Borr Drilling expects to average about 23 active rigs in Q3 2026.
The company expects Q3 adjusted EBITDA to improve significantly from Q2.
Result drivers
Rig preparation costs - Additional preparation work and regulatory approval activities for the Odin rig increased operating expenses.
Rig transitions - Six rigs transitioning between contracts led to reduced revenue and lower utilization.
Higher costs and credit losses - Middle East conflict drove up insurance and fuel costs, and credit losses increased due to a former customer in West Africa, per CEO Bruno Morand.
Analyst coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell".
The stock recently traded at 65 times the next 12-month earnings vs. a P/E of 85 three months ago.
Quarterly results
The offshore driller's Q2 revenue fell 6% sequentially as active rig count declined.
Q2 adjusted EBITDA dropped 51% due to higher costs, rig transitions, and credit losses.
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