Patterson-UTI Posts Profit After Two Losses

The Tip Desk · October 31, 2026 · 3 min read

Third-quarter revenue reached $1.34 billion as net income attributable to common stockholders was $28 million, or $0.07 a share.

Patterson-UTI Energy, Inc. (PTEN), a provider of drilling and completion services, reported net income attributable to common stockholders of $28 million, or $0.07 a share, for the quarter ended September 30, 2026, after a $20 million net loss in the second quarter.

Total revenue was $1.34 billion, a 9% sequential increase after a 10% sequential rise in the prior quarter. Adjusted EBITDA was $264 million, compared with $232 million in the second quarter.

Chief Executive Officer Andy Hendricks said the company was benefiting from increased U.S. onshore drilling and completion demand, which he said was supporting stronger pricing and returns. He said commodity prices continued to support higher customer budgets and that discussions indicated the likelihood of additional rig reactivations and increased completion demand in 2027.

Drilling Services revenue was $417 million, with adjusted gross profit of $149 million. U.S. Contract Drilling operating days totaled 9,249, with an average of 101 rigs operating, up from 8,361 days and an average of 92 rigs in the second quarter. The fleet exited the period with 104 rigs. The company said activity increased throughout the quarter and that demand was particularly strong for rigs returning after structural upgrades, supporting premium pricing for its highest-specification rigs. Growth was concentrated in oil-producing basins, particularly the Rockies and Permian, while natural gas activity remained steady compared with the start of the third quarter. Directional Drilling also benefited from increased demand and greater well complexity, the company said.

Completion Services revenue was $808 million, with adjusted gross profit of $133 million. The company said results improved sequentially, supported by a mid-single-digit pricing increase versus the second quarter. Total completion activity declined modestly as several fleets experienced elevated non-productive time late in the quarter, primarily due to temporary sand availability constraints in South Texas and trucking delays in the Permian Basin. Excluding those disruptions, it said fleetwide utilization remained very strong, with positive pricing momentum continuing into the fourth quarter. Demand was particularly robust for equipment capable of using natural gas as a fuel. By the end of 2026, approximately 90% of the active fleet will be natural gas capable.

Drilling Products revenue was $110 million, with adjusted gross profit of $51 million, which the company described as its strongest quarterly results since acquiring Ulterra in 2023. Revenue increased 21% sequentially. Strong U.S. demand drove a company record revenue per industry rig. International revenue also increased sequentially, reaching a company record for the second consecutive quarter. The company said the performance reflected management of challenges related to the conflict in the Middle East, its largest international market. Other revenue was $6 million, with adjusted gross profit of $4 million.

The company returned approximately $62 million to shareholders in the third quarter, including $24 million for share repurchases, and declared a quarterly dividend of $0.10 a share, payable December 15, 2026. Chief Financial Officer Andy Smith said the company generated strong free cash flow during the quarter and expects free cash flow to remain strong in the fourth quarter and increase meaningfully in 2027 compared with 2026.

For the fourth quarter, Patterson-UTI expects to operate an average of approximately 104 U.S. rigs in Drilling Services and to exit 2026 above that level, with additional reactivations anticipated in the first quarter of 2027. It expects Drilling Services adjusted gross profit of $150 million, Completion Services adjusted gross profit of $140 million, a 5-10% sequential decline in Drilling Products adjusted gross profit, and Other adjusted gross profit steady. General and administrative expense is expected to be approximately $70 million and depreciation, depletion, amortization, and impairment approximately $220 million.