HAL 10-Q
Halliburton Co (HAL)
10-Q
2026-07-24
For: 2026-06-30
View Original
Added on
July 24, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2026
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _______to_______
Commission File Number 001-03492
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices) | (Zip Code) | ||
(281 ) 871-2699
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol | Name of each exchange on which registered |
NYSE Texas |
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.☒ Yes ☐ 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).☒ Yes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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).
As of July 17, 2026, there were 833,130,367 shares of Halliburton Company common stock, $2.50 par value per share, outstanding.
i
HALLIBURTON COMPANY
Index
Page No. | ||
HAL Q2 2026 FORM 10-Q | 1
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
Millions of dollars and shares except per share data | 2026 | 2025 | 2026 | 2025 |
Revenue: | ||||
Services | $ | $ | $ | $ |
Product sales | ||||
Total revenue | ||||
Operating costs and expenses: | ||||
Cost of services | ||||
Cost of sales | ||||
Impairments and other charges (credits) | ( | ( | ||
General and administrative | ||||
SAP S4 upgrade expense | ||||
Total operating costs and expenses | ||||
Operating income | ||||
Interest expense, net of interest income of $21, $18, $43, and $43 | ( | ( | ( | ( |
Other, net | ( | ( | ( | ( |
Income before income taxes | ||||
Income tax provision | ( | ( | ( | ( |
Net income | $ | $ | $ | $ |
Net income attributable to noncontrolling interest | ( | ( | ( | ( |
Net income attributable to company | $ | $ | $ | $ |
Basic and diluted net income per share | $ | $ | $ | $ |
Basic weighted average common shares outstanding | ||||
Diluted weighted average common shares outstanding | ||||
See Notes to Condensed Consolidated Financial Statements.
HAL Q2 2026 FORM 10-Q | 2
HALLIBURTON COMPANY
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
Millions of dollars | 2026 | 2025 | 2026 | 2025 |
Net income | $ | $ | $ | $ |
Other comprehensive income (loss), net of income taxes | ( | |||
Comprehensive income | $ | $ | $ | $ |
Comprehensive income attributable to noncontrolling interest | ( | ( | ( | ( |
Comprehensive income attributable to company shareholders | $ | $ | $ | $ |
See Notes to Condensed Consolidated Financial Statements.
HAL Q2 2026 FORM 10-Q | 3
HALLIBURTON COMPANY
Condensed Consolidated Balance Sheets
(Unaudited)
June 30, | December 31, | |
Millions of dollars and shares except per share data | 2026 | 2025 |
Assets | ||
Current assets: | ||
Cash and equivalents | $ | $ |
Receivables (net of allowances for credit losses of $784 and $805) | ||
Inventories | ||
Other current assets | ||
Total current assets | ||
Property, plant, and equipment (net of accumulated depreciation of $12,823 and $12,616) | ||
Goodwill | ||
Deferred income taxes | ||
Operating lease right-of-use assets | ||
Other assets | ||
Total assets | $ | $ |
Liabilities and Shareholders' Equity | ||
Current liabilities: | ||
Accounts payable | $ | $ |
Accrued employee compensation and benefits | ||
Income taxes payable | ||
Current portion of operating lease liabilities | ||
Taxes other than income | ||
Current maturities of long-term debt | ||
Other current liabilities | ||
Total current liabilities | ||
Long-term debt | ||
Operating lease liabilities | ||
Employee compensation and benefits | ||
Other liabilities | ||
Total liabilities | ||
Shareholders' equity: | ||
Common stock, par value $2.50 per share (authorized 2,000 shares, issued 1,063 and 1,064 shares) | ||
Paid-in capital in excess of par value | ||
Accumulated other comprehensive loss | ( | ( |
Retained earnings | ||
Treasury stock, at cost (229 and 229 shares) | ( | ( |
Company shareholders' equity | ||
Noncontrolling interest in consolidated subsidiaries | ||
Total shareholders' equity | ||
Total liabilities and shareholders' equity | $ | $ |
See Notes to Condensed Consolidated Financial Statements.
HAL Q2 2026 FORM 10-Q | 4
HALLIBURTON COMPANY
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Six Months Ended June 30, | ||
Millions of dollars | 2026 | 2025 |
Cash flows from operating activities: | ||
Net income | $ | $ |
Adjustments to reconcile net income to cash flows from operating activities: | ||
Depreciation, depletion, and amortization | ||
Impairments and other charges (credits) | ( | |
Changes in assets and liabilities: | ||
Receivables | ( | |
Inventories | ( | ( |
Accounts payable | ( | |
Other operating activities | ( | ( |
Total cash flows provided by operating activities | ||
Cash flows from investing activities: | ||
Capital expenditures | ( | ( |
Payments to acquire businesses, net of cash acquired | ( | ( |
Purchases of equity investments | ( | ( |
Purchases of investment securities | ( | ( |
Proceeds from sales of property, plant, and equipment | ||
Sales of investment securities | ||
Sale of an equity investment | ||
Other investing activities | ( | ( |
Total cash flows used in investing activities | ( | ( |
Cash flows from financing activities: | ||
Stock repurchase program | ( | ( |
Dividends to shareholders | ( | ( |
Other financing activities | ( | ( |
Total cash flows used in financing activities | ( | ( |
Effect of exchange rate changes on cash | ( | ( |
Decrease in cash and cash equivalents | ( | ( |
Cash and equivalents at beginning of period | ||
Cash and equivalents at end of period | $ | $ |
Supplemental disclosure of cash flow information: | ||
Cash payments during the period for: | ||
Interest | $ | $ |
Income taxes | $ | $ |
See Notes to Condensed Consolidated Financial Statements.
HAL Q2 2026 FORM 10-Q | 5
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
HALLIBURTON COMPANY
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Note 1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements were prepared using United States
generally accepted accounting principles (U.S. GAAP) for interim financial information and the instructions to Form 10-Q and
Regulation S-X. Accordingly, these financial statements do not include all information or notes required by U.S. GAAP for
annual financial statements and should be read together with our 2025 Annual Report on Form 10-K.
Our accounting policies are in accordance with U.S. GAAP. The preparation of financial statements in conformity with
these accounting principles requires us to make estimates and assumptions that affect:
•the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the
financial statements; and
•the reported amounts of revenue and expenses during the reporting period.
Ultimate results could differ from our estimates.
In our opinion, the condensed consolidated financial statements included herein contain all adjustments necessary to
present fairly our financial position as of June 30, 2026, the results of our operations for the three and six months ended
June 30, 2026 and 2025, and our cash flows for the six months ended June 30, 2026 and 2025. Such adjustments are of a normal
recurring nature. In addition, certain reclassifications of prior period balances have been made to conform to the current period
presentation.
The results of our operations for the three and six months ended June 30, 2026 may not be indicative of results for the
full year.
Note 2. Impairments and Other Charges (Credits)
June 30, 2026 and 2025, which are reflected within “Impairments and other charges (credits)” on our Condensed Consolidated
Statements of Operations.
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
Millions of dollars | 2026 | 2025 | 2026 | 2025 |
Gain on investments | $( | $ | $( | $ |
Loss on sale of a business | ||||
Severance costs | ||||
Impairment of assets held for sale | ||||
Impairment of real estate facilities | ||||
Other | ( | ( | ||
Total impairments and other charges (credits) | $( | $ | $( | $ |
$54 10
remeasuring an equity investment to fair value. Other credits of $48 million were primarily due to a government refund
recovery. These gains were partially offset by a $17 million loss on the sale of a portion of our chemical business, which closed
in April 2026.
During the three months ended June 30, 2025, there were no amounts recorded in impairments and other charges
(credits). During the six months ended June 30, 2025, we recorded a pre-tax charge of $356 million primarily related to $107
million in severance expense as we rationalized global headcount to align with activity levels and $104 million of additional
impairment associated with a strategic decision to market for sale a portion of our chemical business. Additionally, we
recognized a $53 million impairment related to facility closures and lease terminations. Other charges of $92 million were
primarily related to legacy environmental remediation cost estimate increases.
HAL Q2 2026 FORM 10-Q | 6
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
Note 3. Business Segment Information
We operate under two two
Production segment and the Drilling and Evaluation segment. Our equity in earnings and losses of unconsolidated affiliates that
are accounted for using the equity method of accounting are included within cost of services and cost of sales on our statements
of operations, which is part of operating income of the applicable segment.
Our company’s chief operating decision maker (CODM) is Jeffrey Miller, Chairman of the Board, President and Chief
Executive Officer. Throughout the year, our CODM assesses the performance of the two
and operating income, in comparison with forecast and plan and overall results, to make capital and resource allocation
decisions.
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
Millions of dollars | 2026 | 2025 | 2026 | 2025 |
Revenue: | ||||
Completion and Production | $ | $ | $ | $ |
Drilling and Evaluation | ||||
Total revenue | $ | $ | $ | $ |
Operating income: | ||||
Completion and Production | $ | $ | $ | $ |
Drilling and Evaluation | ||||
Total operations | ||||
Corporate and other (a) | ( | ( | ( | ( |
SAP S4 upgrade expense | ( | ( | ( | ( |
Impairments and other (charges) credits (b) | ( | |||
Total operating income | $ | $ | $ | $ |
Interest expense, net of interest income | $( | $( | $( | $( |
Other, net | ( | ( | ( | ( |
Income before income taxes | $ | $ | $ | $ |
Capital expenditures: | ||||
Completion and Production | $ | $ | $ | $ |
Drilling and Evaluation | ||||
Corporate and other | ||||
Total capital expenditures | $ | $ | $ | $ |
Depreciation, depletion, and amortization: | ||||
Completion and Production | $ | $ | $ | $ |
Drilling and Evaluation | ||||
Corporate and other | ||||
Total depreciation, depletion, and amortization | $ | $ | $ | $ |
(a) | Includes certain expenses not attributable to a business segment, such as costs related to support functions, corporate executives, and operating lease assets, and includes amortization expense associated with intangible assets recorded as a result of acquisitions. | ||
(b) | For the three and six months ended June 30, 2026, the amount includes an $ million credit attributable to Drilling and Evaluation, and a $ June 30, 2025, the amount includes a $ Drilling and Evaluation, and a $ Note 2 for further discussion on impairments and other charges (credits). | ||
HAL Q2 2026 FORM 10-Q | 7
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
and segment operating income and are regularly reviewed by our CODM.
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
2026 | 2026 | |||
Millions of dollars | Completion and Production | Drilling and Evaluation | Completion and Production | Drilling and Evaluation |
Segment operating expenses: | ||||
Cost of products, materials, and supplies | $ | $ | $ | $ |
Compensation | ||||
Depreciation, depletion, and amortization | ||||
Other | ||||
Total segment operating expenses | $ | $ | $ | $ |
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
2025 | 2025 | |||
Millions of dollars | Completion and Production | Drilling and Evaluation | Completion and Production | Drilling and Evaluation |
Segment operating expenses: | ||||
Cost of products, materials, and supplies | $ | $ | $ | $ |
Compensation | ||||
Depreciation, depletion, and amortization | ||||
Other | ||||
Total segment operating expenses | $ | $ | $ | $ |
miscellaneous costs.
Millions of dollars | June 30, 2026 | December 31, 2025 |
Total assets: | ||
Completion and Production (a) | $ | $ |
Drilling and Evaluation (a) | ||
Corporate and other (b) | ||
Total assets | $ | $ |
(a) | Assets associated with specific segments primarily include receivables, inventories, property, plant, and equipment, operating lease right-of- use assets, equity in and advances to related companies, and goodwill. | ||
(b) | Includes primarily cash and equivalents and deferred tax assets. | ||
HAL Q2 2026 FORM 10-Q | 8
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
Note 4. Revenue
products in an amount that reflects the consideration we expect to receive in exchange for those services and products. Most of
our service and product contracts are short-term in nature. In recognizing revenue for our services and products, we determine
the transaction price of purchase orders or contracts with our customers, which may consist of fixed and variable consideration.
We also assess our customers’ ability and intention to pay, which is based on a variety of factors, including our historical
payment experience with, and the financial condition of, our customers. Payment terms and conditions vary by contract type,
although terms generally include a requirement of payment within 20 60
revenue include an assessment of progress towards completion of performance obligations for certain long-term contracts,
which involve estimating total costs to determine our progress towards contract completion and calculating the corresponding
We disaggregate revenue from contracts with customers into types of services or products, consistent with our two
reportable segments, in addition to geographical area. Based on the location of services provided and products sold, 37 % and
other country accounted for more than 10% of our revenue for those periods.
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
Millions of dollars | 2026 | 2025 | 2026 | 2025 |
Revenue by segment: | ||||
Completion and Production | $ | $ | $ | $ |
Drilling and Evaluation | ||||
Total revenue | $ | $ | $ | $ |
Revenue by geographic region: | ||||
North America | $ | $ | $ | $ |
Latin America | ||||
Europe/Africa/CIS | ||||
Middle East/Asia | ||||
Total revenue | $ | $ | $ | $ |
Contract balances
We perform our obligations under contracts with our customers by transferring services and products in exchange for
consideration. The timing of our performance often differs from the timing of our customers’ payment, which results in the
recognition of receivables and deferred revenue. Deferred revenue represents advance consideration received from customers
for contracts where revenue is recognized on future performance of service. Deferred revenue, as well as revenue recognized
during the period relating to amounts included as deferred revenue at the beginning of the period, was not material to our
condensed consolidated financial statements.
Transaction price allocated to remaining performance obligations
Remaining performance obligations represent firm contracts for which work has not been performed and future
revenue recognition is expected. We have elected the practical expedient permitting the exclusion of disclosing remaining
performance obligations for contracts that have an original expected duration of one year or less. We have some long-term
contracts related to software and integrated project management services such as lump sum turnkey contracts. For software
contracts, revenue is generally recognized over the duration of the contract period when the software is considered to be a right
to access our intellectual property. For lump sum turnkey projects, we recognize revenue over time using an input method,
which requires us to exercise judgment. Revenue allocated to remaining performance obligations for these long-term contracts
is not material.
HAL Q2 2026 FORM 10-Q | 9
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
As of both June 30, 2026 and December 31, 2025, 31
States. Receivables from our primary customer in Mexico accounted for approximately 7
June 30, 2026 and December 31, 2025. While we have experienced payment delays from our primary customer in Mexico, the
amounts are not in dispute and we have not historically had, and we do not expect, any material write-offs due to collectability
of receivables from this customer. Furthermore, we have entered into credit default swaps (CDSs) with third-party financial
institutions that have an aggregate notional amount outstanding as of June 30, 2026 of $217 million, compared to an aggregate
notional amount outstanding as of December 31, 2025 of $592 million, related to borrowings provided by the financial
institutions to one of our primary customers in Mexico, of which portions of the proceeds were utilized by this customer to pay
certain of our outstanding receivables. See Notes to Condensed Consolidated Financial Statements, Note 11 for further
information on these CDSs. No country other than the United States, and no 10
our net trade receivables at those dates.
We have risk of delayed customer payments and payment defaults associated with customer liquidity issues. We
routinely monitor the financial stability of our customers and employ an extensive process to evaluate the collectability of
outstanding receivables. This process, which involves judgment and estimates, includes analysis of our customers’ historical
time to pay, financial condition and various financial metrics, debt structure, credit ratings, and production profile, as well as
political and economic factors in countries of operations and other customer-specific factors.
Note 5. Inventories
June 30, | December 31, | |
Millions of dollars | 2026 | 2025 |
Finished products and parts | $ | $ |
Raw materials and supplies | ||
Work in process | ||
Total inventories | $ | $ |
Note 6. Accounts Payable
We have an agreement with a third party that allows our participating suppliers to finance payment obligations from us
with a designated third-party financial institution who acts as our paying agent. We have generally extended our payment terms
with suppliers to 90
our payment obligations to such supplier prior to the scheduled due date thereof at a discounted price. We are not required to
provide collateral to the financial institution.
Our obligations to participating suppliers, including amounts due and scheduled payment dates, are not impacted by
the suppliers’ decisions to finance amounts due under these financing arrangements. Our outstanding payment obligations under
this agreement was $256 million as of June 30, 2026, and $280 million as of December 31, 2025, and are included in “Accounts
payable” on the Condensed Consolidated Balance Sheets.
HAL Q2 2026 FORM 10-Q | 10
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
Note 7. Income Taxes
income of $664 million, resulting in an effective tax rate of 19.0 % for the quarter. During the three months ended June 30,
2025, we recorded a total income tax provision of $131 million on a pre-tax income of $611 million, resulting in an effective
tax rate of 21.4 % for the quarter.
income of $1.2 billion, resulting in an effective tax rate of 18.7 % for the period. The effective tax rate for this period was
primarily impacted by the release of a valuation allowance in the amount of $32 million related to changes in deferred tax asset
realizability. During the six months ended June 30, 2025, we recorded a total income tax provision of $234 million on a pre-tax
income of $917 million, resulting in an effective tax rate of 25.5 % for the period.
Our tax returns are subject to review by the taxing authorities in the jurisdictions where we file tax returns. In most
cases we are no longer subject to examination by tax authorities for years before 2014. The only significant operating
jurisdiction that has tax filings under review or subject to examination by the tax authorities is the United States. As of June 30,
2026, the United States federal income tax filings for tax years 2016 through 2024 are currently under review or remain open
for review by the Internal Revenue Service (the IRS).
As of June 30, 2026, the primary unresolved issue for the IRS audit for 2016 relates to the classification of the
$3.5 billion ordinary deduction that we claimed for the termination fee we paid to Baker Hughes in the second quarter of 2016
for which we received a Notice of Proposed Adjustment (NOPA) from the IRS on September 28, 2023. We regularly assess the
likelihood of adverse outcomes resulting from tax examinations to determine the adequacy of our tax reserves, and we believe
our income tax reserves are appropriately provided for all open tax years. We do not expect a final resolution of this issue in the
next twelve months.
The Organization for Economic Co-operation and Development enacted model rules for a new global minimum tax
framework, also known as Pillar Two, and certain governments globally have enacted, or are in the process of enacting,
legislation considering these model rules. These rules did not have a material impact on our taxes for the six months ended
June 30, 2026 and 2025.
Based on the information currently available, we do not anticipate a significant increase or decrease to our tax
contingencies within the next twelve months.
HAL Q2 2026 FORM 10-Q | 11
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
Note 8. Shareholders' Equity
and June 30, 2025, respectively:
Millions of dollars | Common Stock | Paid-in Capital in Excess of Par Value | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest in Consolidated Subsidiaries | Total |
Balance at December 31, 2025 | $ | $ | $( | $ | $( | $ | $ |
Comprehensive income (loss): | |||||||
Net income | |||||||
Other comprehensive income (loss) | |||||||
Cash dividends ($0.17 per share) | ( | ( | |||||
Stock repurchase program | ( | ( | |||||
Stock plans (a) | ( | ||||||
Other | ( | ( | |||||
Balance at March 31, 2026 | $ | $ | $( | $ | $( | $ | $ |
Comprehensive income (loss): | |||||||
Net income | |||||||
Other comprehensive income (loss) | |||||||
Cash dividends ($0.17 per share) | ( | ( | |||||
Stock repurchase program | ( | ( | |||||
Stock plans (a) | ( | ( | ( | ||||
Other | ( | ( | ( | ||||
Balance at June 30, 2026 | $ | $ | $( | $ | $( | $ | $ |
(a) | In the first quarter and second quarter of 2026, we issued common stock from treasury shares for stock options exercised, restricted stock grants, performance shares under our performance unit program, and purchases under our employee stock purchase plan. |
Millions of dollars | Common Stock | Paid-in Capital in Excess of Par Value | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest in Consolidated Subsidiaries | Total |
Balance at December 31, 2024 | $ | $ | $( | $ | $( | $ | $ |
Comprehensive income (loss): | |||||||
Net income | ( | ||||||
Other comprehensive income (loss) | ( | ( | |||||
Cash dividends ($0.17 per share) | ( | ( | |||||
Stock repurchase program | ( | ( | |||||
Stock plans (a) | ( | ( | |||||
Other | |||||||
Balance at March 31, 2025 | $ | $ | $( | $ | $( | $ | $ |
Comprehensive income (loss): | |||||||
Net income | |||||||
Other comprehensive income (loss) | |||||||
Cash dividends ($0.17 per share) | ( | ( | |||||
Stock repurchase program | ( | ( | |||||
Stock plans (a) | ( | ||||||
Other | ( | ( | |||||
Balance at June 30, 2025 | $ | $ | $( | $ | $( | $ | $ |
(a) | In the first quarter and second quarter of 2025, we issued common stock from treasury shares for stock options exercised, restricted stock grants, performance shares under our performance unit program, and purchases under our employee stock purchase plan. |
HAL Q2 2026 FORM 10-Q | 12
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
Our Board of Directors has authorized a program to repurchase our common stock from time to time. We repurchased
Approximately $1.7 billion remained authorized for repurchases under the program as of June 30, 2026. From the inception of
this program in February of 2006 through June 30, 2026, we repurchased 334 million shares of our common stock for a total
cost of approximately $12.4 billion. We repurchased 12 million shares of our common stock under the program during the three
months ended June 30, 2025 for approximately $252 million.
June 30, | December 31, | |
Millions of dollars | 2026 | 2025 |
Cumulative translation adjustments | $( | $( |
Defined benefit and other postretirement liability adjustments | ( | ( |
Other | ( | ( |
Total accumulated other comprehensive loss | $( | $( |
Note 9. Commitments and Contingencies
injury, property damage, environmental, intellectual property, commercial, tax, and other matters arising in the ordinary course
of business, the resolution of which, in the opinion of management, will not have a material adverse effect on our consolidated
results of operations or consolidated financial position. There is inherent risk in any legal or governmental proceeding, claim or
investigation, and no assurance can be given as to the outcome of these proceedings.
Guarantee arrangements
In the normal course of business, we have in place agreements with financial institutions under which approximately
$3.3 billion of letters of credit, bank guarantees, or surety bonds were outstanding as of June 30, 2026. Some of the outstanding
letters of credit have triggering events that would entitle a bank to require cash collateralization. None of these off-balance sheet
Note 10. Income per Share
Basic income or loss per share is based on the weighted average number of common shares outstanding during the
period. Diluted income per share includes additional common shares that would have been outstanding if potential common
shares with a dilutive effect had been issued. Antidilutive securities represent potentially dilutive securities which are excluded
from the computation of diluted income or loss per share as their impact was antidilutive.
Three Months Ended | Six Months Ended | |||
June 30, | June 30, | |||
Millions of shares | 2026 | 2025 | 2026 | 2025 |
Basic weighted average common shares outstanding | ||||
Dilutive effect of awards granted under our stock incentive plans | ||||
Diluted weighted average common shares outstanding | ||||
Antidilutive shares: | ||||
Weighted average options with exercise price greater than the average market price | ||||
Total antidilutive shares | ||||
HAL Q2 2026 FORM 10-Q | 13
Part I. Item 1 | Notes to Condensed Consolidated Financial Statements |
Note 11. Fair Value of Financial Instruments
The carrying amount of cash and equivalents, receivables, and accounts payable, as reflected in the Condensed
Consolidated Balance Sheets, approximates fair value due to the short maturities of these instruments.
June 30, 2026 | December 31, 2025 | ||||||||
Millions of dollars | Level 1 | Level 2 | Total fair value | Carrying value | Level 1 | Level 2 | Total fair value | Carrying value | |
Total debt | $ | $ | $ | $ | $ | $ | $ | $ | |
identical liabilities with transactions occurring on the last two days of period-end. Our debt categorized within level 2 on the
fair value hierarchy is calculated using significant observable inputs for similar liabilities where estimated values are
determined from observable data points on our other bonds and on other similarly rated corporate debt or from observable data
points of transactions occurring prior to two days from period-end and adjusting for changes in market conditions. Differences
between the periods presented in our level 1 and level 2 classification of our long-term debt relate to the timing of when third-
party market transactions on our debt are executed. We have no
of June 30, 2026 of $217 million, compared to an aggregate notional amount outstanding as of December 31, 2025 of $592
million, related to borrowings provided by the financial institutions to one of our primary customers in Mexico, of which a
portion of the proceeds were then utilized by this customer to pay certain of our outstanding receivables. The aggregate notional
outstanding amount of the CDSs reduces monthly over its remaining 3 -month term.
The fair value of the derivative liabilities was not material to our financial condition as of June 30, 2026.
Note 12. New Accounting Pronouncements
In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2024-03
(Subtopic 220-40), “Disaggregation of Income Statement Expenses”, which requires additional disclosure of certain expense
captions presented on the face of the Company’s income statement as well as disclosures about selling expenses. ASU 2024-03
is effective for the Company’s annual reporting periods beginning after December 15, 2026, and interim reporting periods
beginning after December 15, 2027, and should be applied on a prospective or retrospective basis, with early adoption
permitted. We continue to evaluate the effect that adoption of ASU 2024-03 will have on our disclosures.
HAL Q2 2026 FORM 10-Q | 14
Part I. Item 2 | Executive Overview |
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in
conjunction with the condensed consolidated financial statements included in Item 1. Financial Statements contained herein.
EXECUTIVE OVERVIEW
Organization
We are one of the world’s largest providers of products and services to the energy industry. We help our customers
maximize asset value throughout the lifecycle of the reservoir from locating hydrocarbons and managing geological data, to
drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the asset.
Activity levels within our operations are significantly impacted by spending on upstream exploration, development, and
production programs by major, national, and independent oil and natural gas companies. We report our results under two
segments, the Completion and Production segment and the Drilling and Evaluation segment.
•Completion and Production delivers cementing, stimulation, specialty chemicals, intervention, pressure control,
artificial lift, and completion products and services. The segment consists of Artificial Lift, Cementing, Completion
Tools, Pipeline and Process Services, Production Enhancement, and Production Solutions. During the second
quarter of 2026, we completed the sale of a portion of our chemical business.
•Drilling and Evaluation provides field and reservoir modeling, drilling, fluids, evaluation, and precise wellbore
placement solutions that enable customers to model, measure, drill, and optimize their well construction activities.
The segment consists of Baroid, Drill Bits and Services, Halliburton Project Management, Landmark Software and
Services, Sperry Drilling, Testing and Subsea, and Wireline and Perforating.
The business operations of our segments are organized around four primary geographic regions: North America, Latin
America, Europe/Africa/CIS, and Middle East/Asia. We have manufacturing operations in various locations, the most
significant of which are in the United States, Malaysia, Singapore, and the United Kingdom. With over 46,000 employees, we
operate in more than 70 countries around the world, and our corporate headquarters is in Houston, Texas.
Our value proposition is to collaborate and engineer solutions to maximize asset value for our customers. We strive to
achieve strong cash flows and returns for our shareholders by delivering technology and services that improve efficiency,
increase recovery, and maximize production for our customers. Our strategic priorities are to:
- International: Consistently increase international growth in our directional drilling, unconventionals, well
intervention, and artificial lift businesses. Develop behind-the-meter power generation, independently or through
collaboration with Voltagrid.
- North America: Maximize value by, among other things, utilizing our Zeus IQ electric fracturing platform, our
iCruise rotary steerable systems and LOGIX automation.
- Digital: Continue to drive differentiation and efficiencies through the deployment of digital and automation
technologies, both internally and for our customers.
- Capital efficiency: Maintain our capital expenditures at about $1.1 billion, while leveraging technology and targeted
process improvements to enhance utilization of existing capital.
- Shareholder returns: Return over 50% of annual free cash flow to shareholders through dividends and share
repurchases.
- Advance a Sustainable Energy Future: Continue to develop technologies and solutions to help lower our customers’
and our emissions intensity, grow our low carbon energy business, and support Halliburton Labs early-stage
company participants.
HAL Q2 2026 FORM 10-Q | 15
Part I. Item 2 | Executive Overview |
The following charts depict the revenue split between our two operating segments and our four primary geographic
regions for the three months ended June 30, 2026.
Market conditions
During the second quarter of 2026, market conditions were impacted by the ongoing geopolitical conflict in the Middle
East, which disrupted activity levels in certain markets and affected operations across both of our segments.
Oil prices increased in the second quarter of 2026 compared to the first quarter of 2026. The West Texas Intermediate
(WTI) crude oil price averaged approximately $96 per barrel during the second quarter of 2026, compared to approximately
$72 per barrel during the first quarter of 2026, or a 33% increase. The Brent crude oil price averaged approximately $103 per
barrel during the second quarter of 2026, compared to approximately $80 per barrel during the first quarter, or a 29% increase.
Higher commodity prices generally support customer activity and capital spending in the markets we serve, as operator
investment decisions are often influenced by expectations regarding future commodity prices.
Trade tensions and tariffs continue to influence the global demand outlook, with varying impacts across end markets.
We continue to monitor and evaluate the effects of these on goods imported into the United States. During the second quarter of
2026, we recognized a gain of approximately $57 million related to a government refund recovery, which is included in
“Impairments and other charges (credits)” on the Condensed Consolidated Statements of Operations. We continue to monitor
developments related to trade policy and evaluate the potential effects of future tariff actions on our business, financial position,
results of operations and cash flows.
Globally, we continue to be impacted by inflationary cost increases, primarily related to logistics, chemicals, and
cement. We manage these pressures through global procurement strategies, technology modifications, and sourcing efficiencies.
As a standard practice, we generally seek to pass a portion of these cost increases on to our customers and believe we have
effective solutions in place to minimize their operational impact.
Customers remained focused on capital discipline, production optimization, operating efficiency, and expected returns
on investment. Customer activity and spending decisions were influenced by the geopolitical conflict in the Middle East, higher
commodity prices, uncertainty related to global trade policies and tariffs, and inflationary cost pressures. As a result, customers
continued to evaluate investment opportunities while balancing growth objectives, operating priorities, and return expectations.
HAL Q2 2026 FORM 10-Q | 16
Part I. Item 2 | Executive Overview |
Financial results
The following graph illustrates our revenue and operating margins for each operating segment for the second quarter of
2025 and 2026.
During the second quarter of 2026, we generated total company revenue of $5.7 billion, a 4% increase as compared to
the second quarter of 2025. We reported operating income of $778 million, including a pre-tax credit on impairments and other
credits of $95 million, in the second quarter of 2026, as compared to operating income of $727 million in the second quarter of
2025.
Our Completion and Production segment revenue was relatively flat in the second quarter of 2026 as compared to the
second quarter of 2025. Revenue improvements were primarily driven by increased stimulation activity and improved artificial
lift activity in Latin America, higher completion tool sales in Europe/Africa, and improved pressure pumping services in Africa.
Offsetting these increases were lower activity across multiple product service lines in the Middle East, and decreased
stimulation activity and lower specialty chemicals activity resulting from the completed sale of a portion of our chemical
business in North America. Operating income was further adversely impacted by activity mix and reduced pricing for
stimulation services in US Land and Latin America.
Our Drilling and Evaluation segment revenue increased 7% in the second quarter of 2026 as compared to the second
quarter of 2025. These results were primarily driven by higher drilling-related services in North America, Europe/Africa, and
Asia, and higher activity across multiple product service lines in Latin America. Partially offsetting these increases were lower
drilling-related services and decreased wireline activity in the Middle East.
Our North America revenue was relatively flat in the second quarter of 2026 as compared to the second quarter of
2025. These results were primarily driven by improved well construction activity and increased stimulation activity in US Land.
Partially offsetting these increases were lower stimulation activity in the Gulf of America and Canada, and a decrease in well
intervention services and lower specialty chemicals activity resulting from the completed sale of a portion of our chemical
business in US Land.
Internationally, revenue increased 6% in the second quarter of 2026 as compared to the second quarter of 2025, largely
driven by improved stimulation services and higher project management activity in Latin America, increased well construction
activity and higher project management activity in Africa, and higher completion tool sales in Europe/Africa. Partially
offsetting these increases was lower activity across multiple product service lines in the Middle East due to conflict-related
disruptions.
Our operating performance and liquidity are described in more detail in “Liquidity and Capital Resources” and
“Business Environment and Results of Operations.”
HAL Q2 2026 FORM 10-Q | 17
Part I. Item 2 | Liquidity and Capital Resources |
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 2026, we had $2.0 billion of cash and equivalents, compared to $2.2 billion of cash and equivalents at
December 31, 2025.
Significant sources and uses of cash during the first six months of 2026
Sources of cash:
•Cash flows from operating activities were $1.1 billion. Working capital, which consists of receivables, inventories,
and accounts payable, had a negative impact of $187 million.
Uses of cash:
•Capital expenditures were $427 million.
•We repurchased 7.9 million shares of our common stock for $308 million, which includes the excise tax payment
for prior year share repurchases.
•We paid $285 million of dividends to our shareholders.
•We paid $101 million primarily in connection with an equity investment.
Future sources and uses of cash
We manufacture most of our own equipment, which provides us with some flexibility to increase or decrease our
capital expenditures based on market conditions. We currently expect capital spending for 2026 to be approximately $1.1
billion. We believe this level of spending will enable continued investment in our core strategic technologies and businesses,
including the international expansion of our artificial lift, well intervention, unconventionals, and drilling technologies. We will
continue to maintain capital discipline and monitor the rapidly changing market dynamics, and we may adjust our capital
spending accordingly.
While we maintain focus on liquidity and debt reduction, we are also focused on providing cash returns to our
shareholders. Our quarterly dividend rate is $0.17 per common share, or approximately $143 million. In 2023, our Board
approved a capital return framework with a goal of returning at least 50% of our annual free cash flow to shareholders through
dividends and share repurchases, and we expect our returns to shareholders will be in line with our capital return framework for
2026.
We may utilize share repurchases as part of our capital return framework. Our Board of Directors has authorized a
program to repurchase our common stock from time to time. We repurchased 5 million shares of common stock during the
second quarter of 2026 under this program. Approximately $1.7 billion remained authorized for repurchases as of June 30, 2026
and may be used for open market and other share purchases.
During 2023, we began our migration to SAP S4 which we expect to complete in the fourth quarter of 2026. For the
six months ended June 30, 2026, we incurred $88 million in expense on our SAP S4 migration and expect the estimated cost to
be approximately $45 million in the third quarter of 2026. We believe the new system will provide important efficiency
benefits, cost savings, enhanced visibility to our operations, and advanced analytics that will benefit us and our customers.
We may, from time to time, redeem, repurchase, or otherwise acquire our outstanding debt through privately
negotiated transactions, open market purchases, redemptions, tender offers or otherwise, but we are under no obligation to do
so.
Other factors affecting liquidity
Financial condition in current market. As of June 30, 2026, we had $2.0 billion of cash and equivalents and $3.5
billion of available committed bank credit under our revolving credit facility, with an expiration date of August 16, 2030. We
believe we have a manageable debt maturity profile, with approximately $90 million due February 2027. Furthermore, we have
no financial covenants or material adverse change provisions in our bank agreements, and our debt maturities extend over a
long period of time. We believe our cash on hand, cash flows generated from operations, and our available credit facility will
provide sufficient liquidity to address expected global cash needs, including capital expenditures, working capital investments,
shareholder returns, if any, debt repurchases, if any, and scheduled interest and principal payments, in the short term and long
term.
HAL Q2 2026 FORM 10-Q | 18
Part I. Item 2 | Liquidity and Capital Resources |
Guarantee agreements. In the normal course of business, we have agreements with financial institutions under which
approximately $3.3 billion of letters of credit, bank guarantees, or surety bonds were outstanding as of June 30, 2026. Some of
the outstanding letters of credit have triggering events that would entitle a bank to require cash collateralization; however, none
of these triggering events have occurred. As of June 30, 2026, we had no material off-balance sheet liabilities and were not
required to make any material cash distributions to our unconsolidated subsidiaries.
We have entered into credit default swaps (CDSs) with third-party financial institutions that have an aggregate
notional amount outstanding as of June 30, 2026 of $217 million, compared to an aggregate notional amount outstanding as of
December 31, 2025 of $592 million, related to borrowings provided by the financial institutions to one of our primary
customers in Mexico, of which portions of the proceeds were utilized by this customer to pay certain of our outstanding
receivables. The aggregate notional amount outstanding of the CDSs reduces monthly over its remaining 3-month term.
Credit ratings. Our credit ratings with Standard & Poor’s remain BBB+ for our long-term debt and A-2 for our short-
term debt, with a stable outlook. Our credit ratings with Moody's Investors Service remain A3 for our long-term debt and P-2
for our short-term debt, with a stable outlook.
Customer receivables. In line with industry practice, we bill our customers for our services in arrears and are,
therefore, subject to our customers delaying or failing to pay our invoices. In weak economic environments, we may experience
increased delays and failures to pay our invoices due to, among other reasons, a reduction in our customers’ cash flow from
operations and their access to the credit markets, as well as unsettled political conditions.
Receivables from our primary customer in Mexico accounted for approximately 7% of our total receivables as of both
June 30, 2026 and December 31, 2025. While we have experienced payment delays from our primary customer in Mexico, the
amounts are not in dispute and we have not historically had, and we do not expect, any material write-offs due to collectability
of receivables from this customer.
HAL Q2 2026 FORM 10-Q | 19
Part I. Item 2 | Business Environment and Results of Operations |
BUSINESS ENVIRONMENT AND RESULTS OF OPERATIONS
We operate in more than 70 countries throughout the world and provide a broad range of services and products to the
energy industry. Our revenue is generated from the sale of services and products to major, national, and independent oil and
natural gas companies worldwide. The industry we serve is highly competitive, with numerous competitors across each of our
business segments. Based on the location of services provided and products sold, 37% and 39% of our consolidated revenue
was attributable to the United States during the six months ended June 30, 2026 and 2025, respectively. No other country
accounted for more than 10% of our revenue for those periods.
Demand for our services and products is largely dependent on our customers' spending for the exploration,
development, and production of oil and natural gas reserves. Customer spending is influenced by a variety of factors, including
commodity prices and expectations regarding future prices, global oil and natural gas supply and demand fundamentals, the
availability of capital, government policies and regulations, geopolitical developments, and overall economic conditions.
Activity levels in certain markets may also be influenced by longer-term trends affecting energy demand, including
increasing electricity consumption associated with digital infrastructure and data center growth. These factors collectively
influence global drilling, completions, intervention, and production-related activity levels.
Because a significant portion of our business supports our customers' capital spending programs, our financial
performance is closely tied to oil and natural gas prices and worldwide drilling and completions activity. Lower commodity
prices generally result in reduced customer spending and lower activity levels, while higher commodity prices typically support
increased investment and activity. Accordingly, our operating results are significantly affected by changes in commodity prices
and global rig activity, which are summarized in the tables below.
The table below shows the average prices for West Texas Intermediate (WTI) crude oil, United Kingdom Brent crude
oil, and Henry Hub natural gas.
Three Months Ended | Year Ended | ||
June 30, | December 31, | ||
2026 | 2025 | 2025 | |
Oil Price - WTI (1) | $95.75 | $64.63 | $65.46 |
Oil Price - Brent (1) | 103.28 | 68.01 | 69.10 |
Natural Gas Price - Henry Hub (2) | 2.95 | 3.19 | 3.53 |
(1) | Oil prices measured in dollars per barrel. | ||||
(2) | Natural gas price measured in dollars per million British thermal units (Btu), or MMBtu. | ||||
The historical average rig counts based on the weekly Baker Hughes rig count data were as follows:
Three Months Ended | Six Months Ended | Year Ended | |||
June 30, | June 30, | December 31, | |||
2026 | 2025 | 2026 | 2025 | 2025 | |
US Land | 540 | 558 | 536 | 565 | 546 |
US Offshore | 14 | 13 | 15 | 14 | 15 |
Canada | 149 | 128 | 178 | 172 | 175 |
North America | 703 | 699 | 729 | 751 | 736 |
International (1) | 1,056 | 1,078 | 1,070 | 1,088 | 1,080 |
Worldwide Total | 1,759 | 1,777 | 1,799 | 1,839 | 1,816 |
(1) | For the three and six months ended June 30, 2025, historical average rig counts shown are based on data provided by Baker Hughes, which included retroactive adjustments to international rig counts previously reported as a result of a methodology change. | ||||
HAL Q2 2026 FORM 10-Q | 20
Part I. Item 2 | Business Environment and Results of Operations |
Business outlook
We expect customer spending to remain focused on capital discipline, production optimization, and operational
efficiency across both international and North America markets.
Operations in certain Middle East markets continue to be affected by ongoing geopolitical developments, including
periodic operational disruptions, reduced activity in some areas, and higher logistics and supply chain costs. Activity in the
region is recovering from conflict-related lows; however, the pace of recovery remains dependent on day-to-day developments
in the region.
Outside of the Middle East, we expect activity growth to be led by production services, drilling, unconventionals, and
lift. These markets continue to be supported by customer investment in development projects, production capacity maintenance,
and selected offshore and strategic energy projects. In North America, customer activity remains focused on maximizing returns
and improving operating efficiency within existing capital budgets. Over the long term, we expect North America to remain
critical for global energy security, which will require advanced technology and greater service intensity.
While current industry fundamentals remain generally supportive of customer activity, the outlook for our business
remains subject to uncertainty. Customer spending and activity levels may be affected by volatility in oil and natural gas prices,
changes in global supply and demand balances, inflationary pressures, supply chain constraints, the availability of capital,
geopolitical developments, trade policies, sanctions, and regulatory actions. These factors may impact the timing and scope of
customer projects and demand for our services and products.
HAL Q2 2026 FORM 10-Q | 21
Part I. Item 2 | Results of Operations in 2026 Compared to 2025 (QTD) |
RESULTS OF OPERATIONS IN 2026 COMPARED TO 2025
Three Months Ended June 30, 2026 Compared with Three Months Ended June 30, 2025
Three Months Ended | ||||
June 30, | Favorable | Percentage | ||
Millions of dollars | 2026 | 2025 | (Unfavorable) | Change |
Revenue: | ||||
By operating segment: | ||||
Completion and Production | $3,202 | $3,171 | $31 | 1% |
Drilling and Evaluation | 2,512 | 2,339 | 173 | 7 |
Total revenue | $5,714 | $5,510 | $204 | 4% |
By geographic region: | ||||
North America | $2,276 | $2,259 | $17 | 1% |
Latin America | 1,123 | 977 | 146 | 15 |
Europe/Africa/CIS | 1,017 | 820 | 197 | 24 |
Middle East/Asia | 1,298 | 1,454 | (156) | (11) |
Total revenue | $5,714 | $5,510 | $204 | 4% |
Operating income: | ||||
By operating segment: | ||||
Completion and Production | $474 | $513 | $(39) | (8)% |
Drilling and Evaluation | 338 | 312 | 26 | 8 |
Total operations | 812 | 825 | (13) | (2) |
Corporate and other | (83) | (66) | (17) | (26) |
SAP S4 upgrade expense | (46) | (32) | (14) | (44) |
Impairments and other credits | 95 | — | 95 | n/m |
Total operating income | $778 | $727 | $51 | 7% |
n/m = not meaningful | ||||
Operating Segments
Completion and Production
Completion and Production revenue in the second quarter of 2026 was $3.2 billion, or relatively flat, when compared
to the second quarter of 2025. Operating income in the second quarter of 2026 was $474 million, a decrease of $39 million, or
8%, when compared to the second quarter of 2025. Revenue improvements were primarily driven by increased stimulation
activity and improved artificial lift activity in Latin America, higher completion tool sales in Europe/Africa, and increased
pressure pumping services in Africa. Offsetting these increases were lower activity across multiple product service lines in the
Middle East, and decreased stimulation activity and lower specialty chemicals activity resulting from the completed sale of a
portion of our chemical business in North America. Operating income was further adversely impacted by activity mix and
reduced pricing for stimulation services in US Land and Latin America.
Drilling and Evaluation
Drilling and Evaluation revenue in the second quarter of 2026 was $2.5 billion, an increase of $173 million, or 7%,
when compared to the second quarter of 2025. Operating income in the second quarter of 2026 was $338 million, an increase of
$26 million, or 8%, when compared to the second quarter of 2025. These results were primarily driven by higher drilling-
related services in North America, Europe/Africa, and Asia, and higher activity across multiple product service lines in Latin
America. Partially offsetting these increases were lower drilling-related services and decreased wireline activity in the Middle
East.
In the second quarter, the geopolitical conflict in the Middle East affected both of our operating segments.
HAL Q2 2026 FORM 10-Q | 22
Part I. Item 2 | Results of Operations in 2026 Compared to 2025 (QTD) |
Geographic Regions
North America
North America revenue in the second quarter of 2026 was $2.3 billion, relatively flat, as compared to the second
quarter of 2025. These results were primarily driven by improved well construction activity and increased stimulation activity
in US Land. Partially offsetting these increases were lower stimulation activity in the Gulf of America and Canada, and a
decrease in well intervention services and lower specialty chemicals activity resulting from the completed sale of a portion of
our chemical business in US Land.
Latin America
Latin America revenue in the second quarter of 2026 was $1.1 billion, a 15% increase compared to the second quarter
of 2025. These results were primarily driven by improved project management activity and well construction activity in
Ecuador, improved stimulation activity in Argentina, higher completion tool sales and increased stimulation activity in Mexico,
increased activity across multiple product service lines in the Caribbean and Brazil, and higher testing services and wireline
activity across the region. Partially offsetting these increases were lower well construction services and decreased project
management activity in Mexico, and lower completion tool sales in Brazil.
Europe/Africa/CIS
Europe/Africa/CIS revenue in the second quarter of 2026 was $1.0 billion, a 24% increase compared to the second
quarter of 2025. These results were primarily driven by higher activity across multiple product service lines in Angola and
Nigeria, increased drilling-related services and higher completion tool sales in the North Sea, higher completion tool sales in the
Mediterranean and Ivory Coast, and higher well construction activity in Namibia. Partially offsetting these increases were lower
wireline activity and decreased pipeline services in the North Sea, and lower completion tool sales in the Caspian Area.
Middle East/Asia
Middle East/Asia revenue in the second quarter of 2026 was $1.3 billion, an 11% decrease compared to the second
quarter of 2025. These results were primarily driven by decreased activity across multiple product service lines in Saudi Arabia,
Iraq, Qatar, and Kuwait due to conflict-related disruptions. Partially offsetting these decreases were higher testing services in
the United Arab Emirates and improved drilling-related services in Asia.
Other Operating Items
Corporate and Other. During the three months ended June 30, 2026, Corporate and Other expense totaled $83 million,
which was an increase of $17 million, or 26%, as compared to the three months ended June 30, 2025. This increase was
primarily attributable to higher executive compensation costs and increased amortization expense related to recent acquisitions.
SAP S4 Upgrade Expense. As previously mentioned, during 2023, we began our migration to SAP S4, which we
expect to complete in the fourth quarter of 2026. During the second quarter of 2026 and 2025, we recognized $46 million and
$32 million of expense on our SAP S4 migration, respectively.
Impairments and Other Credits. During the three months ended June 30, 2026, we recognized a pre-tax credit of $95
million primarily due to gains on our equity investments, and a government refund recovery, partially offset by a loss on the
sale of a portion of our chemical business. See Notes to Condensed Consolidated Financial Statements, Note 2. Impairments
and Other Charges (Credits) for further discussion of these charges (credits).
Nonoperating Items
Income Tax Provision. During the three months ended June 30, 2026, we recorded a total income tax provision of $126
million on a pre-tax income of $664 million, resulting in an effective tax rate of 19.0% for the quarter. During the three months
ended June 30, 2025, we recorded a total income tax provision of $131 million on a pre-tax income of $611 million, resulting in
an effective tax rate of 21.4% for the quarter.
HAL Q2 2026 FORM 10-Q | 23
Part I. Item 2 | Results of Operations in 2026 Compared to 2025 (QTD) |
Internal Revenue Service Notice of Proposed Adjustment. We are subject to taxes in the United States and in numerous
jurisdictions where we operate or where our subsidiaries are organized. Our tax returns are routinely subject to examination by
the taxing authorities in the jurisdictions where we file tax returns. In most cases we are no longer subject to examination by tax
authorities for years before 2014. The only significant operating jurisdiction that has tax filings under review or subject to
examination by the tax authorities is the United States. Our United States federal income tax filings for tax years 2016 through
2024, including carry back of 2016 net operating losses to 2014, are currently under review or remain open for review by the
IRS.
On September 28, 2023, we received a NOPA from the IRS covering our 2016 U.S. tax return. The NOPA proposed
an adjustment to reclassify approximately 95% of the $3.5 billion termination fee paid to Baker Hughes in 2016 from an
ordinary expense deduction to a capital loss. The termination fee was paid to Baker Hughes under the merger agreement after
antitrust regulators in multiple jurisdictions failed to approve our proposed merger. It is common commercial practice to include
a termination fee in a merger agreement to compensate the target for damages incurred when the acquisition does not go
forward. The IRS’s long-understood position at the time of payment had been to treat such payments as an ordinary and
necessary business expense. We strongly disagree with the proposed adjustment on both a factual and legal basis, and we plan
to vigorously contest it.
We expect that resolving this dispute will take substantial time. In 2023, we initiated the IRS administrative appeals
process, which is ongoing. Failing a resolution through that process, the matter will ultimately be resolved by the United States
federal courts.
We regularly assess the likelihood of adverse outcomes resulting from tax examinations to determine the adequacy of
our tax reserves, and we believe our income tax reserves are appropriately provided for all open tax years. We cannot assure
you that the matter will be determined in our favor or against us, and if the matter is ultimately determined unfavorably to us, it
could have a material adverse impact on our results of operations and cash flows. Based on tax attributes currently available, we
estimate that, should the IRS's position prevail through the appellate process and subsequent litigation, the proposed adjustment
could result in cash taxes due of approximately $640 million (plus interest thereon in the case of amounts due for previous tax
years). Our estimates are calculated under current tax law and on the basis of our assumptions regarding taxable income and
loss and other tax attributes over the relevant period, of which the law could change and which assumptions could and likely
will differ materially from actual results. In any event, no payment of any additional tax is currently required, nor do we
anticipate that the proposed adjustment would materially and adversely impact our ability to meet our expected uses of cash,
including future capital expenditures, working capital investments, and scheduled debt repayments, or our ability to return cash
to shareholders, even if a final determination of the matter is reached that is adverse to us.
HAL Q2 2026 FORM 10-Q | 24
Part I. Item 2 | Results of Operations in 2026 Compared to 2025 (YTD) |
Six Months Ended June 30, 2026 Compared with Six Months Ended June 30, 2025
Six Months Ended | ||||
June 30, | Favorable | Percentage | ||
Millions of dollars | 2026 | 2025 | (Unfavorable) | Change |
Revenue: | ||||
By operating segment: | ||||
Completion and Production | $6,218 | $6,291 | $(73) | (1)% |
Drilling and Evaluation | 4,898 | 4,636 | 262 | 6 |
Total revenue | $11,116 | $10,927 | $189 | 2% |
By geographic region: | ||||
North America | $4,412 | $4,495 | $(83) | (2)% |
Latin America | 2,213 | 1,873 | 340 | 18 |
Europe/Africa/CIS | 1,875 | 1,595 | 280 | 18 |
Middle East/Asia | 2,616 | 2,964 | (348) | (12) |
Total revenue | $11,116 | $10,927 | $189 | 2% |
Operating income: | ||||
By operating segment: | ||||
Completion and Production | $913 | $1,044 | $(131) | (13)% |
Drilling and Evaluation | 689 | 664 | 25 | 4 |
Total operations | 1,602 | 1,708 | (106) | (6) |
Corporate and other | (152) | (132) | (20) | (15) |
SAP S4 upgrade expense | (88) | (62) | (26) | (42) |
Impairments and other (charges) credits | 95 | (356) | 451 | n/m |
Total operating income | $1,457 | $1,158 | $299 | 26% |
n/m = not meaningful | ||||
Operating Segments
Completion and Production
Completion and Production revenue in the first six months of 2026 was $6.2 billion, or relatively flat, when compared
to the first six months of 2025. Operating income for the segment in the first six months of 2026 was $913 million, a decrease
of $131 million, or 13%, when compared to the first six months of 2025. Revenue declines were primarily driven by decreased
activity across multiple product service lines in North America and the Middle East. Offsetting these decreases were improved
activity across multiple product service lines in Latin America, higher completion tool sales in North America, Europe/Africa,
and Asia, increased pressure pumping services in Africa, and increased well intervention services in Europe/Africa. Operating
income was further adversely impacted by activity mix and reduced pricing for stimulation services in Latin America.
Drilling and Evaluation
Drilling and Evaluation revenue in the first six months of 2026 was $4.9 billion, an increase of $262 million, or 6%,
when compared to the first six months of 2025. Operating income for the segment in the first six months of 2026 was $689
million, an increase of $25 million, or 4%, when compared to the first six months of 2025. These results were primarily driven
by higher activity across multiple product service lines in Latin America, improved drilling related services in North America
and Europe, and increased fluids services in Asia. Partially offsetting these increases were lower activity across multiple
product service lines in the Middle East and decreased wireline activity in Europe.
In the first six months of 2026, the geopolitical conflict in the Middle East affected both of our operating segments.
HAL Q2 2026 FORM 10-Q | 25
Part I. Item 2 | Results of Operations in 2026 Compared to 2025 (YTD) |
Geographic Regions
North America
North America revenue in the first six months of 2026 was $4.4 billion, a 2% decrease compared to the first six
months of 2025. These results were primarily driven by lower stimulation activity across the region, lower artificial lift activity
and decreased well intervention services in US Land, a reduction in specialty chemicals activity in US Land following the sale
of a portion of our chemical business, and decreased fluid services in the Gulf of America. Offsetting these decreases were
improved well construction activity in US Land, increased drilling-related services in Canada, and higher completion tool sales
in the Gulf of America.
Latin America
Latin America revenue in the first six months of 2026 was $2.2 billion, an 18% increase compared to the first six
months of 2025. These results were primarily driven by increased activity across multiple product service lines in Ecuador, the
Caribbean, and Brazil, increased stimulation activity and higher completion tool sales in Mexico, and increased stimulation
activity in Argentina. Partially offsetting these increases were decreased well construction activity and lower project
management activity in Mexico, and lower completion tool sales in Brazil.
Europe/Africa/CIS
Europe/Africa/CIS revenue in the first six months of 2026 was $1.9 billion, an 18% increase compared to the first six
months of 2025. These results were primarily driven by higher well construction activity and increased well intervention
services in the region, improved activity across multiple product service lines in Angola, and increased completion tool sales in
Norway and Ivory Coast. Partially offsetting these increases were lower completion tool sales in the Caspian Area and
Romania, and decreased wireline activity in the North Sea.
Middle East/Asia
Middle East/Asia revenue in the first six months of 2026 was $2.6 billion, a 12% decrease compared to the first six
months of 2025. These results were primarily driven by lower activity across multiple product service lines in the Middle East
due to conflict-related disruptions, and decreased wireline activity and lower well intervention services in Asia. Partially
offsetting these decreases were higher fluid services in Brunei, increased testing services in Turkey and the United Arab
Emirates, and improved completion tool sales in Australia.
Other Operating Items
Corporate and Other. During the six months ended June 30, 2026, Corporate and Other expense totaled $152 million,
which was an increase of $20 million, or 15%, as compared to the six months ended June 30, 2025. This increase was primarily
attributable to higher executive compensation costs and increased amortization expense related to recent acquisitions.
SAP S4 Upgrade Expense. As previously mentioned, during 2023 we began our migration to SAP S4, which we expect
to complete in the fourth quarter of 2026. During the six months ended June 30, 2026 and 2025, we recognized $88 million and
$62 million of expense on our SAP S4 migration, respectively.
Impairments and Other Charges (Credits). During the six months ended June 30, 2026, we recognized a pre-tax credit
of $95 million primarily due to gains on our equity investments, and a government refund recovery, partially offset by a loss on
the sale of a portion of our chemical business. During the six months ended June 30, 2025, we took a pre-tax charge of $356
million to adjust our cost to market conditions. These charges consisted primarily of severance costs, an impairment of assets
held for sale, an impairment of facility closures and lease terminations, and other items. See Notes to Condensed Consolidated
Financial Statements, Note 2. Impairments and Other Charges (Credits) for further discussion of these charges (credits).
Nonoperating Items
Pension Settlement Charges from Plan Terminations. During the six months ended June 30, 2026, the Company
entered into agreements to transfer certain defined benefit pension obligations to third-party insurers in connection with plan
terminations. As a result, the Company recognized approximately $23 million of non-cash pension settlement charges,
primarily related to the acceleration of actuarial losses previously recorded in accumulated other comprehensive income. This is
included in “Other, net” on the Condensed Consolidated Statements of Operations.
Income Tax Provision. During the six months ended June 30, 2026, we recorded a total income tax provision of $231
million on a pre-tax income of $1.2 billion, resulting in an effective tax rate of 18.7%. The effective tax rate for this period was
primarily impacted by the release of a valuation allowance in the amount of $32 million related to changes in deferred tax asset
realizability. During the six months ended June 30, 2025, we recorded a total income tax provision of $234 million on pre-tax
income of $917 million, resulting in an effective tax rate of 25.5%. The effective tax rate for this period was primarily impacted
by the additional valuation allowance recognized on our deferred tax assets, which resulted from the pre-tax $356 million of
impairments and other charges.
HAL Q2 2026 FORM 10-Q | 26
Part I. Item 2 | Forward-Looking Information |
FORWARD-LOOKING INFORMATION
The Private Securities Litigation Reform Act of 1995 provides safe harbor provisions for forward-looking information.
Forward-looking information is based on projections and estimates, not historical information. Some statements in this Form
10-Q, including those in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations –
Business Environment and Results of Operations – Business Outlook, are forward-looking and use words like “may,” “may
not,” “believe,” “do not believe,” “plan,” “estimate,” “intend,” “expect,” “do not expect,” “anticipate,” “do not anticipate,”
“should,” “likely,” and other expressions. We may also provide oral or written forward-looking information in our statements
and other materials we release to the public. Forward-looking information involves risks and uncertainties and reflects our best
judgment based on current information. Our results of operations can be affected by inaccurate assumptions we make or by
known or unknown risks and uncertainties. In addition, other factors may affect the accuracy of our forward-looking
information. As a result, no forward-looking information can be guaranteed. Actual events and the results of our operations may
vary materially.
We do not assume any responsibility to publicly update any of our forward-looking statements regardless of whether
factors change as a result of new information, future events, or for any other reason, except as required by law. You should
review any additional disclosures we make in our press releases and Forms 10-K, 10-Q, and 8-K filed with or furnished to the
Securities and Exchange Commission. 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.
For quantitative and qualitative disclosures about market risk, see Part II, Item 7(a), “Quantitative and Qualitative
Disclosures About Market Risk,” in our 2025 Annual Report on Form 10-K. Our exposure to market risk has not changed
materially since December 31, 2025.
Item 4. Controls and Procedures.
In accordance with the Securities Exchange Act of 1934 Rules 13a-15 and 15d-15, we carried out an evaluation, under
the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of
the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that
evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were
effective as of June 30, 2026 to provide reasonable assurance that information required to be disclosed in our reports filed or
submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the
Securities and Exchange Commission’s rules and forms. Our disclosure controls and procedures include controls and
procedures designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is
accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure.
There has been no change in our internal control over financial reporting that occurred during the quarter ended
June 30, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over financial
reporting.
HAL Q2 2026 FORM 10-Q | 27
Part II. Item 1 | Legal Proceedings |
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
See Notes to Condensed Consolidated Financial Statements, Note 9 for further information regarding legal
proceedings.
Item 1(a). Risk Factors.
As of June 30, 2026, there have been no material changes in risk factors previously disclosed in our Annual Report on
Form 10-K for the fiscal year ended December 31, 2025.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Following is a summary of our repurchases of our common stock during the three months ended June 30, 2026.
Period | Total Number of Shares Purchased (a) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (b) | Maximum Number (or Approximate Dollar Value) of Shares that may yet be Purchased Under the Program (b) |
April 1 - 30 | 1,138,308 | $39.17 | 1,126,900 | $1,905,018,007 |
May 1 - 31 | 2,853,517 | $41.25 | 2,051,000 | $1,820,905,966 |
June 1 - 30 | 1,892,926 | $38.47 | 1,866,952 | $1,749,168,405 |
Total | 5,884,751 | $39.95 | 5,044,852 |
(a) | Of the 5,884,751 shares purchased during the three-month period ended June 30, 2026, 839,899 were acquired from employees in connection with the settlement of income tax and related benefit withholding obligations arising from vesting in restricted stock grants. These shares were not part of a publicly announced program to repurchase common stock. |
(b) | Our Board of Directors has authorized a program to repurchase a specified dollar amount of our common stock from time to time. On July 21, 2014, our Board of Directors announced that it had approved an increase in the total available outstanding authorization for repurchases to $6.0 billion. Approximately $1.7 billion remained authorized for repurchases as of June 30, 2026. From the inception of this program in February of 2006 through June 30, 2026, we repurchased approximately 334 million shares of our common stock for a total cost of approximately $12.4 billion. The program may be terminated or suspended at any time and does not have a specified expiration date. |
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Our barite and bentonite mining operations, in support of our fluid services business, are subject to regulation by the
U.S. Mine Safety and Health Administration under the Federal Mine Safety and Health Act of 1977. Information concerning
mine safety violations or other regulatory matters required by section 1503(a) of the Dodd-Frank Wall Street Reform and
Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95 to this quarterly report.
HAL Q2 2026 FORM 10-Q | 28
Part II. Item 5 | Other Information |
Item 5. Other Information.
During the quarter ended June 30, 2026, the following officers of the Company adopted or terminated
trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K, and no
trading arrangements were adopted or terminated by non-management directors of the Company.
Reporting Officer | Title | Reporting Action | Plan Adoption Date | Plan End Date | Aggregated Shares Covered | Intended to Satisfy Rule 10b5-1? |
President, Eastern Hemisphere | Yes | |||||
Director, Executive Vice President and Chief Operating Officer | Yes | |||||
Executive Vice President and Chief Administrative Officer | Yes | |||||
Senior Vice President and Treasurer | Yes | |||||
Chairman of the Board, President and Chief Executive Officer | Yes | |||||
Executive Vice President, Secretary and Chief Legal Officer | Yes | |||||
Executive Vice President and Chief Financial Officer | Yes |
HAL Q2 2026 FORM 10-Q | 29
Part II. Item 6 | Exhibits |
Item 6. Exhibits.
*† | 10.1 | |
† | 10.2 | |
† | 10.3 | |
* | 31.1 | |
* | 31.2 | |
** | 32.1 | |
** | 32.2 | |
* | 95 | |
* | 101.INS | 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 | XBRL Taxonomy Extension Schema Document |
* | 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
* | 101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
* | 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
* | 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
* | 104 | Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
* | Filed with this Form 10-Q. | |
** | Furnished with this Form 10-Q. | |
† | Management contracts or compensatory plans or arrangements. | |
HAL Q2 2026 FORM 10-Q | 30
SIGNATURES
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.
HALLIBURTON COMPANY
/s/ Eric J. Carre | /s/ Stephanie S. Holzhauser |
Eric J. Carre | Stephanie S. Holzhauser |
Executive Vice President and | Senior Vice President and |
Chief Financial Officer | Chief Accounting Officer |
Date: July 24, 2026