Halliburton Q4 Margin Drops, EPS Beats

Halliburton (HAL -2.98%), a provider of products and services to the energy industry, released its fourth-quarter 2024 earnings on January 22, 2025. The company reported an earnings per share (EPS) of $0.70, slightly exceeding the analysts’ expectations of $0.69. However, revenue came in at $5.6 billion, showing a year-over-year decline from $5.739 billion. Despite mixed results, Halliburton maintained a focus on technology and service differentiation, although its overall operating margin took a hit, reflecting both opportunities and challenges in its quarterly performance.

Source: Analyst estimates for the quarter provided by FactSet.

Overview of Halliburton’s Business

Halliburton is a prominent company in the oilfield services sector, offering a range of products and services necessary for the exploration, development, and production of oil and gas. Its business is divided mainly into two segments: Completion and Production, and Drilling and Evaluation. For the Completion and Production segment, revenue reached $3.2 billion, highlighting the company’s critical role in the final phases of oil and gas development. Drilling and Evaluation maintained stable revenue of $2.4 billion, underscoring the importance of exploratory efforts and well analysis.

Halliburton continues to emphasize its role in technological innovation. The company focuses on key areas such as digital technology investment, service differentiation, and expanding its operational footprint in promising international markets. Success factors include its ability to effectively leverage technological advances to streamline operations and enhance service delivery.

Quarterly Highlights

In the fourth quarter, Halliburton’s Completion and Production segment saw a 4% revenue decline to $3.2 billion, largely due to decreased stimulation activities in North America and a decline in pressure pumping in Latin America. Meanwhile, the Drilling and Evaluation segment’s revenue held steady at $2.4 billion, showing a positive trajectory in fluid services, particularly in the Middle East and Europe/Africa regions.

Internationally, Halliburton experienced growth, with a sequential revenue increase of 10% in Europe/Africa and a 7% increase in the Middle East/Asia. This international growth reflects strategic regional investments and steady oil prices, serving as key growth engines for the company. Despite these advantages internationally, North American revenue faced a notable 7% sequential decline to $2.2 billion, highlighting region-specific challenges such as reduced hydraulic fracturing activity.

Significant technology advancements were a feature of Halliburton’s report. The launch of the Intelli diagnostic services and the iCruise Force rotary steerable system emphasizes Halliburton’s investment in enhancing operational capabilities. CEO Jeff Miller highlighted these technologies as pivotal developments in maintaining a competitive edge in the market.

Financially, the quarter’s operating income grew to $932 million, up from $871 million in Q3 2024, and free cash flow hit $1.1 billion. Share repurchases amounted to $309 million in the fourth quarter.

Looking Ahead

Looking forward, Halliburton remains committed to investing in digital technology and expanding its service portfolio. Management plans to focus on drilling technology, particularly artificial lift technologies, to drive future growth. There is a noted interest in the potential of the Middle East and Asia markets, which have been instrumental in recent revenue gains.

In terms of financial outlook, specific forward guidance for revenue and profits was not detailed. Investors should focus on ongoing developments in Halliburton’s technology and service offerings.