NOV Inc.NOV

NOV Inc. Segments Disclosure

10-KFiled Feb 12, 20268 min read

16. Business Segments and Geographic Areas

The Company is comprised of 16 business units to provide products and services to the energy industry. Each of the business units is managed by a business unit president, recognizes revenue, incurs expenses, and has discrete financial information readily available. The business units are aggregated into our 2 reportable segments, Energy Products and Services, and Energy Equipment, based on the products and services provided, customer base, and operating environment. The reportable segments are led by Segment Presidents, who are responsible for oversight of the business units’ strategy and performance. The Segment Presidents report directly to the CEO and provide monthly operating and financial updates.

The CEO has final authority over resource allocation decisions and performance assessment for the Company. Consequently, the CEO has been identified as the CODM. The CODM regularly receives information directly from the Segment Presidents as well as the

business units. However, for decision-making purposes related to the assessment of performance and allocation of resources, the CODM uses financial information at the segment level. The CODM regularly reviews Operating Profit for each segment to assess performance and for resource allocation decisions in the annual budgeting process and in the quarterly performance review processes.

Energy Products and Services

The Company’s Energy Products and Services segment primarily designs, manufactures, rents, and sells products and equipment used in drilling, intervention, completion, and production activities. Products include drill bits, downhole tools, premium drill pipe, drilling fluids, integral and weld-on connectors for conductor strings and surface casing, completion tools, and artificial lift systems. The segment also designs, manufactures, and delivers high-end composite pipe, tanks, and structures engineered to solve both corrosion and weight challenges in a wide variety of applications, including oil and gas, chemical, industrial, wastewater, fuel handling, marine and offshore, and rare earth mineral extraction.

In addition to product and equipment sales, the segment provides services, software, and digital solutions to improve drilling and completion operational performance. Services include tubular inspection and coating, solids control, waste management. Software and digital solutions offered include drilling and completion optimization and remote monitoring (via downhole and surface instrumentation), wired drill pipe services, software controls and applications, and data management and analytics services at the edge and in the cloud.

Energy Products and Services serves oil and gas companies, drilling contractors, oilfield service companies, oilfield equipment rental companies and developers of geothermal energy. Demand for the segment’s products and services primarily depends on the level of oilfield drilling activity by oil and gas companies, drilling contractors, and oilfield service companies. Demand for the segment’s composite solutions serving applications outside of oil and gas are driven by industrial activity, infrastructure spend, and population growth.

Energy Equipment

The Company’s Energy Equipment segment manufactures and supports the capital equipment and integrated systems needed for oil and gas exploration and production, both onshore and offshore, as well as for other marine-based, industrial and renewable energy markets.

The segment designs, manufactures, and integrates technologies for drilling and producing oil and gas wells. This includes equipment and technologies needed for drilling, including land rigs, offshore drilling equipment packages, drilling rig components, managed pressure drilling, and software control systems that mechanize and automate the drilling process and rig functionality; hydraulic fracture stimulation; well intervention, including coiled tubing units, coiled tubing, and wireline units and tools; cementing products; onshore production, including fluid processing, and surface transfer as well as progressive cavity pumps; offshore production, including integrated production systems and subsea production technologies; and aftermarket support of these technologies, providing spare parts, service, and repair.

Energy Equipment primarily serves contract drillers, oilfield service companies, and oil and gas companies. Demand for the segment’s products primarily depends on capital spending plans by drilling contractors, service companies, and oil and gas companies, and secondarily on the overall level of oilfield drilling, completions, and workover activity which drives demand for equipment, spare parts, service, and repair for the segment’s large installed base of equipment.

The segment also serves marine and offshore markets, where it designs and builds equipment for wind turbine installation and cable lay vessels, and offers heavy lift cranes and jacking systems; industrial markets, where the segment provides pumps and mixers for a wide breadth of industrial end markets; and other renewable energy markets, where it is applying its gas processing expertise to provide solutions that aid in wind power development, hydrogen production and carbon sequestration.


 

The following table presents financial data by business segment (in millions):

 

 

Year Ended December 31,

 

 

 

2025

 

 

2024

 

 

2023

 

 

 

Energy Products and Services

 

 

Energy Equipment

 

 

Eliminations and corporate costs (1)

 

 

Total

 

 

Energy Products and Services

 

 

Energy Equipment

 

 

Eliminations and corporate costs (1)

 

 

Total

 

 

Energy Products and Services

 

 

Energy Equipment

 

 

Eliminations and corporate costs (1)

 

 

Total

 

Revenue from external customers

 

$

3,871

 

 

$

4,873

 

 

$

—

 

 

$

8,744

 

 

$

4,040

 

 

$

4,830

 

 

$

—

 

 

$

8,870

 

 

$

3,973

 

 

$

4,610

 

 

$

—

 

 

$

8,583

 

Intersegment revenue

 

 

106

 

 

 

61

 

 

 

(167

)

 

 

—

 

 

 

90

 

 

 

58

 

 

 

(148

)

 

 

—

 

 

 

104

 

 

 

59

 

 

 

(163

)

 

 

—

 

   Total revenue

 

 

3,977

 

 

 

4,934

 

 

 

(167

)

 

 

8,744

 

 

 

4,130

 

 

 

4,888

 

 

 

(148

)

 

 

8,870

 

 

 

4,077

 

 

 

4,669

 

 

 

(163

)

 

 

8,583

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Cost of revenue (2)

 

 

2,964

 

 

 

3,772

 

 

 

(78

)

 

 

6,658

 

 

 

2,934

 

 

 

3,671

 

 

 

(62

)

 

 

6,543

 

 

 

2,870

 

 

 

3,670

 

 

 

(67

)

 

 

6,473

 

   Selling, general, and administrative (2)

 

 

506

 

 

 

518

 

 

 

146

 

 

 

1,170

 

 

 

500

 

 

 

494

 

 

 

114

 

 

 

1,108

 

 

 

518

 

 

 

521

 

 

 

121

 

 

 

1,160

 

Goodwill and long-lived asset impairment

 

 

—

 

 

 

40

 

 

 

30

 

 

 

70

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

   Depreciation and amortization

 

 

233

 

 

 

115

 

 

 

7

 

 

 

355

 

 

 

221

 

 

 

115

 

 

 

7

 

 

 

343

 

 

 

183

 

 

 

111

 

 

 

8

 

 

 

302

 

   (Gain)/loss on sales of fixed assets

 

 

(3

)

 

 

(4

)

 

 

4

 

 

 

(3

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(1

)

 

 

(4

)

 

 

2

 

 

 

(3

)

      Operating profit

 

$

277

 

 

$

493

 

 

$

(276

)

 

$

494

 

 

$

475

 

 

$

608

 

 

$

(207

)

 

$

876

 

 

$

507

 

 

$

371

 

 

$

(227

)

 

$

651

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation to income before income taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Interest and financial costs

 

 

—

 

 

 

—

 

 

 

(88

)

 

 

(88

)

 

 

—

 

 

 

—

 

 

 

(91

)

 

 

(91

)

 

 

—

 

 

 

—

 

 

 

(88

)

 

 

(88

)

   Interest income

 

 

—

 

 

 

—

 

 

 

51

 

 

 

51

 

 

 

—

 

 

 

—

 

 

 

38

 

 

 

38

 

 

 

—

 

 

 

—

 

 

 

28

 

 

 

28

 

   Equity income (loss) in unconsolidated affiliates

 

 

(18

)

 

 

2

 

 

 

—

 

 

 

(16

)

 

 

33

 

 

 

3

 

 

 

—

 

 

 

36

 

 

 

111

 

 

 

8

 

 

 

—

 

 

 

119

 

   Other expenses, net

 

 

—

 

 

 

—

 

 

 

(66

)

 

 

(66

)

 

 

—

 

 

 

—

 

 

 

(28

)

 

 

(28

)

 

 

—

 

 

 

—

 

 

 

(98

)

 

 

(98

)

        Income before income taxes

 

$

259

 

 

$

495

 

 

$

(379

)

 

$

375

 

 

$

508

 

 

$

611

 

 

$

(288

)

 

$

831

 

 

$

618

 

 

$

379

 

 

$

(385

)

 

$

612

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other segment information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Capital expenditures

 

$

229

 

 

$

136

 

 

$

10

 

 

$

375

 

 

$

255

 

 

$

86

 

 

$

10

 

 

$

351

 

 

$

198

 

 

$

68

 

 

$

17

 

 

$

283

 

   Investment in unconsolidated affiliates

 

$

158

 

 

$

5

 

 

$

—

 

 

$

163

 

 

$

158

 

 

$

5

 

 

$

—

 

 

$

163

 

 

$

211

 

 

$

—

 

 

$

—

 

 

$

211

 

   Total assets

 

$

4,777

 

 

$

4,815

 

 

$

1,699

 

 

$

11,291

 

 

$

5,054

 

 

$

4,895

 

 

$

1,412

 

 

$

11,361

 

 

$

4,777

 

 

$

5,509

 

 

$

1,008

 

 

$

11,294

 

 

(1)
Sales from one segment to another generally are priced at estimated equivalent commercial selling prices; however, segments originating an external sale are credited with the full profit to the Company. Eliminations and corporate costs include intercompany transactions conducted between the two reporting segments and with Corporate that are eliminated in consolidation, as well as corporate costs not allocated to the segments. Intercompany transactions within each reporting segment are eliminated within each reporting segment. Also included in the eliminations and corporate costs column are capital expenditures and total assets related to corporate. Corporate assets consist primarily of cash and fixed assets.
(2)
Operating profit for the year ended December 31, 2025, included (i) charges of $96 million, reported in “Cost of revenue,” primarily related to a severance charges of $72 million associated with facility consolidations and other restructuring activities, and a discount charge of $24 million to reflect delayed timing of the expected cash collection of royalty receivables currently in litigation as discussed in Note 14; (ii) charges of $17 million, reported in “Selling, general, and administrative,” related to various restructuring costs; and (iii) impairment charges of $70 million, reported in “Goodwill and long-lived asset impairment”. Operating profit for the year ended December 31, 2024, included (i) a credit of $110 million, reported in “Cost of revenue,” primarily related to a gain on business divestiture of $130 million, offset by charges of $20 million primarily related to severance and other restructuring costs; and (ii) charges of $1 million, reported in “Selling, general and administrative” related to various restructuring costs. Operating profit for the year ended December 31, 2023, included (i) charges of $10 million, reported in “Cost of revenue,” primarily related to a non-cash timing discount charge of $25 million on royalty receivables, other restructuring costs of $5 million, offset by credits related to gains on sales of previously reserved inventory of $20 million; and (ii) charges of $41 million, reported in “Selling, general, and administrative,” primarily related to voluntary early retirement program (“VERP”) of $52 million, other restructuring costs of $14 million, offset by a credit related to release of an earnout accrual of $25 million:

 

 

Year Ended December 31,

 

 

 

2025

 

 

2024

 

 

2023

 

 

 

Energy Products and Services

 

 

Energy Equipment

 

 

Corporate

 

 

Total

 

 

Energy Products and Services

 

 

Energy Equipment

 

 

Corporate

 

 

Total

 

 

Energy Products and Services

 

 

Energy Equipment

 

 

Corporate

 

 

Total

 

Pre-tax Other Items included in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Cost of revenue

 

$

56

 

 

$

39

 

 

$

1

 

 

$

96

 

 

$

7

 

 

$

(118

)

 

$

1

 

 

$

(110

)

 

$

24

 

 

$

(18

)

 

$

4

 

 

$

10

 

   Selling, general, and administrative

 

 

3

 

 

 

—

 

 

 

14

 

 

 

17

 

 

 

—

 

 

 

—

 

 

 

1

 

 

 

1

 

 

 

29

 

 

 

4

 

 

 

8

 

 

 

41

 

   Goodwill and long-lived asset impairment

 

 

—

 

 

 

40

 

 

 

30

 

 

 

70

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

      Total pre-tax Other Items

 

$

59

 

 

$

79

 

 

$

45

 

 

$

183

 

 

$

7

 

 

$

(118

)

 

$

2

 

 

$

(109

)

 

$

53

 

 

$

(14

)

 

$

12

 

 

$

51

 

 

Geographic Areas:

The following table presents consolidated revenues by country based on sales destination of the products or service (in millions):

 

 

Year Ended December 31,

 

 

 

2025

 

 

2024

 

 

2023

 

United States

 

$

2,998

 

 

$

2,984

 

 

$

2,933

 

Norway

 

 

907

 

 

 

714

 

 

 

473

 

Brazil

 

 

896

 

 

 

618

 

 

 

605

 

Other countries

 

 

3,943

 

 

 

4,554

 

 

 

4,572

 

Total

 

$

8,744

 

 

$

8,870

 

 

$

8,583

 

The following table presents net property, plant and equipment by country based on the location (in millions):

 

 

December 31,

 

 

 

2025

 

 

2024

 

United States

 

$

941

 

 

$

928

 

Saudi Arabia

 

 

328

 

 

 

303

 

Other countries

 

 

781

 

 

 

691

 

Total

 

$

2,050

 

 

$

1,922

 

Historical Timeline

Fiscal YearFiled
2025Feb 12, 2026Showing above
2024Feb 14, 2025
2023Feb 14, 2024
2022Feb 14, 2023
2021Feb 11, 2022
2020Feb 12, 2021
2019Feb 13, 2020
2018Feb 14, 2019
2017Feb 16, 2018
2016Feb 17, 2017
2015Feb 19, 2016

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Other Available Disclosures

Income TaxesRevenuePP&EGoodwill & IntangiblesLeasesDebtCommitmentsNew Standards