Hello, and thank you for joining us. My name is Regina, and I will be your conference operator today. I would like to welcome everyone to the TechnipFMC Third Quarter 2025 Earnings Conference Call. I will now turn the conference over to Matt Seinsheimer, Senior Vice President of Investor Relations and Corporate Development. Please proceed.

Thank you, Regina. Good morning and good afternoon, and welcome to TechnipFMC's third quarter 2025 earnings conference call. Our news release and financial statements issued earlier today can be found on our website. I'd like to caution you with respect to any forward-looking statements made during this call. Although these forward-looking statements are based on our current expectations, beliefs and assumptions regarding future developments and business conditions, they are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by these statements. Known material factors that could cause our actual results to differ from our projected results are described in our most recent 10-K, most recent 10-Q and other periodic filings with the U.S. Securities and Exchange Commission. We wish to caution you not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any of our forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise. I will now turn the call over to Doug Pferdehirt, TechnipFMC's Chair and Chief Executive Officer.

Thank you, Matt. Good morning and good afternoon. Thank you for participating in our third quarter earnings call. Total company revenue in the period was $2.6 billion, adjusted EBITDA was $531 million with a margin of 20.1% when excluding foreign exchange impacts. I am very proud of the continued strength in our execution and the delivery of another quarter of high-quality inbound. With total company orders of more than $2.6 billion in the period, 15 of the past 6 quarters have achieved a book-to-bill above 1. We generated free cash flow of $448 million and distributed $271 million through dividends and share repurchases, continuing to deliver on our commitment to return a significant portion of free cash flow to shareholders. Subsea realized quarterly inbound orders of $2.4 billion. This commercial success is the cornerstone of our ability to deliver growth in both revenue and profitability. In the quarter, we announced 4 awards driven by continued strength in South America. We received multiple flexible type contracts from Petrobras, which included the direct award of high-pressure gas injection risers for pre-salt projects. We were also awarded a contract to supply subsea production systems to be deployed in an array of greenfield developments, brownfield expansions and asset revitalizations across Petrobras' extensive portfolio. In Guyana, we were awarded the Hammerhead project from Exxon Mobil, where we leveraged our in-country experience and solid track record for providing schedule certainty. This award represents the seventh greenfield development on the Stabroek Block and will utilize our Subsea 2.0 technology. TechnipFMC has supplied all of the subsea production systems for ExxonMobil in Guyana, since the first contract award in 2017. Our commercial success year-to-date reinforces our confidence in delivering more than $10 billion of subsea orders in 2025 as well as achieving $30 billion of inbound over the last 3 years. Beyond the current year, we believe that offshore projects will continue to receive an increasing share of capital investment. This change in spending allocation is due in part to the significant improvements made in developing the large, high-quality and prolific reservoirs found offshore. These strong attributes were always known and the resource quality was always there, but cost overruns and schedule delays in the past would ultimately challenge project economics. In today's offshore market, much has changed, driven by a number of factors, including improvements in the quality and interpretation of seismic data, shortened delivery times for large production infrastructure, and significant reductions in the time required for drilling and completion activities. As reflected in our inbound awards, the introduction of new commercial models and innovative technologies. At TechnipFMC, we wake up every day with a single purpose, the relentless pursuit of cycle time reduction. This mindset led to the development of our pre-engineered configure-to-order product platform, Subsea 2.0, as well as the creation of the industry's only fully integrated execution model, iEPCI. These innovations provide the elements to shorten cycle times and improve project returns. But even more importantly, to help provide our customers with greater schedule certainty in our project execution. It is this combination of higher economic returns and greater project certainty that is providing sustainability to current activity levels, underpinning our outlook and securing $10 billion of Subsea inbound in 2026 and our confidence that activity will remain strong through the end of the decade. In closing, the continued strength in our Subsea inbound orders reflects the confidence our customers have today and our ability to successfully execute their projects on time and on budget. This is making the author resurgence more durable as evidenced by the shift in spending to these markets. TechnipFMC is also driving this change in behavior. With iEPCI and Subsea 2.0, both having a profound impact on investment decisions by derisking and accelerating subsea projects. The success of these unique offerings has also contributed to the notable increase in the level of direct awards to our company. With greater project certainty, we now see the execution phase of subsea developments as an opportunity to further leverage lean operating principles. In doing so, we can learn, refine, and enhance our own processes, driving a culture of continuous improvement to further shorten cycle times and improve project returns. While focusing on the customer is always a top priority, we also believe that our shareholders should share in our success. Yesterday, we announced our Board of Directors authorized additional share repurchases of up to $2 billion. This significant increase to our share authorization exemplifies our confidence in the outlook as well as our commitment to maximize shareholder value. I will now turn the call over to Alf to discuss our financial results.

Thanks, Doug. Inbound in the quarter was $2.6 billion, driven by $2.4 billion of subsea orders. Total company backlog ended the period at $16.8 billion. Revenue in the quarter was $2.6 billion. Adjusted EBITDA was $531 million when excluding a foreign exchange loss of $12 million. Turning to segment results. In Subsea, revenue of $2.3 billion increased 5% versus the second quarter. The sequential improvement was largely driven by increased project activity, particularly iEPCI projects in Africa, Australia, and the Americas. This was partially offset by reduced project activity in Norway. Adjusted EBITDA was $506 million, up 5% sequentially due to higher project activity. Adjusted EBITDA margin was 21.8%. In Surface Technologies, revenue was $328 million, an increase of 3% from the second quarter. The sequential increase was primarily driven by higher activity in the North Sea and Asia Pacific, partially offset by lower activity in North America. Adjusted EBITDA was $54 million, an increase of 3% sequentially due to higher activity in international markets. Adjusted EBITDA margin was 16.4%, in line with the second quarter results. Turning to corporate and other items in the period. Corporate expense was $28 million. Net interest expense was $11 million and tax expense in the quarter was $76 million. Cash flow from operating activities was $525 million and capital expenditures were $77 million. This resulted in free cash flow of $448 million. We repurchased $250 million of stock in the third quarter. When including $20 million of dividends, total shareholder distributions were $271 million. We have also increased our share repurchase authorization by an additional $2 billion, providing us with $2.3 billion of current authorization. Since the time of our initial authorization in 2022, we have distributed more than $1.6 billion through buybacks and dividends, representing nearly 60% of free cash flow generated over the period. During the quarter, we reduced debt by $258 million including early repayment of the 6.5% senior notes maturing in February 2026. We ended the period with $438 million of gross debt, largely comprised of private placement notes that extend out to 2033, with interest rates of 4% and below. Cash and cash equivalents were $877 million. Our net cash position increased to $439 million. Moving to our guidance. For Subsea, we expect seasonal impacts to our fourth quarter results, with revenue declining mid-single digits sequentially. Adjusted EBITDA margin is expected to decline approximately 300 basis points to 18.8%. For Surface Technologies, we anticipate revenue to decline low single digits sequentially, with an adjusted EBITDA margin similar to the 16.4% reported in the third quarter. Lastly, we expect corporate expense to approximate $35 million. Moving to our full year outlook. I'm going to highlight a few items. Most notably, the updates we have made to our guidance ranges. For Surface Technologies, we now expect adjusted EBITDA margin to be in the range of 16% to 16.5%, above our prior full-year view. And for total company, we are increasing our guidance for adjusted EBITDA by $30 million, which we now expect to approximate $1.83 billion for the full year when excluding foreign exchange. Lastly, with the continued strength in our cash conversion, we are also increasing free cash flow guidance for the year to a range of $1.3 billion to $1.45 billion. All other guidance items for the current year remain the same. Before I move to my closing remarks, I want to recognize the tremendous progress the team has accomplished so far. The consistency in execution and further adoption of lean operating principles make us well positioned for continued improvement in most everything we do. Additionally, our commercial differentiation and the relative stability of offshore markets give us unique visibility, allowing us to provide an early view for Subsea for the upcoming year. For 2026, we are guiding Subsea revenue to a range of $9.1 billion to $9.5 billion with adjusted EBITDA margin in the range of 20.5% to 22%. We will provide the remainder of our 2026 financial guidance with our fourth quarter earnings. In closing, the continued momentum in operational performance drove another solid quarter for TechnipFMC. The strong execution was also reflected in robust free cash flow generation, leading us to increase our full-year expectation to $1.375 billion at the midpoint of the guidance range. We are on pace to return more than 70% of free cash flow to shareholders in 2025 through dividends and share buybacks. And with our increased free cash flow guidance, shareholder distributions now have the potential to double versus the prior year. Yet, even with this substantial increase in distributions, we have maintained the flexibility to further strengthen our balance sheet by reducing gross debt almost $450 million since the beginning of the year, including the opportunistic prepayment of our highest cost debt. And finally, as we look further ahead to 2026, we have provided our outlook for Subsea, which at the midpoint of the guidance implies double-digit growth in adjusted EBITDA. Importantly, this level of EBITDA growth in Subsea is essentially double the anticipated growth in revenue, further expanding margins, improving returns while providing strong support for robust shareholder distributions.

I wanted to start on the share repurchase authorization. It's going to be another good year of free cash this year, strong returns to shareholders above 70%. With the increase in the repurchase authorization and what should be a strong free cash year next year, how are you guys thinking about the right level of cash return in '26?

Sure, Scott. So obviously, we are very pleased with the year we've had with free cash flow generation this year, really supported by our strong commercial and operational execution that we had all year. This execution is foundational because the operational delivery uncertainty around that is really leading to the consistent achievement of milestones that then trigger billings and associated cash collections. So that's really, again, the fundamental strength in the cash flow conversion out of EBITDA clearly has increased significantly this year. However, when you exclude maybe working capital benefits and a few one-time benefits that we have seen in our free cash flow conversion from EBITDA may not be able to stay at that level. But if you think about what we have said historically, we said that we're going to be around 50% of free cash flow conversion from EBITDA, and we think we're now approaching more like 55% when you're normalizing for working capital to a more neutral position.

That's great. And how to think about the kind of level of return to shareholders from the free cash flow for next year kind of what's the framework you guys are thinking about?

Yes. We are reaffirming our commitment to return at least 70% of free cash flow to shareholders. We will maintain this level, consistent with what we have implemented in 2025.

Just on the Subsea award intake, when we were speaking last quarter, you mentioned that there were some awards that haven't been announced to the market that we would see in the coming weeks. I think there was 1 from Equinor in July. Has there been anything that possibly still yet to be announced from the order intake? Certainly, it seems your order intake is obviously very strong and running ahead of others in the market. It's very strong by TechnipFMC. And then as a follow-up, not totally linked, what are your working capital expectations for this year within the new free cash flow guidance?

Thank you for the question, and I’m happy to provide clarification. First, I appreciate you highlighting another strong quarter of inbound. Our differentiation in this area is a result of our efforts to build the company we have, which is reflected in the increasing level of direct awards we receive. This means that the overall market available to others is shrinking as our direct awards grow. This is what gives us confidence and the ability to continue outperforming. Regarding potential future announcements, there are more to come, which depend on our clients' discussions with local governments or partners. Once we receive their approval, we will make those announcements. There are no surprises; it’s a routine part of the process. The timeline for these announcements has extended beyond what we anticipated, but again, I appreciate your recognition of our strong outlook and our focus on securing high-quality projects while being selective in our choices.

Yes. And this is Alf. Regarding the free cash flow and the working capital assumptions. As you clearly point out, we have had a very exceptional year this year and a very strong year in terms of working capital performance. So whatever you can kind of gauge from the year-to-date numbers now is kind of one way to see the upside this year. When we guide for going forward, we will typically put ourselves with a neutral position. That's the right starting point.

I was hoping you could unpack the '26 Subsea guide a little bit for us in relation to kind of what I'm hearing from the rest of the market. Recognizing the midpoint of the guide, the revenue guide on Subsea is in line of consensus. I'm assuming the service component is up roughly cut 10%, like we've been seeing in the past years. So if as backlog conversion looks pretty steady for next year. We keep hearing about offshore picking up the late '26 building into I'm just curious if that's a trend that you think should also play out in your Subsea revenue. You mentioned shortened cycle times. I guess does that imply backlog conversion should start to accelerate in the second half of next year? And does Subsea 2.0 convert faster in the mix?

Sure, Dave. It seems you lost connection there at the end, so you may need to bring me back on a few points. There were several items mentioned, and if I miss any, feel free to ask me to clarify. First, I appreciate you asking about 2026. We seem to be the only ones addressing that year, which highlights our distinct position in the market and the trust our clients place in us to secure projects well in advance, more so than they traditionally would or compared to our competitors. It is a privilege for us to discuss 2026. As you noted, our backlog coverage is robust. It’s not only about the volume of backlog but also about our confidence in increasing revenue and margins, potentially at a faster rate than our revenue growth. This situation extends beyond mere volume; it reflects our higher-quality leads and outstanding execution, which makes me very proud of our team and their achievements. This foundation positions us strongly and provides us with confidence to issue guidance for 2026 when very few others are doing so, and we feel assured in our ability to reach those targets. You inquired about the growth rate of Subsea services in 2025. I would expect it to align with the overall business growth, so you can refer to our revenue forecast for that top-line growth as a reference for Subsea services. Regarding cycle time reduction and its impact on backlog conversion, it indeed plays a significant role and is crucial for our growth strategy, allowing us to expand without the need for substantial capital investments. We aim to achieve more with fewer resources, resulting in returns that have historically been unmatched, and we are on track to continue this trend moving forward. That said, we’re still working on improving efficiency in the offshore installation area, and it's a focal point as we enhance the configured order for Subsea 2.0. Not all our products have reached the customization level of Subsea 2.0, so there's considerable potential for growth in this area, and these factors will contribute to our progress as we advance. If I didn’t address everything you wanted, do feel free to follow up.

Pretty close, pretty close. Let's hope I don't drop out here. My second question is about the Subsea margin guide for next year. What percentage of revenue do you expect to come from Subsea 2.0? And can you tell us what percentage of the inbound year-to-date has been Subsea 2.0?

Sure. The best way to understand this is to consider how much output is coming from our facilities. By the end of 2025, we will be utilizing around 40% of our capacity for Subsea 2.0. Currently, inbound levels for Subsea 2.0 have already surpassed 50% and are still increasing. We anticipate that Subsea 2.0 orders will make up a larger share of our total orders next year, along with significant growth in iEPCI orders as a percentage of our total orders. These developments provide us with substantial leverage as we continue to advance, ensuring growth, expanding margins, increasing leverage, and driving returns.

My first question is about your 2026 Subsea guidance. Doug, at the midpoint of the guidance, it suggests a 175 basis point improvement in margins. I would like to understand how you view the factors contributing to the margin expansion related to the Subsea 2.0 mix, the Subsea services mix, and potential pricing improvements.

Sure, good morning, Arun. Clearly, all of those factors are important. I will focus on the first two because I believe they are the sustainable ones. Many companies have long concentrated on the last factor, which isn’t a viable long-term strategy. We have restructured our company and changed our operating model to achieve sustainable leverage, regardless of market activity levels. There are three key components to consider. We still have some legacy projects in our backlog, which we are working through, and we are now below the 10% mark of what remains. Some of this will continue into 2026. However, we will also see more Subsea 2.0 and increased iEPCI execution. These elements are very tangible. It's important to recognize that the entire organization is engaged in this industrialization journey, and it's significant. Many of you have visited and witnessed how our operations today differ from our past and the rest of the industry, creating what we refer to as solidification, standardization, and industrialization. This approach applies to every aspect of our operations, including all functions and activities within the company. This is how we achieve leverage. With over 20,000 dedicated employees working together each day to find incremental improvements and celebrating their successes, we build momentum and gain confidence in our ability to continue accelerating and enhancing the company’s performance.

Great. Maybe 1 for Alf. Your net cash position has grown to just under the $500 million, I think it's like $439 million. You highlighted plans to return at least 70% of free cash flow. I just wanted to talk about what you think about the balance sheet and future uses of free cash flow because you have a very underlevered balance sheet. And I guess the ultimate question is could we see you returning essentially all of your free cash flow, just given how strong the balance sheet sits today.

Thank you, Arun, for the question. It's definitely a relevant one. We have made significant progress on our balance sheet, including a $450 million reduction in debt this year, alongside our commitment to return at least 70% to shareholders. This reduction represents more than 50% of total debt cut since the start of the year. Our balance sheet is in excellent condition, and we do not anticipate any major changes to our capital allocation strategy, meaning we will maintain a capital-light approach. Previously, we indicated that our capital expenditures would range from 3.5% to 4.5%, and we plan to remain at the lower end of that range. With most of our debt obligations managed and favorable maturities for our remaining debt, we do not foresee significant adjustments to our debt structure at this time. This situation allows for opportunities to distribute any excess cash to shareholders, in line with our commitment to return at least 70%.

Just to kind of keep going on Dave and Arun's comments about just the catalyst within the backlog improvement and the margin outlook. You talk about the industrialization, you have the Subsea 2.0. But Doug, can you maybe talk to us about what 2.0 could mean for the surf side or the installation side of things? Just thinking about those continued catalysts as we work towards the year, just the continued improvement of the business.

Sure, good morning, Derek. I don't want to say too much, but I think there is a significant opportunity to further industrialize the full iEPCI scope. So remember, back in history, we were running them in parallel. We were working on the Subsea 2.0 configure to order for the SPS or the subsea equipment portion of our activity. And then as a result of the merger, we now have the ability as a single entity, and you cannot do this if you are not a single entity because it has, let's say, conflicting behaviors between a traditional surf company and a traditional equipment provider. So as a single entity now for 8 years. It's been 8 years ago that we actually merged. It gives us the opportunity to expand that across the whole portfolio. So I am sure you all will have an opportunity to hear much more about that in the future. But I'm going to be a little bit quiet today, which I know is not my normal behavior, but there is an incredible opportunity, but I am going to stop there. We're working hard at it.

Got it. Fair enough. I appreciate that. Second on the subsea opportunities list, it's pretty noticeable and evident that the scope of over $1 billion is meaningfully increasing really since the middle. Could you talk about the drivers behind that? I'm assuming the certainty that you guys bring to the table. But where could this ultimately go from a project scope perspective as we continue to see that wedge just increase over time?

Thank you. I didn't view it as a wedge initially, but I can see how it can be considered one. It has certainly become a significant wedge. We've discussed this in detail, including in our prepared remarks, driven by the fact that the best reservoirs are offshore, particularly those accessible to the market. Therefore, capital is directed towards that area. There has historically been some hesitation from our customers due to the unpredictability of executing offshore projects. What we've done is restore confidence in the industry; we have regained our confidence and provided it to our customers. This comes down to performing consistently well every day and instilling trust by offering certainty. We need to focus on reducing cycle times daily while ensuring reliability. If we accomplish this—and we are doing that—it will inspire our customers to increasingly invest their capital in offshore projects. This approach is economically sensible. The breakeven points, project returns, and reserve bases show minimal decline rates compared to other investment options. The opportunity list continues to grow stronger. Interestingly, the three new projects added are all gas-related. While this may warrant attention, I believe gas represents a significant part of the future hydrocarbon landscape, especially offshore. A lot of the offshore gas contributes to LNG supply, which we typically associate with terrestrial aspects, often visible at the quayside. However, much of the natural gas supply originates from offshore sources, particularly outside the U.S. So, the newly added projects present an intriguing mix. Additionally, I have a small teaser for you: our proprietary opportunity list, which informs our direct awards, has expanded at an even quicker pace.

Can you talk directionally about the outlook for Surface Technologies for '26 given the Saudi activity potential? And then you also raised the margin guide for '25. So maybe help us understand the drivers there as well.

Sure. We previously discussed this last quarter, and I’m really proud of the team. They have taken the necessary steps to ensure we can deliver strong returns for the company and our shareholders. We have focused our efforts strategically, which has led to impressive results that continue to improve, even as others in the industry are facing challenges. However, the outlook is a bit uncertain, which is why we didn’t include it in our early guidance. We were able to provide guidance for Subsea, but the Surface and Onshore businesses remain much less predictable. Historically, our international or non-North America operations have been more reliable, with less volatility. It’s still early in the process, and we are currently in discussions with our clients about their budgets, but they are managing this aspect themselves, so there isn't much data being shared. We have positioned ourselves with the right customers in the right regions, offering the right technology. Our iComplete solution, which digitizes the entire frac pad, has been very successful, enabling us to control the entire well site and achieve record performance in continuous pumping. We will keep providing these advanced solutions and capitalize on our investments in local manufacturing in the Middle East, where we are well positioned with our clients. While the situation is somewhat less clear at the moment, we plan to offer guidance alongside our full company outlook and Q4 results, as we typically do. This business operates differently than our Subsea business.

Got it. That's helpful. And then can you give us an update on the electric Subsea infrastructure opportunity, where that stands as of now? I've seen some announcements from some of your peers earlier this year as well. Just wondering if that is starting to become a little bit more topical and what that could mean in terms of orders and margins for you?

Sure. It's progressing. What you've seen is the all-electric awards for greenfield projects. TechnipFMC received the first-ever All-Electric Subsea award for the BP Northern Endurance partnership project we announced a few quarters ago. Recently, there was another award in the North Sea. I think the transition to all-electric in greenfield developments will not be as robust as I initially expected. However, there are three areas that will definitely benefit from all-electric solutions, with the third being particularly interesting and novel. The first area is carbon capture and storage, which has already moved to all-electric and will continue to do so. All the opportunities we are pursuing or have secured are based on all-electric infrastructure, and we also have the industry's only certified all-electric CO2 injection tree, which is significant. The second area involves brownfield tiebacks. This expands the connection radius from the host facility by about four times or even more, which provides substantial benefits for customers looking to connect to existing infrastructure, offering low breakeven points and high returns. Our all-electric solutions combined with flexible pipe and subsea processing create compelling opportunities. The third area allows us to retrofit hydraulic trees with electric actuation if the hydraulic system begins to deteriorate. There is always redundancy in place to prevent failures. I don't want to give the wrong impression, but when performance begins to decline, customers may need to retrieve the tree, bring it to the surface, retrofit it, and reinstall it, which can take months or even quarters before production resumes. We have developed an innovative solution that allows us to use remote-operated vehicles to replace hydraulic actuation controllers with electric ones while the system remains in situ, which is quite interesting. This way, clients won't lose several months of production. Therefore, while my earlier views about all new projects transitioning to all-electric might not hold anymore, we’re discovering other exciting applications due to our technology investments.

Can you hear me now?

Yes, we can.

The first one, just a bolt-on, it's a very strong year for TechnipFMC on order intake. But I think a theme that has emerged perhaps is that some operators have kind of chosen a bit, they're going to slow walk deepwater FIDs. Some competitors have called Sub-Saharan Africa is a good example of that. And I also saw an estimate that was putting company tree awards down mid-teens percentage year-over-year in '25. So it would be great to kind of get your perspective on how the cycles evolve year-to-date versus your expectations at the beginning of the year? And I guess, looking forward, perhaps, what are the specific key basins that are going to drive '26 for you?

Sure. I have to be honest. We're not seeing that situation. Three years ago, we predicted that the market would be strong, and we set a goal of securing $30 billion in awards over three years, which we are on track to achieve. Regarding our expectations for this year, they align with our original goal of around $10 billion, and now we anticipate exceeding that amount. While I can't speak for others' experiences, I believe our results demonstrate our position. It’s important to note that 80% of our business comes from direct awards to us, bypassing competitive bidding. This significantly impacts the total available market, which is quite small compared to our access due to customer trust in us, our unique offerings, and our ability to shorten cycle times and enhance project returns, leading to those direct awards. I want to emphasize that the proprietary data set we use informs our opportunity set, which isn't public. Even though our public project list is increasing, those other projects are exclusive to us. We're involved early in the process with these direct awards, conducting concept studies, pre-FEED studies, and FEED studies, then moving directly into an iEPCI 2.0 execution phase. This gives us greater visibility into future opportunities.

Really appreciate that. And a follow-up on that. I mean, looking at your backlog at a very large level, I'd like to get your perspective on kind of resourcing to execute that level of work. And I read somewhere that had increased staffing at your manufacturing facilities in Brazil, Malaysia, and the U.K. by some 20% to 40% in 2024 versus a kind of base of '21, so post-pandemic. Are you happy with the resourcing at the moment? I guess looking at it, given the tightness is, are there some concerns in the industry around potential bottlenecks or capacity constraints? And how are you positioning to execute that work?

I can't confirm those numbers as they are new to me, and I'm uncertain about their source. However, I’ll address your question more generally. Firstly, I want to assure every customer that we do not take on any projects that we cannot execute. We are aware of the competitive bidding landscape and understand the parameters we must meet in terms of quality, execution, payment currency, and risk. If a project does not meet our standards, we simply won't bid on it. We are committed to delivering on time and within budget, which is crucial for securing repeat awards. Our consistent performance has allowed us to often replace our competitors, highlighting a shift in how we operate compared to the rest of the industry. We've developed a different operational model over the last decade, and our primary focus remains on execution. We are confident in our staffing and resource levels. Our strategy emphasizes reducing cycle times and enhancing efficiency, which allows us to do more with the same resources rather than just increasing staffing levels.

I wanted to start with some more questions on services. So Doug, can you remind us what the mix of services between like installation versus servicing your installed base is in the business like roughly? And the reason I ask is the comments earlier about kind of '26 and a service growth rate looking like the overall subsea, I would have thought that services could be doing a better growth rate than sort of decelerating, so maybe you could unpack that a little bit for us? And then the second part of it is like if you look longer term, is there anything we should be thinking about how the integrated awards that you've taken in the past several years affect the servicing opportunity and then anything with the vintaging of your installed base as we come up on maybe some anniversaries of more service opportunity?

Sure, and thank you, Mark, for bringing us back to service; it's important. I would like to clarify one point in your statement regarding deceleration. There hasn’t been any deceleration. The larger our installed base, the greater the opportunities we have, and with increased volume, we experience a longer tail and more chances for growth. Let’s discuss the mix of services. We start with original installation activity, followed by inspection, maintenance, and repair of existing infrastructure. Additionally, we have refurbishment of equipment and intervention services. It’s beneficial that we not only have a strong market presence but also respond when a wellbore requires intervention, which occurs much more frequently than equipment failure, as the equipment is designed to last 25 to 35 years. We provide the necessary services to ensure the integrity of the wellbore. There are instances where wellbores can fail within the first year or after five years, and with increased intelligence in wellbore technology, there are more chances for parts to need replacement or repair, leading us to be involved. There is no doubt that our Subsea Services business has experienced significant growth. I previously projected it to reach about $1.8 billion this year, which is nearly double what it was a short time ago. I take pride in our Subsea Services business as it offers not only quality earnings but also leverage, sustainability, and continuity. My comment about its growth being in line with the core business, which is also expanding at a good rate, may have seemed understated, but that was not my intention.

Sure, Mark, Alf here. Yes, you are correct. We are well covered on the backlog. We experienced a strong Q3, but as you mentioned, we are guiding Q4 down compared to Q3. The decline in revenue is primarily due to vessel utilization. We encounter seasonal activity levels every year that lead to this decline, particularly in the North Sea. Overall, this impacts our ability to operate offshore and generate revenue. We also discussed the associated EBITDA decline. However, when you look at the overall picture of our revenue guidance, we were at a midpoint of $8.6 billion. If you consider both Q3 and Q4 performance together, you'll see an uptick and an expectation that we will exceed the midpoint for the full year when all is said and done.

Doug, you gave some good color on 2026, and you gave that color early, a lot of good questions, but your revenue is still below the orders you have been booking for several years now, right? So there should be upside going forward. What I want to focus on bags as you enter deeper into the execution phase of this backlog, right? What are you focused on? What are you looking at, especially among wondering both the installation side of things, the vessel side of the market, especially given some consolidation out there? Just maybe talk to the execution side of things as you execute on the backlog and orders you're booking.

Sure. I think the biggest thing to focus on, and we've talked about this previously on calls was just if leads the quality of the inbound, which obviously goes into the backlog, which then has to be executed. And what we know is we know there's more iEPCI, we know there's more 2.0, and that creates a significant level of confidence in our ability to be able to execute those projects. I said earlier, it came out on a couple of the earlier questions. It's all about relentless pursuit of the reduction of cycle time. Sure. That makes sense. It means our customers get a higher project return. It means they're happy for us to share a greater portion of the economic value that we create, but it also has to do with our internal efficiency. And again, being able to do more with the same or the same with the last, whatever scenario you might be in. But that's how we're able to ensure that we can deliver this backlog successfully for our clients and maintain that reputation and the honor position that we have with our client base today.

Sure. First, I want to clarify our normalized working capital and the free cash flow conversion. Previously, we mentioned that our conversion rate was at 50%. Currently, we estimate that we'll achieve approximately 55% conversion from our EBITDA, assuming working capital remains neutral. You are correct that working capital plays a significant role in our business. During a period of robust growth in incoming projects, our ability to secure high-quality backlog enables us to meet both early and ongoing project milestones effectively. We strive to manage our working capital efficiently or even improve upon it as we undertake additional subsea work. Looking at our year-over-year inbound situation, while we may encounter fewer opportunities for incremental growth, our ambition remains constant. However, as I look ahead, I wouldn't expect to go much beyond neutral working capital for now, but we will provide further guidance in February.

Obviously, the adoption and the resilience of what you put in place here just jumps off the page yet again. And I'd say the ExxonMobil ahead Subsea 2.0 awards seems to be the ultimate validation of that. However, one part, Doug, I'd say that we haven't touched on is the question about installation capacity out there in the market, still essential for all clients. And obviously, you work with Saipem in Guyana at Hammerhead as well. So could you just update us on TechnipFMC's view on that merger that's going on to Saipem 7 in the market, and whether you see any impact from that regarding the vessel infrastructure you've spoken to in the past and indeed, if anything, worth commenting on your submissions regarding that process?

Sure, Mark, and thank you for your patience. So just a clarification. So well, first of all, thank you for the comments. Those are well received. Yes, the seventh project in Guyana was critical. The fact that 2.0 shows that evolution, that continued market adoption and with obviously a very important client to us. The only thing I need to clarify is we don't work with Saipem in Guyana. So we do and our scope is our scope, and then the installation scope is bid separately. So that question would really need to be answered by ExxonMobil not by ourselves. In regards to the merger, look, the regulators will make their decision. Our customers will make their decision. So they ever the regulator decides and then there's whatever behavior the clients decide on how they want to react. We are in a position where when asked or encouraged by our clients or the regulators to comment. We have a responsibility to comment, and we're just providing clarifications on market, market segmentation and the way that the market operates, but it will be what it will be. Keep in mind that we have this relentless pursuit of reduction of cycle time meaning if we can now deliver a subsea project in 2 years versus 3 years, I've created 33% more capacity with my existing fleet. So this is about being more efficient, having higher returns, not having more assets.

This concludes our conference call. A replay of the call will be available on our website beginning at approximately 3:00 p.m. New York time today. If you have any further questions, please feel free to reach out to the Investor Relations team. Thank you for joining us. Regina, you may now end the call.

This will conclude today's call. Thank you all for joining. You may now disconnect.