Demand for deepwater rigs continues to improve as customers pursue longer-term programs, with tightening supply, increasing multi-year visibility, and repricing of legacy contracts positioning Seadrill to enter 2026 from a position of strength. The company's contracted backlog has grown to approximately $2.5 billion, covering roughly 90% of its 2026 revenue guidance midpoint.
Cyborg Score Rationale
The company reported full-year 2025 EBITDA of $353 million, exceeding the midpoint of its original guidance range. EBITDA outperformance, backlog growth, 90% revenue coverage at midpoint for 2026, and a visible path to stronger free cash flow in H2 2026 outweigh near-term negatives. However, aging rigs and potential future impairments present risks.
Top Insights
The offshore deepwater market entered 2026 with renewed strength after a subdued 2025, supported by tightening supply, rising utilization and improving contract terms.
90% of the midpoint of Seadrill's 2026 revenue range is covered by firm backlog, providing strong revenue visibility.
The company expects an inflection to strong cash flow generation in the middle of 2026 after contracts commence and associated readiness capex subside.
Seadrill executed complex deepwater programs ahead of schedule and budget while achieving the best Total Recordable Incident Rate in its history.
Named Competitors
Transocean Ltd. — Ultra-deepwater and harsh-environment offshore drilling contractor