Offshore drilling rig owner Transocean (NYSE:RIG) reported third-quarter earnings after the market closed on Wednesday and showed improvement across the board. Revenue rose 5% from a year ago to $2.56 billion and net income swung from a loss of $381 million to a profit of $546 million, or an adjusted $1.37 per share. That beat Wall Street's expectation of $2.49 billion in revenue and earnings of $1.07 per share.  

Increased efficiency helped drive earnings higher this quarter, highlighted by ultra-deepwater revenue efficiency increasing to 92.5% from 91.1% last quarter. The comparison to a year ago was a little unfair, because that's when Transocean took an $881 million charge related to exiting the standard jackup market. Long-term, the company's focus on deepwater should keep utilization and profit margins higher than they were in the past.

Transocean also announced it is spending $1.2 billion to build five new high-specification jackups that will be completed from 2016 to 2017. The high-specification market has replaced much of the demand formerly held by standard jackups, which have been at extremely low utilization rates until very recently.  

The ultra-deepwater market continues to command high dayrates, and as a result, Transocean is well positioned to grow into the future. Swinging to a profit wasn't entirely surprising after selling its jackup fleet, but the amount Transocean beat expectations was impressive and bodes well for the company going forward.

Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool owns shares of Transocean. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.