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Halliburton’s 3Q15 Revenues Miss, but Earnings Beat Estimates

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Halliburton’s 3Q15 revenues versus consensus

Halliburton’s (HAL) 3Q15 adjusted revenues fell short of estimates. At $5.58 billion, the 3Q15 adjusted revenue for Halliburton was 1.2% lower than the $5.65 billion consensus sell-side analysts’ revenue estimate.

On an average, adjusted revenues have beat consensus revenues by ~1% in the past ten quarters. From 3Q13–3Q15, Halliburton’s adjusted revenues have decreased 25%. It decreased ~36% from 3Q14 to 3Q15.

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Halliburton’s quarterly earnings per share versus consensus

The 3Q15 adjusted EPS (earnings per share) for Halliburton is $0.31, 14% higher than the consensus sell-side analysts’ EPS estimate of $0.27. Adjusted earnings exclude $506 million in pretax impairment charges and Baker Hughes (BHI) acquisition-related charges. Halliburton’s earnings from its international operations held up much better than its North America operations, which led to better-than-expected 3Q15 earnings.

Between 3Q13 and 3Q15, Halliburton’s adjusted EPS decreased 63%. It decreased more sharply by ~74% from 3Q14 to 3Q15. The fall in crude oil prices has triggered lower capex spending by energy upstream companies in the past year, which would affect oilfield service companies like Halliburton negatively.

As noted in the graph above, HAL’s adjusted EPS exceeded estimates in recent quarters. On an average, adjusted EPS has beat consensus EPS by ~8% in the past ten quarters.

Halliburton’s share price reaction on earnings

Halliburton released its financial information for 3Q15 on October 19, 2015. Its stock reacted somewhat negatively immediately following the earnings release. On that day, it decreased 1.2% to $37.36 from the previous day’s close. Since the beginning of this year, its share price has gone down 5%.

Schlumberger (SLB), the largest oilfield equipment and services company by market capitalization, released its financial information for 3Q15 on October 15, 2015. Schlumberger’s share price decreased 2.2% on the next day of its latest earnings.

Together, HAL and SLB make up 30.3% of the VanEck Vectors Oil Services ETF (OIH). OIH has fallen ~16% since the beginning of this year. For more information, please read Schlumberger’s 3Q15 Earnings Beat Estimates, Revenues Fall Short.

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