This morning Halliburton (HAL 0.91%) reported fiscal third quarter results. Revenue rose 8% to $8.7 billion. Adjusted income from operations popped 29% to $1.0 billion or $1.19 per share. This compares to average analyst estimates of $8.58 billion and $1.10 per share for revenue and EPS respectively.

The drill-down
CEO Dave Lesar in part gave credit to North American results where revenue climbed 9% and operating income jumped 15%. Lesar added,

"Service intensity levels surged to unprecedented levels, as completion volumes per well were up more than 50% compared to the third quarter of last year, and we expect this level of activity to continue. More importantly, our exit rate margins for North America were in excess of 20%."

Results from the Eastern Hemisphere weren't too shabby either: Revenue inched up 4% and operating income moved up 6%. For Latin America, it was particularly strong and eased some concerns over previous weakness in the region. Revenue leaped sequentially 16% and operating income more than doubled. Halliburton explained it was "primarily as a result of increased project management, consulting and software revenue in Mexico."

In light of the strength, the company raised its quarterly dividend by 20% to $0.18 per share while buying back $300 million worth of stock during the quarter. Lesar explained, "These actions reflect our confidence in the strength of our long-term business outlook, our commitment to shareholder distributions, and our focus on delivering best-in-class returns."

The company has another $5.7 billion worth of buybacks still under authorization. Lesar summed up management's takeaway and confidence succinctly: 

"Our strategy is working well and we intend to stay the course. Our leadership in North America positions us well to take advantage of this quickly evolving market, and we continue to realize significant revenue and margin expansion in our international business."

Concerns relieved
While one quarter doesn't necessarily make a trend, the results coupled with management's confidence is a great sign. First, there was worry about weakness in Latin America, and the gains were certainly welcome. While the company had previously forecasted an improvement, a bird in hand is worth two in the bush.

Last quarter during the conference call Lesar stated, "Turning to Latin America, we faced issues around revenue timing during the quarter ... I am certainly not thrilled with how some of the things played out this quarter."

Next, CFO Mark McMullum in a presentation in September had warned about costs, but in true CFO fashion it appears at least for now that he was just being overly conservative given that operating income rose faster as a percent than revenue.

McMullum had stated, "Labor costs go up, diesel costs go up, maintenance costs go up and of course depreciation, as well in terms of the jobs that you're doing. So, all of those factors conspire to driving cost up." Costs may have been up, but Halliburton handled it just fine.

Finally, with oil prices tanking, this is always a concern beyond Halliburton's control that could lead to either softness across the industry in terms of revenue or softness in terms of contract pricing. Nothing in the earnings release suggested this is a problem -- at least as of yet. Much of the recent decline in the stock price has been a result of fear. With some of that alleviated, Halliburton stock should get a boost.