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Hard times hit NOV as the company’s stock (NYSE:NOV) plummeted by 11.2% at the close of trading on Friday. The energy equipment maker faced its lowest close in nearly seven months despite exceeding Q4 earnings estimates. The steep drop followed news that the company anticipated a mere 4%-8% increase in revenue for the fiscal year 2024. This figure stands below analysts’ expectations, driving NOV’s stock to a dismal low at the end of Friday.
NOV CEO, Clay Williams, pointed to anticipated oilfield spending decreases in North America as the driving force behind the downside revenue projection. The company’s subdued revenue growth forecast translates to a range of $8.92 billion to $9.27 billion, falling short of the consensus estimate of approximately 8% growth to $9.26 billion.
Williams attributed NOV’s challenges to notable supply chain disruptions and inflation in comparison to other players in the oilfield services industry, stating during the post-earnings conference call that the company “faced a lot of headwinds with respect to supply chain disruptions, more so than I think anybody else in oilfield services, along with inflation.”
Despite the disappointing revenue outlook, Q4 net income soared to $598 million, or $1.52 per share, from $104 million, or $0.27 per share, in the year-earlier quarter. Additionally, revenues climbed 7% quarter-over-quarter and 13% year-over-year to $2.34 billion in Q4.
Notably, Q4 revenues by segment showed promising performances: Wellbore Technologies rose 8.1% year-over-year to $824 million, Completion and Production increased by 8.8% to $803 million, and Rig Technologies surged by 24% to $766 million.
Although Q4 adjusted EBITDA scaled 27% year-over-year to $294 million, it failed to meet the $300 million analyst consensus estimate.
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