“Halliburton has been hardest hit in its North and Latin American (LATAM) markets, which represented a 53% decline in revenue over Q1 - compared to the company’s international market, which only saw a 13% revenue decline. It is, therefore, no surprise that stabilization efforts focus outside those regions. While the US and LATAM had reduced drilling activity and pressure pumping, internationally, Halliburton saw an uptick in completion tool sales and drilling activity in a number of countries such as China and Kuwait.
“Halliburton executives continue to work towards a target of US$1bn in cost reductions with 75% reached by end of Q2. The main linchpin in its strategy is offering operators cost savings through improved efficiencies offered by an investment in digital technologies. The company’s announcement of a five-year agreement with Microsoft and Accenture continues to double down on digital technology.
“Since drilling activity is down, operators are likely to turn their focus on improving completion and evaluation techniques. However, although Halliburton remains optimistic on its ability to adapt and rebound, the market remains uncertain. The company still has to contend with some very real factors, including the scalability and reproducibility of implementing digital solutions, adoption of solutions by clients and overall depressed opportunities in the market resulting from decreased global oil and gas demand. Halliburton may have mitigated haemorrhaging, but it is unclear whether that is enough in this ‘new normal’.”
