Transocean Ltd

Three months ended June 30, 2024 compared to the three months ended June 30, 2023

The following is an analysis of our operating results. See “—Performance and Other Key Indicators” for definitions of operating days, average daily revenue, revenue efficiency and rig utilization.

“nm” means not meaningful.

Contract drilling revenues—Contract drilling revenues increased for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily due to the following: (a) approximately $65 million resulting from higher average daily revenues, (b) approximately $40 million resulting from increased utilization, (c) approximately $35 million resulting from the operations of our newbuild ultra-deepwater floatersDeepwater Titan andDeepwater Aquila, (d) approximately $20 million resulting from the operations of the harsh environment floaterTransocean Norge and (e) approximately $20 million resulting from decreased amortization of contract intangible assets. These increases were partially offset by the following: (a) approximately $20 million resulting from early termination fees in the three months ended June 30, 2023 with no comparable activity in the current-year period, (b) approximately $15 million resulting from the harsh environment floaterPaul B. Loyd, Jr., the sale of which we completed in February 2024, and (c) approximately $15 million resulting from reimbursement revenues.

Costs and expenses—Operating and maintenance costs and expenses increased for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily due to the following: (a) approximately $50 million resulting from increased operating activity, (b) approximately $20 million resulting from the effect of inflation on personnel and other operating costs, (c) approximately $15 million resulting from the operations of our newbuild ultra-deepwater floatersDeepwater Titan andDeepwater Aquila, (d) approximately $15 million resulting from the operations of the harsh environment floaterTransocean Norge, (e) approximately $10 million resulting from

• 19 -

incremental in-service costs related to additional services and contract preparation cost recognition, (f) approximately $5 million resulting from higher maintenance costs for the active fleet and (g) approximately $5 million resulting from increased costs associated with the early retirement of certain personnel. These increases were partially offset by the following: (a) approximately $30 million resulting from lower contract preparation costs, (b) approximately $15 million resulting from lower reimbursable costs, (c) approximately $10 million resulting from the operations the harsh environment floaterPaul B. Loyd, Jr., the sale of which we completed in February 2024, and (d) approximately $5 million resulting from favorable settlements of various contingencies related to prior years.

General and administrative costs and expenses increased for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily due to (a) approximately $6 million resulting from increased personnel costs, primarily resulting from costs associated with the early retirement of certain personnel and (b) approximately $6 million resulting from legal and professional fees.

Loss on impairment—In the three months ended June 30, 2024, we recognized a loss of $143 million, associated with the impairment ofDeepwater Nautilus and related assets. In the three months ended June 30, 2023, we recognized a loss of $53 million, associated with the impairment ofPaul B. Loyd, Jr. andTransocean Leader, together with related assets.

Other income and expense—Interest expense, net of amounts capitalized, decreased in the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily due to the following: (a) $115 million decreased interest resulting from the change to the fair value of the bifurcated compound exchange feature embedded in the indenture governing the 4.625% senior guaranteed exchangeable bonds due September 2029 (“4.625% Senior Guaranteed Exchangeable Bonds”) and (b) $19 million decreased interest resulting from debt repaid as scheduled or early retired, partially offset by, (c) $37 million increased interest resulting from debt issued since June 2023 and (d) $5 million increased interest resulting from reduced interest costs capitalized for our newbuild construction program.

In the three months ended June 30, 2024, we recognized a net gain on retirement of debt as follows: (a) an aggregate net gain of $144 million resulting from retirement of the notes validly tendered in the Tender Offers, partially offset by (b) an aggregate net loss of $4 million associated with the redemption and early retirement of $761 million aggregate principal amount of our debt securities.

Other income, net, decreased in the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily due to (a) reduced income of $8 million related to our dual-activity patent, (b) reduced gains of $5 million resulting from net changes to currency exchange rates, partially offset by (c) increased income of $5 million associated with the equity investments in our unconsolidated affiliates.

Income tax expense or benefit—In the three months ended June 30, 2024 and 2023, our effective tax rate was 474.5 percent and 8.8 percent, respectively, based on income or loss before income tax expense or benefit. In the three months ended June 30, 2024 and 2023, the effect of various discrete period tax items was a net tax benefit of $7 million and $1 million, respectively. In the three months ended June 30, 2024, such discrete items included changes to deferred taxes due to a loss on the impairment of assets. In the three months ended June 30, 2023, such discrete items included expiration of various uncertain tax positions, changes to valuation allowances and changes to deferred tax expense due to new rig operations. In the three months ended June 30, 2024 and 2023, our effective tax rate, excluding discrete items, was 416.3 percent and 11.7 percent, respectively, based on income or loss before income tax expense or benefit.

Due to our operating activities and organizational structure, our income tax expense does not change proportionally with our income before income taxes. We may have subsidiaries with tax expense on taxable earnings that exceeds the tax benefits in other jurisdictions, or vice versa, which sometimes results in a negative effective tax rate or unusually high effective tax rates relative to consolidated losses before income taxes. Our earnings are unevenly distributed across jurisdictions and may experience variability in timing among interim periods throughout the year and such variability may influence the allocation of income tax expense or benefit to the respective interim period. The annual effective tax rate used to allocate income tax expense or benefit to interim periods may also be influenced by the removal of loss jurisdictions from the calculations. Our rig operating structures further complicate our tax calculations, especially in instances where we have more than one operating structure for the taxing jurisdiction and, thus, more than one method of calculating taxes depending on the operating structure utilized by the rig under the contract.

• 20 -

Six months ended June 30, 2024 compared to the six months ended June 30, 2023

The following is an analysis of our operating results. See “—Performance and Other Key Indicators” for definitions of operating days, average daily revenue, revenue efficiency and rig utilization.

“nm” means not meaningful.

Contract drilling revenues—Contract drilling revenues increased for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, primarily due to the following: (a) approximately $145 million resulting from higher average daily revenues, (b) approximately $60 million resulting from the operations of our two newbuild ultra-deepwater floatersDeepwater Titan andDeepwater Aquila, (c) approximately $55 million resulting from increased activity for the operations of the harsh environment floaterTransocean Norge, (d) approximately $30 million resulting from decreased amortization of contract intangible assets and (e) approximately $15 million resulting from increased utilization. These increases were partially offset by the following: (a) approximately $20 million resulting from early termination fees in the six months ended June 30, 2023 with no comparable activity in the current-year period, (b) approximately $15 million resulting from the operations of the harsh environment floaterPaul B. Loyd, Jr., the sale of which we completed in February 2024, (c) approximately $10 million resulting from decreased reimbursement revenues and (d) approximately $10 million resulting from decreased revenue efficiency for the comparable active fleet.

Costs and expenses—Operating and maintenance costs and expenses increased for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, primarily due to the following: (a) approximately $65 million resulting from increased operating activity, (b) approximately $40 million resulting from the effect of inflation on personnel and other operating costs, (c) approximately $40 million resulting from the operations of the harsh environment floaterTransocean Norge, (d) approximately $30 million resulting from the operations of our newbuild ultra-deepwater floatersDeepwater Titan andDeepwater Aquila, (e) approximately $15 million resulting from higher contract preparation costs and (f) approximately $5 million resulting from increased costs associated with the early retirement of certain personnel. These increases were partially offset by the following: (a) approximately $15 million resulting from favorable settlements of various litigation and contingencies, (b) approximately $10 million resulting from lower reimbursable costs, (c) approximately $10 million resulting from the operations of the harsh environment floaterPaul B. Loyd, Jr., the sale of which we completed in February 2024, and (d) approximately $5 million resulting from lower in-service maintenance costs for the comparable fleet.

General and administrative costs and expenses increased for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, primarily due to (a) approximately $11 million of increased personnel costs, primarily resulting from costs associated with the early retirement of certain personnel and (b) approximately $8 million resulting from increased legal and professional fees.

Loss on impairment or disposal of assets—In the six months ended June 30, 2024, we recognized a loss of $143 million, associated with the impairment ofDeepwater Nautilus and related assets. In the six months ended June 30, 2023, we recognized a loss of $53 million, associated with the impairment ofPaul B. Loyd, Jr. andTransocean Leader, together with related assets.

In the six months ended June 30, 2023, we recognized a loss of $169 million associated with our non-cash contribution of the ultra-deepwater drillshipOcean Rig Olympia and related assets for a noncontrolling ownership interest in an unconsolidated affiliate. In the

• 21 -

six months ended June 30, 2024 and 2023, we recognized an aggregate net loss of $6 million and $1 million, respectively, associated with the disposal of assets unrelated to rig sales.

Other income and expense—Interest expense, net of amounts capitalized, decreased in the six months ended June 30, 2024, compared to the six months ended June 30, 2023, primarily due to the following: (a) approximately $258 million decreased interest resulting from the fair value adjustment of the bifurcated compound exchange feature embedded in the indenture governing the 4.625% Senior Guaranteed Exchangeable Bonds and (b) approximately $30 million decreased interest resulting from debt repaid as scheduled or early retired, partially offset by, (c) approximately $52 million increased interest resulting from debt issued since January 2023 and (d) $18 million increased interest resulting from reduced interest costs capitalized for our newbuild construction program.

In the six months ended June 30, 2024, we recognized a net gain on retirement of debt as follows: (a) an aggregate net gain of $144 million resulting from retirement of notes validly tendered in the Tender Offers, partially offset by (b) an aggregate net loss of $4 million associated with the redemption and early retirement of $761 million aggregate principal amount of our debt securities. In the six months ended June 30, 2023, we recognized an aggregate net loss of $32 million associated with the redemption and early retirement of $1.38 billion aggregate principal amount of our debt securities.

Income tax expense or benefit—In the six months ended June 30, 2024 and 2023, our effective tax rate was 57.8 percent and (5.9) percent, respectively, based on loss before income tax expense or benefit. In the six months ended June 30, 2024 and 2023, the effect of various discrete period tax items was a net tax benefit of $128 million and $12 million, respectively. In the six months ended June 30, 2024, such discrete items included changes to deferred taxes due to rig ownership changes, rig movement and contract expirations across multiple jurisdictions. In the six months ended June 30, 2023, such discrete items included expiration of various uncertain tax positions, changes to deferred taxes due to new rig operations and changes to valuation allowances. In the six months ended June 30, 2024 and 2023, our effective tax rate, excluding discrete items, was (179.3) percent and (14.0) percent, respectively, based on loss before income tax expense or benefit.

Due to our operating activities and organizational structure, our income tax expense does not change proportionally with our income before income taxes. We may have subsidiaries with tax expense on taxable earnings that exceeds the tax benefits in other jurisdictions, or vice versa, which sometimes results in a negative effective tax rate or unusually high effective tax rates relative to consolidated losses before income taxes. Our earnings are unevenly distributed across jurisdictions and may experience variability in timing among interim periods throughout the year and such variability may influence the allocation of income tax expense or benefit to the respective interim period. The annual effective tax rate used to allocate income tax expense or benefit to interim periods may also be influenced by the removal of loss jurisdictions from the calculations. Our rig operating structures further complicate our tax calculations, especially in instances where we have more than one operating structure for the taxing jurisdiction and, thus, more than one method of calculating taxes depending on the operating structure utilized by the rig under the contract.

Liquidity and Capital Resources

Sources and uses of cash

In the six months ended June 30, 2024, our primary sources of cash were net cash proceeds from issuance of debt, disposal of assets and cash provided by operating activities. Our primary uses of cash were repayments of debt and capital expenditures.

Net cash provided by operating activities decreased primarily due to (a) increased cash paid to suppliers, (b) increased cash paid for interest and income taxes and (c) increased cash paid to employees, partially offset by (d) increased cash collected from customers.

• 22 -

Net cash used in investing activities decreased primarily due to (a) increased proceeds from disposal of assets and (b) reduced cash invested in the debt and equity of our unconsolidated affiliates, partially offset by (c) increased cash paid for capital expenditures.

Net cash used in financing activities increased primarily due to (a) increased net cash used to early retire $1.61 billion aggregate principal amount of certain of our debt securities in the six months ended June 30, 2024 compared to $1.38 billion aggregate principal amount of certain of our debt securities in the prior year period, partially offset by (b) increased net cash proceeds from the issuance of $900 million aggregate principal amount of 8.25% Senior Notes and $900 million aggregate principal amount of 8.50% Senior Notes in the six months ended June 30, 2024 compared to net cash proceeds from the issuance of $1.175 billion aggregate principal amount of 8.75% senior secured notes due February 2030 and $525 million aggregate principal amount of 8.375% senior secured notes due February 2028 in the prior year period.