Noble Corporation Plc (NE) Earnings

Management highlights

### Financial and Capital Highlights - Completed a successful debt refinancing in June 2026, issuing $800 million in new 6.25% senior unsecured notes due 2034 to retire legacy debt, simplifying the capital structure and unlocking $35 million in annual cash benefits from reduced interest and tax expenses. - Maintained a robust capital return program: returned $80 million to shareholders via a $0.50 per share quarterly dividend in Q2 2026, and the board declared an identical $0.50 per share dividend to be paid in September 2026. - Recorded a $42 million impairment charge for the scrapping of the Ocean Apex, which closed in early July 2026 for net scrap proceeds of $5 million. Completed the lease buyout of the third of four Black Ships BOP systems for $18 million, with the final buyout expected in Q4 2026 for the same amount. ### Commercial and Operational Updates - Secured two new contracts adding $200 million in new backlog: the *Noble Viking* won a six-well contract in the Asia-Pacific region expected to run through most of 2028, and the *Noble Klaus Bachmann* won a three-well contract with BP in the UK North Sea starting March 2027 at $320,000 per day, preceding a three-year contract with Ocker BP in Norway. - Q2 2026 results included a $43 million adverse impact from an operational suspension of the company's two rigs in Brazil, with an additional projected $15 million revenue reduction through January 2027 as administrative resolutions with regulators are finalized. Both rigs have resumed operations as of the call. - The *Noble Interceptor* is scheduled for reactivation in late summer 2026 for a 5-8 month accommodation program, and is being bid for 2027 drilling opportunities. Backlog from the *Noble Innovator* was transferred to the *Noble Intrepid*, reducing 2026 second half revenue but opening up opportunities for the *Noble Intrepid* in 2027. ### Market Outlook - Global ultra-deepwater (UDW) market fundamentals remain strong: 77 rig years of UDW backlog contracted in H1 2026 is the highest level in over a decade. Open floater demand outside Brazil remains over 95 rig years, 20% higher than the 2024 high. - Current contracted utilization of the marketed UDW fleet is 95%, with 79% current utilization (87 units under contract), expected to rise over coming quarters as long-term programs ramp up. Recent fixtures have seen day rates rise to the mid-$400,000 per day range, with higher rates for longer-term future contracts and lower rates for near-term gap filling work. - Regional demand trends: Softness in the Western Hemisphere (U.S. Gulf of Mexico, Brazil) driven by reduced Petrobras activity is more than offset by strength in the Eastern Hemisphere (Africa, Asia-Pacific). Asia-Pacific is the fastest growing deepwater market, currently at a multi-year high of 10-11 contracted UDW rigs, with 42 rig years of open demand remaining even after ONGC tender withdrawals. India's multi-rig exploration campaign is delayed by one year, not canceled. - Management expects the entire marketed global fleet to reach essentially full contraction by late 2027, with tighter inventory and idle capacity and growing global energy security demand supporting positive market momentum.

Guidance

• Full year 2026 total revenue guidance was revised downward to a range of $2.8 billion to $2.9 billion, from the prior range of $2.8 billion to $3.0 billion. The revised guidance still includes approximately $150 million in reimbursable and other revenue. • Full year 2026 adjusted EBITDA guidance was revised downward to a range of $850 million to $925 million, from the prior range of $940 million to $1.02 billion. The downward revision is primarily driven by the revenue impact from the suspended Brazil rigs, plus the backlog transfer between the *Noble Intrepid* and *Noble Innovator*, and the *Noble Viking* contract options shifting into 2027. • Full year 2026 capital expenditure guidance is maintained at $615 million to $665 million, which includes an estimated $25 million in customer reimbursable capex. • Management expects a meaningful earnings inflection for Noble by the second half of 2027, supported by already contracted backlog and new contract awards for the company's remaining available 2027 capacity.

Segment performance

Noble Corporation reports results for its contract drilling services segment, which is its core operating business. For the second quarter of 2026, the segment generated total contract revenue of $679 million, with adjusted EBITDA of $212 million, equal to an adjusted EBITDA margin of 30%. The segment also reported operating cash flow of $144 million, capital expenditures of $205 million, and negative free cash flow of $59 million. As of July 27, 2026, the segment's total backlog (excluding reimbursable and ancillary service revenue) stands at $6.8 billion, with approximately $1 billion scheduled for revenue recognition in the remainder of 2026 and $2.3 billion scheduled for 2027. The company also separately operates a CJ70 jack-up segment, which currently holds 100% contracted utilization across all 11 units operating in Norway and the UK.

Risks & headwinds

• The ongoing operational and regulatory dispute related to the two suspended Brazil rigs creates uncertainty around future revenue, with outcomes that could vary from the $15 million projected revenue reduction included in revised guidance. • Oil price volatility driven by geopolitical conflict (such as the ongoing Iran conflict) creates near-term uncertainty for customer activity levels and timing of contract awards. • Near-term demand in the U.S. Gulf of Mexico has softened, and sustained low oil prices could lead to further reductions in activity in the region. • Older, lower-specification drilling rigs face rising SPS (special periodic survey) costs and limited demand, creating a risk of additional impairments or scrapping that could negatively impact earnings. • The delayed ONGC tender program in India and shifted contract timelines for multiple rigs create near-term revenue uncertainty, even if long-term demand remains intact.

Analyst Q&A

• Q: Arun Jaram (JP Morgan) asked how the divergent demand trends between Eastern and Western Hemispheres will inform Noble's future strategy and rig relocation, noting Noble is currently underrepresented in West Africa and Asia-Pacific. /

  A: Management noted that faster-than-expected demand growth in Asia-Pacific, driven in part by energy security priorities, is a welcome upside, and India's delayed exploration program adds longer-term upside. Noble could reasonably move an additional rig to the region, but no final decision has been made. West Africa has a large pipeline of FID-approved projects through Mozambique and multiple West African nations that will create demand for 2-2.5 years out, and Noble also expects to expand its presence there, though timelines are not yet finalized.

• Q: Scott Gruber (Citigroup) asked if mid-$400,000 per day UDW day rates (seen for 2028 contracts) are achievable for 2027 one-year contracts, or if that rate is only available for longer-term contracts starting further out. /

  A: Management confirmed that pricing still follows the historical norm: near-term gap filler work is priced at a discount, while longer-term contracts also carry a slight discount, with most other work falling into the mid-range that matches the rates cited in prepared remarks. Management reaffirmed the outlook for full industry UDW floating fleet utilization by 2027, with contracts currently in process that will become clearer over the coming months.

• Q: Doug Becker (Capital One) asked for more detail on the potential administrative solutions for the suspended Brazil rigs, including the possibility of day rate cuts, additional idle time, or early termination. /

  A: Management explained that the suspension stemmed from a Brazilian regulatory (ANP) audit, and the matter is still ongoing, so limited detail can be shared. Both rigs are currently operating, and the $15 million adverse revenue impact included in revised guidance reflects a range of potential outcomes as negotiations continue.

• Q: Noel Parks (Toohey Brothers) asked what could cause a sharper increase in day rates from the current gradual upward trend. /

  A: Management noted that sharp day rate spikes in past cycles required broad perceived scarcity of available rigs, which is not present today. Customers remain disciplined, and the expected path forward is gradual organic upward pressure on rates as demand increases toward fixed supply, without the extreme spikes seen in previous cycles. Management added that this smoother, more gradual trajectory is beneficial for all industry participants, and has already been seen in the resilience of day rates during the recent downturn.