Abstract

Transocean will report its quarterly results on February 19, 2026 Post Market; this preview outlines expected revenue, margins, EPS trajectory, segment developments, and the prevailing institutional stance based on the latest available forecasts and news flow since January 1, 2026 through February 12, 2026.

Market Forecast

- Based on the latest forecast set, Transocean’s current-quarter revenue is estimated at $1.03 billion, implying 7.57% year-over-year growth; forecast EBIT is $225.85 million with an expected year-over-year growth of 55.53%, and estimated EPS is $0.08 with year-over-year growth of 69.70%. - The company’s gross margin and net margin are not guided explicitly for the current quarter; however, modeling frameworks imply margin expansion in line with the higher EBIT growth vs. revenue growth, which would typically support an upward trajectory for adjusted EPS on a year-over-year basis. - Main business highlight and outlook: Contract drilling remains the core revenue driver, supported by higher dayrate realization and improved utilization trends in ultra-deepwater. - Most promising segment: Contract drilling revenue is projected near $1.03 billion this quarter, up 7.57% year over year, as the fleet roll-over into higher dayrates continues.

Last Quarter Review

- Transocean’s prior quarter delivered revenue of $1.03 billion, a gross profit margin of 43.19%, GAAP net loss attributable to shareholders of $1.92 billion, and a net margin of -187.06%; adjusted EPS was $0.06, with year-over-year growth not disclosed by the company’s report but tracked higher on improved operational results. - Key highlight: EBIT of $239.00 million exceeded internal estimates, reflecting better-than-expected dayrates and operating efficiency across the contracted fleet. - Main business highlights: Contract drilling generated $1.03 billion of revenue, up 8.44% year over year, benefiting from higher average dayrates and stable utilization in ultra-deepwater assets.

Current Quarter Outlook (with major analytical insights)

Contract Drilling Momentum

Transocean’s contracted backlog and rolling dayrate uplift remain central to the investment debate this quarter. The company’s guidance framework and external models point to approximately $1.03 billion in revenue, which assumes mid-to-high single-digit growth driven by the gradual repricing of rigs onto higher dayrates. EBIT growth estimated at 55.53% year over year suggests improved operating leverage as utilization normalizes and idle time declines. This mix should support a positive earnings cadence even if revenue growth is steady rather than rapid.

Dayrate dispersion by basin and rig class continues to matter for mix, with ultra-deepwater assets still achieving the most resilient pricing. The key sensitivity remains unplanned downtime; the prior quarter’s operational performance was solid, and maintaining similar uptime should convert contracted revenue into EBIT with fewer leakage points. As contracts signed during the upcycle are recognized, incremental flow-through to margins tends to be higher, reinforcing the path to positive EPS on a sustained basis.

The upcoming quarter will also be influenced by the pace of contract awards and start-ups that migrate from backlog into revenue. Slippage has diminished from early-cycle norms, but schedule risk is ever present in offshore operations, and visibility around commencement dates will shape how the revenue bridge lands relative to the model consensus.

Ultra-Deepwater as the Primary Growth Engine

Ultra-deepwater continues to represent the largest opportunity set in Transocean’s portfolio, reflecting both the technology moat and the industry’s capital allocation bias toward the highest-return reservoirs. As more rigs transition to dayrates set in the 2024–2025 contracting window, the revenue capture rate increases, aiding EBIT expansion outpacing the top line. The forecast EPS of $0.08 and EBIT of $225.85 million align with a scenario where ultra-deepwater utilization remains tight and operational reliability stays high.

The unit economics in ultra-deepwater carry higher fixed costs that magnify operating leverage when dayrates step up, which helps explain the wide gap between revenue growth (7.57%) and EBIT growth (55.53%) implied by the forecast. This dynamic can persist while the fleet roll-over continues, even without a substantial increase in fleet count. Investors will watch whether any scheduled special periodic surveys or reactivations introduce cost spikes; the absence of such items would allow more of the dayrate uplift to drop to EBIT.

Contract visibility is also critical. Where backlog includes multi-year contracts with escalation clauses, quarterly volatility can be dampened and upside is more a function of operational delivery. Any notable new awards announced in recent weeks would be incremental to medium-term expectations rather than a near-term revenue event, but the signaling effect can reinforce the stock’s sensitivity to the cycle.

Stock Price Drivers This Quarter

The equity narrative into this print is anchored on margin inflection, execution, and backlog durability. With last quarter’s gross margin at 43.19% and EBIT beating internal expectations, the market is calibrated to see confirmation that cost control and uptime can sustain an upward EPS path. Any indication of lower-than-anticipated unplanned downtime or better-than-modeled opex per rig can unlock further flow-through to EPS, especially given the relatively modest top-line growth.

Balance sheet and capital allocation are secondary but relevant. While GAAP net results were affected by non-cash items last quarter, investors will parse cash generation relative to maintenance and reactivation capex needs. Evidence that higher dayrates are translating to stronger cash conversion without outsized capex surprises would be a constructive signal. Conversely, if reactivation or survey costs front-load in the quarter, that could cap the operating leverage and temper the EPS trajectory.

Lastly, award cadence and commentary on basins such as the U.S. Gulf of Mexico, Brazil, and West Africa can shape the stock reaction. Announcements that extend the duration and quality of backlog are typically taken positively, while any postponements or pricing softness would challenge the bullish margin expansion narrative. Given the projected EPS uplift and EBIT acceleration, expectations lean toward a constructive setup, but execution remains the swing factor.

Analyst Opinions

The majority of recent institutional commentary skews bullish, emphasizing the visibility provided by contracted backlog and improving dayrates. Analysts highlight that forecast revenue growth of 7.57% alongside 55.53% EBIT growth points to margin expansion as rigs roll onto higher dayrates and uptime stabilizes. A commonly cited data point is the outperformance on EBIT last quarter versus estimates, which reinforces confidence in operational execution. Several houses maintain positive stances on offshore drillers broadly, citing durable multi-year upstream spending plans by key operators and limited newbuild supply, which support dayrate stability.

Representative views point to upside if Transocean’s commentary confirms continued tightening in ultra-deepwater utilization and limited schedule slippage. Coverage also notes that while GAAP results were distorted by non-cash items last quarter, the adjusted EPS path appears favorable so long as maintenance and reactivation expenses remain contained. In this framework, the bullish camp expects the company to meet or slightly exceed consensus on revenue and EBIT, with the EPS trajectory underpinned by operating leverage. Overall, bulls outnumber bears in the current discourse, and their thesis rests on backlog visibility, pricing resilience, and operational delivery into the quarter.