Halliburton posted a better-than-expected third quarter profit on Wednesday thanks to cost cuts and rig count gains.
The Houston-based company booked a third quarter operating income of $128 million, up from a $3.88 billion loss in the second quarter.
Revenue held steady from the second quarter at $3.83 billion but was down from $5.58 billion in the prior year quarter.
Net income attributable to company climbed to $6 million, or $0.01 per basic and diluted share, compared to a $54 million loss in the year-ago quarter.
Analysts polled by Thomson Reuters expected a loss of $0.06 per share and $3.9 billion in revenue.
Completion and Production revenue fell to $2.17 billion from $3.2 billion in the third quarter of last year.
Completion and Production operating income declined to $24 million in the third quarter, down from $163 million in the same period last year.
Drilling and Evaluation revenue came in at $1.65 billion for the third quarter compared to $2.38 billion for the year-ago quarter.
Drilling and Evaluation operating income dropped to $151 million in the third quarter compared to $401 million in the same quarter last year.
North America revenue climbed 9 percent sequentially to $1.7 billion in the third quarter, relative to a 14 percent increase in the average U.S. rig count.
North America operating results improved to a loss of $66 million, a 47 percent sequential gain.
Halliburton said the improved North American operating results was “driven primarily by increased utilization throughout the United States land sector and effective cost management.”
Corporate and other operating income came in at a loss of $47 million compared to a $58 million loss in the prior year quarter.
International revenue dropped 6 percent sequentially in the third quarter to $2.2 billion due to a “decline in drilling activity and well completions, as well as continued pricing pressure,” Halliburton said.
International third quarter operating income fell 2 percent from the second quarter to $241 million.
“For our international business, we believe the seasonal year-end sales will be minimal and customer pricing pressure will continue; however, these will likely be offset by continued cost management. As such, we expect fourth quarter results to come in flat compared to the third quarter,” Chairman and CEO Dave Lesar said.
The company said that international margins remained “relatively flat as decreased logging services and production solutions activity were partially offset by increased project management activity and continued expense reductions.”
Latin America revenue in the third quarter $415 million, a 13 percent sequential decrease, on an operating income of $11 million, a 50 percent decline from the previous quarter.
Halliburton said those declines were “largely a result of reduced activity in Mexico, Argentina and Venezuela.”
Europe/Africa/CIS revenue fell 6 percent sequentially to $744 million in the third quarter due to reduced activity in Nigeria and Continental Europe.
Europe/Africa/CIS operating income increased 19 percent sequentially to $76 million in the third quarter.
Middle East/Asia revenue fell 3 percent from the prior quarter to $1 billion in the third quarter of 2016.
Middle East/Asia operating income declined 4 percent sequentially to $154 million.
“As we look forward, we expect an increased commodity price to stimulate rig count growth. In the near term, we remain cautious around fourth quarter customer activity due to holiday and seasonal weather-related downtimes. However, it does not change our view that things are getting better for us and our customers,” Lesar said.