SEADRILL Ltd
For the period ended Jun 30, 2026. Filed Aug 10, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 10, 2026
SDRL$42.20+2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-11.
0001737706-26-000016
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-10.
0001737706-26-000026
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 123 previous paragraphs and 186 current paragraphs.
74 unchanged; 40 reworded; 61 added; 8 removed; 1 previous and 11 current paragraphs rearranged.
Tables are not compared: 13 previous and 19 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (61)
Current report
Refinancing of Senior Notes
Current report
On June 30, 2026, Seadrill Finance issued $700 million in aggregate principal amount of 6.750% Senior Notes due 2034 in an offering conducted pursuant to Rule 144A and Regulation S under the Securities Act. The 2034 Notes are fully and unconditionally guaranteed, jointly and severally, by the Company and certain subsidiaries of the Company that are guarantors under the Credit Agreement, and in the future by certain subsidiaries of the Company that become borrowers or guarantors under the Credit Agreement or any other syndicated credit facility or capital markets debt in an aggregate principal amount in excess of a certain amount.
Current report
On June 30, 2026, in connection with the issuance of the 2034 Notes, Seadrill Finance satisfied and discharged the 2030 Notes Indenture in accordance with its terms.
Current report
Refer to "Liquidity and Capital Resources - Borrowing Activities" and Note 9- "Debt" for additional information.
Current report
Revolving Credit Facility Amendment
Current report
On June 16, 2026, Seadrill Limited, along with its subsidiary, Seadrill Finance, entered into the Amendment to the Credit Agreement to, among other things, increase the commitments for revolving borrowings from $225 million to $300 million and extend the maturity date from 2028 to 2031. The Amendment became effective on June 30, 2026, and the commitments thereunder became effective and available to be borrowed, subject to customary borrowing conditions.
Current report
Refer to "Liquidity and Capital Resources - Capital allocation framework and Share repurchase program" and Note 9- "Debt" for additional information.
Current report
Share Repurchase Program
Current report
On June 22, 2026, the Company's Board of Directors authorized an extension of the Share repurchase program to run through December 31, 2026.
Current report
During the three and six months ended June 30, 2026, the Company repurchased an aggregate of 511,078 Shares with a weighted average Share price of $38.66, amounting to approximately $20 million.
Current report
Refer to "Liquidity and Capital Resources - Capital allocation framework and Share repurchase program" and Note 12 - "Common shares" for additional information about the Share repurchase program.
Current report
The amortization of deferred mobilization revenues increased by $9 million during the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The increase was primarily attributable to revenues related to the West Elara recognized during the three months ended June 30, 2026, along with mobilization fees related to West Jupiter and West Capella following the start of their contracts in March 2026.
Current report
v. Other items
Current report
Contract revenues include integrated and add-on services.
Current report
There was an increase in contract revenues of $15 million during the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily attributable to the West Capella, West Saturn, West Vela, West Neptune and Sevan Louisiana earning revenues from integrated and add-on services during the three months ended June 30, 2026, compared to the three months ended June 30, 2025.
Current report
The $3 million increase in the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was primarily due to additional hired equipment on the Sevan Louisiana during the second quarter of 2026, compared to the second quarter of 2025.
Current report
c) Management contract expenses
Current report
Management contract expenses include costs related to Sonadrill's rigs, Quenguela and Libongos, and the Seadrill rig leased to Sonadrill, the West Gemini.
Current report
Management contract expenses decreased by $51 million during the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily attributable to estimated damages recognized following the unfavorable court judgment related to fees for arranging the Sonadrill joint venture in the three months ended June 30, 2025, not recurring in the three months ended June 30, 2026.
Current report
Refer to Note 13 -"Commitments and contingencies - Legal Proceedings - Sonadrill fees claim" of our unaudited Condensed Consolidated Financial Statements, included in Part I, Item 1. "Financial Statements" of this Quarterly Report on Form 10-Q, for additional details.
Current report
Other financial and non-operating items increased by $10 million during the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to a loss on debt extinguishment of the 2030 Notes, partially offset by a recovery of costs during the three months ended June 30, 2026 and the recognition of value-added tax ("VAT") liabilities during the three months ended June 30, 2025, not recurring in the three months ended June 30, 2026.
Current report
Results for the six months ended June 30, 2026 and June 30, 2025
Current report
Operating revenues
Current report
a) Contract revenues
Current report
The average number of rigs on contract decreased from 10 in the six months ended June 30, 2025 to nine in the six months ended June 30, 2026. The decrease in total days on contract resulted in lower contract revenues of $3 million in the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Current report
The decrease was partially offset by the West Neptune and West Polaris, operating throughout the six months ended June 30, 2026 compared to being partially contracted during the six months ended June 30, 2025, along with the West Capella starting its contract in March 2026 compared to the six months ended June 30, 2025, during which the rig was operating for less days.
Current report
ii. Average contractual dayrates
Current report
The average contractual dayrate earned during the six months ended June 30, 2026 was $352 thousand compared to $327 thousand during the six months ended June 30, 2025, resulting in a $38 million increase in contract revenues in the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Current report
The economic utilization for the six months ended June 30, 2026 was 95%, compared to 89% for the six months ended June 30, 2025, resulting in a $38 million increase in contract revenues in the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Current report
The increase was primarily due to improved economic utilization on the West Tellus, West Polaris, West Auriga and Sevan Louisiana during the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This was partially offset by the impact of lower economic utilization due to increased downtime on the West Saturnand West Carina during the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Current report
iv. Deferred mobilization revenues
Current report
The amortization of deferred mobilization revenues increased by $8 million during the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase was primarily attributable to revenues related to the West Elara recognized during the six months ended June 30, 2026, along with mobilization fees related to West Jupiter and West Capella following the start of their contracts in March 2026.
Current report
v. Other items
Current report
There was an increase in contract revenues of $15 million during the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily attributable to the West Capella, West Saturn, West Vela, West Neptune and Sevan Louisiana earning increased revenues from integrated and add-on services during the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Current report
b) Management contract revenues
Current report
Management contract revenues include revenues related to contracts where we provide management, operational and technical support services and are comprised of revenues from our joint venture, Sonadrill, relating to the Libongos, Quenguela and West Gemini.
Current report
Management contract revenues increased by $4 million in the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily driven by higher management fees on the Libongos, Quenguela and the West Gemini.
Current report
Refer to Note 10 -"Related party transactions" of our unaudited Condensed Consolidated Financial Statements, included in Part I, Item 1. "Financial Statements" of this Quarterly Report on Form 10-Q, for additional details.
Current report
Operating expenses
Current report
a) Vessel and rig operating expenses
Showing the first 40 of 61 passages. Open the source sections for the rest.
Removed paragraphs (8)
Previous report
The amortization of deferred mobilization revenues decreased by $1 million during the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The decrease was primarily attributable to mobilization fees received on the West Capella recognized during the first quarter of 2025.
Previous report
The $5 million decrease in the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily due to reduced reimbursable services provided to the West Gemini and Quenguela during the first quarter of 2026, compared to the first quarter of 2025.
Previous report
c) Selling, general and administrative expenses
Previous report
Selling, general and administrative expenses include the cost of our corporate and regional offices, certain legal and professional fees as well as the remuneration and other compensation of our officers, directors and employees engaged in central management and administration activities.
Previous report
Selling, general and administrative expense increased by $2 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to personnel costs and professional fees.
Previous report
Collateral package
Previous report
$575 million Notes Offerings
Previous report
In July 2023, Seadrill Finance issued the Notes in a private offering. The Notes mature on August 1, 2030. The Notes are guaranteed by the Company and the same subsidiaries of the Company that guarantee the Credit Agreement. The Notes are secured by a second priority lien on the same assets that secure the Credit Agreement.
Reworded paragraphs (40)
Previous wording
We are an offshore drilling contractor providing worldwide offshore drilling services to the oil and gas industry. Our primary business is the ownership and operation of drillships and semi-submersible rigs for operations in shallow to ultra-deepwater in both benign and harsh environments. We contract our drilling units to drill wells for our customers on a dayrate basis. Our customers include oil super-majors, state-owned national oil companies and independent oil and gas companies. In addition, we provide management services to certain affiliated entities.
Current wording
We are an offshore drilling contractor providing worldwide offshore drilling services to the oil and gas industry. Our primary business is the ownership and operation of drilling rigs for operations in shallow to ultra-deepwater in both benign and harsh environments. We contract our drilling units to drill wells for our customers on a dayrate basis. Our customers include oil super-majors, state-owned national oil companies and independent oil and gas companies. In addition, we provide management services to certain affiliated entities.
Previous wording
The price of oil has experienced increased volatility and has risen in response to the ongoing conflicts in the Middle East, including the current conflict in Iran, which started on February 28, 2026, and the unprecedented closure of the Strait of Hormuz. The Brent oil price was $71 per barrel on February 27, 2026 and increased to an average price of approximately $103 per barrel for the month of March 2026. We continue to evaluate and monitor the impacts of the recent oil price volatility and the ongoing conflicts in the Middle East on our business and operations; however, it is not possible to predict the long-term impact, if any, of the disruptions to commodity prices, global energy supplies, energy markets and economic conditions, on our business and operations.
Current wording
The price of oil has experienced increased volatility and has risen in response to the ongoing conflicts in the Middle East, including the current conflict in Iran, which started on February 28, 2026, and the unprecedented blockades of the Strait of Hormuz resulting therefrom. The Brent oil price was $71 per barrel on February 27, 2026 and increased to an average price of approximately $103 per barrel for the second quarter of 2026. We continue to evaluate and monitor the impacts of the recent oil price volatility and the ongoing conflicts in the Middle East on our business and operations; however, it is not possible to predict the long-term impact, if any, of the disruptions to commodity prices, global energy supplies, energy markets and economic conditions, on our business and operations.
Previous wording
The table below shows the average oil price for thethree months ended March 31, 2026 andyear ended December 31, 2025. The Brent oil price as of May 6, 2026 was $101/bbl.
Current wording
The table below shows the average oil price for thesix months ended June 30, 2026 andyear ended December 31, 2025. The Brent oil price as of August 6, 2026 was $82/bbl.
Previous wording
The price of Brent oil averaged $78 per barrel during the three months ended March 31, 2026 up from $68 per barrel in 2025, driven primarily by ongoing conflicts in the Middle East that disrupted global oil supply during the first quarter of 2026.
Current wording
The price of Brent oil averaged $88 per barrel during the six months ended June 30, 2026 up from an average of $70 per barrel in 2025, driven primarily by ongoing conflicts in the Middle East that disrupted global oil supply during the first half of 2026.
Previous wording
Uncertainty persists in the market, particularly in light of concerns over global economic conditions (including the current conflict in Iran), government trade policies and output increases by the Organization of the Petroleum Exporting Countries and other major international producers. This has led to the continued deferral of offshore capital expenditures and could have a negative impact on near-term future demand for offshore drilling services. In addition, inflationary pressures may impact the cost base in our industry, including personnel costs and the prices of goods and services required to reactivate or operate rigs.
Current wording
Uncertainty persists in the market, particularly in light of concerns over global economic conditions (including the current conflict in Iran), government trade policies and output increases by the Organization of the Petroleum Exporting Countries and other major international producers. In addition, inflationary pressures may impact the cost base in our industry, including personnel costs and the prices of goods and services required to reactivate or operate rigs.
Previous wording
The table below shows the global number of rigs on contract and marketed utilization for the three months ended March 31, 2026 and year ended December 31, 2025:
Current wording
The table below shows the global number of rigs on contract and marketed utilization for the six months ended June 30, 2026 and year ended December 31, 2025:
Previous wording
Marketed utilization and the number of contracted rigs remained relatively consistent in the three months ended March 31, 2026 compared to the year ended December 31, 2025.
Current wording
Marketed utilization and the number of contracted rigs remained relatively consistent in the six months ended June 30, 2026 compared to the year ended December 31, 2025.
Previous wording
Marketed utilization for harsh environment floaters improved in the three months ended March 31, 2026 compared to the year ended December 31, 2025, whereas utilization for harsh environment jackups remained consistent over the same periods, reflecting continued demand for high-specification assets.
Current wording
Marketed utilization for harsh environment floaters improved in the six months ended June 30, 2026 compared to the year ended December 31, 2025, whereas utilization for harsh environment jackups remained relatively consistent over the same periods, reflecting continued demand for high-specification assets.
Previous wording
The average number of rigs on contract remained consistent at nine in each of the three months ended March 31, 2026 and 2025; however, there was a decrease in the total days on contract resulting in lower contract revenues of $11 million in the three months ended March 31, 2026 compared to the three months ended March 31, 2025.
Current wording
The average number of rigs on contract remained consistent at 10 in each of the three months ended June 30, 2026 and 2025; however, there was an increase in the total days on contract resulting in higher contract revenues of $11 million in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Previous wording
The decrease was primarily driven by fewer operating days on the West Jupiter, West Capella and Sevan Louisiana, which were undergoing contract preparation activities during the three months ended March 31, 2026 for contracts that started during March 2026 in Brazil, Malaysia and the U.S. Gulf of America, respectively, compared to the three months ended March 31, 2025, during which the rigs were operating for more days. The decrease was partially offset by the West Neptune and West Polaris, operating throughout the three months ended March 31, 2026, compared to being partially contracted during the three months ended March 31, 2025.
Current wording
The increase was primarily driven by the West Capellaand Sevan Louisiana, with contracts that started in March 2026 in Malaysia and the U.S. Gulf of America, respectively, compared to the three months ended June 30, 2025, during which the rigs were operating for less days. The increase was partially offset by the West Tellus operating for fewer days during the three months ended June 30, 2026, due to contract preparations for its new contract that started in June 2026 in Brazil, compared to being fully contracted during the three months ended June 30, 2025.
Previous wording
The average contractual dayrate earned during the three months ended March 31, 2026 was $343 thousand compared to $323 thousand during the three months ended March 31, 2025, resulting in a $5 million increase in contract revenues in the three months ended March 31, 2026 compared to the three months ended March 31, 2025.
Current wording
The average contractual dayrate earned during the three months ended June 30, 2026 was $360 thousand compared to $331 thousand during the three months ended June 30, 2025, resulting in a $24 million increase in contract revenues in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Previous wording
The increase was driven by higher dayrates for the West Jupiter, West Auriga, West Polaris, West Tellus and West Carina operating in Brazil, the West Neptune operating in the U.S. Gulf of America, and the West Elara operating in Norway during the three months ended March 31, 2026, compared to the three months ended March 31, 2025. These impacts were partially offset by lower dayrates for the West Vela and Sevan Louisiana operating in the U.S. Gulf of America during the three months ended March 31, 2026, compared to the three months ended March 31, 2025.
Current wording
The increase was driven by higher dayrates for the West Jupiter, West Tellus, West Auriga, and West Carina operating in Brazil, and the West Neptune operating in the U.S. Gulf of America during the three months ended June 30, 2026, compared to the three months ended June 30, 2025. These impacts were partially offset by lower dayrates for the West Vela and Sevan Louisiana operating in the U.S. Gulf of America, and the West Polaris operating in Brazil during the three months ended June 30, 2026, compared to the three months ended June 30, 2025.
Previous wording
The economic utilization for the three months ended March 31, 2026 was 95%, compared to 84% for the three months ended March 31, 2025, resulting in a $36 million increase in contract revenues in the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily due to improved economic utilization on the West Tellus, West Polaris, West Aurigaand Sevan Louisiana during the three months ended March 31, 2026 compared to the three months ended March 31, 2025.
Current wording
The economic utilization for the three months ended June 30, 2026 was 96%, compared to 93% for the three months ended June 30, 2025, resulting in a $8 million increase in contract revenues in the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was primarily due to improved economic utilization on the West Polarisand West Elara during the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This was partially offset by downtime on the West Saturn during the three months ended June 30, 2026.
Previous wording
Total operating expenses include vessel and rig operating expenses, reimbursable expenses, depreciation of drilling units and equipment, amortization of intangibles, management contract expenses, selling, general and administrative expenses, and merger and integration related expenses.
Current wording
Total operating expenses include vessel and rig operating expenses, reimbursable expenses, depreciation of drilling units and equipment, amortization of intangibles, management contract expenses, and selling, general and administrative expenses.
Previous wording
Vessel and rig operating expenses increased by $2 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025. During the three months ended March 31, 2026, there was an $9 million increase in vessel and rig operating expenses compared to the three months ended March 31, 2025, primarily related to the West Polaris commencing operations in February 2025 in Brazil, along with higher repair and maintenance costs across the fleet. This was partially offset by a $7 million decrease in vessel and rig operating expenses during the three months ended March 31, 2026, attributable to lower deferred mobilization costs related to contracts in Brazil completing during the first quarter of 2026.
Current wording
Vessel and rig operating expenses increased by $35 million during the three months ended June 30, 2026 compared to the three months ended June 30, 2025. There was a $43 million increase in vessel and rig operating expenses primarily related to the West Capella commencing operations in Malaysia in March 2026, along with higher integrated services, repair and maintenance and personnel costs during the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This was partially offset by an $8 million decrease in vessel and rig operating expenses during the three months ended June 30, 2026, attributable to the West Tellus preparing for its contract that started in June 2026 in Brazil, compared to operating throughout the three months ended June 30, 2025.
Previous wording
The $16 million increase in depreciation and amortization for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 is mainly attributable to long-term maintenance and capital projects across the fleet, and unfavorable contracts being fully amortized during 2025.
Current wording
The $16 million increase in depreciation and amortization for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 is mainly related to long-term maintenance and capital projects across the fleet, and unfavorable contracts recorded as liabilities being fully amortized during 2025.
Previous wording
Depreciation increased by $11 million in the three months ended March 31, 2026 compared to the three months ended March 31, 2025, mainly attributable to long-term maintenance and capital projects across the fleet, primarily related to West Neptune, West Gemini and Sevan Louisiana during the second half of 2025.
Current wording
Depreciation increased by $12 million in the three months ended June 30, 2026 compared to the three months ended June 30, 2025, mainly attributable to long-term maintenance and capital projects across the fleet, primarily related to the West Neptune, West Vela, West Gemini, West Capella and Sevan Louisiana.
Previous wording
Amortization increased by $5 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, mainly attributable to unfavorable contracts recorded as liabilities being fully amortized during 2025 related to the West Tellus, West Jupiterand West Carina.
Current wording
Amortization increased by $4 million during the three months ended June 30, 2026 compared to the three months ended June 30, 2025, mainly attributable to unfavorable contracts recorded as liabilities being fully amortized during 2025 related to the West Tellus, West Jupiterand West Carina.
Previous wording
We incur interest on our debt facilities as summarized below:
Current wording
We incurred interest on our debt facilities as summarized below:
Previous wording
The $8 million increase in tax expense during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily reflects changes in the Company's mix of pre-tax income and loss among tax jurisdictions, as well as lower utilization of tax loss carryforwards in the three months ended March 31, 2026.
Current wording
The $17 million decrease in tax expense during the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily reflects changes in the Company's mix of pre-tax income and loss among tax jurisdictions and changes in the valuation allowance established for Switzerland in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Previous wording
The earnings during the three months ended March 31, 2026 and the three months ended March 31, 2025 related to Seadrill's proportion of earnings from Sonadrill.
Current wording
The equity in earnings of equity method investment relates to Seadrill's proportion of earnings from Sonadrill.
Previous wording
The decrease in earnings of $4 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily driven by lower operating dayrates for Libongosand West Gemini, partially offset by an increased dayrate for Quenguela, operating in Angola during the three months ended March 31, 2026, compared to the three months ended March 31, 2025.
Current wording
The decrease in earnings of $6 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was primarily driven by lower operating dayrates for Libongos and West Gemini, along with the impact of higher management fees for the West Gemini, Libongos and Quenguela in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This was partially offset by an increased dayrate for Quenguela operating in Angola during the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Previous wording
Other financial and non-operating items improved by $15 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily driven by a provision recognized during the three months ended March 31, 2025 related to assets sold, which did not recur during the three months ended March 31, 2026.
Current wording
Other financial and non-operating items improved by $5 million during the six months ended June 30, 2026 compared to the six months ended June 30, 2025, driven by a recovery of costs during the six months ended June 30, 2026, along with the recognition of VAT liabilities and a provision for assets sold during the six months ended June 30, 2025, which did not recur during the six months ended June 30, 2026. This was partially offset by a loss on debt extinguishment of the 2030 Notes recognized during the six months ended June 30, 2026.
Previous wording
In July 2023, in connection with the issuance of the Notes, Seadrill announced capital allocation principles designed to prioritize a conservative capital structure and liquidity position, focused capital investment in its fleet, and returns to shareholders. Within this framework, Seadrill intends to maintain a net leverage target of less than 1.0x under current market conditions, with a maximum through-cycle net leverage target of less than 2.0x. Seadrill also intends to maintain a strong liquidity position to provide resilience even in a downturn scenario by establishing a target minimum cash-on-hand of $250 million. Further, Seadrill intends to evaluate the potential for accretive additions in core asset categories.
Current wording
In July 2023, in connection with the issuance of the 2030 Notes, Seadrill announced capital allocation principles designed to prioritize a conservative capital structure and liquidity position, focused capital investment in its fleet, and returns to shareholders. Within this framework, Seadrill intends to maintain a net leverage target of less than 1.0x under current market conditions, with a maximum through-cycle net leverage target of less than 2.0x. Seadrill also intends to maintain a strong liquidity position to provide resilience even in a downturn scenario by establishing a target minimum cash-on-hand of $250 million. Further, Seadrill intends to evaluate the potential for accretive additions in core asset categories.
Previous wording
During the second quarter of 2024, the Company's Board of Directors authorized a $500 million Share repurchase program that will run for a period of two years from June 25, 2024, the date of completion for the programs initiated in 2023 ("Current Repurchase Program"). Under the Current Repurchase Program, the Board authorized the Company to purchase up to $300 million of the Company's Shares in 2024. Since the Current Repurchase Program commenced, the Company has repurchased an aggregate of 6,714,252 Shares with a weighted average Share price of $43.52, amounting to $292 million. On September 30, 2024 and December 16, 2024, the Company canceled 4,213,349 and 2,500,903 treasury Shares, respectively, repurchased under this program.
Current wording
During the second quarter of 2024, the Company's Board of Directors authorized a $500 million Share repurchase program that would initially run for a period of two years from June 25, 2024, the date of completion for the programs initiated in 2023 ("Share repurchase program").
Previous wording
During the three months ended March 31, 2026 and March 31, 2025, the Company did not repurchase Shares.
Current wording
During the three and six months ended June 30, 2026, the Company repurchased an aggregate of 511,078 Shares with a weighted average Share price of $38.66, amounting to approximately $20 million. During the three and six months ended June 30, 2025, the Company did not repurchase Shares.
Previous wording
As of March 31, 2026, $208 million of the $500 million authorized amount remained available under the Current Repurchase Program.
Current wording
From commencement of the Share repurchase program through June 30, 2026, the Company repurchased an aggregate of 7,225,330 Shares with a weighted average Share price of $43.18, amounting to approximately $312 million. As of June 30, 2026, approximately $188 million of the $500 million authorized amount remained available under the Share repurchase program.
Previous wording
While the Current Repurchase Program has a fixed expiration, it may be modified, suspended or discontinued at any time. Shares may be repurchased at any time and from time to time under the program in open market purchases, privately negotiated purchases, block trades, tender offers, accelerated share repurchase transactions or other derivative transactions, through the purchase of call options or the sale of put options, or otherwise, or by any combination of the foregoing. The Company is under no obligation to purchase any Shares in respect of the repurchase program. The manner, timing, pricing and amount of any repurchases may be based upon a number of factors, including market conditions, the Company’s financial position and capital requirements, financial conditions, competing uses for cash, statutory solvency requirements, the restrictions in the Company’s debt agreements and other factors.
Current wording
While the Share repurchase program has a fixed expiration, it may be modified, suspended or discontinued at any time. Shares may be repurchased at any time and from time to time under the program in open market purchases, privately negotiated purchases, block trades, tender offers, accelerated share repurchase transactions or other derivative transactions, through the purchase of call options or the sale of put options, or otherwise, or by any combination of the foregoing. The Company is under no obligation to purchase any Shares in respect of the repurchase program. The manner, timing, pricing and amount of any repurchases may be based upon a number of factors, including market conditions, the Company’s financial position and capital requirements, financial conditions, competing uses for cash, statutory solvency requirements, the restrictions in the Company’s debt agreements and other factors.
Previous wording
The Company may continue Share repurchases pursuant to the Current Repurchase Program at the Board’s discretion. While we intend to announce the initiation of any Board approved repurchase programs in the future, as well as periodic information required under U.S. securities laws and regulations, we do not intend to announce any sub-authorizations for Share repurchases made pursuant to the Current Repurchase Program or any successor program given that we are no longer required to comply with European regulations requiring onerous disclosure in connection with repurchase programs.
Current wording
The Company may continue Share repurchases pursuant to the Share repurchase program at the Board’s discretion.
Previous wording
As of March 31, 2026, Seadrill had available liquidity of $482 million, which consisted of unrestricted cash of $304 million and available borrowings under our Revolving Credit Facility of $178 million. Our cash on hand, available borrowings under the Revolving Credit Facility, and contract and other revenues are expected to generate sufficient cash flow to fund our anticipated debt service and working capital requirements for the next 12 months.
Current wording
As of June 30, 2026, Seadrill had available liquidity of $585 million, which consisted of unrestricted cash of $337 million and available borrowings under our Revolving Credit Facility of $248 million. Our cash on hand, available borrowings under the Revolving Credit Facility, and contract and other revenues are expected to generate sufficient cash flow to fund our anticipated debt service and working capital requirements for the next 12 months.
Previous wording
a) Net cash used in operating activities
Current wording
a)Net cash used in operating activities
Previous wording
Net cash used in operating activities during the three months ended March 31, 2026 was$22 million compared to$27 million for the three months ended March 31, 2025. The$5 million decrease in net cash used in operating activities in the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily driven by improved operating results and reduced disbursements to suppliers, partially offset by the impact of timing of receipts from customers and increased mobilization costs incurred primarily related to the West Tellus, West Jupiter and West Capella.
Current wording
Net cash used in operating activities during the six months ended June 30, 2026 was$40 million compared to$16 million for the six months ended June 30, 2025. The$24 million increase in net cash used in operating activities in the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was mainly driven by the timing of receipts from customers and our related party, Sonadrill, and increased mobilization costs incurred primarily related to the West Tellus, West Jupiter and West Capella. These were partially offset by the impact of improved operating results and reduced disbursements to suppliers.
Previous wording
The $13 million cash used in investing activities during thethree months ended March 31, 2026 was primarily related to capital expenditures on the West Tellus, West Jupiter and West Capellaand the acquisition of capital spares.
Current wording
Net cash used in investing activities during the six months ended June 30, 2026 was$38 million compared to $72 million during the six months ended June 30, 2025. The net cash used in investing activities during the six months ended June 30, 2026 represented capital expenditures primarily on the West Tellus, West Jupiter and West Capellaand the acquisition of capital spares, compared tocapital expenditures mainly on the West Neptune, West Elara and West Auriga and the acquisition of capital spares during the six months ended June 30, 2025.
Previous wording
An overview of our debt as of March 31, 2026, divided into (i) secured bond and (ii) unsecured senior convertible bond, is presented in the table below:
Current wording
An overview of our debt as of June 30, 2026 is presented in the table below:
Previous wording
In July 2023, the Company entered into the $225 million, five-year Credit Agreement in respect of the Revolving Credit Facility. Seadrill Finance is the borrower under the Credit Agreement, and the facility is secured by first priority liens on substantially all of the Company's rigs and related assets, other than non-core assets. The Company, and certain of its subsidiaries that own collateral or are otherwise material, guarantee the obligations under the Credit Agreement. The loans outstanding under the Credit Agreement bear interest at a rate per annum equal to the applicable margin plus, at Seadrill Finance's option, either: (i) the Term SOFR Rate (as defined in the Credit Agreement) plus 0.10%; or (ii) the Daily Simple SOFR (as defined in the Credit Agreement) plus 0.10%. For both the Term SOFR Rate loans and Daily Simple SOFR loans, the applicable margin was 2.75% per annum as of March 31, 2026, and may vary based on Seadrill's Credit Ratings (as defined in the Credit Agreement), from 2.50% to 3.50% per annum. A commitment fee is incurred under the Revolving Credit Facility on undrawn amounts, at a rate of 0.5% per annum to and including July 27, 2026, 0.75% per annum from and including July 28, 2026 to and including July 27, 2027, and 1.00% per annum thereafter. This facility has not been drawn to date.
Current wording
In July 2023, Seadrill Limited, along with its subsidiary, Seadrill Finance, entered into the Credit Agreement which established the Revolving Credit Facility. Seadrill Finance is the borrower under the Credit Agreement, and the facility is secured by liens on substantially all of the Company's rigs and related assets, other than non-core assets. Seadrill Limited, and certain of its subsidiaries that own collateral or are otherwise material, guarantee the obligations under the Credit Agreement.
Previous wording
On April 3, 2026, the Company amended the Credit Agreement to increase the letter of credit sub-limit from $50 million to $100 million.
Current wording
On April 3, 2026, Seadrill Limited, along with its subsidiary, Seadrill Finance, entered into Amendment No. 1 to Senior Secured Revolving Credit Agreement to increase the letter of credit sub-limit from $50 million to $100 million.
Previous wording
During the third quarter of 2025, the Company issued a NOK403 million guarantee ($41 million as of March 31, 2026) under the Revolving Credit Facility related to the SFL Hercules Ltd. claim. As of March 31, 2026, outstanding letters of credit and bank guarantees under the Revolving Credit Facility totaled approximately $47 million, which reduced the Company’s available capacity under the Revolving Credit Facility to $178 million.
Current wording
During the third quarter of 2025, the Company issued a NOK403 million guarantee ($41 million as of June 30, 2026) under the Revolving Credit Facility related to the SFL Hercules Ltd. claim. As of June 30, 2026, outstanding letters of credit and bank guarantees under the Revolving Credit Facility totaled approximately $52 million, which reduced the Company’s available capacity under the Revolving Credit Facility to $248 million.
Previous wording
For further details, please refer to Note 13 – "Commitments and contingencies" of our unaudited Condensed Consolidated Financial Statements.
Current wording
For further details, please refer to Note 9 - "Debt" and Note 13 – "Commitments and contingencies" of our unaudited Condensed Consolidated Financial Statements, included in Part I, Item 1. "Financial Statements" of this Quarterly Report on Form 10-Q.
Previous wording
Seadrill Rig Holding Company Limited, a subsidiary of Seadrill, has an uncommitted bilateral facility with DNB Bank ASA (the “Bilateral Facility”), which permits the issuance of letters of credit and bank guarantees for our account. Up to $25 million of reimbursement obligations under the Bilateral Facility are secured on apari passu basis with the collateral that secures the Credit Agreement, and any additional obligations under the Bilateral Facility would need to be secured by cash or other collateral. We pay a fee of 1% on outstanding letters of credit and bank guarantees issued under the Bilateral Facility. As of March 31, 2026, we had approximately $24 million of outstanding letters of credit and bank guarantees issued under the Bilateral Facility.
Current wording
Seadrill Rig Holding Company Limited, a subsidiary of Seadrill, has an uncommitted bilateral facility with DNB Bank ASA (the “Bilateral Facility”), which permits the issuance of letters of credit and bank guarantees for our account. The Bilateral Facility provides up to $25 million of capacity, where reimbursement obligations under the Bilateral Facility are secured on apari passu basis with the collateral that secures the Credit Agreement. We pay a fee of 1% on outstanding letters of credit and bank guarantees issued under the Bilateral Facility. As of June 30, 2026, we had approximately $25 million of outstanding letters of credit and bank guarantees issued under the Bilateral Facility.
Previous wording
For further details on these facilities, please refer to Note 9 – "Debt" of our unaudited Condensed Consolidated Financial Statements.
Current wording
For further details on these facilities, please refer to Note 9 – "Debt" of our unaudited Condensed Consolidated Financial Statements, included in Part I, Item 1. "Financial Statements" of this Quarterly Report on Form 10-Q.
Rearranged current paragraphs (11)
Current report — wording carried from elsewhere
The tables included below set out financial information for the six months ended June 30, 2026 and June 30, 2025:
Current report — wording carried from elsewhere
i. Average number of rigs on contract
Current report — wording carried from elsewhere
The decrease was primarily driven by fewer operating days on the West Jupiter and the West Tellus, which were undergoing contract preparation activities during the six months ended June 30, 2026, for contracts that started in March 2026 and June 2026, respectively, compared to being fully contracted during the six months ended June 30, 2025.
Current report — wording carried from elsewhere
The increase was driven by higher dayrates for the West Jupiter, West Auriga, West Tellus and West Carina operating in Brazil, the West Neptune operating in the U.S. Gulf of America, and the West Elara operating in Norway during the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Current report — wording carried from elsewhere
These impacts were partially offset by lower dayrates for the West Vela and Sevan Louisiana operating in the U.S. Gulf of America, and the West Capella during the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Current report — wording carried from elsewhere
iii. Economic utilization for rigs on contract
Current report — wording carried from elsewhere
Depreciation of drilling units and equipment
Current report — wording carried from elsewhere
We incurred interest on our debt facilities as summarized below:
Current report — wording carried from elsewhere
b) Other financial and non-operating items
Current report — wording carried from elsewhere
The $9 million decrease in tax expense during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily reflects changes in the Company's mix of pre-tax income and loss among tax jurisdictions and changes in valuation allowances established for Switzerland and Brazil.
Current report — wording carried from elsewhere
On September 30, 2024 and December 16, 2024, the Company canceled 4,213,349 and 2,500,903 treasury Shares, respectively, repurchased under this program.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The$49 million cash used in investing activities during the three months ended March 31, 2025 was primarily related to capital expenditures on the West Neptune, West Elara and West Auriga and the acquisition of capital spares.