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Valaris (VAL) FY2025 results: revenue $2.4 billion, up 0.3% on the year

Valaris Ltd. (VAL) reported revenue of $2.4 billion for fiscal 2025, the year ended 31 December 2025, up 0.3% on the year before. Net income was $983 million, up 163.2%, and diluted earnings per share $13.86. The figures are the company's own, from the 10-K it filed with the SEC on 20 February 2026.

Revenue
$2.4 billion
+0.3% on the year
FY2018FY2025
Operating margin
20.1%
14.9% a year earlier
FY2018FY2025
Net income
$983 million
+163.2% on the year
FY2018FY2025
Diluted EPS
$13.86
+170.7% on the year
FY2018FY2025

this yearthe year beforeHover a bar for its figure.

The year in brief

What management said about the year

Guidance figures: 4 new.

  • Net income lifted by tax benefit: Net income was $717 million against $187 million in the third quarter, including a $680 million tax benefit as recorded in the statement of operations.
  • Adjusted EBITDA fell to $97 million: Adjusted EBITDA was $97 million against $163 million in the third quarter, while revenue exclusive of reimbursable items was $502 million against $556 million.
  • Floater revenue fell on idle drillships: Floater revenue exclusive of reimbursable items was $255 million against $293 million, mainly because drillships DS-15 and DS-18 finished contracts without immediate follow-on work.
  • Backlog rose to $4.7 billion: Total contract backlog was $4,672.3 million at February 17, 2026, against $4,450.3 million at October 23, 2025, after nearly $900 million of new contracts.
  • Drillship awards for DS-7 and DS-9: Contract awards were recently announced for drillships DS-7 and DS-9. Management expects all ten active drillships to be working as 2027 begins.
Read the Q4 FY2025 earnings call summary

From this 10-K

Valaris is an offshore contract drilling company that drills and completes oil and natural gas wells for international and government-owned oil and gas companies and independent operators. It is a Bermuda company, and it works in the Gulf of America, South America, the North Sea, the Mediterranean, the Middle East, Africa and Asia Pacific. It has four operating segments: Floaters, Jackups, ARO and Other.

Valaris Ltd., the 10-K for 2025

Valaris is an offshore contract drilling company that drills and completes oil and natural gas wells for international and government-owned oil and gas companies and independent operators. It is a Bermuda company, and it works in the Gulf of America, South America, the North Sea, the Mediterranean, the Middle East, Africa and Asia Pacific. It has four operating segments: Floaters, Jackups, ARO and Other.

Fleet

As of February 20, 2026 it owned 46 rigs: 13 drillships, two semisubmersible rigs and 31 jackup rigs. It also holds a 50% interest in ARO, its unconsolidated joint venture with Saudi Aramco, which owns another nine rigs. At December 31, 2025, excluding a rig held for sale, 17 of its rigs were in Europe, 16 in the Middle East and Africa, eight in North and South America and four in Asia and the Pacific Rim. Floaters covers the drillships and semisubmersibles, and the Other segment covers management services on rigs owned by third parties and its lease arrangements with ARO. Besides drilling, its rigs are sometimes used as accommodation units or for well workovers, plug and abandonment, decommissioning and carbon capture and sequestration work.

Contracts

It works under day rate contracts, providing a rig and crew for a daily rate that can fall from the full rate to a lower rate or zero during suspensions, repairs and other events. It may also receive lump-sum fees for moving rigs and for capital upgrades. Customers bear substantially all of the costs of building the well and the economic risk of the well's success, while Valaris pays the rig's operating costs, including crew labor. Most contracts are awarded through competitive bidding and can run for a fixed period or for the time needed to drill one or more wells, often with customer extension options and early termination rights.

Pending combination with Transocean

On February 9, 2026 Valaris and Transocean signed a business combination agreement providing for Transocean to acquire all of Valaris' shares in exchange for Transocean shares, through a court-approved scheme of arrangement under Bermuda law. At the time of the filing the deal had not closed, and after closing Valaris shareholders were expected to own approximately 47% of the combined company.

Competition

The filing describes offshore contract drilling as highly competitive, with contracts mostly awarded by competitive bid. Price is often the main factor, along with service quality, operational and safety performance, equipment suitability and availability, location, reputation and technical expertise.

People

At December 31, 2025 it had a workforce of approximately 5,070 people including contractors, or approximately 3,800 excluding contractors, from 78 nationalities across 25 locations. Most work on its offshore rigs and are paid hourly, and some employees and contractors outside the U.S. are covered by collective bargaining or similar agreements.

From Valaris' annual report on Form 10-K for the year ended 31 December 2025. The filing

Written from the 10-K filed 20 February 2026: read the full 10-K.

The four quarters: Q1 FY2025 · Q2 FY2025 · Q3 FY2025 · Q4 FY2025

Income statement (profit and loss)

$ millionFY2025FY2024FY2023On the yearLast 8 years
Revenue2,3692,3631,784+0.3%
Cost of revenue1,6301,7611,544-7.5%
Gross profit739602241+22.9%
Gross margin31.2%25.5%13.5%
Operating income47735253.5+35.4%
Operating margin20.1%14.9%3.0%
Pre-tax income55237084.2+49.2%
Income tax-4270.4-783
Effective tax rate-77.3%0.1%-929.5%
Net income983373865+163.2%
Net margin41.5%15.8%48.5%
Diluted EPS$13.86$5.12$11.51+170.7%
$ million except per share.
Read moreFree cash flow is operating cash flow less capital expenditure; the effective tax rate is income tax over pre-tax income; margins are the line over revenue. Gross profit is revenue less cost of revenue, and operating income is revenue less the company's own total costs, where the statement does not print those lines. Those four are arithmetic on the filed numbers; everything else is as filed. Money is in $ million as the company files it, or in $ billion by the switch above the tables; per share figures and share counts are as they are.

Cash flow

$ millionFY2025FY2024FY2023On the yearLast 8 years
Operating cash flow546355268+53.7%
Capital expenditure344455696-24.5%
Free cash flow203-99.7-429
Free cash flow margin8.6%-4.2%-24.0%
Cash from investing-206-452-666
Cash from financing-104-158286
Depreciation146122101+19.8%
Share-based compensation25.227.727.3-9.0%
Buybacks100126199-20.9%
Diluted shares, weighted71m73m75m-2.7%
Shares outstanding at period end69m71m72m-2.5%

Balance sheet

$ millionFY2025FY2024FY2023On the yearLast 8 years
Shareholders' equity3,1702,2381,988+41.6%
Non-controlling interest2.15.89.4-63.8%
Debt1,0861,0831,079+0.3%
Operating lease liabilities37.356.948.9-34.4%
Other liabilities1,0101,0361,197-2.5%
Total liabilities and equity5,3054,4204,322+20.0%
Fixed assets2,0891,9331,634+8.1%
Cash and equivalents599368620+62.8%
Receivables475571459-16.9%
Other assets2,1421,5481,609+38.4%
Total assets5,3054,4204,322+20.0%

10-K for the year ended 31 December 2025, filed 20 February 2026: the filing.