HALLIBURTON CO

RESULTS OF OPERATIONS IN 2026 COMPARED TO 2025

Three Months Ended March 31, 2026 Compared with Three Months Ended March 31, 2025

Operating Segments

Completion and Production

Completion and Production revenue in thefirst quarter of 2026 was$3.0 billion, a decrease of$104 million, or 3%,

when compared to thefirst quarter of 2025. Operating income in thefirst quarter of 2026 was$439 million, a decrease of$92

million, or 17%, when compared to thefirst quarter of 2025. These results were primarily driven by lower stimulation activity

in North America, and lower completion tool sales and decreased pressure pumping services in the Middle East. Partially

offsetting these decreases were higher completion tool sales in the Western Hemisphere, and improved pressure pumping

services in Africa.

Drilling and Evaluation

Drilling and Evaluation revenue in thefirst quarter of 2026 was$2.4 billion, an increase of$89 million, or 4%, when

compared to thefirst quarter of 2025. Operating income in thefirst quarter of 2026 was$351 million, flat when compared to the

first quarter of 2025. These results were primarily driven by higher project management activity in Latin America and increased

drilling-related services in Europe and the Western Hemisphere. Partially offsetting these increases were lower activity across

multiple product service lines in the Middle East, lower wireline activity in the Eastern Hemisphere, and decreased fluid

services in the Gulf of America.

In thefirst quarter of 2026, the geopolitical conflict in the Middle East affected both of our operating segments, with

an impact of $0.02 to $0.03 of diluted net income per share.

Geographic Regions

North America

North America revenue in thefirst quarter of 2026 was$2.1 billion, a 4% decrease, as compared to thefirst quarter of

2025. This decline was primarily driven by lower stimulation activity and decreased artificial lift activity in US Land, and lower

stimulation activity and decreased fluid services in the Gulf of America. Partially offsetting these decreases were increased

drilling-related services in US Land and higher completion tool sales in the region.

Latin America

Latin America revenue in thefirst quarter of 2026 was$1.1 billion, a 22% increase compared to thefirst quarter of

2025. This increase was primarily driven by higher activity across multiple product service lines in Ecuador, the Caribbean, and

Brazil, and improved stimulation activity in Mexico and Argentina. Partially offsetting these increases were lower project

management activity and decreased drilling-related services in Mexico.

Europe/Africa/CIS

Europe/Africa/CIS revenue in thefirst quarter of 2026 was$858 million, an 11% increase compared to thefirst quarter

of 2025. This increase was primarily driven by increased drilling-related services and higher completion tool sales in Norway,

and improved pressure pumping services in Angola. Partially offsetting these increases were lower completion tool sales in the

Caspian Area and decreased drilling-related services in Namibia.

Middle East/Asia

Middle East/Asia revenue in thefirst quarter of 2026 was$1.3 billion, a 13% decrease compared to thefirst quarter of

2025. This decrease was primarily driven by conflict-related disruptions that resulted in lower activity across multiple product

service lines in Saudi Arabia and decreased drilling-related services in Qatar. Partially offsetting these decreases were higher

completion tool sales and improved fluid services in Asia.

Other Operating Items

SAP S4 Upgrade Expense. As previously mentioned, during 2023, we began our migration to SAP S4, which we

expect to complete inthe fourth quarter of 2026. During thefirst quarter of 2026, we recognized$42 million of expense on our

SAP S4 migration. During thefirst quarter of 2025, we recognized$30 million of expense on our SAP S4 migration.

Impairments and Other Charges. During the three months ended March 31, 2026, there were no amounts recorded in

impairments and other charges. During thethree months ended March 31, 2025, we took a pre-tax charge of$356 million

primarily related to severance costs, an impairment of assets held for sale, an impairment of facility closures and lease

terminations, and other items. See Notes to Condensed Consolidated Financial Statements, Note 2 for further discussion of

these charges.

Nonoperating Items

Pension Settlement Charges from Plan Terminations. During thethree months ended March 31, 2026, the Company

entered into agreements to transfer certain defined benefit pension obligations to third-party insurers in connection with plan

terminations. As a result, the Company recognized approximately $23 million of non-cash pension settlement charges,

primarily related to the acceleration of actuarial losses previously recorded in accumulated other comprehensive income. This is

included in “Other, net” on the Condensed Consolidated Statements of Operations.

Income Tax Provision. During thethree months ended March 31, 2026, we recorded a total income tax provision of

$105 million on a pre-tax income of$569 million, resulting in an effective tax rate of 18.5% for the quarter. The effective tax

rate for this period was primarily impacted by the release of a valuation allowance in the amount of $32 million related to

changes in deferredtax asset realizability. During thethree months ended March 31, 2025, we recorded a total income tax

provision of$103 million on a pre-tax income of$306 million, resulting in an effective tax rate of 33.7% for the quarter. The

effective tax rate for this period was primarily impacted by the additional valuation allowance recognized on our deferred tax

assets, which resulted from the pre-tax $356 million of impairments and other charges.

Pillar Two. The Organization for Economic Co-operation and Development enacted model rules for a new global

minimum tax framework, also known as Pillar Two, and certain governments globally have enacted, or are in the process of

enacting, legislation considering these model rules. These rules did not have a material impact on our taxes for thethree months

ended March 31, 2026 and 2025.

Internal Revenue Service Notice of Proposed Adjustment. We are subject to taxes in the United States and in numerous

jurisdictions where we operate or where our subsidiaries are organized. Our tax returns are routinely subject to examination 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 2014. The only significant operating jurisdiction that has tax filings under review or subject to

examination by the tax authorities is the United States. Our United States federal income tax filings for tax years 2016 through

2024, including carry back of 2016 net operating losses to 2014, are currently under review or remain open for review by the

IRS.

On September 28, 2023, we received a NOPA from the IRS covering our 2016 U.S. tax return. The NOPA proposed

an adjustment to reclassify approximately 95% of the $3.5 billion termination fee paid to Baker Hughes in 2016 from an

ordinary expense deduction to a capital loss. The termination fee was paid to Baker Hughes under the merger agreement after

antitrust regulators in multiple jurisdictions failed to approve our proposed merger. It is common commercial practice to include

a termination fee in a merger agreement to compensate the target for damages incurred when the acquisition does not go

forward. The IRS’s long-understood position at the time of payment had been to treat such payments as an ordinary and

necessary business expense. We strongly disagree with the proposed adjustment on both a factual and legal basis, and we plan

to vigorously contest it.

We expect that resolving this dispute will take substantial time. In 2023, we initiated the IRS administrative appeals

process, which is ongoing. Failing a resolution through that process, the matter would ultimately be resolved by the United

States federal courts.

We regularly assess the likelihood of adverse outcomes resulting from tax examinations to determine the adequacy of

our tax reserves, and we believe our income tax reserves are appropriately provided for all open tax years. We cannot assure

you that the matter will be determined in our favor or against us, and if the matter is ultimately determined unfavorably to us, it

could have a material adverse impact on our results of operations and cash flows. Based on tax attributes currently available, we

estimate that, should the IRS's position prevail through the appellate process and subsequent litigation, the proposed adjustment

could result in cash taxes due of approximately $640 million (plus interest thereon in the case of amounts due for previous tax

years). Our estimates are calculated under current tax law and on the basis of our assumptions regarding taxable income and

loss and other tax attributes over the relevant period, which law could change and which assumptions could and likely will

differ materially from actual results. In any event, no payment of any additional tax is currently required, nor do we anticipate

that the proposed adjustment would materially and adversely impact our ability to meet our expected uses of cash, including

future capital expenditures, working capital investments, and scheduled debt repayments, or our ability to return cash to

shareholders, even if a final determination of the matter is reached that is adverse to us.