Hercules Offshore (NASDAQ:HERO) reported earnings today, revealing an unimpressive third quarter. The company suffered a $37.9 million loss from continuing operations, with international operations proving particularly problematic. There, lost operating days added up to significant revenue declines. The shallow-water driller fared better on the domestic front, with day-rates up 29% over last year, and utilization rates coming in at 88%, up 14% YTD.

While it hasn't been a great year for Hercules the future still holds a glimmer of hope as the jackup rig segment has seen increased demand, especially in the Gulf of Mexico. The favorable environment should last well into 2013, which helps Hercules since the company currently has the fourth largest jackup fleet in the world. However, Fool.com analyst Joel South sees deepwater drilling as the future of offshore drilling, but to see how this sub-industry did this past quarter, we will have to wait until Transocean (NYSE: RIG) and Seadrill (NYSE: SDRL) report next month. Competition is fierce in this industry and for full detail on the story, be sure to check out the video below.

Joel South has no positions in the stocks mentioned above. Taylor Muckerman has no positions in the stocks mentioned above. The Motley Fool owns shares of Transocean and Seadrill. Motley Fool newsletter services recommend Seadrill. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.