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National Oilwell Varco -7% as revenues continue to slide

Published 10/27/2016, 12:58 PM
Updated 10/27/2016, 12:58 PM
National Oilwell Varco -7% as revenues continue to slide

National Oilwell Varco -7% as revenues continue to slide

  • National Oilwell Varco (NYSE:NOV -7.2%) plunges after posting a larger than expected Q3 loss, as revenues keep shrinking in the international, offshore and capital equipment markets.
  • NOV reports Q3 revenue of $1.65B, down 5% Q/Q and 50% Y/Y, after it had expected revenue to bounce 10% off the bottom due to "large projects booked earlier in the year and see continued improvement in our production-related businesses."
  • Q3 revenue in NOV's rig systems segment totaled $470M, down 17% Q/Q and 69% Y/Y, with new orders of $185M compared to $363M shipped out of backlog, resulting in a $2.76B total backlog; revenue in the rig aftermarket segment fell 12% Q/Q and 44% Y/Y.
  • In its earnings conference call, NOV estimated that it captured $240M-$250M of its forecast $400M in annualized cost savings during Q3; the company also said it expects Q4 rig revenues to decline in the mid single-digit percentage range, with rig margins falling a few hundred bps.

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