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BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION | 9 Months Ended
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Jun. 30, 2025
Segment Reporting [Abstract] |
BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION |
NOTE 15 BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION
Description of the Business During the second quarter of fiscal year 2025, the naming convention for one of our reportable segments changed from Offshore Gulf of Mexico to Offshore Solutions. Beginning on the Closing Date, Offshore Solutions now includes the results from the acquired KCA Deutag offshore management contract operations. Similarly, our International Solutions segment now includes the results from the acquired KCA Deutag land operations. Operating results related to KCA Deutag's Kenera business unit are included in "Other" along with results from our real estate operations and our wholly-owned captive insurance companies. Our North America Solutions operating segment remains unchanged. For additional information regarding the completion of the Acquisition, refer to Note 3—Business Combination. We are a performance-driven drilling solutions and technologies company based in Tulsa, Oklahoma with operations in all major U.S. onshore oil and gas producing basins as well as the Middle East, Europe, Latin America, and Australia. Our drilling operations consist mainly of contracting Company-owned drilling equipment primarily to large oil and gas exploration companies. We believe we are the recognized industry leader in drilling as well as technological innovation. We focus on offering our customers an integrated solutions-based approach by combining proprietary rig technology, automation software, and digital expertise into our rig operations rather than a product-based offering, such as a rig or separate technology package. Our drilling services operations are organized into the following reportable operating business segments: North America Solutions, International Solutions, and Offshore Solutions. Each reportable operating segment is a strategic business unit that is managed separately, and consolidated revenues and expenses reflect the elimination of all material intercompany transactions. External revenues included in “Other” primarily consist of rental, manufacturing and engineering services income. Segment Performance We evaluate segment performance based on segment operating income (loss) before income taxes which includes: •Revenues from external and internal customers •Direct operating costs •Depreciation and amortization •Research and development •Allocated general and administrative expenses •Asset impairment charges •Restructuring charges but excludes gain on reimbursement of drilling equipment, other gain on sale of assets, corporate selling, general and administrative costs, corporate depreciation, corporate acquisition transactions costs, corporate asset impairment charges, and corporate restructuring charges. General and administrative costs are allocated to the segments based primarily on specific identification and, to the extent that such identification is not practical, other methods may be used which we believe to be a reasonable reflection of the utilization of services provided. Summarized financial information of our reportable segments for the three and nine months ended June 30, 2025 and 2024 is shown in the following tables:
| Three Months Ended June 30, 2025
(in thousands) | North America Solutions |  | International Solutions |  | Offshore Solutions |  | Other |  | Eliminations |  | Total
External sales | $ | 591,976 |  |  | $ | 265,099 |  |  | $ | 161,777 |  |  | $ | 22,072 |  |  |  |  | $ | 1,040,924 |
Intersegment | 238 |  |  | 704 |  |  | — |  |  | 20,826 |  |  | (21,768) |  |  | — |
Total sales | 592,214 |  |  | 265,803 |  |  | 161,777 |  |  | 42,898 |  |  | (21,768) |  |  | 1,040,924 |
Segment operating income (loss) | $ | 157,649 |  |  | $ | (166,513) |  |  | $ | 8,769 |  |  | $ | (70,004) |  |  | $ | 6,114 |  |  | $ | (63,985) |
| Three Months Ended June 30, 2024
(in thousands) | North America Solutions |  | International Solutions |  | Offshore Solutions |  | Other |  | Eliminations |  | Total
External sales | $ | 620,040 |  |  | $ | 47,882 |  |  | $ | 27,218 |  |  | $ | 2,584 |  |  | $ | — |  |  | $ | 697,724 |
Intersegment | — |  |  | — |  |  | — |  |  | 14,677 |  |  | (14,677) |  |  | — |
Total sales | 620,040 |  |  | 47,882 |  |  | 27,218 |  |  | 17,261 |  |  | (14,677) |  |  | 697,724 |
Segment operating income (loss) | $ | 163,407 |  |  | $ | (2,748) |  |  | $ | 5,010 |  |  | $ | (4,791) |  |  | $ | (616) |  |  | $ | 160,262 |
| Nine Months Ended June 30, 2025
(in thousands) | North America Solutions |  | International Solutions |  | Offshore Solutions |  | Other |  | Eliminations |  | Total
External sales | $ | 1,789,350 |  |  | $ | 560,319 |  |  | $ | 340,067 |  |  | $ | 44,529 |  |  | $ | — |  |  | $ | 2,734,265 |
Intersegment | 703 |  |  | 873 |  |  | — |  |  | 63,175 |  |  | (64,751) |  |  | — |
Total sales | 1,790,053 |  |  | 561,192 |  |  | 340,067 |  |  | 107,704 |  |  | (64,751) |  |  | 2,734,265 |
Segment operating income (loss) | $ | 461,803 |  |  | $ | (215,980) |  |  | $ | 29,649 |  |  | $ | (70,605) |  |  | $ | (2,247) |  |  | $ | 202,620 |
| Nine Months Ended June 30, 2024
(in thousands) | North America Solutions |  | International Solutions |  | Offshore Solutions |  | Other |  | Eliminations |  | Total
External sales | $ | 1,827,661 |  |  | $ | 148,512 |  |  | $ | 78,662 |  |  | $ | 7,979 |  |  | $ | — |  |  | $ | 2,062,814 |
Intersegment | — |  |  | — |  |  | — |  |  | 45,649 |  |  | (45,649) |  |  | — |
Total sales | 1,827,661 |  |  | 148,512 |  |  | 78,662 |  |  | 53,628 |  |  | (45,649) |  |  | 2,062,814 |
Segment operating income (loss) | $ | 455,030 |  |  | $ | 8,606 |  |  | $ | 8,140 |  |  | $ | (2,073) |  |  | $ | (1,054) |  |  | $ | 468,649 |
The following table reconciles segment operating income (loss) per the tables above to income before income taxes as reported on the Unaudited Condensed Consolidated Statements of Operations:
| Three Months Ended June 30, 2025 |  | Nine Months Ended June 30, 2025
(in thousands) | 2025 |  | 2024 |  | 2025 |  | 2024
Segment operating income (loss) | $ | (63,985) |  |  | $ | 160,262 |  |  | $ | 202,620 |  |  | $ | 468,649 |
Gain on reimbursement of drilling equipment | 6,773 |  |  | 9,732 |  |  | 26,149 |  |  | 24,687 |
Other loss on sale of assets | (1,347) |  |  | (2,730) |  |  | (2,136) |  |  | (2,718) |
Corporate selling, general and administrative costs, corporate depreciation, corporate acquisition transaction costs, corporate asset impairment charges, and corporate restructuring charges | (69,710) |  |  | (53,807) |  |  | (221,853) |  |  | (140,756) |
Operating income (loss) | (128,269) |  |  | 113,457 |  |  | 4,780 |  |  | 349,862 |
Other income (expense) |  |  |  |  |  |  |
Interest and dividend income | 2,856 |  |  | 11,888 |  |  | 31,854 |  |  | 29,189 |
Interest expense | (29,200) |  |  | (4,336) |  |  | (79,836) |  |  | (12,969) |
Gain (loss) on investment securities | (337) |  |  | 389 |  |  | 14,084 |  |  | 102 |
Foreign currency exchange loss | (9,216) |  |  | (2,144) |  |  | (16,137) |  |  | (4,509) |
Other | 31,258 |  |  | 3,134 |  |  | 33,214 |  |  | 2,991 |
Total unallocated amounts | (4,639) |  |  | 8,931 |  |  | (16,821) |  |  | 14,804 |
Income (loss) before income taxes | $ | (132,908) |  |  | $ | 122,388 |  |  | $ | (12,041) |  |  | $ | 364,666 |
The following table reconciles segment total assets to total assets as reported on the Unaudited Condensed Consolidated Balance Sheets:
(in thousands) | June 30, 2025 |  | September 30, 2024
Total assets 1 |  |  |
North America Solutions | $ | 3,099,587 |  |  | $ | 3,225,410 |
International Solutions | 2,504,474 |  |  | 685,833 |
Offshore Solutions | 645,611 |  |  | 73,119 |
Other | 324,751 |  |  | 157,877 |
| 6,574,423 |  |  | 4,142,239 |
Investments and corporate operations | 287,580 |  |  | 1,639,659 |
| $ | 6,862,003 |  |  | $ | 5,781,898 |
(1)Assets by segment exclude investments in subsidiaries and intersegment activity. The following table presents revenues from external customers by country based on the location of service provided:
| Three Months Ended June 30, |  | Nine Months Ended June 30,
(in thousands) | 2025 |  | 2024 |  | 2025 |  | 2024
Operating revenues |  |  |  |  |  |  |
United States | $ | 659,364 |  |  | $ | 648,816 |  |  | $ | 1,876,295 |  |  | $ | 1,911,122 |
Saudi Arabia | 103,752 |  |  | — |  |  | 201,673 |  |  | — |
Norway | 82,854 |  |  | — |  |  | 161,159 |  |  | — |
Argentina | 39,634 |  |  | 38,064 |  |  | 119,245 |  |  | 107,964 |
Oman | 45,089 |  |  | — |  |  | 114,709 |  |  | — |
Azerbaijan | 38,922 |  |  | — |  |  | 81,681 |  |  | — |
Germany | 16,027 |  |  | — |  |  | 33,079 |  |  | — |
Bahrain | 8,304 |  |  | 4,602 |  |  | 21,576 |  |  | 13,634 |
Columbia | 9,742 |  |  | 31 |  |  | 20,688 |  |  | 8,976 |
Kuwait | 10,508 |  |  | — |  |  | 19,680 |  |  | — |
Other Foreign | 26,728 |  |  | 6,211 |  |  | 84,480 |  |  | 21,118 |
Total | $ | 1,040,924 |  |  | $ | 697,724 |  |  | $ | 2,734,265 |  |  | $ | 2,062,814 |
Refer to Note 10—Revenue from Contracts with Customers for additional information regarding the recognition of revenue. The following table presents property, plant and equipment by country based on the location of service provided:
(in thousands) | June 30, 2025 |  | September 30, 2024
Property, plant and equipment, net |  |  |
United States | $ | 2,576,767 |  |  | $ | 2,752,325 |
Saudi Arabia | 991,640 |  |  | 149,472 |
Oman | 449,849 |  |  | — |
Germany | 81,417 |  |  | — |
Argentina | 71,414 |  |  | 62,533 |
Kuwait | 41,947 |  |  | — |
Colombia | 38,520 |  |  | 19,243 |
Norway | 24,629 |  |  | — |
Bahrain | 23,221 |  |  | 19,807 |
Other Foreign | 108,752 |  |  | 12,897 |
Total | $ | 4,408,156 |  |  | $ | 3,016,277 |

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