Halliburton Company (HAL Quick QuoteHAL - Free Report) reported third-quarter 2026 adjusted earnings of 60 cents per share, surpassing both the Zacks Consensus Estimate and the year-ago adjusted earnings of 58 cents. The improvement was supported by stronger drilling activity and international operations.

Revenues of $5.7 billion rose 1.8% year over year and surpassed the Zacks Consensus Estimate by 2%. The top-line improvement was driven by Drilling and Evaluation growth, while lower North American stimulation activity remained a headwind.

HAL's Drilling Unit Gains, Completion Revenues Fall

The Completion and Production segment generated revenues of $3.1 billion, down 4.2% from $3.2 billion in the year-ago quarter. The decline reflected reduced stimulation activity in the Western Hemisphere, partially offset by increased activity across multiple service lines in the Middle East.

The segment recorded operating income of $457 million, declining 11.1% from $514 million a year earlier. Its operating margin contracted to 14.8% from 15.9%.

The Drilling and Evaluation segment reported revenues of $2.6 billion, increasing 10% from $2.4 billion in the prior-year period. Operating income climbed 12.4% to $391 million from $348 million. Improved activity in the Middle East and Latin America, along with increased drilling-related services in the Western Hemisphere, supported performance.

Halliburton's International Revenues Show Strength

North American revenues declined 8.6% year over year to $2.2 billion from $2.4 billion. The region also witnessed a 5.1% sequential decline, primarily due to reduced pressure pumping services in U.S. land operations.

International revenues increased to $3.5 billion from $3.2 billion in the year-ago period. Latin American revenues climbed 12.7% to $1.1 billion, while Europe/Africa/CIS revenues surged 22.7% to just over $1 billion.

Middle East/Asia revenues edged down 0.5% year over year to $1.4 billion but registered 8.2% sequential growth, benefiting from increased activity in Saudi Arabia and Kuwait. Beyond quarterly activity trends, Halliburton's contract awards from BP plc (BP Quick QuoteBP - Free Report) offshore Brazil and Eni S.p.A. (E Quick QuoteE - Free Report) in the Eastern Mediterranean highlight its continued participation in international deepwater developments.

HAL's Adjusted Margins Improve Sequentially

Halliburton recorded operating income of $624 million compared with $356 million in the year-ago quarter. The reported operating margin expanded to 10.9% from 6.4%.

However, adjusted operating income declined to $731 million from $748 million a year earlier. The adjusted operating margin contracted to 12.8% from 13.4% but improved from 12% in the preceding quarter.

HAL recognized $107 million in pretax impairments and other charges, including severance costs associated with global workforce rationalization and inventory-related write-downs, partially offset by investment-related gains.

Adjusted EBITDA totaled $1 billion, slightly below the prior-year figure of $1.01 billion. The adjusted EBITDA margin declined to 17.5% from 18%.

Halliburton's Cash Flow and Balance Sheet

Halliburton incurred capital expenditures of $266 million in the third quarter compared with $261 million a year earlier. Depreciation, depletion and amortization expenses totaled $296 million, up from $285 million.

As of Sept. 30, 2026, this Zacks Rank #4 (Sell) company held $1.84 billion in cash and equivalents and $7.1 billion in long-term debt. Total shareholders' equity stood at $11.16 billion.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cash flow from operating activities totaled $368 million, generating free cash flow of $156 million. HAL repurchased approximately $250 million of common stock and paid dividends of 17 cents per share during the quarter.

HAL's Management Outlook and Growth Prospects

Halliburton expects mid-single-digit revenue growth in 2027, with operating margins reaching approximately 15%, representing an improvement of about 200 basis points. Management's preliminary outlook assumes a flat North American market and does not depend on a recovery in regional hydraulic fracturing activity.

Halliburton expects efforts to restore production, rebuild inventories and strengthen energy security to support multiyear demand growth for oilfield services. International opportunities, including deepwater developments involving BP and Eni, complement the company's focus on operational efficiency and margin improvement.

Halliburton Expands Deepwater and Technology Portfolio

Halliburton secured an integrated contract from BP for the first appraisal campaign in Brazil's deepwater Bumerangue field. The agreement covers drilling and reservoir evaluation services, incorporating LOGIX automation and remote operations to improve execution efficiency and reduce operational complexity.

Separately, Eni awarded Halliburton an integrated well construction and completions contract for the Cronos ultra-deepwater development offshore Cyprus. The company also successfully deployed LOGIX automation on an Eni exploration well offshore Indonesia, demonstrating its drilling technology capabilities in complex offshore environments.

Additionally, Halliburton signed a multi-year digital transformation agreement with Pampa Energía in Argentina and secured a research and development agreement with Kuwait Oil Company, expanding its technology-focused initiatives across international markets.