Valaris (VAL) Q2 2026 earnings summary

Executive summary

• Offshore drilling operations span six continents with a fleet of 43 rigs and a 50% stake in ARO, a joint venture with Saudi Aramco owning nine rigs.

• Achieved total operating revenues of $539 million and net income of $47 million for Q2 2026, reversing a net loss of $18 million in Q1 2026.

• Adjusted EBITDA reached $97 million, despite a $30 million negative impact from Middle East conflicts.

• Pending business combination with Transocean will result in Transocean shareholders owning 53% and Valaris shareholders 47% of the combined company, subject to customary approvals and expected to close in Q4 2026.

• The offshore drilling industry remains cyclical, with recent volatility driven by Middle East conflicts, impacting supply, costs, and insurance premiums.

Financial highlights

• Q2 2026 net income attributable to shareholders was $50.4 million, down from $115.1 million in Q2 2025.

• Q2 2026 operating revenues were $539.2 million, a 16% increase sequentially, but down 12% year-over-year.

• Adjusted EBITDA improved to $97 million from $67 million in Q1 2026.

• Q2 2026 EPS was $0.73 (basic), compared to $1.62 in Q2 2025; diluted EPS was $0.72, up from a loss of $0.24 in Q1 2026.

• Cash and cash equivalents stood at $541.2 million as of June 30, 2026.

Outlook and guidance

• Capital expenditures for 2026 are projected at $425–$475 million, focused on maintenance and upgrades.

• Adverse impacts from Middle East conflicts are expected to moderate in the second half of 2026 as certain rigs return to service and insurance costs decline.

• Two additional drillships set to commence new contracts before year-end, anticipated to further improve financial performance.

• The company expects continued cost inflation and is monitoring geopolitical risks and supply chain disruptions.

• Offshore drilling market outlook remains positive, with robust deepwater contract opportunities and strong customer demand.