Seadrill Ltd (NYSE: SDRL)

Seadrill Limited is an offshore drilling contractor that provides worldwide offshore drilling services to the oil and gas industry. The company owns and operates drillships and semi submersible rigs for work in shallow to ultra deepwater in both benign and harsh environments. It contracts its drilling units to customers on a day rate basis and also provides management services to certain affiliated entities. As of December 31 2024 Seadrill Limited owned fifteen drilling units, of which eleven were operating (including one leased to the Sonadrill joint venture), one sixth generation drillship was being prepared for a contract that commenced in February 2025 and three were cold stacked. In addition to its owned assets the company managed two drilling units owned by Sonangol. The fleet comprises ten drillships, three semi submersible rigs and one jackup rig, with the remaining units either undergoing preparation or held in cold standby.

Seadrill Limited generates revenue primarily by contracting its drilling units to oil and gas companies at an agreed day rate for a fixed contract term or on a well completion basis. Day rates vary depending on rig type, capabilities, contract length, geographic location, operating expenses, taxes and prevailing market conditions. The company also earns fees for mobilization, demobilization, capital upgrades and cost escalations tied to public indices. In addition, Seadrill Limited receives management service fees from affiliated entities such as the Sonadrill joint venture. These management fees are typically based on a fixed monthly rate or a percentage of the operating costs of the managed units.

Seadrill Limited holds a strong position in the offshore drilling sector due to its modern fleet, safety focus and long term customer relationships. The company emphasizes four competitive strengths: a fleet built after 2007 providing scale and relative youth; an unwavering commitment to safety and environmental stewardship; a technologically advanced array of rigs that delivers high operational reliability; and enduring partnerships with major oil and gas firms. Competition in the industry is intense with numerous global and regional contractors vying for contracts based on price, rig availability, technical specifications and safety records.

Seadrill Limited serves a diverse customer base that includes oil super majors, state owned national oil companies and independent oil and gas producers. According to its disclosures, the largest customers by revenue share in 2024 were Sonadrill at 22%, Petrobras at 18%, Var Energi at 7%, Equinor at 7% and ConocoPhillips at 7%. The remaining revenue came from a broad range of other oil and gas companies.