Disclosures

Information regarding mine safety and other regulatory actions at our mines is included in Exhibit 95 to this Form 10-Q.

Item 6. Exhibits

Reference is hereby made to the Exhibit Index commencing on page 33.

INDEX TO EXHIBITS

(a)

Exhibits


3.1		Seventh Amended and Restated Certificate of Incorporation of NOV Inc. (1)

3.2		Amended and Restated Bylaws of NOV Inc. (2)

10.1		NOV Inc. Long-Term Incentive Plan, as amended and restated May 20, 2025 (3)

31.1		Certification pursuant to Rule 13a-14a and Rule 15d-14(a) of the Securities and Exchange Act, as amended. (3)

31.2		Certification pursuant to Rule 13a-14a and Rule 15d-14(a) of the Securities and Exchange Act, as amended. (3)

32.1		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (3)

32.2		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (3)

95		Mine Safety Information pursuant to section 1503 of the Dodd-Frank Act. (3)

101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

* Compensatory plan or arrangement for management or others.

(1)

Filed as Exhibit 3.1 to our Current Report on Form 8-K filed on May 18, 2023

(2)

Filed as Exhibit 3.1 to our Current Report on Form 8-K filed on February 28, 2023.

(3)

Filed herewith.

We hereby undertake, pursuant to Regulation S-K, Item 601(b), paragraph (4) (iii), to furnish to the U.S. Securities and Exchange Commission, upon request, all constituent instruments defining the rights of holders of our long-term debt not filed herewith.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


Date: July 29, 2025	By:	/s/ Christy H. Novak
	Christy H. Novak
	Vice President, Corporate Controller & Chief Accounting Officer
	(Duly Authorized Officer, Principal Accounting Officer)

NOV Inc. - Quarter Report: 2025 June (Form 10-Q)

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