Halliburton Q3 2024 10-Q Filed

Ticker: HAL · Form: 10-Q · Filed: Nov 7, 2024 · CIK: 45012

Halliburton CO 10-Q Filing Summary
FieldDetail
CompanyHalliburton CO (HAL)
Form Type10-Q
Filed DateNov 7, 2024
Risk Levelmedium
Pages17
Reading Time20 min
Key Dollar Amounts$2.50
Sentimentneutral

Sentiment: neutral

Topics: 10-Q, financials, oilfield-services, energy

Related Tickers: SLB, BKR, OIS

TL;DR

HAL 10-Q filed: Q3 and YTD financials out, showing segment revenues for Completion/Production and Drilling/Evaluation.

AI Summary

Halliburton Company (HAL) filed its 10-Q for the period ending September 30, 2024. The filing details financial performance for the third quarter and the first nine months of the year, including revenue and income figures. Specific segment revenues for Completion and Production, and Drilling and Evaluation are provided for the relevant periods.

Why It Matters

This filing provides investors with the latest financial performance data for Halliburton, a major player in the oilfield services sector, impacting the broader energy market.

Risk Assessment

Risk Level: medium — As a major oilfield services company, Halliburton's performance is inherently tied to volatile energy prices and global economic conditions.

Key Numbers

Key Players & Entities

FAQ

What were Halliburton's total revenues for the third quarter of 2024?

The filing indicates revenue for the period July 1, 2024 to September 30, 2024, but does not provide a single consolidated total revenue figure in the provided snippet.

How does Halliburton's Q3 2024 service revenue compare to Q3 2023?

The filing provides data points for 'us-gaap:ServiceMember' for both periods, allowing for a direct comparison of service revenue performance year-over-year.

What are the two main business segments reported by Halliburton?

The filing references 'hal:CompletionAndProductionMember' and 'hal:DrillingAndEvaluationMember', indicating these are key operational segments.

What was the company's total asset value at the end of the previous fiscal year?

Halliburton reported total assets of $878,501,985 as of December 31, 2023.

When was Halliburton Co. previously known by another name?

The company was formerly known as HALLIBURTON OIL WELL CEMENTING CO, with a date of name change on 19660911.

Filing Stats: 5,032 words · 20 min read · ~17 pages · Grade level 15 · Accepted 2024-11-07 11:57:26

Key Financial Figures

Filing Documents

Financial Statements

Financial Statements 1 Condensed Consolidated Statements of Operations 1 Condensed Consolidated Statements of Comprehensive Income 2 Condensed Consolidated Balance Sheets 3 Condensed Consolidated Statements of Cash Flows 4 Notes to Condensed Consolidated Financial Statements 5 Note 1. Basis of Presentation 5 Note 2. Impairments and Other Charges 5 Note 3 . Business Segment Information 6 Note 4 . Revenue 7 Note 5 . Inventories 8 Note 6 . Accounts Payable 8 Note 7 . Income Taxes 9 Note 8 . Shareholders' Equity 10 Note 9 . Commitments and Contingencies 12 Note 10 . Income per Share 12 Note 1 1 . Fair Value of Financial Instruments 12 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 14 Executive Overview 14 Liquidity and Capital Resources 17 Business Environment and Results of Operations 19 Results of Operations in 2024 Compared to 2023 (QTD) 21 Results of Operations in 2024 Compared to 2023 (YTD) 24 Forward-Looking Information 27 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 27 Item 4.

Controls and Procedures

Controls and Procedures 27 PART II. OTHER INFORMATION 28 Item 1.

Legal Proceedings

Legal Proceedings 28

Risk Factors

Risk Factors 28 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 29 Item 3. Defaults Upon Senior Securities 29 Item 4. Mine Safety Disclosures 29 Item 5. Other Information 29 Item 6. Exhibits 30

SIGNATURES

SIGNATURES 31 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements HALLIBURTON COMPANY Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, Millions of dollars and shares except per share data 2024 2023 2024 2023 Revenue: Services $ 4,093 $ 4,131 $ 12,454 $ 12,478 Product sales 1,604 1,673 4,880 4,801 Total revenue 5,697 5,804 17,334 17,279 Operating costs and expenses: Cost of services 3,361 3,349 10,206 10,152 Cost of sales 1,266 1,337 3,853 3,900 General and administrative 55 58 178 166 Impairments and other charges 116 — 116 — SAP S4 upgrade expense 28 23 91 36 Total operating costs and expenses 4,826 4,767 14,444 14,254 Operating income 871 1,037 2,890 3,025 Interest expense, net of interest income of $ 28 , $ 24 , $ 72 , and $ 59 ( 85 ) ( 94 ) ( 269 ) ( 297 ) Loss on Blue Chip Swap transactions — — — ( 104 ) Other, net ( 52 ) ( 27 ) ( 180 ) ( 96 ) Income before income taxes 734 916 2,441 2,528 Income tax provision ( 154 ) ( 192 ) ( 539 ) ( 533 ) Net income $ 580 $ 724 $ 1,902 $ 1,995 Net income attributable to noncontrolling interest ( 9 ) ( 8 ) ( 16 ) ( 18 ) Net income attributable to company $ 571 $ 716 $ 1,886 $ 1,977 Basic net income per share $ 0.65 $ 0.80 $ 2.13 $ 2.19 Diluted net income per share $ 0.65 $ 0.79 $ 2.13 $ 2.19 Basic weighted average common shares outstanding 881 898 885 901 Diluted weighted average common shares outstanding 881 902 886 904 See notes to condensed consolidated financial statements. HAL Q3 2024 FORM 10-Q | 1 Table of Contents HALLIBURTON COMPANY Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, Millions of dollars 2024 2023 2024 2023 Net income $ 580 $ 724 $ 1,902 $ 1,995 Other comprehensive income, net of income taxes 3 1 3 3 Comprehensive income $ 583 $ 725 $ 1,905 $ 1,998 Comprehensive income attributable to noncontrolling interest ( 9 ) ( 8 ) ( 17 ) ( 18

Item 1 | Notes to Condensed Consolidated Financial Statements

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 2023 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 September 30, 2024, the results of our operations for the three and nine months ended September 30, 2024 and 2023, and our cash flows for the nine months ended September 30, 2024 and 2023. 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 nine months ended September 30, 2024 may not be indicative of results for the full year. Note 2. Impairments and Other Charges The following table presents various pre-tax charges we recorded during the three and nine months ended September 30, 2024, which are reflected within "Impairments and o

Item 1 | Notes to Condensed Consolidated Financial Statements

Part I. Item 1 | Notes to Condensed Consolidated Financial Statements As disclosed within our Form 8-Ks filed on August 23, 2024, and September 3, 2024, we became aware that an unauthorized third party gained access to certain of our systems. As a result, we incurred $ 35 million in expenses during the three months ended September 30, 2024 related to the engagement of external advisors to assess and remediate the effects of the activity, and restore our systems, as well as legal fees, payroll related costs, and other expenses . Additionally, we recognized a gain of $ 43 million related to a fair value adjustment on an equity investment during the three months ended September 30, 2024 . During the three and nine months ended September 30, 2023, there were no amounts recorded in impairments and other charges. Note 3. Business Segment Information We operate under two divisions, which form the basis for the two operating segments we report: the Completion and 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. The following table presents information on our business segments. Three Months Ended September 30, Nine Months Ended September 30, Millions of dollars 2024 2023 2024 2023 Revenue: Completion and Production $ 3,299 $ 3,487 $ 10,073 $ 10,372 Drilling and Evaluation 2,398 2,317 7,261 6,907 Total revenue $ 5,697 $ 5,804 $ 17,334 $ 17,279 Operating income: Completion and Production $ 669 $ 746 $ 2,080 $ 2,119 Drilling and Evaluation 406 378 1,207 1,123 Total operations 1,075 1,124 3,287 3,242 Corporate and other (a) ( 60 ) ( 64 ) ( 190 ) ( 181 ) SAP S4 upgrade expense ( 28 ) ( 23 ) ( 91 ) ( 36 ) Impairments and other charges (b) ( 116 ) — ( 116 ) — Total operating i

Item 1 | Notes to Condensed Consolidated Financial Statements

Part I. Item 1 | Notes to Condensed Consolidated Financial Statements Note 4. Revenue Revenue is recognized based on the transfer of control or our customers' ability to benefit from our services and 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 to 60 days. Other judgments involved in recognizing 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 amount of revenue to recognize. Disaggregation of revenue 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, 41 % and 45 % of our consolidated revenue was from the United States for the nine months ended September 30, 2024 and 2023, respectively. No other country accounted for more than 10% of our revenue for those periods. The following table presents information on our disaggregated revenue. Three Months Ended September 30, Nine Months Ended September 30, Millions of dollars 2024 2023 2024 2023 Revenue by segment: Completion and Production $ 3,299 $ 3,487 $ 10,073 $ 10,372 Drilling and Evaluation

Item 1 | Notes to Condensed Consolidated Financial Statements

Part I. Item 1 | Notes to Condensed Consolidated Financial Statements Receivables As of September 30, 2024, 30 % of our net trade receivables was from customers in the United States and 12 % was from customers in Mexico. As of December 31, 2023, 33 % of our net trade receivables was from customers in the United States and 9 % was from customers in Mexico. Receivables from our primary customer in Mexico accounted for approximately 10 % and 6 % of our total receivables as of September 30, 2024 and December 31, 2023, respectively. 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. No country other than the United States and Mexico or single customer accounted for more than 10 % of 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 Inventories consisted of the following: Millions of dollars September 30, 2024 December 31, 2023 Finished products and parts $ 1,987 $ 2,069 Raw materials and supplies 1,063 1,021 Work in process 144 136 Total inventories $ 3,194 $ 3,226 Note 6. Accounts Payable Effective January 1, 2023, we adopted new supplier finance program disclosure requirements contained in guidance issued by the Financial Accounting Standards Board (ASU 2022-04, "Disclosure

Item 1 | Notes to Condensed Consolidated Financial Statements

Part I. Item 1 | Notes to Condensed Consolidated Financial Statements Note 7. Income Taxes During the three months ended September 30, 2024, we recorded a total income tax provision of $ 154 million, which included a partial release of a valuation allowance on our deferred tax assets in the amount of $ 41 million, on a pre-tax income of $ 734 million, resulting in an effective tax rate of 21.0 % for the quarter. During the three months ended September 30, 2023, we recorded a total income tax provision of $ 192 million on a pre-tax income of $ 916 million, resulting in an effective tax rate of 21.0 % for the quarter. During the nine months ended September 30, 2024, we recorded a total income tax provision of $ 539 million, which included a partial release of a valuation allowance on our deferred tax assets in the amount of $ 41 million, on a pre-tax income of $ 2.4 billion, resulting in an effective tax rate of 22.1 % for the period. During the nine months ended September 30, 2023, we recorded a total income tax provision of $ 533 million on a pre-tax income of $ 2.5 billion, resulting in an effective tax rate of 21.1 % 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 2012. The only significant operating jurisdiction that has tax filings under review or subject to examination by the tax authorities is the United States. The United States federal income tax filings for tax years 2016 through 2023 are currently under review or remain open for review by the Internal Revenue Service (the IRS). As of September 30, 2024, 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)

Item 1 | Notes to Condensed Consolidated Financial Statements

Part I. Item 1 | Notes to Condensed Consolidated Financial Statements Note 8. Shareholders' Equity The following tables summarize our shareholders' equity activity for the three and nine months ended September 30, 2024 and September 30, 2023, 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, 2023 $ 2,663 $ 63 $ ( 5,540 ) $ 12,536 $ ( 331 ) $ 42 $ 9,433 Comprehensive income (loss): Net income — — — 606 — 3 609 Other comprehensive income (loss) — — — — ( 1 ) 1 — Cash dividends ($ 0.17 per share) — — — ( 151 ) — — ( 151 ) Stock repurchase program — — ( 250 ) — — — ( 250 ) Stock plans (a) ( 1 ) ( 63 ) 108 ( 3 ) — — 41 Other — — — — — — — Balance at March 31, 2024 $ 2,662 $ — $ ( 5,682 ) $ 12,988 $ ( 332 ) $ 46 $ 9,682 Comprehensive income (loss): Net income — — — 709 — 4 713 Other comprehensive income (loss) — — — — — — — Cash dividends ($ 0.17 per share) — — — ( 151 ) — — ( 151 ) Stock repurchase program — — ( 250 ) — — — ( 250 ) Stock plans (a) 1 — 151 ( 96 ) — — 56 Other — — — — — ( 4 ) ( 4 ) Balance at June 30, 2024 $ 2,663 $ — $ ( 5,781 ) $ 13,450 $ ( 332 ) $ 46 $ 10,046 Comprehensive income (loss): Net income — — — 571 — 9 580 Other comprehensive income — — — — 3 — 3 Cash dividends ($ 0.17 per share) — — — ( 150 ) — — ( 150 ) Stock repurchase program — — ( 196 ) — — — ( 196 ) Stock plans (a) ( 1 ) 38 37 ( 6 ) — — 68 Other — — — — — 1 1 Balance at September 30, 2024 $ 2,662 $ 38 $ ( 5,940 ) $ 13,865 $ ( 329 ) $ 56 $ 10,352 (a) In the first, second, and third quarter of 2024, 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. As a result, additional paid in capital was reduced to zer

Item 1 | Notes to Condensed Consolidated Financial Statements

Part I. Item 1 | Notes to Condensed Consolidated Financial Statements 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, 2022 $ 2,664 $ 50 $ ( 5,108 ) $ 10,572 $ ( 230 ) $ 29 $ 7,977 Comprehensive income (loss): Net income — — — 651 — 4 655 Other comprehensive income — — — — 1 — 1 Cash dividends ($ 0.16 per share) — — — ( 145 ) — — ( 145 ) Stock repurchase program — — ( 100 ) — — — ( 100 ) Stock plans (a) — ( 50 ) 113 ( 3 ) — — 60 Other — — — — — ( 3 ) ( 3 ) Balance at March 31, 2023 $ 2,664 $ — $ ( 5,095 ) $ 11,075 $ ( 229 ) $ 30 $ 8,445 Comprehensive income (loss): Net income — — — 610 — 6 616 Other comprehensive income — — — — 1 — 1 Cash dividends ($ 0.16 per share) — — — ( 144 ) — — ( 144 ) Stock repurchase program — — ( 250 ) — — — ( 250 ) Stock plans (a) ( 1 ) — 144 ( 82 ) — — 61 Other — — — — — ( 2 ) ( 2 ) Balance at June 30, 2023 $ 2,663 $ — $ ( 5,201 ) $ 11,459 $ ( 228 ) $ 34 $ 8,727 Comprehensive income (loss): Net income — — — 716 — 8 724 Other comprehensive income — — — — 1 — 1 Cash divi

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