Property and Equipment

9 Months Ended

Sep. 30, 2025

Property, Plant and Equipment [Abstract]

Property and equipment consisted of the following at September 30, 2025 and December 31, 2024 (in thousands):


	September 30, 2025		December 31, 2024
Equipment	$	8,320,188	$	8,416,063
Oil and natural gas properties	245,736		243,663
Buildings	239,073		248,739
Rental equipment	135,054		136,256
Land	41,225		37,847
Total property and equipment	8,981,276		9,082,568
Less accumulated depreciation, depletion, amortization and impairment	(6,195,848)		(6,072,226)
Property and equipment, net	$	2,785,428	$	3,010,342

Depreciation and depletion expense on property and equipment of approximately $194 million and $220 million was recorded in the three months ended September 30, 2025 and 2024, respectively. Depreciation and depletion expense on property and equipment of approximately $592 million and $684 million was recorded in the nine months ended September 30, 2025 and 2024, respectively.

During the second quarter of 2025, global economic conditions deteriorated, in part, because of enacted and proposed trade policies and tariffs by the United States and other governments, as well as uncertainty regarding potential future changes to global trade policies and tariffs. Additionally, during the second quarter of 2025, OPEC+ countries began phasing out voluntary crude oil production cuts, leading to an increase in global supply. These developments, combined with rising geopolitical tensions—particularly in the Middle East— have heightened uncertainty in global energy markets, which has contributed to a decline in our share price, lowered average crude oil futures prices and increased uncertainty regarding the future economic environment in which we operate.

During the second quarter of 2025, negative market indicators such as lower industry-wide drilling rig and pressure pumping fleet count forecasts, increased volatility and margin compression for certain of our asset groups led to our reduced outlook for activity. The reduction in activity forecasts combined with the recent decline in the market price of our common stock were considered a triggering event indicating certain of our long-lived tangible and intangible assets may be impaired. We deemed it necessary to perform recoverability tests on our hydraulic fracturing asset group within our completion services reporting unit and

our Latin American contract drilling asset group during the second quarter of 2025. We estimated future cash flows over the expected remaining life of the primary asset for each asset group.

On an undiscounted basis, the expected cash flows exceeded the carrying value of our hydraulic fracturing asset group within our completion services reporting unit, indicating that no impairment was required during the second quarter of 2025.

The recoverability test for our Latin American contract drilling asset group during the second quarter of 2025 indicated that estimated undiscounted cash flows did not exceed its carrying value. Accordingly, we performed an impairment test and estimated the fair value of the asset group using the income approach. Under this approach, we used a discounted cash flow model, which utilized present values of cash flows to estimate fair value. Forecasted cash flows reflected known market conditions in the second quarter of 2025 and management’s anticipated business outlook for the asset group. Future cash flows were projected based on estimates of revenue, gross profit, selling, general and administrative expense, changes in working capital, and capital expenditures. Future cash flows were then discounted using a market-participant, risk-adjusted weighted average cost of capital. Based on the results of the analysis performed, we recorded a $27.8 million impairment charge to Latin American drilling equipment during the second quarter of 2025 in our drilling services segment.

During the third quarter of 2024, we evaluated our fleet of drilling rigs for marketability based on the condition of inactive rigs, expenditures that would be necessary to bring them to working condition and the expected demand for drilling services by rig type. The components comprising rigs that would no longer be marketed were evaluated, and those components with continuing utility to other marketed rigs were identified for transfer to other rigs or to yards to be used as spare equipment. The remaining components of these rigs were abandoned. During the three months ended September 30, 2024, we identified 42 legacy, non-Tier-1 super-spec drilling rigs and related equipment to be abandoned. Based on the strong customer preference across the industry for Tier-1 super-spec drilling rigs, in addition to efficiency gains and technology advancements that reduced the total number of rigs needed for the U.S. drilling market, we believed the 42 rigs that were abandoned had limited commercial opportunity. Our operating results for the three and nine months ended September 30, 2024 included a charge of $114 million related to this abandonment.

While the full effects of recent market developments are yet to be determined, prolonged trade tensions and sustained lower crude oil futures prices could adversely affect our future outlook on activity and profitability. If these conditions persist or deteriorate further, or if other unforeseen macroeconomic conditions emerge, they could negatively impact the expected cash flows used in our recoverability tests for our asset groups. Such changes could result in impairment charges in the future, which could be material to our results of operations and financial statements as a whole.