Transocean Lifts Backlog to $8.0 Billion After $2.0 Billion of Awards

The Tip Desk · November 3, 2026 · 3 min read

Contract drilling revenues were $937 million as utilization slipped, while adjusted EBITDA held at $313 million and 2027 coverage reached about 95%.

Transocean Ltd. (RIG), the offshore contract drilling company, added $2.0 billion of contract backlog at a weighted average dayrate of about $423,000 since its August fleet status report, lifting total backlog to approximately $8.0 billion and improving 2027 contract coverage to about 95%.

The awards followed a much smaller $292 million addition at about $461,000 in the prior quarter. Chief executive Keelan Adamson said new deepwater and harsh-environment fixtures had strengthened forward visibility.

Contract drilling revenues were $937 million in the three months ended September 30, 2026, down from $966 million in the second quarter. The company said the sequential decline was primarily due to an expected decrease in rig utilization. Fleet-wide utilization fell to 74.7% from 78.2%. Ultra-deepwater floaters earned $590 million, down from $623 million, with utilization at 67.6% versus 72.6%. Harsh-environment floaters earned $347 million, up from $343 million, with utilization at 95.1%.

Revenue efficiency was 96.8%. Ultra-deepwater efficiency rose to 96.4% from 95.7%; harsh-environment efficiency fell to 97.7% from 99.5%. Total fleet average daily revenue was $462,600.

Adjusted EBITDA was $313 million, implying a 33.4% margin, versus $312 million and 32.2% in the second quarter. Operating and maintenance expense declined to $589 million from $608 million. Net income was $26 million, or $0.02 a share, down from $170 million, or $0.04 a share. Adjusted net income was $1 million.

Interest expense, excluding the $22 million effect of the bifurcated exchange feature of the 4.625% Exchangeable Bonds due 2029, was $112 million. Cash taxes paid, net of $9 million of refunds, were $7 million.

Net cash provided by operating activities was $174 million. After $43 million of capital expenditures, free cash flow was $131 million. The company ended the period with total liquidity of $1.3 billion, including a $510 million undrawn revolving credit facility. Total debt principal fell to $4,975 million from $5,107 million as Transocean retired the remaining $200 million of Deepwater Aquila notes ahead of schedule.

Adamson said priorities remain safe customer service, converting backlog into cash flow, and reducing debt. With regulatory approvals in hand, the company said the Valaris closing is expected on December 1 and that it is focused on integration planning and capturing $200 million in identified annual synergies.

Fourth-quarter 2026 contract drilling revenue guidance is $915 million to $965 million, with fleet-wide revenue efficiency of 96.50%. Full-year 2026 revenue is guided at $3,900 million to $3,950 million. Preliminary full-year 2027 revenue is $3,850 million to $4,000 million. Fourth-quarter operating and maintenance expense is guided at $550 million to $600 million, interest expense at $107 million, and capital expenditures at $50 million. Year-end 2026 liquidity is guided at $1,300 million; preliminary 2027 year-end liquidity is $1,500 million to $1,700 million.