The sharp free cash flow decline and restructuring charges signal near-term headwinds, but the 2027 guidance for 200bp margin expansion provides a catalyst. Monitor Q4 cash flow trajectory and North America activity for confirmation of the recovery thesis.
Price Chart
Executive Summary
Halliburton reported Q3 2026 adjusted EPS of $0.60, a 6.3% sequential decline from Q2's $0.64, on flat revenue of $5.7B. GAAP EPS fell sharply to $0.50 from $0.64, hit by a $107M pre-tax charge for severance and inventory write-downs. The CEO guided for mid-single-digit revenue growth and ~15% operating margins in 2027, a ~200bp improvement, but the current quarter showed operating margin compression to 10.9% from 13.6% sequentially, and free cash flow plunged to $156M from $668M.
Key Financial Metrics
Key Facts
- Q3 2026 GAAP EPS $0.50 vs Q2 $0.64; adjusted EPS $0.60 vs Q2 $0.55
- Revenue flat at $5.7B sequentially; North America revenue fell 5% QoQ
- Operating margin fell to 10.9% from 13.6% QoQ; adjusted operating margin improved to 12.8% from 12.0%
- Free cash flow collapsed to $156M from $668M in Q2 2026
- Recognized $107M pre-tax charge for severance ($107M) and inventory write-downs ($25M), partially offset by a $36M investment gain
- CEO guided for mid-single-digit revenue growth and ~15% operating margins in 2027, assuming flat North America
- Repurchased ~$250M of common stock; paid $0.17/share dividend
Financial Impact
GAAP EPS declined 22% sequentially; free cash flow fell 77% QoQ to $156M; $107M restructuring charge
Risk Factors
- North America revenue declining 5% sequentially with no recovery assumed in 2027 guidance
- Free cash flow deterioration may constrain buyback pace
- Severance costs suggest ongoing cost rationalization may not be complete
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0000045012-26-000070 |
| Document: hal-20261020.htm | 0000045012-26-000070 |
| Document: 0000045012-26-000070-index-headers.html | 0000045012-26-000070 |
| Document: 0000045012-26-000070-index.html | 0000045012-26-000070 |
| Document: 0000045012-26-000070.txt | 0000045012-26-000070 |
| 8-K Data (Synthetic) | 0000045012-26-000070 |
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|---|---|---|---|---|---|
Oct 20, 2026 7d ago | 3 | $33.59 $35.62 | ▲ +6.04% | ▲ +5.96% | $35.62 (+6.04%) |
Oct 20, 2026 7d ago | 8-K | $33.59 $35.62 | ▼ −6.04% | ▼ −5.96% | $35.62 (−6.04%) |
Oct 15, 2026 12d ago | 8-K | $33.50 $34.92 | ▲ +4.24% | ▲ +4.67% | $35.62 (+6.33%) |
Sep 16, 2026 5w ago | 8-K | $34.03 $32.76 | ▼ −3.73% | ▼ −4.33% | $35.62 (+4.67%) |
Aug 20, 2026 9w ago | Insider Cluster | $35.34 $36.18 | ▲ +2.38% | ▲ +1.90% | $35.62 (+0.79%) |
Aug 19, 2026 9w ago | Insider Cluster | $35.02 $34.44 | ▼ −1.66% | ▼ −1.27% | $35.62 (+1.71%) |
Jul 21, 2026 14w ago | 8-K | $33.19 $32.13 | ▼ −3.19% | ▼ −1.97% | $35.62 (+7.32%) |
Jun 29, 2026 17w ago | 8-K | $34.09 $33.00 | ▼ −3.20% | ▼ −4.58% | $35.62 (+4.49%) |
Apr 30, 2026 25w ago | Insider Cluster | $42.29 $40.40 | ▼ −4.46% | ▼ −6.19% | $35.62 (−15.76%) |
Apr 30, 2026 25w ago | Insider Cluster | $42.29 $40.40 | ▼ −4.46% | ▼ −6.19% | $35.62 (−15.76%) |
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