Helmerich & Payne, Inc. Announces Fiscal First Quarter Results

TULSA, Okla.--( BUSINESS WIRE)--Helmerich & Payne, Inc. (NYSE:HP)

Operating and Financial Highlights for the Quarter Ended December 31, 2025

Management Commentary

“During the first fiscal quarter, the Company executed with discipline, delivering strong operational and financial results across all business segments. These results demonstrate our ability to generate consistent operational performance and advance our strategic priorities in a dynamic market environment,” commented CEO John Lindsay.

“Our NAS segment continued to hold its industry-leading position, supported by solid financial performance and strong execution. With a presence across all major U.S. basins, the team continued to deliver reliable, high‑quality solutions that support customer programs. We effectively managed basin‑level activity churn, including in the Permian, where we maintain leading market share by delivering reliable results and differentiated offerings.”

“Notably, our new FlexRobotics TM Technology was successfully deployed on a rig for a Super Major in the Permian Basin, supporting the drilling of multiple pads and delivering strong, reliable rig-floor performance. We are seeing growing customer interest in adding additional units to the fleet. Also significant, NAS technology adoption continues to increase year‑over‑year, with deployment now occurring on nearly every active rig. As customers continue to recognize the efficiencies these technologies provide, we expect adoption to remain strong and further deepen alignment with our customers.”

“For our International Solutions segment, the first fiscal quarter marked continued progress in advancing our global strategy and bringing U.S. unconventional expertise to key international markets,” Lindsay said. “With rig reactivations underway in Saudi Arabia, we expect startups to be completed by mid‑2026. Discussions with national and international oil companies across our core regions remain encouraging, reinforcing our confidence in the value our drilling solutions deliver worldwide.”

“Our Offshore Solutions segment delivered stable and consistent performance in the first fiscal quarter. The business continues to generate consistent cash flows driven by low capital intensity, strong customer relationships, and activity across the Gulf of America, the Caspian Sea, Norway and UK North Sea, Africa, and Canada. With approximately 30% of the global platform operations and maintenance market, we remain encouraged by the segment’s outlook.”

Senior Vice President and CFO Kevin Vann added, “As we progress through fiscal 2026, our disciplined approach to capital deployment continues to support strong free cash flow and ongoing balance sheet improvement. We have repaid $260 million on the $400 million term loan and remain on track to retire the remaining balance ahead of schedule using free cash flow. This progress highlights our commitment to prudent capital allocation.”

Lindsay concluded, “We remain encouraged by the opportunities ahead through the remainder of 2026 and beyond. Our expanded global scale and the continued strengthening of our competitive position give me confidence in the path forward. In NAS, our differentiated solutions, super‑spec fleet investments, peer‑leading cost structure, and steady technology adoption provide meaningful durability. H&P is anchored by a strong safety culture and a customer‑focused approach, all driven by a workforce that is second to none in this industry. As we enter this new chapter of leadership, I am confident that Trey and his team are well equipped to continue delivering long-term term value for shareholders. We look forward to building on this momentum throughout the year."

The Company also noted that, as previously announced, John Lindsay plans to retire in March, with a leadership transition underway and no change to the Company’s strategic direction or financial priorities.

Operating Segment Results for the First Quarter of Fiscal Year 2026

North America Solutions: Realized operating income of $36 million, compared with $118 million in the previous quarter. These results include a one-time impairment of $98 million. Supported by consistent operational execution direct margin (2) slightly exceeded the midpoint of guidance at approximately $239 million, versus $242 million in the prior quarter. On a per day basis, direct margin averaged approximately $18,193 with 143 rigs operating, demonstrating the durability of the active fleet and reinforcing our position as a peer-leading margin generator.

International Solutions: The segment reported an operating loss of $(55) million, compared with a loss of approximately $(76) million in the previous quarter. Direct margin (2) again exceeded the midpoint of guidance expectations, totaling approximately $29 million versus approximately $30 million in the prior quarter, supported by steady activity levels within the segment.

Offshore Solutions: Contributed operating income of approximately $16 million, compared with approximately $20 million in the previous quarter. These results include a one-time impairment of $2 million. Direct margin (2) for the quarter was approximately $31 million, compared with approximately $35 million in the prior quarter, providing consistent and reliable cash flow contributions.

Select Items (4) Included in Net Loss per Diluted Share

First quarter of fiscal year 2026 net loss of $(0.98) per diluted share included a net impact of $(0.83) per share in after-tax gains and losses comprised of the following:

Fourth quarter of fiscal year 2025 net loss of $(0.58) per diluted share included a net impact of $(0.57) per share in after-tax losses comprised of the following:

Operational Outlook for the Second Quarter of Fiscal Year 2026

The guidance below represents our expectations as of the date of this release.

North America Solutions:

International Solutions:

Offshore Solutions:

Other:

Other Estimates for Fiscal Year 2026

Conference Call

A conference call will be held at 11 a.m. (ET), Thursday, February 5, 2026, with John Lindsay, CEO, Trey Adams, President, Kevin Vann, Senior Vice President and CFO, and other management team members to discuss the Company’s first quarter fiscal year 2026 results. Dial-in information for the conference call is (800)-343-4136 for domestic callers or (203)-518-9843 for international callers. The call access code is ‘Helmerich’. Participants can listen to the live webcast of the conference call and access the accompanying earnings presentation by visiting our website at www.hpinc.com. Navigate to the “Investors” section, click on “News and Events – Events & Presentations,” and select the event to access the webcast and materials.

About Helmerich & Payne, Inc.

Founded in 1920, Helmerich & Payne, Inc. (H&P) (NYSE: HP) is committed to delivering industry leading levels of drilling productivity and reliability. H&P operates with the highest level of integrity, safety and innovation to deliver superior results for its customers and returns for shareholders. Through its subsidiaries, the Company designs, fabricates and operates high-performance drilling rigs in conventional and unconventional plays around the world. H&P also develops and implements advanced automation, directional drilling and survey management technologies. As of February 4, 2026, H&P's fleet includes 203 land rigs in the United States, 131 international land rigs and four offshore platform rigs, plus operating 31 offshore labor contracts. For more information, see H&P online at www.hpinc.com.

Forward-Looking Statements

This release includes “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, and such statements are based on current expectations and assumptions that are subject to risks and uncertainties. All statements other than statements of historical facts included in this release, including, without limitation, outlook for fiscal 2026, the Company’s business strategy, future financial position, operations outlook, future cash flow, future use of generated cash flow, dividend amounts and timing, amounts of any future dividends, investments, active rig count projections, projected costs and plans, objectives of management for future operations, contract terms, financing and funding, debt reduction plans, capex spending and budgets, outlook for domestic and international markets, future commodity prices, and future customer activity and relationships are forward-looking statements. For information regarding risks and uncertainties associated with the Company’s business, please refer to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections and other disclosures in the Company’s SEC filings, including but not limited to its annual report on Form 10‑K and quarterly reports on Form 10‑Q. As a result of these factors, Helmerich & Payne, Inc.’s actual results may differ materially from those indicated or implied by such forward-looking statements. Investors are cautioned not to put undue reliance on such statements. We undertake no duty to publicly update or revise any forward-looking statements, whether as a result of new information, changes in internal estimates, expectations or otherwise, except as required under applicable securities laws.

Helmerich & Payne uses its Investor Relations website as a channel of distribution for material company information. Such information is routinely posted and accessible on its Investor Relations website at www.hpinc.com. Information on our website is not part of this release.

Note Regarding Trademarks. Helmerich & Payne, Inc. owns or has rights to the use of trademarks, service marks and trade names that it uses in conjunction with the operation of its business. Some of the trademarks that appear in this release or otherwise used by H&P include FlexRig and FlexRobotics, which may be registered or trademarked in the United States and other jurisdictions.

(1) Adjusted net income, which is considered a non-GAAP metric, is defined as net income (loss), excluding the impact of 'select items' which management defines as certain items that do not reflect the ongoing performance of our core business operations. Adjusted net income is included as supplemental disclosure as management uses it to assess and understand current operational performance, especially in analyzing historical trends which are used in forecasting future period results. For this reason, we believe this measure will be useful information to investors. The presence of non-GAAP metrics is not intended to suggest that such measures should be considered as a substitute for certain GAAP metrics and, given that not all companies define adjusted net income the same way, this financial measure may not be comparable to similarly titled metrics disclosed by other companies. See Non-GAAP Measurements for a reconciliation of net income (loss) to adjusted net income.

(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues (less reimbursements) less direct operating expenses (less reimbursements) and is included as a supplemental disclosure. We believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See Non-GAAP Measurements for a reconciliation of segment operating income (loss) to direct margin. Expected direct margin for the first quarter of fiscal 2026 is provided on a non-GAAP basis only because certain information necessary to calculate the most comparable GAAP measure is unavailable due to the uncertainty and inherent difficulty of predicting the occurrence and the future financial statement impact of certain items. Therefore, as a result of the uncertainty and variability of the nature and amount of future items and adjustments, which could be significant, we are unable to provide a reconciliation of expected direct margin to the most comparable GAAP measure without unreasonable effort.

(3) Adjusted EBITDA is considered to be a non-GAAP metric. Adjusted EBITDA is defined as net income (loss) before taxes, depreciation and amortization, gains and losses on asset sales, other income and expense - which includes interest income and interest expense, and excludes the impact of 'select items' which management defines as certain items that do not reflect the ongoing performance of our core business operations. Adjusted EBITDA is included as supplemental disclosure as management uses it to assess and understand current operational performance, especially in analyzing historical trends which are used in forecasting future period results. For this reason, we believe this measure will be useful to information to investors. The presence of non-GAAP metrics is not intended to suggest that such measures should be considered as a substitute for certain GAAP metrics and, given that not all companies define Adjusted EBITDA the same way, this financial measure may not be comparable to similarly titled metrics disclosed by other companies. See Non-GAAP Measurements for a reconciliation of net income to Adjusted EBITDA.

(4) Select items are considered non-GAAP metrics and are included as a supplemental disclosure as the Company believes identifying and excluding select items is useful in assessing and understanding current operational performance, especially in making comparisons over time involving previous and subsequent periods and/or forecasting future periods results. Select items are excluded as they are deemed to be outside the Company's core business operations. See Non-GAAP Measurements.

(5) Does not include 24 rigs that have either suspended operations or have been notified to suspend operations in Saudi Arabia

Interim Financial Information

Prior to the three months ended March 31, 2025, foreign currency exchange gains and losses were presented in the operating costs and expense line items to which they relate, namely within Drilling services operating expenses, on our Unaudited Condensed Consolidated Statements of Operations. To conform with the current period presentation, we reclassified amounts previously presented in separate line items within operating costs and expenses to the Foreign currency exchange gain (loss) line on our Unaudited Condensed Consolidated Statements of Operations for the three months ended December 31, 2025. The impact of this change was not material to any period presented.

HELMERICH & PAYNE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

(in thousands, except per share amounts)

December 31,

September 30,

December 31,

2025

2024

OPERATING REVENUES

Drilling services

981,125

990,211

674,613

Other

35,901

21,537

2,689

1,017,026

1,011,748

677,302

OPERATING COSTS AND EXPENSES

Drilling services operating expenses, excluding depreciation and amortization

682,780

694,611

410,916

Other operating expenses

31,260

20,319

1,156

Depreciation and amortization

181,919

188,857

99,080

Research and development

6,646

7,567

9,359

Selling, general and administrative

70,444

77,645

63,098

Acquisition transaction costs

3,405

5,677

10,535

Asset impairment charges

103,086

18,928

—

Restructuring charges

1,591

7,450

—

Gain on reimbursement of drilling equipment

(6,120

)

(7,249

)

(9,403

)

Other (gain) loss on sale of assets

1,926

(595

)

1,673

1,076,937

1,013,210

586,414

OPERATING INCOME (LOSS)

(59,911

)

(1,462

)

90,888

Other income (expense)

Interest and dividend income

2,758

3,353

21,741

Interest expense

(25,607

)

(27,972

)

(22,298

)

Gain (loss) on investment securities

929

(36,461

)

(13,367

)

Foreign currency exchange gain (loss)

6,455

(905

)

Other

(1,926

)

(5,985

)

360

(23,819

)

(60,610

)

(14,469

)

Income (loss) before income taxes

(83,730

)

(62,072

)

76,419

Income tax expense (benefit)

11,201

(6,265

)

21,647

NET INCOME (LOSS)

(94,931

)

(55,807

)

54,772

Net income attributable to non-controlling interest

1,775

1,556

—

NET INCOME (LOSS) ATTRIBUTABLE TO HELMERICH & PAYNE, INC.

(96,706

)

(57,363

)

54,772

Earnings (loss) per share attributable to Helmerich & Payne, Inc:

Basic

(0.98

)

(0.58

)

0.55

Diluted

(0.98

)

(0.58

)

0.54

Weighted average shares outstanding:

Basic

99,544

99,441

98,867

Diluted

99,544

99,441

99,159

HELMERICH & PAYNE, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

December 31,

September 30,

(in thousands except share data and share amounts)

2025

ASSETS

Current Assets:

Cash and cash equivalents

247,195

196,848

Restricted cash

30,884

27,412

Short-term investments

21,775

21,496

Accounts receivable, net of allowance of $20,206 and $19,647, respectively

726,819

782,644

Inventories of materials and supplies, net

324,814

324,326

Prepaid expenses and other, net

85,030

97,518

Assets held-for-sale

25,820

15,231

Total current assets

1,462,337

1,465,475

Investments, net

70,538

68,198

Property, plant and equipment, net

4,100,077

4,313,074

Other Noncurrent Assets:

Goodwill

182,576

182,854

Intangible assets, net

463,082

485,540

Operating lease right-of-use assets

117,294

123,598

Restricted cash

1,429

1,640

Other assets, net

61,763

65,359

Total other noncurrent assets

826,144

858,991

Total assets

6,459,096

6,705,738

LIABILITIES & SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable

188,312

217,923

Dividends payable

25,417

25,199

Accrued liabilities

501,264

564,855

Current portion of long-term debt, net

6,859

Total current liabilities

721,852

814,836

Noncurrent Liabilities:

Long-term debt, net

2,026,314

2,057,084

Deferred income taxes

631,121

624,000

Retirement benefit obligation

104,795

109,864

Other

272,738

270,616

Total noncurrent liabilities

3,034,968

3,061,564

Shareholders' Equity:

Common stock, 0.10 par value, 160,000,000 shares authorized, 112,222,865 shares issued as of December 31, 2025 and September 30, 2025, and 99,849,488 and 99,446,577 shares outstanding as of December 31, 2025 and September 30, 2025, respectively

11,222

Preferred stock, no par value, 1,000,000 shares authorized, no shares issued

—

Additional paid-in capital

499,943

513,050

Retained earnings

2,496,928

2,619,090

Accumulated other comprehensive income (loss)

42,680

44,964

Treasury stock, at cost, 12,373,377 shares and 12,776,288 shares as of December 31, 2025 and September 30, 2025, respectively

(447,763

)

(463,536

)

Non-controlling interest

99,266

104,548

Total shareholders’ equity

2,702,276

2,829,338

Total liabilities and shareholders' equity

6,459,096

6,705,738

HELMERICH & PAYNE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended December 31,

(in thousands)

2025

2024

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss)

(94,931

)

54,772

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization

181,919

99,080

Asset impairment charge

103,086

—

Amortization of debt discount and debt issuance costs

1,250

2,390

Stock-based compensation

9,287

6,851

Gain (loss) on investment securities

(929

)

13,367

Gain on reimbursement of drilling equipment

(6,120

)

(9,403

)

Other loss on sale of assets

1,926

1,673

Deferred income tax

7,182

(9,923

)

Other

(2,345

)

(381

)

Changes in assets and liabilities

(17,896

)

(68

)

Net cash provided by operating activities

182,429

158,358

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures

(67,565

)

(106,485

)

Purchase of short-term investments

(18,019

)

(95,956

)

Purchase of long-term investments

—

(646

)

Proceeds from sale of short-term investments

16,645

242,920

Insurance proceeds from involuntary conversion

—

698

Proceeds from asset sales

11,020

12,120

Other

(374

)

—

Net cash provided by (used in) investing activities

(58,293

)

52,651

CASH FLOWS FROM FINANCING ACTIVITIES:

Dividends paid

(25,238

)

(25,021

)

Distributions to non-controlling interests

(7,000

)

—

Debt issuance costs

—

(1,216

)

Payments for employee taxes on net settlement of equity awards

(5,835

)

(6,913

)

Payments on unsecured long-term debt

(30,000

)

—

Other

(1,715

)

—

Net cash used in financing activities

(69,788

)

(33,150

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(740

)

—

Net increase in cash, cash equivalents and restricted cash

53,608

177,859

Cash, cash equivalents and restricted cash, beginning of period

225,900

1,528,660

Cash, cash equivalents and restricted cash, end of period

279,508

1,706,519

HELMERICH & PAYNE, INC.

SEGMENT REPORTING

Three Months Ended

December 31,

September 30,

December 31,

(in thousands, except operating statistics)

2025

2024

NORTH AMERICA SOLUTIONS

Operating revenues

563,938

572,274

598,145

Direct operating expenses

325,133

330,235

332,347

Depreciation and amortization

84,244

88,248

88,336

Research and development

6,408

7,580

9,440

Selling, general and administrative expense

14,022

25,781

15,809

Asset impairment charges

97,922

—

Restructuring charges

—

2,272

—

Segment operating income

36,209

118,158

152,213

Financial Data and Other Operating Statistics 1:

Direct margin (Non-GAAP) 2

238,805

242,039

265,798

Revenue days 3

13,126

12,999

13,708

Average active rigs 4

143

141

149

Number of active rigs at the end of period 5

139

144

148

Number of available rigs at the end of period

203

223

225

Reimbursements of "out-of-pocket" expenses

72,797

71,289

68,426

INTERNATIONAL SOLUTIONS

Operating revenues

234,288

241,234

47,480

Direct operating expenses

205,573

211,716

54,428

Depreciation and amortization

78,121

90,102

4,828

Selling, general and administrative expense

4,145

4,964

2,708

Acquisition transaction costs

436

1,234

—

Asset impairment charges

—

4,368

—

Restructuring charges

1,318

4,565

—

Segment operating loss

(55,305

)

(75,715

)

(14,484

)

Financial Data and Other Operating Statistics 1:

Direct margin (Non-GAAP) 2

28,715

29,518

(6,948

)

Revenue days 3

5,444

5,691

1,689

Average active rigs 4

Number of active rigs at the end of period 5

Number of available rigs at the end of period

131

137

Reimbursements of "out-of-pocket" expenses

11,768

12,720

2,119

OFFSHORE SOLUTIONS

Operating revenues

188,282

180,327

29,210

Direct operating expenses

157,280

145,566

22,661

Depreciation and amortization

10,820

10,023

1,980

Selling, general and administrative expense

1,044

1,297

1,064

Acquisition transaction costs

573

2,911

—

Asset impairment charges

2,128

—

Restructuring charges

—

237

—

Segment operating income

16,437

20,293

3,505

Financial Data and Other Operating Statistics 1:

Direct margin (Non-GAAP) 2

31,002

34,761

6,549

Revenue days 3

276

Average active rigs 4

Number of active rigs at the end of period 5

Number of available rigs at the end of period

Reimbursements of "out-of-pocket" expenses

39,664

29,458

7,225

(1)

These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results. Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

(2)

Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin.

(3)

Defined as the number of contractual days during the reporting period in which revenue was recognized from Company owned rigs. This metric excludes revenue days associated with leased rigs.

(4)

Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e. 92 days for the three months ended December 31, 2025, September 30, 2025, and December 31, 2024.)

(5)

Defined as the number of contractual days for owned and leased rigs with recognized revenue for during the period.

Segment operating income (loss) for all segments is a non-GAAP financial measure of the Company’s performance, as it excludes gain on reimbursement of drilling equipment, other gain (loss) on sale of assets, corporate selling, general and administrative costs, corporate depreciation, corporate acquisition transaction costs, corporate asset impairment charges, and corporate restructuring charges. The Company considers segment operating income (loss) to be an important supplemental measure of operating performance for presenting trends in the Company’s core businesses. This measure is used by the Company to facilitate period-to-period comparisons in operating performance of the Company’s reportable segments in the aggregate by eliminating items that affect comparability between periods. The Company believes that segment operating income (loss) is useful to investors because it provides a means to evaluate the operating performance of the segments and the Company on an ongoing basis using criteria that are used by our internal decision makers. Additionally, it highlights operating trends and aids analytical comparisons. However, segment operating income (loss) has limitations and should not be used as an alternative to operating income or loss, a performance measure determined in accordance with GAAP, as it excludes certain costs that may affect the Company’s operating performance in future periods.

The following table reconciles operating income (loss) per the information above to income (loss) before income taxes as reported on the Unaudited Condensed Consolidated Statements of Operations:

Three Months Ended

December 31,

September 30,

December 31,

(in thousands)

2025

2024

Operating income (loss)

North America Solutions

36,209

118,158

152,213

International Solutions

(55,305

)

(75,715

)

(14,484

)

Offshore Solutions

16,437

20,293

3,505

Other

(1,223

)

(32,792

)

774

Eliminations

(795

)

(1,752

)

102

Segment operating income (loss)

(4,677

)

28,192

142,110

Gain on reimbursement of drilling equipment

6,120

7,249

9,403

Other gain (loss) on sale of assets

(1,926

)

595

(1,673

)

Corporate selling, general and administrative costs, corporate depreciation, corporate acquisition transaction costs, corporate asset impairment charges, and corporate restructuring charges

(59,428

)

(37,498

)

(58,952

)

Operating income (loss)

(59,911

)

(1,462

)

90,888

Other income (expense):

Interest and dividend income

2,758

3,353

21,741

Interest expense

(25,607

)

(27,972

)

(22,298

)

Gain (loss) on investment securities

929

(36,461

)

(13,367

)

Foreign currency exchange gain (loss)

6,455

(905

)

Other

(1,926

)

(5,985

)

360

Total other income (expense)

(23,819

)

(60,610

)

(14,469

)

Income (loss) before income taxes

(83,730

)

(62,072

)

76,419

NON-GAAP MEASUREMENTS

NON-GAAP RECONCILIATION OF SELECT ITEMS AND ADJUSTED NET LOSS(**)

Three Months Ended December 31, 2025

(in thousands, except per share data)

Pretax

Tax Impact

Net

EPS

Net loss (GAAP basis)

(96,706

)

(0.98

)

(-) Changes in actuarial assumptions on estimated liabilities

1,607

365

1,242

0.01

(-) Gain on investment security

929

211

718

0.01

(-) Restructuring charges

(1,591

)

—

(1,591

)

(0.02

)

(-) Acquisition transaction costs

(3,405

)

(386

)

(3,019

)

(0.03

)

(-) Impairment expense

(103,086

)

(23,401

)

(79,685

)

(0.80

)

Adjusted net loss

(14,371

)

(0.15

)

Three Months Ended September 30, 2025

(in thousands, except per share data)

Pretax

Tax Impact

Net

EPS

Net loss (GAAP basis)

(57,363

)

(0.58

)

(-) Changes in actuarial assumptions on estimated liabilities

3,864

877

2,987

0.03

(-) Acquisition transaction costs

(5,677

)

(680

)

(4,997

)

(0.05

)

(-) Restructuring charges

(7,450

)

(595

)

(6,855

)

(0.07

)

(-) Credit loss expense associated with long-term note receivable

(9,878

)

(2,242

)

(7,636

)

(0.08

)

(-) Impairment expense

(11,450

)

—

(11,450

)

(0.12

)

(-) Loss on investment security

(36,461

)

(8,277

)

(28,184

)

(0.28

)

Adjusted net loss

(1,228

)

(0.01

)

(**)The Company believes identifying and excluding select items is useful in assessing and understanding current operational performance, especially in making comparisons over time involving previous and subsequent periods and/or forecasting future period results. Select items are excluded as they are deemed to be outside of the Company's core business operations.

NON-GAAP RECONCILIATION OF DIRECT MARGIN

Direct margin is considered a non-GAAP metric. We define "direct margin" as operating revenues (less reimbursements) less direct operating expenses (less reimbursements). Direct margin is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. Direct margin is not a substitute for financial measures prepared in accordance with GAAP and should therefore be considered only as supplemental to such GAAP financial measures.

The following table reconciles direct margin to segment operating income (loss), which we believe is the financial measure calculated and presented in accordance with GAAP that is most directly comparable to direct margin.

Three Months Ended

December 31,

September 30,

December 31,

(in thousands)

2025

2024

NORTH AMERICA SOLUTIONS

Segment operating income

36,209

118,158

152,213

Add back:

Depreciation and amortization

84,244

88,248

88,336

Research and development

6,408

7,580

9,440

Selling, general and administrative expense

14,022

25,781

15,809

Asset impairment charge

97,922

—

Restructuring charges

—

2,272

—

Direct margin (Non-GAAP)

238,805

242,039

265,798

INTERNATIONAL SOLUTIONS

Segment operating loss

(55,305

)

(75,715

)

(14,484

)

Add back:

Depreciation and amortization

78,121

90,102

4,828

Selling, general and administrative expense

4,145

4,964

2,708

Acquisition transaction costs

436

1,234

—

Asset impairment charge

—

4,368

—

Restructuring charges

1,318

4,565

—

Direct margin (Non-GAAP)

28,715

29,518

(6,948

)

OFFSHORE SOLUTIONS

Segment operating income

16,437

20,293

3,505

Add back:

Depreciation and amortization

10,820

10,023

1,980

Selling, general and administrative expense

1,044

1,297

1,064

Acquisition transaction costs

573

2,911

—

Asset impairment charges

2,128

—

Restructuring charges

—

237

—

Direct margin (Non-GAAP)

31,002

34,761

6,549

NON-GAAP RECONCILIATION OF ADJUSTED EBITDA

Adjusted EBITDA and 'Select Items' are considered to be non-GAAP metrics. Adjusted EBITDA is defined as net income (loss) before taxes, depreciation and amortization, gains and losses on asset sales, other income and expense - which includes interest income and interest expense, and excludes the impact of 'select items' which management defines as certain items that do not reflect the ongoing performance of our core business operations. These metrics are included as supplemental disclosures as management uses them to assess and understand current operational performance, especially in analyzing historical trends which are used in forecasting future period results. For this reason, we believe this measure will be useful to information to investors. The presence of non-GAAP metrics is not intended to suggest that such measures should be considered as a substitute for certain GAAP metrics and, given that not all companies define Adjusted EBITDA the same way, this financial measure may not be comparable to similarly titled metrics disclosed by other companies.

The following table reconciles adjusted EBITDA to net income (loss), which we believe is the financial measure calculated and presented in accordance with GAAP that is most directly comparable to direct margin.

Three Months Ended

December 31,

September 30,

December 31,

(in thousands)

2025

2024

Net income (loss) attributable to Helmerich and Payne, Inc.

(96,706

)

(57,363

)

54,772

Add back:

Net income attributable to non-controlling interest

1,775

1,556

—

Income tax expense (benefit)

11,201

(6,265

)

21,647

Other (income) expense

Interest and dividend income

(2,758

)

(3,353

)

(21,741

)

Interest expense

25,607

27,972

22,298

(Gain) loss on investment securities

(929

)

36,461

13,367

Foreign currency exchange (gain) loss

(27

)

(6,455

)

905

Other

1,926

5,985

(360

)

Depreciation and amortization

181,919

188,857

99,080

Acquisition transaction costs

3,405

5,677

10,535

Asset impairment charges

103,086

18,928

—

Restructuring charges

1,591

7,450

—

Other (gain) loss on sale of assets

1,926

(595

)

1,673

Excluding Select Items (Non-GAAP)

Credit loss expense associated with long-term note receivable

—

9,878

—

Change in actuarial assumptions on estimated liabilities

(1,607

)

(3,864

)

—

Gains related to an insurance claim

—

(2,366

)

Adjusted EBITDA (Non-GAAP)

230,409

224,869

199,810