The 10-second takeaway
For the quarter ended June 30 (Q2), Transocean beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share dropped to a loss.
Margins shrank across the board.
Transocean booked revenue of $2.58 billion. The 17 analysts polled by S&P Capital IQ predicted a top line of $2.50 billion on the same basis. GAAP reported sales were 10% higher than the prior-year quarter's $2.33 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.72. The 26 earnings estimates compiled by S&P Capital IQ predicted $0.45 per share. GAAP EPS were -$0.86 for Q2 against $0.48 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 8.5%, 2,760 basis points worse than the prior-year quarter. Operating margin was -8.0%, 2,590 basis points worse than the prior-year quarter. Net margin was -11.8%, 1,840 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.60 billion. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $10.01 billion. The average EPS estimate is $2.89.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Transocean is outperform, with an average price target of $65.17.
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Seth Jayson owned shares of the following at the time of publication: Transocean. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Transocean. 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.