About Transocean Ltd.
Transocean Ltd. (NYSE: RIG) is a leading international offshore contract drilling company that provides specialized drilling services for oil and gas wells worldwide. Headquartered in Steinhausen, Switzerland, the company owns and operates a fleet of mobile offshore drilling rigs, including ultra-deepwater and harsh environment floaters, which it leases to integrated energy companies, national oil companies, and independent exploration and production firms. Its services include contracting rigs, associated equipment, and work crews to drill wells beneath the ocean floor. Founded in 1926, Transocean is one of the most prominent players in the offshore drilling sector and is listed on the New York Stock Exchange (NYSE) under the ticker RIG.
Transocean’s operations are capital-intensive and cyclical, tied closely to global oil and gas exploration activity. It has focused increasingly on high-specification deepwater drilling assets and continues to secure multi-year contracts for its rigs around the world.
2025 Results
Operating revenues increased to $3.965 billion, representing a 13% rise compared to $3.524 billion in 2024, reflecting improved activity levels and stronger contract performance. Revenue efficiency improved to 96.5%, up from 94.5% in the prior year, indicating enhanced operational uptime and execution across the fleet.
Net loss attributable to controlling interest was $2.915 billion, or $3.04 per diluted share, reflecting non-cash charges and other financial impacts during the year. Adjusted EBITDA rose to $1.37 billion, an increase of 19% from $1.148 billion in 2024, demonstrating stronger operating performance and margin improvement.
Cash flows from operating activities totaled $749 million, up $302 million (68%) year-over-year, driven by higher revenues and improved cost management. Free cash flow reached $626 million, a substantial increase of $433 million compared to $193 million in the previous year, supporting debt reduction and liquidity strengthening.
The total principal amount of debt declined to $5.686 billion, a reduction of $1.258 billion (18%), highlighting the company’s continued focus on deleveraging. Total liquidity stood at $1.507 billion, including availability under an undrawn revolving credit facility, providing financial flexibility.
The company added $839 million in contract backlog at a weighted average dayrate of $453,000, strengthening revenue visibility for future periods.
4Q25 Financial Summary
Net income attributable to controlling interest of $25 million, $0.02 per diluted share. Cash provided by operating activities was $349 million, up 42% compared to prior quarter and was primarily related to working capital improvements.
Contract drilling revenues were $1.043 billion, up 1.5% compared to prior quarter, primarily related to improved rig utilization, partially offset by slightly lower revenue efficiency across the fleet. Operating and maintenance expense was $605 million, up 3.6% compared to prior quarter, primarily related to four rigs undergoing recertifications or shipyard maintenance, partially offset by lower costs on rigs sold or classified as held for sale.
Interest expense was $132 million, excluding the effect of the bifurcated exchange feature of the 4.625% exchangeable bonds due 2029, down 6% compared to prior quarter, primarily due to our debt reduction efforts achieved in the fourth quarter. Capital expenditures were $28 million.
The effective tax rate was 68.8%, up from (1.4)% in the prior quarter. The increase was primarily due to losses on rig impairments in the prior quarter. Excluding discrete items, the Effective Tax Rate was 72.3% compared to 34.8% in the previous quarter. Cash taxes paid in the period were $18 million.
Fleet Status Report and Contract Backlog
We published our Fleet Status Report today. Since the October 2025 report, we added 10 new fixtures with an aggregate incremental backlog of approximately $610 million and a weighted average dayrate of $417,000 per day. As of February 19, 2026, the total backlog is approximately $6.1 billion.
Q1 and 2026 Outlook
For the first quarter of 2026, contract drilling revenues are expected to range between $1,020 million and $1,050 million. For the full year 2026, revenues are projected to be between $3,800 million and $3,950 million. Fleet-wide revenue efficiency is projected to be 96.5% for both the first quarter and the full year 2026, reflecting continued strong operational performance.
Operating and maintenance expenses are expected to range between $605 million and $625 million in the first quarter. For the full year, these expenses are projected to be between $2,250 million and $2,375 million. General and administrative expenses are estimated at $40 million to $50 million for the first quarter and $170 million to $180 million for the full year 2026.
Interest expense is expected to total approximately $125 million in the first quarter and $480 million for the full year. Interest income is projected to range between $(5) million and $(10) million in the first quarter, and between $(30) million and $(35) million for the full year 2026.
Capital expenditures are expected to range between $35 million and $45 million in the first quarter and total approximately $130 million for the full year. Cash taxes are estimated at $15 million for the first quarter and between $85 million and $90 million for the full year 2026. Total liquidity was not provided for the first quarter. For the full year 2026, total liquidity is projected to range between $1,600 million and $1,700 million.