CLB

A month has gone by since the last earnings report for Core Laboratories (CLB). Shares have added about 18.7% in that time frame, outperforming the S&P 500. Will the recent positive trend continue leading up to its next earnings release, or is Core Laboratories due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent drivers for Core Laboratories Inc. before we dive into how investors and analysts have reacted as of late. Core Laboratories reported second-quarter 2026 adjusted earnings of 11 cents per share, which beat the Zacks Consensus Estimate of 8 cents, driven by outperformance of the Production Enhancement segment. However, the bottom line decreased from the year-ago quarter’s reported figure of 19 cents due to the underperformance of the Reservoir Description segment and increased costs and expenses. This oilfield service provider reported second-quarter operating revenues of $124.6 million, missing the Zacks Consensus Estimate of $128 million and decreasing from the earlier-year quarter’s reported figure of $130.1 million. This can be attributed to military conflicts in the Middle East and the Russia-Ukraine region, which disrupted energy infrastructure, delaying projects, disrupting crude oil trade and reducing demand for the company's international laboratory services. During the second quarter, CLB repurchased 214,712 shares of common stock for a total of $2.7 million. The company’s debt leverage ratio was at 1.30 and net debt decreased by $0.5 million. Reservoir Description: Revenues in this segment decreased 8.7% from the year-ago quarter to $78.7 million. The top line also missed our model estimation of $82 million. Operating income decreased from $12.2 million in the year-ago period to $3.7 million and missed our estimate of $6 million, caused by three primary factors: reduced client activity in the Middle East, lower global crude assay activity resulting from disruptions to hydrocarbon cargo shipments and increased military action and expanded European sanctions associated with the Russia-Ukraine conflict. Production Enhancement: This segment’s revenues increased 4.5% to $45.9 million from $43.9 million in the prior-year quarter. The top line also beat our model estimate of $45.6 million. Operating income increased from $3.1 million in the year-ago period to $5.2 million and beat our model estimate of $2 million. The outperformance in the Production Enhancement segment can be attributed to improvement in U.S. completion activity and increased product sales in both the U.S. and international markets. CLB reported total costs and expenses of $115.5 million in the second quarter, increasing by 0.5% from the year-ago quarter’s level of $114.9 million. Our estimation for the metric was $118.6 million. As of June 30, 2026, the company had cash and cash equivalents of $22.7 million and long-term debt of $113.9 million. CLB’s debt-to-capitalization was about 29%. Net cash provided by operating activities in the second quarter totaled $7.8 million, while capital expenditure amounted to $4.7 million. This led to a positive free cash flow of $3.1 million. Core Laboratories’ board of directors approved a quarterly dividend of 1 cent per share to its common shareholders of record as of Aug. 10, 2026. The payout, which remains unchanged from the previous quarter, will be made on Aug. 31. Ongoing conflicts in the Middle East and Russia-Ukraine prompted the IEA, EIA and OPEC to lower their 2026 global oil demand forecasts due to higher energy prices, supply disruptions and trade constraints. However, all three agencies expect demand growth to recover in 2027. Core Laboratories believes the long-term need for new production and enhanced recovery remains intact, supported by declining output from mature fields, energy security concerns and diversified hydrocarbon supply. The company expects third-quarter revenues to rise sequentially, aided by improving activity in the South Atlantic Margin and Asia-Pacific, despite continued geopolitical disruptions affecting project execution and logistics. Modest improvement in U.S. land completions, growing adoption of its reservoir technologies and diagnostics, and expanding international offshore and exploration projects are expected to support long-term growth. For the third quarter of 2026, CLB expects revenues to range from $128.5 million to $135.5 million. Operating income is anticipated to be between $10.5 million and $15 million, with earnings per share expected to be between 12 cents and 20 cents. Revenues for the Reservoir Description segment are anticipated to be between $81 million and $84 million, with operating income ranging from $5.5 million to $7.9 million. Revenues for the Production Enhancement segment are expected to be between $47.5 million and $51.5 million, with operating income predicted to be between $4.8 million and $6.9 million. The company anticipates an effective tax rate of 25% for the third quarter. Its guidance for the third quarter of 2026 is based on estimates for underlying operations and excludes any gains or losses from foreign exchange. During the second quarter of 2026, Core Laboratories expanded its technology-driven reservoir evaluation and completion capabilities through several projects across Asia-Pacific, Africa and the Middle East. In Australia, the company deployed its Advanced Digital Imaging System (ADIS) to analyze reservoir rock samples for an onshore gas project, integrating the results into its proprietary RAPID™ database to accelerate reservoir interpretation. Offshore Namibia, CLB applied advanced laboratory technologies to characterize geological and petrophysical properties, supporting more accurate reservoir models and reducing exploration risk. The company also launched a reservoir characterization program for Murphy Oil's offshore Côte d’Ivoire discovery using its Dual Energy CT technology. In Asia-Pacific, Core Laboratories enabled a national oil company to establish in-house Tubing Conveyed Perforating capabilities through equipment supply and technical training. Additionally, regulatory approvals in the UAE for SpectraStim proppant tracing and SpectraScan spectral gamma ray logging broadened the company's reservoir optimization offerings, strengthening its position in a key Middle Eastern energy market. Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions. The consensus estimate has shifted -5.56% due to these changes. At this time, Core Laboratories has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Charting a somewhat similar path, the stock was allocated a score of C on the value side, putting it in the middle 20% for this investment strategy. Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in. Core Laboratories has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. Core Laboratories belongs to the Zacks Oil and Gas - Field Services industry. Another stock from the same industry, Oceaneering International (OII), has gained 7.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026. Oceaneering International reported revenues of $768.18 million in the last reported quarter, representing a year-over-year change of +10%. EPS of $0.65 for the same period compares with $0.49 a year ago. For the current quarter, Oceaneering International is expected to post earnings of $0.58 per share, indicating a change of +5.5% from the year-ago quarter. The Zacks Consensus Estimate has changed +9.4% over the last 30 days. The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Oceaneering International. Also, the stock has a VGM Score of C. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Core Laboratories Inc. (CLB) : Free Stock Analysis Report Oceaneering International, Inc. (OII) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, July 30, 2026 at 8:30 a.m. ET Chairman and Chief Executive Officer - Lawrence Bruno Chief Financial Officer - Chris Hill Senior Vice President and Head of Investor Relations - Gwendolyn Schreffler Operator: Good day, and welcome to the Core Labs Second Quarter 2026 Earnings Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Larry Bruno, Chairman and CEO of Core Labs. Please go ahead. Lawrence Bruno: Thanks, Alan. Good morning in the Americas. Good afternoon in Europe, Africa, and the Middle East, and good evening in Asia Pacific. We'd like to welcome all of our shareholders, analysts, and most importantly, our employees to Core Laboratories second quarter 2026 earnings call. This morning, I'm joined by Chris Hill, Core's Chief Financial Officer, and Gwen Gresham, Core's Senior Vice President and Head of Investor Relations. The call will be divided into 6 segments. Gwen will start by making remarks regarding forward-looking statements. We'll then have some opening comments, including a high-level review of important factors in Core's second quarter performance. In addition, we'll review Core strategies and the 3 financial tenets that Core employs to build long-term shareholder value. Chris will then give a detailed financial overview and have additional comments regarding shareholder value. Following Chris, Gwen will provide some comments on the company's outlook and guidance. I'll then review Core's 2 operating segments, detailing our progress and discussing the continued successful introduction and deployment of Core Laboratories technologies, as well as highlighting some of Core's operations, recent client interactions, and major projects worldwide. Then we'll open the phones for a Q&A session. I'll now turn the call over to Gwen for remarks on forward-looking statements. Gwendolyn Schreffler: Before we start the conference this morning, I'll mention that some of the statements we make during this call may include projections, estimates, and other forward-looking information. This would include any discussion of the company's business outlook. These types of forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to materially differ from our forward-looking statements. These risks and uncertainties are discussed in our most recent annual report on Form 10-K, as well as other reports and registration statements filed by us with the SEC. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Our comments also include non-GAAP financial measures. Reconciliation to the most directly comparable GAAP financial measures is included in the press release announcing our second quarter results. Those non-GAAP measures can also be found on our website. With that said, I'll pass the discussion back to Larry. Lawrence Bruno: Thanks, Gwen. Moving now to some high-level comments about our second quarter 2026 results. Core continued to execute its strategic plan of technology investments targeted to both solve client problems and capitalize on Core's technical and geographic opportunities. The ongoing military conflict in the Middle East, which began during the first quarter of 2026, continued to affect operations through project delays and logistical disruptions across several countries where the company operates. Reservoir Description bore the greatest impacts of the Middle East conflict as crude assay work and reservoir characterization projects depend on field operations, active maritime hydrocarbon trade and transportation, timely sample acquisition, and access to client facilities. The closure of the Strait of Hormuz and the widespread disruption to maritime hydrocarbon transportation routes extends beyond the Middle East region. In addition, in both Russia and Ukraine, escalating attacks on refining, storage, and hydrocarbon transportation sites, along with evolving sanctions, resulted in additional headwinds. Production Enhancement was comparatively less affected by these geopolitical conflicts, although certain service activities and completion product shipments into the region continued to experience delays. Even in this challenging operating environment, energetic product sales improved during the quarter, reflecting continued operator adoption of Core Labs' advanced completion technologies across both the U.S. and international markets. While the Middle East situation remains uncertain and further geopolitical developments could continue to influence Core's business, operating conditions improved in several other geographic markets during the second quarter and client engagement strengthened outside the Middle East. Looking at Reservoir Description, second quarter revenue was down 4% from Q1 of 2026 and down 9% compared to Q2 of last year. Second quarter operating margins in Reservoir Description ex item were 5%, down sequentially by approximately 100 basis points. Despite the multiple factors impacting Core Labs' second quarter results, the company maintained its focus on creating new technology offerings, maximizing operating efficiency, and leveraging our global network to support client operations. In Production Enhancement, second quarter revenue was up 15% compared to Q1 of 2026, and margins in Production Enhancement ex item were 12%, up nicely from 5% in Q1 of 2026, or over 700 basis points. Sequential margins benefited from higher product sales during the quarter, driven by increased operator adoption of Core Labs' proprietary completion technologies across both the U.S. and international markets. Second quarter operating margins also benefited from the resolution of previously recorded tax matters. The company maintained its longstanding commitment to shareholder returns during the quarter, returning free cash to our shareholders through our quarterly dividend and by repurchasing more than 214,000 shares of company stock, representing a value of $2.7 million. Q2 marks the 7th consecutive quarter of share buybacks. Core intends to continue using free cash to fund our quarterly dividend, pursue growth opportunities, and improve shareholder value through opportunistic share repurchases. Considering current market dynamics and looking ahead to the mid and longer term, Core Lab has decades of experience supporting clients through periods of geopolitical uncertainty. The company's longstanding presence in the Middle East, along with the company's proprietary technologies and dedicated employees, will allow Core Lab to continue serving its clients across this strategically important region. Moreover, despite near-term headwinds, Core's global operations, asset-light business model, and diversified technology portfolio position the company for long-term success. For 90 years, Core Lab's resilience, technical leadership and unwavering client focus have enabled the company to deliver differentiated solutions and help our clients derisk their operational decisions. As we move ahead, Core will continue to execute on its key strategic objectives by, one, introducing new product and service offerings in key geographic markets, two, maintaining a lean and focused organization, and three, maintaining our commitments to returning excess free cash to our shareholders while preserving the company's strong balance sheet. Core's strengths, together with disciplined capital deployment, continued free cash flow generation and the company's commitment to returning excess capital to its owners will drive long-term value creation for Core Lab's shareholders. Now to review the company's strategies and the financial tenets that have guided Core Lab's shareholder value creation through our more than 32-year history as a publicly traded company. While we continue to pursue growth opportunities, the company will remain focused on its 3 long-standing, long-term financial tenets, those being to maximize free cash flow, maximize return on invested capital, and returning excess free cash to our shareholders. I'll now turn it over to Chris for the detailed financial review. Chris Hill: Thanks, Larry. Before we review the financial performance for the quarter, the guidance we gave on our last call and past calls excluded the impact of any FX gains and losses and assumed an effective tax rate of 25%. So accordingly, our discussion today excludes any foreign exchange gain or loss for current and prior periods. The comparison periods for the first quarter of 2026 and the second quarter of 2025 also included items that were discussed in those calls and highlighted in our earnings release for those periods. These items have also been excluded from our discussion of the financial results today. You can find a summary of those items in the tables attached to our press release for the second quarter of 2026. Now looking at the income statement, revenue was $124.6 million in the second quarter, up over 2% compared to the prior quarter and down 4% year-over-year. Sequentially, we saw increased demand for our completion products in both the U.S. land and international markets, while service revenue increased in certain international regions. The conflicts in both Russia, Ukraine, and the Middle East, which have intensified, have primarily impacted our service revenue. Of this revenue, service revenue, which is more international, was $94.3 million for the quarter, flat sequentially and down 2% year-over-year. Our service revenue associated with crude assay services and regional studies continue to be impacted by the geopolitical conflicts in the Middle East and Russia, Ukraine, which are the primary reason for the year-over-year decrease. However, growth in other regions outside these affected areas offset some of the impact. Sequentially, although the Middle East and Russia have been significantly impacted, service revenue was flat. We continue to see demand improve for our reservoir rock and fluid analytical programs in certain international regions where exploration programs are more active. Additionally, our well completion diagnostic services continue to perform well in the U.S. market and is showing some growth internationally, excluding the Middle East. Product sales, which are more equally tied to North America and international activity, were $30.3 million for the quarter and were up 10% sequentially, but down 11% year-over-year. Sequentially, completion activity in the U.S. improved modestly. However, we saw significant growth in our U.S. completion product sales. Switching to international product sales, which are typically larger bulk orders and can vary from one quarter to another, were also up nicely compared to the first quarter. When looking at year-over-year, we had a large laboratory instrumentation sale last year, which did not repeat in the second quarter of 2026. However, this was partially offset by improved sales of perforating products in both the U.S. and international markets. Moving on to cost of services ex items for the quarter was 80% of service revenue, a slight improvement from 81% in the prior quarter and increased from 77% last year. Sequential improvement was primarily driven by continued cost reduction initiatives in regions impacted by the conflicts. The year-over-year increase is primarily result of the company continuing to carry costs in the regions, which have been more negatively impacted in 2026 by the escalation of conflicts in both the Middle East and Russia, Ukraine. As discussed on prior calls, the service side of our business has been more affected by geopolitical conflicts and expanded sanctions. Volatility in crude oil prices, along with continued conflict in Russia, Ukraine, and the Middle East, have disrupted regional operations and reduced demand for our crude assay services, which are closely tied to the trading and maritime movement of crude oil and derived products. We will continue to manage our cost structure as effectively as possible as we work through these disruptions in certain regions. Cost of sales ex items in the second quarter was 85% of revenue, which improved from 94% in the prior quarter and was relatively flat compared to last year. Sequential improvement was primarily driven by continued cost control initiatives and manufacturing efficiencies. With these initiatives in place, we anticipate the manufacturing absorption rate in future periods to be in line with projected product sales. Additionally, in the second quarter of 2026, we received a partial refund of import tariffs, which were incurred in prior periods. G&A ex items for the quarter was $11 million, which was relatively flat compared to the prior quarter, and up slightly from the same quarter in the prior year. For 2026, we expect G&A ex items to be approximately $43 million to $45 million. It is also important to note that 100% of our corporate G&A expenses are allocated and absorbed into the financial performance of the reported segments. Depreciation and amortization for the quarter was $3.8 million, flat compared to the prior quarter. EBIT ex items for the quarter was $9.4 million, up from $6.6 million last quarter, yielding an EBIT margin of approximately 8% and expanding 210 basis points from last quarter. Our EBIT for the quarter on a GAAP basis was $9.2 million. Interest expense of $2.8 million for the second quarter compares to $2.9 million in the prior quarter and $2.7 million in the same quarter in the prior year. The changes in interest expense were primarily due to changes in our average borrowings with variable interest rates during the periods. Income tax expense at an effective tax rate of 25% and ex items was $1.6 million for the quarter. On a GAAP basis, we recorded tax expense of $500,000 for the quarter. The second quarter expense includes benefits from certain discrete items recorded in the quarter. The effective tax rate will continue to be somewhat sensitive to the geographic mix of earnings across the globe and the impact of items discrete to each quarter. We continue to project the company's effective tax rate to be approximately 25%. Net income ex items for the quarter was $5.1 million, up sequentially from $2.7 million last quarter, but down from $8.8 million in the second quarter of last year. On a GAAP basis, we had net income of $6 million for the quarter. Earnings per diluted share ex items was $0.11 for the quarter, compared to $0.06 in the prior quarter, and $0.19 in the second quarter of last year. On a GAAP basis, EPS was $0.13 for the quarter. Turning to the balance sheet, receivables were $108.8 million and increased slightly from the prior quarter. Our DSOs for the second quarter were at 73 days, which improved slightly from 74 days last quarter. The timing of collections have been impacted by the ongoing conflicts, and we continue to remain focused on our collection efforts in the affected regions. Inventory at June 30, 2026, was $58 million, up slightly from last quarter-end. Inventory turns for the quarter were 1.8 and remained the same compared to last quarter. With continued focus, we anticipate inventory turns will gradually improve as we progress through the remainder of 2026. And now to the liability side of the balance sheet. Our long-term debt was $116.4 million as of June 30, 2026, and considering cash of $22.7 million, net debt was $93.6 million, which decreased slightly from the last quarter. Our leverage ratio is currently at 1.3 compared to 1.2 last quarter. Our debt is currently comprised of $65 million in senior notes, a term loan of $49.4 million and $2 million outstanding under our bank credit facility. Looking at cash flow. For the second quarter of 2026, cash flow from operating activities was $7.8 million, and after paying approximately $4.7 million of CapEx for operations, our free cash flow for the quarter was $3.1 million. Cash from operations almost doubled this quarter when you compare it to the first quarter. However, our capital expenditures were also higher. The elevated capital expenditures are primarily associated with investments to support a recently signed multi-year contract in the Asia-Pacific region and rebuilding our facilities in the Mediterranean region, which incurred weather-related damage in the first quarter. As discussed in prior quarters, the capital expenditures associated with rebuilding our U.K. facility, which was damaged by fire are covered by the company's property and casualty insurance and have been excluded in the calculation of free cash flow. In the second quarter of 2026, capital expenditures associated with rebuilding the U.K. facility were $1.1 million. Looking ahead to the rest of the year, we will continue our strict capital discipline and asset-light business model with capital expenditures primarily targeted at growth opportunities. Excluding the CapEx associated with rebuilding the U.K. facility, we expect capital expenditures for the full year of 2026 to be in the range of $15 million to $18 million. Core Lab's operational leverage continues to provide the ability to grow revenue and profitability with minimal capital requirements. Capital expenditures for operations has historically ranged from 2% to 4% of revenue, even during periods of significant growth. That same level of laboratory infrastructure, intellectual property, and leverage exists in the business today. We believe evaluating a company's ability to generate free cash flow and free cash flow yield is an important metric for shareholders when comparing and projecting companies' financial results, particularly for those shareholders who utilize discounted cash flow models to assess valuations. I will now turn it over to Gwen for an update on our guidance and outlook. Gwendolyn Schreffler: Thank you, Chris. Turning to Core Lab's outlook for the third quarter of 2026. As a result of the ongoing conflicts in the Middle East and Russia, Ukraine, the IEA, the EIA, and OPEC have all revised their respective 2026 global crude oil demand forecast to reflect the impact of higher energy prices, constrained product availability, and interruptions to global hydrocarbon trade and transportation. While near-term demand has been negatively impacted by the ongoing conflict, the agencies all project demand growth will rebound in 2027. The long-term need for investment in new resources of global crude oil production and initiatives to maximize recovery from existing producing fields remains strong. Accelerating decline rates from existing producing fields, together with geopolitical uncertainty, reinforce the importance of energy security and geographically diversified resources of hydrocarbon supply. Collectively, these factors expect to support continued client investment in hydrocarbon development and new exploration. Despite client activity headwinds from the 2 ongoing geopolitical conflicts, Core expects third quarter revenue to increase sequentially, supported by improvement in several international regions, including the South Atlantic margin and Asia-Pacific. Recent escalations in both the Middle East and Russia, Ukraine conflict are expected to continue affecting client operations, project timing, and logistics across portions of these regions during the third quarter, with greater impact to Reservoir Description and the service component of Production Enhancement compared to the company's completion product business. U.S. land completion activity is expected to improve modestly as the third quarter 2026 progresses. Core Lab expects growing adoption of its diagnostic services, reservoir optimization technologies, and proprietary energetic systems to outperform U.S. land completion activity. Longer-term international projects, including offshore developments and emerging exploration plays, are expected to create additional growth opportunities. While the timing of recovery in certain Middle East markets remains difficult to predict, Core believes long-term fundamentals support future growth in exploration activity levels. The company's international footprint, proprietary technologies, and expertise support Core Lab to capitalize on opportunities across global markets. In summary, Reservoir Description's third quarter 2026 revenue is projected to range from $81 million to $84 million, with operating income of $5.5 million to $7.9 million. Production Enhancement's third quarter revenue is estimated to range from $47.5 million to $51.5 million, with operating income of $4.8 million to $6.9 million. Core's third quarter 2026 revenue is projected to range from $128.5 million to $135.5 million, with operating income of $10.5 million to $15 million, yielding operating margins of approximately 10%. EPS for the third quarter is expected to range from $0.12 to $0.20. The company's guidance is based on projections for underlying operations and excludes gains and losses in foreign exchange and assumes an effective tax rate of 25%. With that, I'll turn the call back over to Larry. Lawrence Bruno: Thanks, Gwen. First, I'd like to recognize our employees in the Middle East, whose professionalism, resilience, and unwavering support to our clients have been especially evident throughout the recent geopolitical conflict. I'd also like to thank our entire global team of employees for their continued commitment to innovation, integrity, and exceptional service to our clients. For 90 years, our employees' collective expertise and dedication has been the foundation of Core Lab's success. Looking at the macro, while global energy markets continue to navigate geopolitical uncertainty, evolving trade policies and commodity price volatility, the IEA, EIA, and OPEC are revising their near-term forecast for oil demand. They are also projecting demand growth to rebound by approximately 1.7 million to 2 million barrels per day in 2027, supporting constructive long-term market fundamentals. The U.S. EIA's long-term reference case forecast shows crude oil demand growth continuing through 2050, approaching 120 million barrels per day. Increases in demand will require more than incremental production growth from existing fields. New supply must also be brought online to replace the natural decline from producing fields. The IEA estimates that absent investment, global oil production would decline by approximately 8% per year due to natural field depletion. As a result, they conclude that a significant portion of global upstream capital spending is required to sustain existing production before addressing any incremental growth. The IEA also noted that nearly 90% of upstream investment since 2019 has been directed toward maintaining existing production rather than expanding overall supply. Recent draws in global crude oil inventory in both commercial storage and strategic reserves provide another indication of the need for sustained investment. Inventory draws have helped balance recent supply disruptions resulting from the closure of the Strait of Hormuz, but those volumes will ultimately need to be replenished as the market works to restore adequate supply capacity and support long-term energy security. The most recent EIA short-term outlook projects U.S. crude oil production to average approximately 13.8 million barrels per day in 2026, increasing only modestly from 2025, with only slight additional growth expected in 2027. Taken together, forecasted global demand growth and accelerating decline rates from existing producing fields, along with the need to replenish global inventories and moderating incremental U.S. production growth, reinforce the need for sustained investment in new discoveries. Collectively, these trends, together with renewed concerns about energy security, reinforce the need for a geographically diverse investment cycle encompassing new hydrocarbon exploration, appraisal, and development of international conventional offshore fields. Furthermore, there will be a growing need for additional investment in existing producing fields to mitigate natural decline. Core Lab's global reach, proprietary technologies and specialized technical expertise offer clients critical advantages to optimize their assets. Now let's review the second quarter performance of our 2 business segments. Turning first to Reservoir Description. For the first quarter of 2026, revenue came in at $79 million, down 4% compared to Q1 of 2026. Operating income for Reservoir Description, ex items, was $3.7 million, down from $4.8 million in Q1, yielding operating margins of 5%. Sequential margins were primarily impacted by reduced assay work resulting from disruptions to crude oil and derived product cargo movements through the Strait of Hormuz, along with delayed project execution and reduced client activity across the Middle East. In addition, expanded sanctions and military action against oil and gas infrastructure also negatively impacted the company's operations in Ukraine and Russia. These geopolitical headwinds were partially offset by continued investment in reservoir characterization programs that are supporting international exploration, appraisal and development projects in other regions. Now for some operational highlights from Reservoir Description. During the second quarter of 2026, even as portions of our business remain affected by geopolitical disruptions, clients continued to rely on Core Lab's specialized technical expertise and global laboratory network system. Core Lab saw growth in international reservoir characterization activity, securing project work on new offshore exploration and appraisal projects, as well as carbon capture and storage projects across several regions. In particular, activity across West Africa continued to grow during the second quarter, reinforcing a broad trend of increasing international offshore projects. Core Lab was engaged by a major international operator to support reservoir characterization activities following a successful offshore Namibia exploration well. Also, during the second quarter of 2026, Core Lab initiated a reservoir characterization program supporting Murphy Oil's recently announced discovery offshore Cote d’Ivoire. Following recovery operations at the well site, core samples were transported to Core Lab's Houston Advanced Technology Center for accelerated analysis using the company's proprietary Dual Energy CT technology. Core Lab is very pleased to be assisting Murphy Oil in its Cote d'Ivoire project. Turning to North America, the company's specialized laboratory capabilities are also helping operators improve recovery from existing producing assets. Utilizing proprietary laboratory technologies, Core Lab's Advanced Technology Center in Calgary is supporting a heavy oil operator with laboratory testing of solvent-assisted thermal recovery techniques. Using innovative proprietary steam flood laboratory technologies, Core Lab replicated subsurface conditions and was able to show how oil production progressed while transitioning from low salinity brine injection to a steam flood, while also incrementally introducing solvents as temperatures rose. The integrated testing program continuously measured oil recovery, permeability, and potential formation damage. The results provided the operator with critical data to evaluate the effectiveness of various solvent injection systems, allowing them to maximize oil recovery. Moving now to Production Enhancement, where Core Lab's technologies continue to help our clients optimize their well completions and improve production. Revenue for Production Enhancement for the second quarter of 2026 came in at $46 million, up 15% sequentially and 5% year-over-year. Q2 2026 operating income for Production Enhancement ex items was $5 million, yielding operating margins of 12%, with sequential incremental margins of 59%. While U.S. completion activity improved modestly during the quarter, many operators continued to emphasize capital discipline, maintaining their original 2026 execution plans. The demand for Core Lab's advanced completion technologies remained strong, driven by both improved energetic product sales across both the U.S. and international markets, as well as increased market penetration for diagnostic services. Now for some operational highlights from Production Enhancement. During the second quarter, operators across several U.S. unconventional basins continued to deploy Core Lab's newly commercialized InPulse perforating technology. InPulse incorporates a proprietary energetic material that generates a secondary pressure pulse immediately following the initial perforation event. This technology improves near-wellbore connectivity and reduces breakdown pressures, leading to faster stage execution and improved completion efficiency. As commercialization continues, growing deployment among existing Core Lab clients is supporting increased product adoption and creating opportunities to expand the technology across North American unconventional plays. InPulse has applications in domestic and international markets, in both conventional and unconventional reservoirs, and for geothermal wells. Application for Core's completion diagnostic services are also expanding. During the second quarter, an operator in West Texas utilized Core's FLOWPROFILER oil and water tracer technology to identify the highest quality landing intervals before committing to specific lateral targets. Following a successful tracer-backed appraisal program in the vertical borehole, the operator deployed tracers into selected horizontal wells, where stage-by-stage diagnostics identified the highest producing completion intervals. Elsewhere, a major operator in Louisiana utilized the company's gas tracer technology to evaluate production performance across extended length horizontal laterals. The diagnostics confirmed that the completion design had produced sustained gas contribution from the toe of the well, increasing confidence in the development of this long lateral. Core Lab's diagnostic technology also supported a leading independent operator in Western Canada in evaluating a complex multilateral water shutoff program. Core's diagnostic technologies confirmed that water was bypassing the isolation packer, providing definitive evidence that allowed the operator to refine the completion design. Collectively, these diagnostic projects demonstrate the expanding role of Core Lab's proprietary tracer technologies across the unconventional development cycle, from reservoir appraisal and completion optimization, as well as production surveillance and even water management programs. That concludes our operational review. We appreciate your participation, and Alan will now open the call for questions. Operator: [Operator Instructions] Our first question today comes from Don Crist of Johnson Rice. Donald Crist: I wanted to start on the assay work. Obviously, the Middle East is a large portion of worldwide shipments of oil, and you're being influenced by both that and Ukraine/Russia. But I wanted to see how much you're seeing a pickup in movement of oil in other parts of the world. In other words, if 25% or 30% of your business was out of those 2 regions, how much has the rest of the world picked up with movements out of the U.S. or other places? Any color there? Lawrence Bruno: Yes. Good I don't have in front of me the breakdown by region. But I can tell you that we look at pre-conflict cargo movements versus post-conflict cargo movements, and those are down 16% globally. And so you can imagine, one of the things I think it's important to convey here is we have revenue opportunities on both sides of a transaction. So a cargo ship that might be loading in the Middle East, we have an opportunity there. And then if that cargo makes landfall in North America or Europe, we have an opportunity there. So we kind of get it at both ends, unfortunately, with the shipments not getting out of the Strait of Hormuz. The other thing I think is important, and we touched on it during our commentary is with the volatility in the situation, we're trying to do what we can to minimize costs without disassembling the experience and the staff that we have to do this, because things change, and we don't want to discharge all these folks and then have to try to bring them back or rebuild the organization. So we're doing the best we can, given the volatility, but we'll continue to stay focused on maximizing efficiency in the operation and making sure we're running as cost effectively as possible. Chris Hill: Right. The only other point I would say, too, Larry, is that when these conflicts flare up and then the oil price starts jumping all over the place, that also slows down the activity when you're talking about moving trading, primarily oil. So the trader part of that comes to a stop because they can't predict future oil prices. So it has an immediate impact on that. Gwendolyn Schreffler: And maybe just one comment. Sorry, Don, maybe just one add-on to that, the Russia, Ukraine situation. We are executing during the quarter a cost reduction plan for that business. Donald Crist: Okay. But you're testing SPR oil there, too, right, that's coming out of the various places around the world? Lawrence Bruno: Yes, if there's stuff going into the transportation network around the globe, we get a bite at that apple. Donald Crist: Right. Okay. That's what I wanted to clarify. Lawrence Bruno: Yes. Whether it's coming out of an SPR or whether it's coming out of a tank somewhere. Donald Crist: Okay. And then on the offshore side, the comments that I've heard most recently from other operators is there's more conviction today in projects moving forward than they've seen in the past, where operators may be testing pricing or other kind of factors. Are you seeing more conviction in your customer calls today that these offshore projects that we've been predicting for a couple of years now are moving forward? Are you seeing that as well? Lawrence Bruno: Yes, don, I think that's very true. I think -- I'll call it the intensity of the conversations have picked up. But the comment we made before, we actually saw that starting to happen as back into 2025 and ran into a string of dry holes where we had committed work, a substantial amount of committed work ready to go and client said, hey, didn't find anything, stand down. And so, we talked about some of the projects that we're engaged with right now on discoveries, obviously another client to be successful, when they're in their exploration efforts. But I think things are lining up for a very nice rebound in activity on offshore reservoir characterization projects late this year, but certainly into 2027. Donald Crist: Right. Okay. And then one final one for me. A couple of quarters back, you had talked about a project or a product that in the U.S. was boosting recoveries, but it had to be done on the initial completion. Is that this InPulse product that you talked about this quarter? Lawrence Bruno: Well, I'm not quite sure. So there's 2 topics that might cover that. One is InPulse, which we just talked to again here, where that's a perforating or an energetic technology that kind of pre-stimulates the near wellbore area so that the charge goes off, penetrates the casing, and then right behind that, and I can't remember whether it's milliseconds or microseconds at the moment, a very powerful secondary charge rubblizes the area in the near wellbore. And the feedback we got from our clients were that, that was reducing their breakdown time, their time to rate, as they refer to it, the time to get the maximum rate. The other thing that might fit into your conversation there is enhanced oil recovery, which is a laboratory process. We've got a number of tests going on for clients that look at ways to increase the recovery rate out of unconventional reservoirs. And the commentary about having to be done early on is one of the keys in making that work is to maximize surface area in the near wellbore area. If you have a lot of penetrations and you rubblize the area around the near wellbore, that increased surface area allows for better thermodynamic interaction and the enhanced oil recovery process of either swelling the oil in place or evaporation, or vaporization and condensation, 2 different techniques takes place. But they both benefit from how you've stimulated the well. And so we've got projects going on both. We've got growing acceptance of InPulse charges, and we've got engagement with several clients on these EOR processes where we're validating the thermodynamic processes that will work. Now, with those EOR projects, in both cases, containment is an issue that we can't help the clients with. Can they introduce a gas into the reservoir and have it go to work where they want it? Or is it gonna run down faults or extended fracs and disappear into the subsurface? That's something that we can't really help them with. Donald Crist: Right. Okay. Well, everybody's looking for more recovery, so I'm sure both of those products will gain traction. So I appreciate the color, guys. I'll turn it back. Lawrence Bruno: Yes. Thanks, Don. We published a few things a while back on the vaporization and condensation technique, if people want to go look that up. Operator: Our next question comes from Sean Mitchell of Daniel Energy Partners. Sean Mitchell: Any color, Larry, just additional color around the UAE regulatory approval for SpectraStim and SpectraScan? Obviously, that was notable in the press release. Any additional color there? And then any additional read-through from your peers this week, in OFS land around kind of normalization of the Middle East? Anything that's corroborating with what your own opinion it might be or different? Lawrence Bruno: So on the UAE, the technology that we're talking about there involve using isotopes. And so it's a technique that we are using in some other parts of the Middle East, where we've got licensing. We've been doing work for ADNOC and other UAE folks for a while, but now we have another tool in our belt, if you will, to address other diagnostics. So that regulatory door is now open for us. We can now store on-site and we can deploy them into the field to help diagnose what's going on. In terms of what we're seeing in the Middle East, it's not just the assay work, there's also the subsurface reservoir characterization work that's being impacted as well as completion diagnostics in at least 2 countries, I'm thinking off the top of my head, that where field operations got suspended. What we saw happen was there was tankers -- when the ceasefire was announced, we saw the tankers start to take on more cargo, and some started to leave the region. But not as many as people might have hoped. And we can track that. We've got independent sources that track the tanker movements that we subscribe to. We monitor that. And then on the subsurface projects, things were starting to pick up. Think of this as more of the upstream applications that we engage with. Things were starting to pick up. Clients were looking at getting back in the field with us so that we could start getting samples from the well site, and that's now pulled back some. Sean Mitchell: Got it. Maybe one other follow-on to Don's comment just on customer interest. What we've heard a lot lately is just more exploration. We actually have heard it a couple of times over the last several weeks from E&P companies. And just wondering like outside of the Middle East, is the phone starting to ring more and more on kind of exploration in general? That seems to be coming up more and more today. Lawrence Bruno: Yes. No question about it. Like I said, it started ringing a while back for us, and unfortunately, a sort of failure to launch for us. We got kind of left at the dock. But Africa is clearly picking up. Brazil and the South Atlantic margin picking up and Asia Pacific also picking up for us. And there's a couple places I can't talk about yet that will raise some eyebrows if and when those projects come to fruition. And hopefully, we'll be able to talk about those in the coming quarters. Operator: The next question comes from Sophia Vallecillo of Bank of America. Sophia Vallecillo: I just wanted to ask over the guide a little bit. So obviously, you're guiding sequential growth. And is any of that coming from normalization in the Middle East or Russia, Ukraine? Or is all of that growth coming from the geomarkets you mentioned, completely offsetting the geopolitical impacts? Gwendolyn Schreffler: For Reservoir Description, Sophia, we're projecting that to be up mid-single digits and driven by Africa, Brazil, Asia Pacific, and parts of Europe, like Larry mentioned. So I would say ex-Middle East, although we are seeing some marginal improvement with how projects are moving along, the subsurface projects are moving along in the Middle East. And then for Production Enhancement, we're projecting that to be up mid-single to low-double digits and that's driven by what we think will be a modest improvement on U.S. land. We think operators will continue their capital spending plans for 2026, so not as sensitive to the volatility in the commodity prices. And then we also expect our international product business to be up slightly sequentially as well. Then that's going to be driven by the Eastern Hemisphere and Africa. Sophia Vallecillo: Okay. And then is there any sort of visibility into 4Q yet, or is it way too early? Gwendolyn Schreffler: I think it's a little early for that given the... Lawrence Bruno: Tell us when the war's gonna end. Yes, sophia, I think Gwen covered it very well there. What I might add to that a little bit is we obviously felt like we had to dial in contingencies for what does the upside look like if things come to a conclusion sooner in the Middle East? Or what does it look like if things come to fruition later in resolving the Middle East conflict? So that's somewhat we felt sort of compelled to give a pretty wide range there to try to cover the eventualities. We try to be as transparent as we can, and what we see is upside and downside on that. And then the other one for us, and we're -- Chris mentioned, we're working -- I think -- I'm sorry, Gwen mentioned, we're working hard on it. There's a lot of complications in navigating the situations in Russia, Ukraine. We're getting squeezed kind of from both sides there. Different governments telling us opposing things we can and can't do. And so that's also challenging to navigate. There were some dramatic images over the second quarter of explosions at Russian storage facilities, for example, and in the Ukraine as well. And we have operations in both countries and that's presenting some uncertainty and challenges for us, too. On top of that, the sanctions got reinforced. I think the U.S. did it in the fourth quarter and then Europe came in the first -- late first quarter and also enhanced sanctions. So that's also tying our hands on who we can and can't work for. All right. I think we'll wrap up there. In summary, Core's operational leadership continues to position the company for improving client activity levels in the incoming -- in the coming quarters and years. For 9 decades, through many cycles, Core Lab has successfully navigated changing industry dynamics, geopolitical uncertainty and global market disruptions by remaining focused on innovation, operational excellence and serving our clients. Core Lab is well-positioned, both operationally and technologically to help our global client base optimize reservoir performance and address their evolving needs. Our focus on differentiated technologies, scientific expertise, and client collaboration continues to distinguish the company across the oil field service sector. The company will remain focused on maximizing free cash and returns on invested capital. In addition to our quarterly dividend, we'll bring value to our shareholders via growth opportunities, driven by both the introduction of problem-solving technologies and new market penetration. In the near term, Core will continue to use free cash to repurchase shares while preserving its strong balance sheet. In closing, we thank and appreciate all of our shareholders and the analysts that cover Core Lab. The executive management team and the board of Core Laboratories give a special thanks to our worldwide employees that have made these results possible. We're proud to be associated with their continuing achievements. So thanks for spending time with us and we look forward to our next update. Goodbye for now. Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. Before you buy stock in Core Laboratories, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Core Laboratories wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* Now, it’s worth noting Stock Advisor’s total average return is 953% — a market-crushing outperformance compared to 214% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Core Laboratories (CLB) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

The Williams Companies, Inc. WMB reported second-quarter 2026 adjusted earnings per share of 50 cents, which missed the Zacks Consensus Estimate of 52 cents. However, the bottom line increased from the year-ago period’s level of 46 cents, driven by better-than-expected performance of its Transmission, Power & Gulf, Northeast G&P and West segments. The Tulsa, OK-based oil and gas storage and transportation company’s revenues of $3 billion missed the Zacks Consensus Estimate by $2 million. The figure increased by 9.8% from the year-ago quarter’s reported revenues. This can be attributed to higher service revenues and increased product sales. Williams Companies, Inc. (The) price-consensus-eps-surprise-chart | Williams Companies, Inc. (The) Quote Adjusted EBITDA totaled $1.9 billion in the quarter under review, which was up 6% year over year. Cash flow from operations amounted to $1.4 billion, down 5.1% from the corresponding quarter of 2025. Williams Companies has agreed to acquire Momentum Midstream in a deal worth up to $5.5 billion, strengthening its Haynesville footprint and expanding its integrated natural gas infrastructure to meet rising Gulf Coast LNG, power and industrial demand. Momentum adds more than 4,000 miles of pipelines, 6 Bcf/d gathering capacity and key processing assets, with the deal expected to boost AFFO and EPS. Williams Companies also announced the Delta Aces and Shelby Trough Connector expansions, positioning the company to capture growing natural gas demand and enhance basin connectivity. Transmission, Power & Gulf: The segment reported an adjusted EBITDA of $959 million, up 6.2% from the year-ago quarter’s level. The increase was driven by contributions from projects placed in service, new Gulf volumes and higher storage revenues. However, the figure missed the Zacks Consensus Estimate by 2.5%. Northeast G&P: Driven primarily by higher volumes at Ohio Valley Midstream and higher proportional EBITDA from Blue Racer Midstream and Bradford within Appalachia Midstream, this segment registered an adjusted EBITDA of $540 million. This represents a 7.8% increase from $501 million in the year-earlier quarter. It beat the Zacks Consensus Estimate of $518 million. West: This segment focuses on the gathering and processing of assets in the Western United States. Adjusted EBITDA for this segment totaled $359 million, up 5.3% from the prior-year quarter’s level of $341 million. Strong results were fueled by Louisiana Energy Gateway, placed into service in third-quarter 2025, as well as higher gathering volumes, including contributions from the 2025 Rimrock and Saber acquisitions. However, the figure missed the Zacks Consensus Estimate of $389 million. Gas & NGL Marketing Services: The segment posted a negative adjusted EBITDA of $1 million, narrowing down from the year-ago negative EBITDA of $15 million, resulting from higher gas marketing margins due to winter storms. The Zacks Consensus Estimate for the same was pegged at a negative $7.27 million. Other: This segment posted an adjusted EBITDA of $64 million, representing a 17.9% decrease from $78 million in the year-earlier quarter, caused by unfavorable changes in net realized results from upstream operations, including the impact of the divested South Mansfield interests. However, the figure beat the Zacks Consensus Estimate of $57 million. In the reported quarter, total costs and expenses of $1.9 billion increased by about 2% from the year-ago quarter’s figure. Total capital expenditure (capex) was $1.8 billion. As of June 30, 2026, this Zacks Rank #3 (Hold) company had cash and cash equivalents of $203 million and long-term debt of $28.1 billion, with a debt-to-capitalization of 64.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Williams Companies raised its 2026 guidance and now expects adjusted EBITDA of $8.3-$8.5 billion, with growth capital expenditures projected at $7.3-$7.9 billion. Factoring in the pro forma contribution from the Momentum Midstream acquisition over the past four quarters, the company expects its 2026 leverage ratio to be approximately 3.75x at the midpoint. The growth capex and debt-to-adjusted EBITDA guidance exclude certain reimbursable long-lead equipment costs. While we have discussed WMB’s second-quarter results in detail, let us take a look at three other key reports in this space. Expand Energy Corporation EXE reported second-quarter 2026 adjusted earnings per share of $1.33, beating the Zacks Consensus Estimate of $1.22. The company’s bottom line increased from the year-ago adjusted profit of $1.10 per share, fueled by strong production and lower operating expenses. Expand Energy’s ‘natural gas, oil and NGL’ revenues of $1.8 billion missed the Zacks Consensus Estimate of $2 billion. The top line was also below the year-ago figure of $2 billion. As of June 30, 2026, the company had $663 million in cash and cash equivalents. Expand Energy had a long-term debt of $3.7 billion, reflecting a debt-to-capitalization of 16%. NOV Inc. NOV reported second-quarter 2026 adjusted earnings of 31 cents per share, which beat the Zacks Consensus Estimate of 16 cents. The bottom line also increased 6.9% from the year-ago quarter’s 29 cents, driven by outperformance of the Energy Equipment segment. The oil and gas equipment and services company’s total revenues of $2.1 billion beat the Zacks Consensus Estimate by $39 million. However, NOV’s revenues fell 2.5% from the year-ago quarter’s figure of $2.2 billion due to lower year-over-year revenues from the Energy Products and Services segment. As of June 30, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.7 billion with a debt-to-capitalization of 21.3%. Core Laboratories Inc. CLB reported second-quarter 2026 adjusted earnings of 11 cents per share, which beat the Zacks Consensus Estimate of 8 cents, driven by outperformance of the Production Enhancement segment. However, the bottom line decreased from the year-ago quarter’s reported figure of 19 cents due to the underperformance of the Reservoir Description segment and increased costs and expenses. This oilfield service provider reported second-quarter operating revenues of $124.6 million, missing the Zacks Consensus Estimate of $128 million and decreasing from the earlier-year quarter’s reported figure of $130.1 million. This can be attributed to military conflicts in the Middle East and the Russia-Ukraine region, which disrupted energy infrastructure, delaying projects, disrupting crude oil trade and reducing demand for the company's international laboratory services. As of June 30, 2026, the company had cash and cash equivalents of $22.7 million and long-term debt of $113.9 million. CLB’s debt-to-capitalization was about 29%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Williams Companies, Inc. (The) (WMB) : Free Stock Analysis Report Core Laboratories Inc. (CLB) : Free Stock Analysis Report NOV Inc. (NOV) : Free Stock Analysis Report Expand Energy Corporation (EXE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Diamondback Energy, Inc. FANG reported second-quarter 2026 adjusted earnings per share (EPS) of $6.48, which beat the Zacks Consensus Estimate of $5.96 and more than doubled from the year-ago adjusted profit of $2.67. The outperformance was driven by production growth and a 53.1% improvement in the year-over-year realized oil prices. This Midland, TX-based oil and gas exploration and production company’s revenues of $5.6 billion increased more than 51% from the year-ago quarter and topped the Zacks Consensus Estimate by about 17%, fueled primarily by higher sales of oil, natural gas and natural gas liquids, increased sales of purchased oil and higher revenues from other operating income. Diamondback Energy, Inc. price-consensus-eps-surprise-chart | Diamondback Energy, Inc. Quote In the second quarter of 2026, Diamondback Energy generated free cash flow and adjusted free cash flow of $2.3 billion. Over the same period, it bought back nearly 756,385 common shares for roughly $141 million at an average price of $186.63 per share, excluding excise taxes. In July, the board of directors increased the company's share repurchase authorization from $8 billion to $16 billion, effectively doubling the program's capacity. Following this increase, approximately $9.9 billion remains available for future share repurchases under the authorization. FANG’s board of directors approved a base quarterly dividend of $1.10 per common share for the second quarter of 2026, payable on Aug. 20 to its stockholders of record on Aug. 13. FANG’s production of oil and natural gas averaged 1,017,659 barrels of oil equivalent per day (BOE/d), comprising 51.6% oil. The figure was up 10.6% from the year-ago quarter and beat our model estimate of 969,519.9 BOE/d. While crude and natural gas output increased 5.9% and 16.5% year over year, respectively, natural gas liquids volumes climbed 15.7%. The average realized oil price during the quarter was $96.82 per barrel, 53.1% higher than the year-ago realization of $63.23. The figure also beat our estimate of $66.12 per barrel. Meanwhile, the average realized natural gas price decreased to a negative $2.15 per thousand cubic feet from 88 cents in the prior year. The figure was also below our model estimate of 60 cents. Overall, the upstream oil and gas company fetched $51.68 per barrel compared with $39.61 a year ago. Diamondback Energy’s second-quarter cash operating cost was $10.96 per BOE compared with $10.10 in the prior-year quarter and our estimate of $12.56. The increase in costs compared with the year-ago period reflected a rise in lease operating expenses to $5.96 per BOE from $5.26 in the second quarter of 2025 and an increase in Production and ad valorem taxes to $3.26 per BOE from $2.56 in the prior-year quarter. However, FANG’s gathering, processing and transportation expenses decreased 29.5% year over year to $1.22 per BOE. Cash G&A expenses also fell in the second quarter of 2026 to 52 cents per BOE from 55 cents in the corresponding period of 2025. Diamondback Energy logged $996 million in capital expenditure — spending $842 million on operated drilling and completion additions to oil and natural gas properties, and $154 million on non-operated additions. The company booked $2.3 billion in adjusted free cash flow in the second quarter. As of June 30, the Permian-focused operator had approximately $462 million in cash and cash equivalents and $11.1 billion in long-term debt, representing a debt-to-capitalization of 20.1%. Diamondback Energy updated its 2026 guidance by raising its full-year oil production outlook to more than 522 MBO/d, up from the previous guidance of more than 520 MBO/d, and increasing its total production forecast to over 1,000 MBOE/d from more than 972 MBOE/d. The company maintained its full-year cash capital expenditure guidance at approximately $3.9 billion. For the third quarter of 2026, this Zacks Rank #3 (Hold) company expects oil production to range between 517 MBO/d and 527 MBO/d, with total combined production projected at 995-1,015 MBOE/d. Third-quarter cash capital expenditures are expected to be between $950 million and $1.05 billion. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. While we have discussed FANG’s second-quarter results in detail, let us take a look at three other key reports in the energy space. Expand Energy Corporation EXE reported second-quarter 2026 adjusted earnings per share of $1.33, beating the Zacks Consensus Estimate of $1.22. The company’s bottom line increased from the year-ago adjusted profit of $1.10 per share, fueled by strong production and lower operating expenses. Expand Energy’s ‘natural gas, oil and NGL’ revenues of $1.8 billion missed the Zacks Consensus Estimate of $2 billion. The top line was also below the year-ago figure of $2 billion. As of June 30, 2026, the company had $663 million in cash and cash equivalents. Expand Energy had a long-term debt of $3.7 billion, reflecting a debt-to-capitalization of 16%. NOV Inc. NOV reported second-quarter 2026 adjusted earnings of 31 cents per share, which beat the Zacks Consensus Estimate of 16 cents. The bottom line also increased 6.9% from the year-ago quarter’s 29 cents, driven by outperformance of the Energy Equipment segment. The oil and gas equipment and services company’s total revenues of $2.1 billion beat the Zacks Consensus Estimate by $39 million. However, NOV’s revenues fell 2.5% from the year-ago quarter’s figure of $2.2 billion due to lower year-over-year revenues from the Energy Products and Services segment. As of June 30, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.7 billion with a debt-to-capitalization of 21.3%. Core Laboratories Inc. CLB reported second-quarter 2026 adjusted earnings of 11 cents per share, which beat the Zacks Consensus Estimate of 8 cents, driven by outperformance of the Production Enhancement segment. However, the bottom line decreased from the year-ago quarter’s reported figure of 19 cents due to the underperformance of the Reservoir Description segment and increased costs and expenses. This oilfield service provider reported second-quarter operating revenues of $124.6 million, missing the Zacks Consensus Estimate of $128 million and decreasing from the earlier-year quarter’s reported figure of $130.1 million. This can be attributed to military conflicts in the Middle East and the Russia-Ukraine region, which disrupted energy infrastructure, delaying projects, disrupting crude oil trade and reducing demand for the company's international laboratory services. As of June 30, 2026, the company had cash and cash equivalents of $22.7 million and long-term debt of $113.9 million. CLB’s debt-to-capitalization was about 29%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Diamondback Energy, Inc. (FANG) : Free Stock Analysis Report Core Laboratories Inc. (CLB) : Free Stock Analysis Report NOV Inc. (NOV) : Free Stock Analysis Report Expand Energy Corporation (EXE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Oilfield services company Core Laboratories (NYSE:CLB) fell short of the market’s revenue expectations in Q2 CY2026, with sales falling 4.3% year on year to $124.6 million. Its non-GAAP profit of $0.11 per share was 26.9% above analysts’ consensus estimates. Is now the time to buy CLB? Find out in our full research report (it’s free). Revenue: $124.6 million vs analyst estimates of $126.3 million (4.3% year-on-year decline, 1.3% miss) Adjusted EPS: $0.11 vs analyst estimates of $0.09 (26.9% beat) Operating Margin: 7.3%, down from 9.8% in the same quarter last year Market Capitalization: $455 million Core Laboratories' second quarter was defined by ongoing geopolitical disruptions, most notably the military conflict in the Middle East and escalated tensions in Russia and Ukraine, which led to project delays and logistical challenges. Management identified that these conflicts primarily affected the Reservoir Description segment, where delays in crude assay work and reduced maritime hydrocarbon movement weighed on results. CEO Lawrence Bruno stated, "The closure of the Strait of Hormuz and the widespread disruption to maritime hydrocarbon transportation routes extends beyond the Middle East region." Despite these challenges, the company benefited from improved energetic product sales and continued adoption of advanced completion technologies, especially within the Production Enhancement segment. Looking ahead, Core Laboratories expects sequential revenue growth driven by recovery in select international markets such as Africa, Brazil, and Asia-Pacific, as well as continued operator adoption of its proprietary technologies. Management emphasized that while geopolitical risks remain, emerging offshore developments and increased exploration activity are likely to create new opportunities. Senior Vice President Gwendolyn Schreffler noted, "Core’s international footprint, proprietary technologies, and expertise support us to capitalize on opportunities across global markets." The company also remains focused on maintaining a lean organization and disciplined capital deployment to navigate uncertainty. Management attributed the quarter’s performance to the impact of ongoing geopolitical conflicts, offset by growth in select international markets and new technology adoption. Geopolitical disruptions: The company faced significant operational headwinds from the conflicts in the Middle East and Russia/Ukraine, leading to delays in field operations, crude assay work, and access to client facilities, especially for Reservoir Description services. Production Enhancement resilience: Despite disruptions, the Production Enhancement segment saw sequential revenue and margin improvement due to increased operator adoption of Core's advanced completion technologies, particularly in the U.S. and international markets. Technology-driven sales: The commercialization of InPulse perforating technology and expanded use of diagnostic services such as FLOWPROFILER and gas tracers contributed to higher demand and improved completion efficiency for clients in unconventional basins. Cost management focus: Management executed cost reduction initiatives in conflict-affected regions, maintaining operating efficiency while preserving technical expertise and the company’s global network to support client needs. International growth pockets: Client engagement and new project wins in West Africa, Asia-Pacific, and South Atlantic margin helped offset declines in regions impacted by conflict, with notable projects including reservoir characterization for Murphy Oil offshore Côte d’Ivoire and increased offshore exploration activity. Management anticipates that the normalization of international activity and ongoing technology adoption will drive sequential growth, while persistent geopolitical uncertainty remains a headwind. International market recovery: The company expects improved client activity, particularly in Africa, Brazil, Asia-Pacific, and parts of Europe, to support sequential revenue growth, even as the Middle East and Russia/Ukraine remain volatile. Continued technology deployment: Management is focused on expanding adoption of proprietary diagnostic and completion technologies, such as InPulse and tracer services, which are seen as key differentiators both domestically and internationally. Geopolitical and regulatory risks: The outlook remains sensitive to further developments in global conflicts and newly reinforced sanctions, especially as evolving regulations in Russia and Ukraine create operational uncertainty and could impact project timing and logistics. In the coming quarters, StockStory analysts will monitor (1) the pace of recovery in international markets outside the Middle East and Russia/Ukraine, (2) the rate of customer adoption for Core Laboratories’ diagnostic and completion technologies, and (3) the company’s ability to manage costs and navigate regulatory challenges in conflict-affected regions. Progress in offshore exploration and new project wins will also be key factors to watch. Core Laboratories currently trades at $10.32, up from $9.85 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively. Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.

Core Laboratories Inc. CLB reported second-quarter 2026 adjusted earnings of 11 cents per share, which beat the Zacks Consensus Estimate of 8 cents, driven by outperformance of the Production Enhancement segment. However, the bottom line decreased from the year-ago quarter’s reported figure of 19 cents due to the underperformance of the Reservoir Description segment and increased costs and expenses. This oilfield service provider reported second-quarter operating revenues of $124.6 million, missing the Zacks Consensus Estimate of $128 million and decreasing from the earlier-year quarter’s reported figure of $130.1 million. This can be attributed to military conflicts in the Middle East and the Russia-Ukraine region, which disrupted energy infrastructure, delaying projects, disrupting crude oil trade and reducing demand for the company's international laboratory services. Core Laboratories Inc. price-consensus-eps-surprise-chart | Core Laboratories Inc. Quote During the second quarter, CLB repurchased 214,712shares of common stock for a total of $2.7 million. The company’s debt leverage ratio was at 1.30 and net debt decreased by $0.5 million. Reservoir Description: Revenues in this segment decreased 8.7% from the year-ago quarter to $78.7 million. Moreover, the top line missed our model estimation of $82 million. Operating income decreased from $12.2 million in the year-ago period to $3.7 million and missed our estimate of $6 million, caused by three primary factors: reduced client activity in the Middle East, lower global crude assay activity resulting from disruptions to hydrocarbon cargo shipments and increased military action and expanded European sanctions associated with the Russia-Ukraine conflict. Production Enhancement: This segment’s revenues increased 4.5% to $45.9 million from $43.9 million in the prior-year quarter. Moreover, the top line beat our model estimate of $45.6 million. Operating income increased from $3.1 million in the year-ago period to $5.2 million and beat our model estimate of $2 million. The outperformance in the Production Enhancement segment can be attributed to improvement in U.S. completion activity and increased product sales in both the U.S. and international markets. CLB reported total costs and expenses of $115.5 million in the second quarter, increasing by 0.5% from the year-ago quarter’s level of $114.9 million. Our estimation for the metric was $118.6 million. As of June 30, 2026, the company had cash and cash equivalents of $22.7 million and long-term debt of $113.9 million. CLB’s debt-to-capitalization was about 29%. Net cash provided by operating activities in the second quarter totaled $7.8 million, while capital expenditure amounted to $4.7 million. This led to a positive free cash flow of $3.1 million. Core Laboratories’ board of directors approved a quarterly dividend of 1 cent per share to its common shareholders of record as of Aug. 10, 2026. The payout, which remains unchanged from the previous quarter, will be made on Aug. 31. Ongoing conflicts in the Middle East and Russia-Ukraine prompted the IEA, EIA and OPEC to lower their 2026 global oil demand forecasts due to higher energy prices, supply disruptions and trade constraints. However, all three agencies expect demand growth to recover in 2027. Core Laboratories believes the long-term need for new production and enhanced recovery remains intact, supported by declining output from mature fields, energy security concerns and diversified hydrocarbon supply. The company expects third-quarter revenues to rise sequentially, aided by improving activity in the South Atlantic Margin and Asia-Pacific, despite continued geopolitical disruptions affecting project execution and logistics. Modest improvement in U.S. land completions, growing adoption of its reservoir technologies and diagnostics, and expanding international offshore and exploration projects are expected to support long-term growth. For the third quarter of 2026, CLB expects revenues to range from $128.5 million to $135.5 million. Operating income is anticipated to be between $10.5 million and $15 million, with earnings per share expected to be between 12 cents and 20 cents. Revenues for the Reservoir Description segment are anticipated to be between $81 million and $84 million, with operating income ranging from $5.5 million to $7.9 million. Revenues for the Production Enhancement segment are expected to be between $47.5 million and $51.5 million, with operating income predicted to be between $4.8 million and $6.9 million. The company anticipates an effective tax rate of 25% for the third quarter. Its guidance for the third quarter of 2026 is based on estimates for underlying operations and excludes any gains or losses from foreign exchange. During the second quarter of 2026, Core Laboratories expanded its technology-driven reservoir evaluation and completion capabilities through several high-value projects across Asia-Pacific, Africa and the Middle East. In Australia, the company deployed its Advanced Digital Imaging System (ADIS) to analyze reservoir rock samples for an onshore gas project, integrating the results into its proprietary RAPID™ database to accelerate reservoir interpretation. Offshore Namibia, CLB applied advanced laboratory technologies to characterize geological and petrophysical properties, supporting more accurate reservoir models and reducing exploration risk. The company also launched a reservoir characterization program for Murphy Oil's offshore Côte d’Ivoire discovery using its Dual Energy CT technology. In Asia-Pacific, Core Laboratories enabled a national oil company to establish in-house Tubing Conveyed Perforating capabilities through equipment supply and technical training. Additionally, regulatory approvals in the UAE for SpectraStim™ proppant tracing and SpectraScan® spectral gamma ray logging broadened the company's reservoir optimization offerings, strengthening its position in a key Middle Eastern energy market. Core Laboratoriescurrently has a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. While we have discussed CLB’s second-quarter results in detail, let us take a look at three other key reports in the Oil/Energy space. Expand Energy Corporation EXE reported second-quarter 2026 adjusted earnings per share of $1.33, beating the Zacks Consensus Estimate of $1.22. The company’s bottom line increased from the year-ago adjusted profit of $1.10 per share, fueled by strong production and lower operating expenses. Expand Energy’s ‘natural gas, oil and NGL’ revenues of $1.8 billion missed the Zacks Consensus Estimate of $2 billion. The top line was also below the year-ago figure of $2 billion. As of June 30, 2026, the company had $663 million in cash and cash equivalents. Expand Energy had a long-term debt of $3.7 billion, reflecting a debt-to-capitalization of 16%. NOV Inc. NOV reported second-quarter 2026 adjusted earnings of 31 cents per share, which beat the Zacks Consensus Estimate of 16 cents. The bottom line also increased 6.9% from the year-ago quarter’s 29 cents, driven by outperformance of the Energy Equipment segment. The oil and gas equipment and services company’s total revenues of $2.1 billion beat the Zacks Consensus Estimate by $39 million. However, NOV’s revenues fell 2.5% from the year-ago quarter’s figure of $2.2 billion due to lower year-over-year revenues from the Energy Products and Services segment. As of June 30, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.7 billion with a debt-to-capitalization of 21.3%. Liberty Energy Inc. LBRT reported a second-quarter 2026 adjusted net profit of 9 cents per share, beating the Zacks Consensus Estimate of 7 cents. The outperformance was driven by the company’s focus on AI-driven technology advancements and strong operational execution. However, the bottom line decreased from the year-ago quarter’s profit of 12 cents due to increased year-over-year costs and expenses. LBRT's revenues totaled $1.2 billion, which beat the Zacks Consensus Estimate of $1.1 billion. The top line also increased from the prior-year quarter’s $1 billion by 14%, supported by record utilization and a modest pricing uplift along with higher product sales. As of June 30, Liberty Energy had approximately $555.4 million in cash and cash equivalents. The pressure pumper’s long-term debt of $1.3 billion represented a debt-to-capitalization of 39.5%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Core Laboratories Inc. (CLB) : Free Stock Analysis Report NOV Inc. (NOV) : Free Stock Analysis Report Liberty Energy Inc. (LBRT) : Free Stock Analysis Report Expand Energy Corporation (EXE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Core Laboratories Inc.? Here are five stocks we like better. Core Laboratories’ Q2 revenue rose 2% sequentially to $124.6 million, although it fell 4% year over year as geopolitical conflicts disrupted Reservoir Description services. Production Enhancement revenue grew 15% sequentially, supported by stronger completion-product sales and improved margins. Adjusted EPS increased to $0.11 from $0.06 in the prior quarter, while free cash flow reached $3.1 million. The company repurchased $2.7 million of shares and ended the quarter with $93.6 million in net debt. Management forecast Q3 revenue of $128.5 million to $135.5 million and adjusted diluted EPS of $0.12 to $0.20, with growth expected from Africa, Brazil, Asia-Pacific, Europe and modestly improving U.S. completion activity despite ongoing geopolitical risks. MarketBeat ‘Stock of the Week’: Halliburton Is One Slick Oil Play Core Laboratories (NYSE:CLB) reported second-quarter 2026 revenue of $124.6 million, up more than 2% from the prior quarter but down 4% from a year earlier, as stronger completion-product sales partly offset disruptions to its service business from conflicts in the Middle East and Russia-Ukraine. Chief Executive Officer Larry Bruno said the company continued to invest in technologies aimed at solving client problems and expanding its market opportunities, despite project delays, logistical disruptions and reduced activity in affected regions. Reservoir Description, the segment most exposed to field operations, crude transportation and sample acquisition, faced the greatest effects from the conflicts and the closure of the Strait of Hormuz. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now “Operating conditions improved in several other geographic markets during the second quarter, and client engagement strengthened outside the Middle East,” Bruno said. He added that Production Enhancement was comparatively less affected, with energetic product sales improving as operators adopted the company’s completion technologies in U.S. and international markets. Core Lab’s service revenue was $94.3 million, flat sequentially and down 2% from the second quarter of 2025. Chief Financial Officer Chris Hill said crude assay services and regional studies remained affected by geopolitical disruptions, though growth in other regions offset part of the decline. The company also cited improving demand for reservoir rock and fluid analytical programs in international exploration markets and continued strength in U.S. completion diagnostic services. → Microsoft Just Flipped the AI Spending Narrative Overnight Product sales totaled $30.3 million, rising 10% from the first quarter but declining 11% year over year. Hill said both U.S. and international completion product sales increased from the prior quarter. The year-over-year comparison reflected a large laboratory instrumentation sale in the prior-year quarter that did not recur, partially offset by stronger perforating-product sales. EBIT excluding items was $9.4 million, compared with $6.6 million in the first quarter, producing an approximately 8% margin. Net income excluding items was $5.1 million, up from $2.7 million sequentially but down from $8.8 million a year earlier. Adjusted diluted earnings per share were $0.11, compared with $0.06 in the first quarter and $0.19 a year earlier. On a GAAP basis, net income was $6 million and diluted EPS was $0.13. Reservoir Description generated $79 million in second-quarter revenue, down 4% sequentially, with operating income excluding items of $3.7 million and a 5% operating margin. Bruno said disruptions to cargo movements through the Strait of Hormuz, delayed project execution and reduced activity across the Middle East weighed on assay work and margins. Expanded sanctions and military action affecting oil and gas infrastructure in Russia and Ukraine also created headwinds. → Carrier Earnings Could Send the Stock to a New All-Time High Production Enhancement revenue rose 15% sequentially and 5% year over year to $46 million. Operating income excluding items was $5 million, producing a 12% margin, compared with a 5% margin in the prior quarter. The improvement reflected higher energetic-product sales, increased adoption of proprietary completion technologies and manufacturing efficiencies, according to management. Cash flow from operating activities was $7.8 million, nearly double the first-quarter level, while capital expenditures for operations totaled about $4.7 million. Free cash flow was $3.1 million for the quarter. The company said elevated capital spending supported a recently signed multiyear Asia-Pacific contract and the rebuilding of Mediterranean facilities damaged by weather in the first quarter. Separately, Core Lab spent $1.1 million rebuilding a U.K. facility damaged by fire; those expenditures were covered by property and casualty insurance and excluded from its free-cash-flow calculation. At June 30, the company had $116.4 million in long-term debt and $22.7 million in cash, resulting in net debt of $93.6 million. Its leverage ratio was 1.3, compared with 1.2 in the previous quarter. Core Lab repurchased more than 214,000 shares, valued at $2.7 million, during the quarter, marking its seventh consecutive quarter of buybacks. Bruno said the company intends to continue using free cash flow for its quarterly dividend, growth investments and opportunistic repurchases while maintaining its balance sheet. Management highlighted growing activity in offshore reservoir characterization, including work in West Africa, Namibia and Côte d’Ivoire. Core Lab began a reservoir characterization program supporting Murphy Oil’s offshore Côte d’Ivoire discovery, using its Dual Energy CT technology at its Houston Advanced Technology Center. The company also cited expanded deployment of its InPulse perforating technology in U.S. unconventional basins. Bruno said the technology produces a secondary pressure pulse after the initial perforation event, which is intended to improve near-wellbore connectivity, reduce breakdown pressures and support faster completion-stage execution. In the United Arab Emirates, Core Lab received regulatory approval related to its SPECTRASTIM and SPECTRASCAN technologies, according to Bruno. He said the approval allows the company to store and deploy isotopes locally for diagnostic applications. During the question-and-answer session, Bruno said offshore activity was gaining momentum in Africa, Brazil, the South Atlantic margin and Asia-Pacific. However, he noted that the timing of a broader recovery remains uncertain because of geopolitical conditions and prior exploration disappointments. Core Lab expects third-quarter revenue of $128.5 million to $135.5 million and operating income of $10.5 million to $15 million, implying an operating margin of about 10%. The company projected diluted EPS of $0.12 to $0.20, excluding foreign-exchange gains and losses and assuming a 25% effective tax rate. Reservoir Description revenue is expected to range from $81 million to $84 million, while Production Enhancement revenue is expected to be $47.5 million to $51.5 million. Gwen Gresham, senior vice president and head of investor relations, said expected sequential growth is primarily tied to Africa, Brazil, Asia-Pacific, parts of Europe, modestly improving U.S. land completion activity and international product sales. Management said the Middle East and Russia-Ukraine conflicts are expected to continue affecting project timing, logistics and client operations in the third quarter, with a greater impact on Reservoir Description and the service component of Production Enhancement than on its completion-product business. Core Laboratories N.V. is a global provider of proprietary and patented reservoir description and production enhancement services to the oil and gas industry. The company applies specialized expertise in core and fluid analysis, advanced petrophysical interpretation, and reservoir engineering to optimize hydrocarbon recovery. By integrating laboratory testing with field services and digital analytics, Core Laboratories delivers insights that help operators maximize production and extend the life of their assets. The company's portfolio spans two primary service lines: reservoir description and production enhancement. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Core Laboratories Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Core Laboratories Inc. CLB shares lost 47.1% in the past 6 months, in contrast to the Oil and Gas - Field Services industry’s rise of 3.9%. The shares of the company trades near a depressed level after a sharp selloff, but the investment case is not one-sided. Image Source: Zacks Investment Research The stock offers a lower valuation, an asset-light model and improving technology adoption in Production Enhancement. Those positives must be weighed against falling earnings, geopolitical disruptions and limited near-term visibility. CLB’s share price of $10.35 compares with a 6-12 month price target of $13. The discount points to potential upside, but the longer-term view remains measured because operating recovery is still uneven. The stock trades at 0.79X forward 12-month sales, below its five-year median of 1.58X. Its trailing 12-month enterprise value-to-earnings before interest, taxes, depreciation and amortization multiple is 8.07X, also below the five-year median of 13.99X. Valuation is helpful, but stronger earnings execution is needed to make the discount more convincing. Image Source: Zacks Investment Research Core Lab reported second-quarter 2026 adjusted earnings of 11 cents per share, above expectations of 8 cents. The result still declined from 19 cents in the year-ago quarter. Revenues fell 4.3% year over year to $124.6 million. Six-month operating income declined 44% to $11 million, while the current-year earnings estimate moved 4.5% lower over the past four weeks. SLB SLB, a larger oilfield technology peer, provides a relevant comparison for investors tracking offshore and international spending cycles. Halliburton Company HAL is another key services peer because its completions exposure overlaps with activity trends that influence CLB’s Production Enhancement business. Core Lab’s asset-light model remains central to the bull case. Low capital spending requirements and service-oriented operations help the company preserve cash during uneven industry conditions. Second-quarter free cash flow was $3.1 million. CLB also paid its quarterly dividend and repurchased 214,712 shares for $2.7 million, marking the seventh consecutive quarter of buybacks. Net debt decreased by $0.5 million during the quarter, but modest cash generation limits how quickly the company can reduce debt while funding dividends, repurchases and growth investments. Potential catalysts remain tied to international exploration, offshore activity and wider use of proprietary technologies. Production Enhancement revenues rose 15% sequentially and 5% year over year, with operating margins reaching 12%. Core Lab secured work tied to projects in Australia, Namibia and Côte d’Ivoire. It also received regulatory approval to deploy SpectraStim and SpectraScan technologies in the United Arab Emirates. Still, Reservoir Description revenues fell 9% year over year, with margins of 5%, as Middle East activity, crude assay work and Russia-Ukraine-related sanctions pressured demand. The bottom line is that CLB looks cheaper after the selloff, but the stock still requires patience. A valuation reset alone does not remove earnings volatility or geopolitical exposure. The stock currently carries a Zacks Rank #4 (Sell). That rank tempers the appeal of a Value Score of B because weaker estimate revisions remain a concern. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. CLB also has a Growth Score of D, Momentum Score of C and VGM Score of D. The Style Scores suggest value characteristics are more favorable than growth and broader blended factors, but a weak Zacks Rank keeps the near-term setup cautious until revisions and operating momentum improve. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Core Laboratories Inc. (CLB) : Free Stock Analysis Report SLB Limited (SLB) : Free Stock Analysis Report Halliburton Company (HAL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: July 30, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Production enhancement revenue increased 15% sequentially and 5% year-over-year, with operating margins improving to 12% from 5% in Q1 2026. Core Laboratories Inc (NYSE:CLB) continued its share repurchase program for the seventh consecutive quarter, buying back over 214,000 shares for $2.7 million. The company secured new international reservoir characterization projects in West Africa, Namibia, and Cote d'Ivoire, supporting offshore exploration growth. Commercialization of the proprietary impulse perforating technology is gaining traction, reducing breakdown pressures and improving completion efficiency for clients. Free cash flow generation improved to $3.1 million in Q2 2026, nearly doubling from the prior quarter, with a strong balance sheet and net debt of $93.6 million. Reservoir description revenue declined 4% sequentially and 9% year-over-year, with operating margins falling to 5% due to geopolitical disruptions. Ongoing military conflict in the Middle East and the closure of the Strait of Hormuz caused project delays and logistical disruptions, impacting crude assay work. Escalating attacks on energy infrastructure and expanded sanctions in Russia and Ukraine created additional headwinds, reducing service revenue. Global crude oil cargo movements declined 16% post-conflict, directly reducing revenue opportunities for Core Laboratories Inc (NYSE:CLB)'s assay services. Third-quarter 2026 guidance includes a wide revenue range of $128.5 million to $135.5 million, reflecting uncertainty from geopolitical conflicts and potential further disruptions. Here are the key highlights from the Core Laboratories Inc (NYSE:CLB) Q2 2026 earnings call, presented as Q&A pairs. Warning! GuruFocus has detected 3 Warning Sign with CLB. Is CLB fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide more color on the impact of the Middle East conflict on your crude assay business and whether you are seeing a pickup in oil movements from other parts of the world to offset this?A: (Larry Bruno, Chairman and CEO) The conflict has significantly impacted global cargo movements, which are down 16% globally. We have revenue opportunities on both ends of a transaction (loading and landing), so the disruption from the Strait of Hormuz closure is a major headwind. While we are trying to minimize costs without disassembling our experienced staff, the volatility in oil prices also slows down trading activity. We are not seeing a full offset from other regions. Q: Are you seeing more conviction from your customers regarding offshore projects moving forward, as some other operators have suggested?A: (Larry Bruno, Chairman and CEO) Yes, the intensity of conversations has definitely picked up. We saw this starting in 2025, but it was interrupted by a string of dry holes. Now, things are lining up for a very nice rebound in offshore reservoir characterization activity, likely late this year and certainly into 2027. Q: Regarding the guidance for Q3, is the projected sequential growth coming from a normalization in the Middle East and Russia/Ukraine, or is it entirely from other geographies offsetting the geopolitical impacts?A: (Gwen Gresham, SVP, Head of Investor Relations) The growth is primarily driven by other regions. For Reservoir Description, we project mid single-digit growth driven by Africa, Brazil, Asia Pacific, and parts of Europe, though we are seeing marginal improvement in Middle East subsurface projects. For Production Enhancement, growth is driven by a modest improvement in US land and an uptick in international product sales from the Eastern Hemisphere and Africa. Q: Can you provide any additional color on the new regulatory approval for diagnostic technologies in the UAE?A: (Larry Bruno, Chairman and CEO) The technologies involve using isotopes for diagnostics. While we have been doing work for ADNOC and other UAE clients, this new regulatory door allows us to store and deploy these tools on-site in the field, adding another diagnostic tool to our capabilities in the region. Q: Outside of the Middle East, is the phone starting to ring more for exploration work?A: (Larry Bruno, Chairman and CEO) No question about it. Africa is clearly picking up, as is the South Atlantic margin (Brazil) and Asia Pacific. There are also a couple of other places we can't discuss yet that will raise eyebrows when projects come to fruition. Q: You mentioned a product that boosts recoveries but must be done on the initial completion. Is that the "Impulse" technology discussed this quarter?A: (Larry Bruno, Chairman and CEO) That could be one of two topics. "Impulse" is a perforating technology that pre-stimulates the near-wellbore area, reducing breakdown time. The other is enhanced oil recovery (EOR) processes, which also benefit from maximizing surface area in the near-wellbore area during initial completion. We have growing acceptance for both technologies. Q: Do you have any visibility into the fourth quarter, or is it too early?A: (Larry Bruno, Chairman and CEO) It's a little early. We felt compelled to give a wide guidance range for Q3 to cover the eventualities of the Middle East conflict resolving sooner or later. Additionally, navigating the complicated and evolving situations in Russia and Ukraine, including conflicting government directives and enhanced sanctions, presents significant uncertainty. Q: Can you elaborate on the cost reduction plan for the Russia/Ukraine business mentioned during the call?A: (Chris Hill, CFO) Yes, we are executing a cost reduction plan for that specific business during the quarter to manage the impact of the ongoing conflict and sanctions. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Core Laboratories (CLB) came out with quarterly earnings of $0.11 per share, beating the Zacks Consensus Estimate of $0.08 per share. This compares to earnings of $0.19 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +37.50%. A quarter ago, it was expected that this energy services company would post earnings of $0.06 per share when it actually produced earnings of $0.06, delivering no surprise. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Core Laboratories, which belongs to the Zacks Oil and Gas - Field Services industry, posted revenues of $124.61 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 2.31%. This compares to year-ago revenues of $130.16 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Core Laboratories shares have lost about 33.3% since the beginning of the year versus the S&P 500's gain of 8.5%. While Core Laboratories has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Core Laboratories was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.18 on $130.98 million in revenues for the coming quarter and $0.53 on $517.88 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Oil and Gas - Field Services is currently in the bottom 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Drilling Tools International Corp. (DTI), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This company is expected to post quarterly loss of $0.04 per share in its upcoming report, which represents a year-over-year change of -100%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Drilling Tools International Corp.'s revenues are expected to be $38.16 million, down 3.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Core Laboratories Inc. (CLB) : Free Stock Analysis Report Drilling Tools International Corp. (DTI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Geopolitical conflict in the Middle East significantly impacted Reservoir Description due to the closure of the Strait of Hormuz, which disrupted maritime hydrocarbon transportation and crude assay service demand. Production Enhancement demonstrated resilience with 15% sequential revenue growth, driven by increased operator adoption of proprietary completion technologies like InPulse in both U.S. and international markets. Management is executing a cost-reduction plan in the Russia-Ukraine region to mitigate headwinds from escalating infrastructure attacks and evolving international sanctions. The company is pivoting toward growth in unaffected regions, specifically noting increased client engagement and project wins in West Africa, Brazil, and the Asia-Pacific region. Operational margins in Production Enhancement expanded by over 700 basis points sequentially, benefiting from higher product sales and the resolution of prior tax matters. Global upstream investment trends show that nearly 90% of spending since 2019 has been directed toward maintaining existing production rather than expanding overall supply. Strategic focus remains on three financial tenets: maximizing free cash flow, maximizing return on invested capital, and returning excess cash to shareholders through dividends and buybacks. Third quarter revenue is projected to increase sequentially, supported by a rebound in international regions including the South Atlantic margin and Asia-Pacific. Management anticipates a significant rebound in offshore reservoir characterization projects starting late 2026 and accelerating into 2027 as exploration activity intensifies. Capital expenditure for the full year 2026 is expected to range between $15 million and $18 million, primarily targeted at growth opportunities in the Asia-Pacific and Mediterranean regions. The company assumes a 25% effective tax rate for the third quarter, though results remain sensitive to the geographic mix of earnings and geopolitical volatility. Guidance for the third quarter includes a wide range to account for uncertainties regarding the duration of the Middle East conflict and its impact on global cargo movements. The company repurchased 214,000 shares for $2.7 million in Q2, marking the seventh consecutive quarter of share buybacks. Elevated Q2 capital expenditures were driven by a new multi-year contract in Asia-Pacific and rebuilding facilities in the Mediterranean following weather damage. Ongoing conflicts in Russia and Ukraine present complex regulatory challenges, with management navigating opposing directives from different governments regarding permissible operations. A partial refund of import tariffs incurred in prior periods contributed to the sequential improvement in cost of sales for the second quarter. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Global cargo movements are down approximately 16% compared to pre-conflict levels, affecting revenue opportunities at both loading and offloading points. Management is retaining experienced staff despite volatility to ensure the organization is ready for a rapid recovery when shipping lanes normalize. While some 2025 projects were delayed by 'dry holes,' management reports that the intensity of client conversations regarding new offshore exploration has increased significantly. Growth is specifically noted in Namibia and Cote d’Ivoire, with expectations for a broader rebound in 2027. The InPulse technology uses a secondary pressure pulse to rubblize the near-wellbore area, which reduces breakdown time and improves completion efficiency for operators. This technology is being integrated with enhanced oil recovery (EOR) studies to help maximize surface area for better thermodynamic interaction in unconventional reservoirs. Core Labs received regulatory approval to use isotopes for SpectraStim and SpectraScan services in the UAE. This allows the company to store materials on-site and provides a new diagnostic 'tool in the belt' for major clients like ADNOC.