What changed in this filing

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Item 1. Financial Statements

2024-07-29 compared with 2024-04-26 · 102 added, 78 removed, 386 unchanged (32% of the section changed)

33 unchanged sentences

1 billion shares authorized;

395,503,573 and 393,945,659 shares issued and outstanding at March 31, 2024 and December 31, 2023

393,706,882 and 393,945,659 shares issued and outstanding at June 30, 2024 and December 31, 2023

Additional paid-in capital

9 unchanged sentences

Three Months Ended

Six Months Ended

Cost of revenue

13 unchanged sentences

See notes to unaudited consolidated financial statements.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(In millions)

Three Months Ended

Six Months Ended

Currency translation adjustments

7 unchanged sentences

(In millions)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

Adjustments to reconcile net income to net cash used in

Adjustments to reconcile net income to net cash provided by (used in)

operating activities:

3 unchanged sentences

Equity income in unconsolidated affiliates

Dividend from unconsolidated affiliate

Stock-based compensation

Gain on business divestiture

Change in operating assets and liabilities, net of acquisitions

6 unchanged sentences

Other assets/liabilities, net

Net cash used in operating activities

Net cash provided by (used in) operating activities

Cash flows from investing activities:

1 unchanged sentence

Business acquisitions, net of cash acquired

Business divestitures, net of cash disposed

Net cash used in investing activities

1 unchanged sentence

Borrowings against lines of credit and other debt

Payments against lines of credit and other debt

Cash dividends paid

Share repurchases

Financing leases

Net cash provided by (used in) financing activities

Net cash used in financing activities

Effect of exchange rates on cash

Decrease in cash and cash equivalents

Increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of period

18 unchanged sentences

Balance at March 31, 2024

Other comprehensive loss

Cash dividends, $ 0.075 per common share

Transactions with non-controlling interests

Stock-based compensation

Share repurchases

Balance at June 30, 2024

Shares Issued

11 unchanged sentences

Balance at March 31, 2023

Other comprehensive income, net

Cash dividends, $ 0.05 per common share

Stock-based compensation

Balance at June 30, 2023

See notes to unaudited consolidated financial statements.

6 unchanged sentences

In our opinion, the consolidated financial statements include all adjustments, which are of a normal recurring nature unless otherwise disclosed, necessary for a fair presentation of the results for the interim periods.

The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year.

The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for the full year.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported and contingent amounts of assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the reporting period.

18 unchanged sentences

Amounts reclassified from accumulated other comprehensive

Balance at March 31, 2024

Balance at June 30, 2024

The components of amounts reclassified from accumulated other comprehensive loss are as follows (in millions):

Three Months Ended March 31,

Three Months Ended June 30,

Cost of revenue

1 unchanged sentence

Selling, general and administrative

Six Months Ended June 30,

Cost of revenue

Other expense

Selling, general and administrative

The Company’s reporting currency is the U.S.

3 unchanged sentences

The movement in other comprehensive income (loss) from period to period will be the combination of:

1) changes in fair value of open derivatives of ($ 2 ) million during the three months ended March 31, 2024 ;

and, 2) the outflow of other comprehensive loss related to cumulative changes in the fair value of derivatives that have settled in the current period were $ 2 million the three months ended March 31, 2024 .

1) changes in fair value of open derivatives of $ 2 million and zero during the three and six months ended June 30, 2024 ;

and, 2) the outflow of other comprehensive loss related to cumulative changes in the fair value of derivatives that have settled in the current period, which were zero and $ 2 million the three and six months ended June 30, 2024 .

Effective January 1, 2024, NOV consolidated its reporting structure into two segments:

3 unchanged sentences

Three Months Ended

Six Months Ended

Energy Products and Services

10 unchanged sentences

Intrasegment transactions are eliminated within each segment.

Total other items included in operating profit for the three months ended March 31, 2024 and March 31, 2023 , were a pre-tax credit of $ 3 million and $ 4 million, respectively, primarily related to gains on sale of previously reserved inventory.

Business Combinations

During the first quarter of 2024, our Energy Products and Services segment made two strategic acquisitions to enhance and expand our existing portfolio for a total consideration of $ 243 million, net of cash acquired.

One of the two acquisitions involved White Deer Energy, a middle market private equity fund focused on energy investments.

Total other items included in operating profit were a credit of $ 118 million and $ 121 million for the three and six months ended June 30, 2024, primarily related to gains from divestiture of its Pole Products business, and a credit of $ 7 million and $ 11 million for the three and six months ended June 30, 2023, primarily related to gains on the sale of previously reserved inventory.

Acquisitions and Divestitures

During the first half of 2024, our Energy Products and Services segment made two strategic acquisitions to enhance and expand our existing portfolio for a total consideration of $ 245 million, net of cash acquired.

One of the two acquisitions was a company owned by White Deer Energy, a middle market private equity fund focused on energy investments.

As the transaction involved a related party at the time it was entered into (e.g., directors Ben A.

1 unchanged sentence

Mattson both had an investment interest in certain White Deer Energy funds), the acquisition was approved by the disinterested members of the Company’s Board of Directors.

At March 31, 2024, we provisionally recorded $ 112 million of goodwill and amortizable intangible assets;

As of June 30, 2024 , we provisionally recorded $ 126 million of goodwill and amortizable intangible assets;

$ 63 million of PP&E, including financing and operating lease right of use assets;

$ 89 million of net working capital;

and $ 17 million of finance and operating lease liabilities.

$ 16 million of finance and operating lease liabilities, and $ 17 million in other liabilities.

The fair values of the assets acquired and liabilities assumed are preliminary and subject to change until we finalize our accounting for these acquisitions.

On April 9, 2024, NOV completed the divestiture of its Pole Products business.

Pole Products is a leading manufacturer of premium spun-cast concrete and tapered steel poles for diverse applications.

We recorded a gain of $ 131 million, which is included as a reduction of Cost of Revenue on the Consolidated Statements of Income.

During the second quarter, the Company purchased the remaining noncontrolling interest in Keystone Tower Systems (KTS) for total consideration of $ 30 million.

Disaggregation of Revenue

2 unchanged sentences

and Canada (in millions):

Three Months Ended March 31,

Three Months Ended June 30,

North America

International

Six Months Ended June 30,

North America

International

Performance Obligations

Net revenue recognized from performance obligations satisfied in previous periods was $ 6 million for the three months ended March 31, 2024 primarily due to change orders.

Net revenue recognized from performance obligations satisfied in previous periods was $ 8 million for the three months ended June 30, 2024 primarily due to change orders.

Remaining performance obligations represent the transaction price of firm orders for all revenue streams for which work has not been performed on contracts with original expected duration of one year or more.

We do not disclose the remaining performance obligations of royalty contracts, service contracts for which there is a right to invoice, and short-term contracts that are expected to have a duration of one year or less.

As of March 31, 2024 , the aggregate amount of the transaction price allocated to remaining performance obligations was $ 4,267 million.

The Company expects to recognize approximately $ 1,079 million in revenue for the remaining performance obligations in 2024 and $ 3,188 million in 2025 and thereafter.

As of June 30, 2024 , the aggregate amount of the transaction price allocated to remaining performance obligations was $ 4,691 million.

Although numerous factors can affect timing of revenue recognized on performance obligations, such as customer change orders and supplier accelerations or delays, the Company expects to recognize approximately $ 778 million in revenue for the remaining performance obligations in 2024 , $ 1,316 million in 2025 , $ 801 million in 2026 , and $ 1,796 million thereafter .

Contract Assets and Liabilities

5 unchanged sentences

Currency translation adjustments and other

Balance at March 31, 2024

Balance at June 30, 2024

Royalty Revenue

The Company recognizes royalty revenue due under various licenses for the Company's intellectual property, including for technology related to drill bits.

The Company recognized revenue for drill bit licenses of approximately $ 16 million for the three months ended March 31, 2024 , and $ 20 million for the three months ended March 31, 2023.

The Company recognized revenue for drill bit licenses of approximately $ 17 million and $ 33 million for the three and six months ended June 30, 2024 , and $ 21 million and $ 41 million for the three and six months ended June 30, 2023.

The Company is currently pursuing litigation against certain non-paying licensees, which will impact our ability to collect the receivables timely.

As such, revenue and the related receivables are recorded at a discount to reflect the delayed timing of future cash collections.

As of March 31, 2024 , the receivables of $ 84 million, net of allowances of $ 13 million for credit losses and $ 20 million for the remaining timing related discount, are included in Other assets on the Consolidated Balance Sheets.

As of June 30, 2024 , the receivables of $ 96 million, net of allowances of $ 17 million for credit losses and $ 18 million for the remaining timing related discount, are included in Other assets on the Consolidated Balance Sheets.

These allowances do not impact the amount the Company is entitled to recover on its claims from the licensees in litigation.

While we continue to believe it is probable the Company will collect all or substantially all of the consideration

to which it is entitled pursuant to the terms of the licensing agreements, the Company will also continue to evaluate the credit quality of the receivables.

While we continue to believe it is probable the Company will collect all or substantially all of the consideration to which it is entitled pursuant to the terms of the licensing agreements, the Company will also continue to evaluate the credit quality of the receivables.

See Note 15 for discussion of the ongoing litigation.

2 unchanged sentences

The Company’s customer base, mostly in the oil and gas industry, have generally similar collectability risk characteristics, although larger and state-owned customers may have lower risk than smaller independent customers.

As of March 31, 2024, the allowance for credit losses totaled $ 75 million.

As of June 30, 2024 , the allowance for credit losses totaled $ 73 million.

The changes in the carrying amount of the allowance for credit losses are as follows (in millions):

2 unchanged sentences

Recoveries collected

Balance at March 31, 2024

Balance at June 30, 2024

The Company leases certain facilities and equipment to support its operations around the world.

19 unchanged sentences

The credit facility contains a financial covenant regarding maximum debt-to-capitalization ratio of 60 %.

As of March 31, 2024, the Company was in compliance with a debt-to-capitalization ratio of 24.5 % and had $ 50 million of outstanding borrowings under the facility, resulting in $ 1.95 billion of available funds.

As of June 30, 2024, the Company was in compliance with a debt-to-capitalization ratio of 23.6 % and had no outstanding borrowings or letters of credits issued under the facility, resulting in $ 2.0 billion of available funds.

A consolidated joint venture of the Company borrowed $ 120 million against a $ 150 million bank line of credit for the construction of a facility in Saudi Arabia.

1 unchanged sentence

The bank line of credit contains a financial covenant regarding maximum debt-to-equity ratio of 75 %.

As of March 31, 2024 , the joint venture was in compliance.

As of June 30, 2024 , the joint venture was in compliance.

The facility construction was completed in the fourth quarter of 2022, and the joint venture will not have future borrowings on the line of credit.

The line of credit repayment schedule began in December 2022 with final payment no later than June 2032 .

As of March 31, 2024 , the Company has $ 104 million in borrowings related to this line of credit.

As of June 30, 2024 , the Company has $ 99 million in borrowings related to this line of credit.

The carrying value of debt under the Company’s consolidated joint venture approximates fair value because the interest rates are variable and reflective of current market rates.

1 unchanged sentence

The Company can repay the entire outstanding facility balance without penalty at its sole discretion.

Other debt at March 31, 2024 included $ 34 million of funding provided by minority interest partners of NOV consolidated joint ventures, of which $ 3 million is due in the next twelve months.

The Company had $ 472 million of outstanding letters of credit at March 31, 2024, primarily in Norway and the United States, that are under various bilateral letter of credit facilities.

Other debt at June 30, 2024 included $ 61 million of amounts owed to current and former minority interest partners of NOV consolidated joint ventures, of which $ 14 million is due in the next twelve months.

The Company had $ 457 million of outstanding letters of credit at June 30, 2024, primarily in Norway and the United States, that are under various bilateral letter of credit facilities.

Letters of credit are issued as bid bonds, advanced payment bonds and performance bonds.

At March 31, 2024 and December 31, 2023, the fair value of the Company’s unsecured Senior Notes approximated $ 1,380 million and $ 1,316 million, respectively.

At June 30, 2024 and December 31, 2023 , the fair value of the Company’s unsecured Senior Notes approximated $ 1,288 million and $ 1,316 million, respectively.

The fair value of the Company’s debt is estimated using Level 2 inputs in the fair value hierarchy and is based on quoted prices for those of similar instruments.

At March 31, 2024 and December 31, 2023 , the carrying value of the Company’s unsecured Senior Notes approximated $ 1,587 million and $ 1,586 million, respectively.

The effective tax rate for the three months ended March 31, 2024 was 26.7 %, compared to 13.8 % for the same period in 2023.

The effective tax rate for 2024 was negatively impacted by a mix of earnings in higher tax rate jurisdictions, losses in certain jurisdictions with no tax benefit, and a shortfall related to previously recognized stock compensation deductibility, partially offset by the reduction of valuation allowances related to U.S.

At June 30, 2024 and December 31, 2023 , the carrying value of the Company’s unsecured Senior Notes approximated $ 1,587 million and $ 1,586 million, respectively.

The effective tax rate for the three and six months ended June 30, 2024 was 23.9 % and 24.9 %, respectively, compared to 10.8 % and 12.1 % for the same period in 2023.

The effective tax rate for 2024 was negatively impacted by a mix of earnings in higher tax rate jurisdictions, losses in certain jurisdictions with no tax benefit, and adjustments to the carrying value of deferred tax assets, partially offset by the reduction of valuation allowances related to U.S.

and state deferred tax assets.

The effective tax rate for 2023 was positively impacted by the utilization of previously unrealized loss carryforwards and tax credits as well as favorable adjustments related to changes in certain exchange rates, partially offset by losses in certain jurisdictions with no tax benefit.

The effective tax rate for 2023 was positively impacted by the utilization of previously unrealized loss carryforwards and tax credits as well as favorable adjustments related to changes in certain exchange rates, partially offset by current year losses in certain jurisdictions with no tax benefit.

Stock-Based Compensation

4 unchanged sentences

The NOV Plan is also subject to a fungible ratio concept, such that the issuance of stock options and stock appreciation rights reduces the number of available shares under the NOV Plan on a 1-for-1 basis, and the issuance of other awards reduces the number of available shares under the NOV Plan on a 1.5-for-1 basis.

At March 31, 2024, approximately 7.6 million shares remained available for future grants under the NOV Plan.

At June 30, 2024 , approximately 7.7 million shares remained available for future grants under the NOV Plan.

The Company also has outstanding awards under its former stock-based compensation plan known as the National Oilwell Varco, Inc.

Long-Term Incentive Plan (the “Former Plan”), however the Company is no longer granting new awards under the Former Plan.

On February 6, 2024, under the NOV Plan, the Company granted 1,110,478 stock options with a fair value of $ 7.90 per option and an exercise price of $ 17.52 per share;

2,571,356 restricted stock units with a fair value of $ 17.52 per share;

and performance share awards (PSAs) to senior management employees with potential payouts varying from zero to 1,061,644 shares.

The stock options vest over a three-year period from the grant date.

The restricted stock units vest in three equal annual installments commencing on the first anniversary of the grant date.

The 2024 PSAs can be earned based on performance against two established goals over a three-year period:

85 % with a TSR (total shareholder return) goal and 15 % with an internal NVA (“NOV Value Added”, a return on capital metric) goal.

TSR performance is determined by comparing the Company’s TSR with the TSR of the members of the Philadelphia Stock Exchange’s Oil Services Sector Index (OSX) for the three-year performance period.

The TSR portion of the performance share awards is subject to a vesting cap equal to 100% of Target Level if the Company’s absolute TSR is negative, regardless of relative TSR results.

Conversely, if the Company’s absolute TSR is greater than 15% annualized over the three-year performance period the payout amount shall not be less than 50% of Target Level, regardless of relative TSR results.

The NVA goal is based on the Company’s improvement in NVA from the beginning of the performance period until the end of the performance period.

NVA is calculated as an amount equal to the Company’s (a) gross cash earnings less (b) average gross operating assets times an amount equal to a required return on assets, with certain adjustments.

Total expense for all stock-based compensation arrangements was $ 19 million for the three months ended March 31, 2024, and $ 15 million for the three months ended March 31, 2023.

There was an income tax benefit of $ 4 million recognized in the Consolidated Statements of Income for stock-based compensation arrangements under the NOV Plan for the three months ended March 31, 2024 .

There was no income tax benefit recognized in the Consolidated Statements of Income for stock-based compensation arrangements under the NOV Plan for the three months ended March 31, 2023.

On May 15, 2024, the Company granted 85,950 restricted stock units with a fair value of $ 18.85 per share.

The awards were granted to non-employee members of the board of directors and vest on the first anniversary of the grant date.

On May 13, 2024, the Company granted 2,667 restricted stock units with a fair value of $ 18.76 per share.

On May 30, 2024, the Company granted 13,639 restricted stock units with a fair value of $ 18.33 per share.

The awards were granted to employees and vest in three equal annual installments commencing on the first anniversary of grant date.

Total expense for all stock-based compensation arrangements was $ 17 million and $ 36 million for the three and six months ended June 30, 2024, respectively, and $ 17 million and $ 32 million for the three and six months ended June 30, 2023, respectively.

The total income tax expense/(benefit) recognized in the Consolidated Statements of Income for stock-based compensation arrangements was ($ 1 ) million and $ 3 million for the three and six months ended June 30, 2024 , respectively.

There was no income tax benefit recognized in the Consolidated Statements of Income for stock-based compensation arrangements under the NOV Plan for the three and six months ended June 30, 2023 .

Derivative Financial Instruments

8 unchanged sentences

Brazilian Real

Singapore Dollar

South African Rand

Singapore Dollar

British Pound Sterling

8 unchanged sentences

The gain or loss on the derivative instrument is recognized in earnings in other income (expense), together with the changes in the hedged nonfunctional monetary accounts.

The amount of loss recognized in other expense, net was $ 3 million for the three months ended March 31, 2024 and $ 5 million for the three months ended March 31, 2023.

The amount of gain (loss) recognized in other expense, net was $ 13 million and $ 10 million for the three and six months ended June 30, 2024 , respectively, and ($ 5 ) million and ($ 10 ) million for the three and six months ended June 30, 2023, respectively.

The Company has the following fair values of its derivative instruments and their balance sheet classifications (in millions):

25 unchanged sentences

Three Months Ended

Six Months Ended

Net income attributable to Company

7 unchanged sentences

The two-class method requires a portion of net income attributable to Company to be allocated to participating securities, which are unvested awards of share-based payments with non-forfeitable rights to receive dividends or dividend equivalents if declared.

Net income attributable to the Company allocated to these participating securities was immaterial for each of the three months ended March 31, 2024 and 2023 , respectively.

The Company had stock options outstanding that were anti-dilutive totaling 17 million shares for the three months ended March 31, 2024, compared to 16 million shares for the three months ended March 31, 2023 .

Net income attributable to the Company allocated to these participating securities was immaterial for each of the three and six months ended June 30, 2024 and 2024 , respectively.

The Company had stock options outstanding that were anti-dilutive totaling 16 million shares for each of the three and six months ended June 30, 2024 , respectively, compared to 23 million and 22 million shares for the three and six months ended June 30, 2023 , respectively.

Cash Dividends

Cash dividends were $ 20 million for both the three months ended March 31, 2024 and March 31, 2023 .

Cash dividends were $ 30 million and $ 50 million for the three and six months ended June 30, 2024 , compared to $ 20 million and $ 40 million for the three and six months ended June 30, 2023.

The declaration and payment of future dividends is at the discretion of the Company’s Board of Directors and will be dependent upon the Company’s results of operations, financial condition, capital requirements and other factors deemed relevant by the Company’s Board of Directors.

3 unchanged sentences

In the United States these governmental authorities include the U.S.

Department of Labor, the Occupational Safety and Health Administration, the Environmental Protection Agency, the Bureau of Land Management, the Department of Treasury, Office of Foreign Asset Controls, state environmental agencies and many others.

Department of Labor, the Occupational Safety and Health Administration, the Environmental Protection Agency, the Bureau of Land Management, the Department of Treasury, Office of Foreign Assets Control, state environmental agencies and many others.

We are unaware of any material liabilities in connection with our compliance with such laws.

3 unchanged sentences

The Company carries substantial insurance to cover insurable risks above a self-insured retention.

The Company believes, and the Company’s experience has been, that such insurance has been sufficient to cover any such material risks.

The Company believes, and the Company’s experience has been, that such insurance has been sufficient to cover any material risks.

The Company is also a party to claims, threatened and actual litigation, arbitration, and internal investigations of potential regulatory and compliance matters which may arise from the Company’s business activities.

These regulatory matters and disputes may involve private parties and/or government authorities who may assert a broad variety of potential claims against the Company, such as employment law claims, collective actions or class action claims, intellectual property claims (such as alleged patent infringement, and/or misappropriation of trade secrets by the company), premises liability claims, environmental claims, product liability claims, warranty claims, personal injury claims arising from exposure to or use of allegedly defective products or from activities of the Company, alleged regulatory violations, alleged violations of anti-corruption and anti-bribery, trade, customs or other laws and other commercial

and/or regulatory claims seeking recovery for alleged actual or exemplary damages or fines and penalties.

Such claims involve various theories of liability which may include negligence, breach of contract, strict liability, product liability, and other theories of liability.

These regulatory matters and disputes may involve private parties and/or government authorities who may assert a broad variety of potential claims against the Company, such as employment law claims, collective actions or class action claims, intellectual property claims (such as alleged patent infringement, and/or misappropriation of trade secrets by the Company), premises liability claims, environmental claims, product liability claims, warranty claims, personal injury claims arising from exposure to or use of allegedly defective products or from activities of the Company, alleged regulatory violations, alleged violations of anti-corruption and anti-bribery, trade, customs or other laws and other commercial and/or regulatory claims seeking recovery for alleged actual or exemplary damages or fines and penalties.

Such claims involve various theories of liability which may include negligence, breach of contract, strict liability, product liability, and others.

For some of these contingent claims and potential liabilities, the Company’s insurance coverage may not apply, or exclusions to coverage or legal impediments may apply.

In such instances, settlement or other resolution of such claims, individually or collectively, could have a material financial or reputational impact on the Company.

As of March 31, 2024, the Company recorded reserves in an amount believed to be sufficient, given the estimated range of potential outcomes, for contingent liabilities believed to be probable.

As of June 30, 2024, the Company recorded reserves in an amount believed to be sufficient, given the estimated range of potential outcomes, for contingent liabilities believed to be probable.

These reserves include costs currently and reasonably estimated to be incurred for reclamation of a closed barite mine and product liability claims, as well as other circumstances involving material claims.

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The companies agreed to pay the royalties for the right to use the portfolio of patents, whether they used some, all or none of the specific patented claims in any particular patent.

The license agreements each provide that they terminate on the date of the last to expire of the patents in the licensed portfolio.

The license agreements provide that they terminate on the date of the last to expire of the patents in the licensed portfolio.

Having obtained the benefit of these licenses for more than a decade, all of the drill bit manufacturer licensees unilaterally stopped making royalty payments even though all of the patents in the portfolio have not expired.

These companies have asserted, among other reasons, that they are entitled to stop making these payments because they have not elected to manufacture products covered by the unexpired patents.

These companies have asserted, among other reasons, that they are entitled to stop making these payments because they claim to not manufacture products covered by the unexpired patents.

Some of these companies stopped making payments after the expiration of what are allegedly the patents in the portfolio that they elected to use.

Others paid for some period of time after that date but have since stopped payment.

Others paid for some period of time after that date but have since stopped making payments.

The Company has sued asserting that failure to pay the royalties is a breach of the license agreements at issue.

The Company is in litigation with most of the licensees seeking a judicial determination that it is entitled to be paid royalties pursuant to the terms of the licenses.

The licensees have responded with a number of alleged defenses and requests for declaratory judgment all focused on avoiding the payments called for under the licenses.

The parties’ legal filings to date can be found in two cases currently pending in the United States District Court for the Southern District of Texas:

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Such trade regulations can be complex and conflicting, as different countries use trade regulation to promote conflicting policy objectives.

Compliance with these laws and regulations presents challenges which could result in future

liabilities (for example, alleged violation of those laws or when laws conflict between countries).

Compliance with these laws and regulations presents challenges which could result in future liabilities (for example, alleged violation of those laws or when laws conflict between countries).

The Company may face increased tariffs and trade costs, loss of revenue, loss of customers, fines, penalties, increased costs, the need for renegotiation of agreements, and other business disruptions.

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We may incur additional costs as a result of conditions in Russia if we are unable to complete the transaction to sell our Russian business on the terms of the agreements.

Geopolitical events continue to pose supply chain risks.

The Company’s ability to manufacture equipment and perform services could be impaired from such disruptions and the Company could be exposed to liabilities resulting from additional interruption or delay in its ability to perform due to factors such as materials shortages, inflationary pressures, and limited manpower.

Geopolitical events continue to pose supply chain and other business risks.

The Company’s ability to manufacture equipment and perform services could be impaired by such disruptions and the Company could be exposed to liabilities resulting from additional interruption or delay in its ability to perform due to factors such as materials shortages, inflationary pressures, limited manpower or otherwise.

We may face loss of workers, labor shortages, litigation, fines and/or other adverse consequences resulting from ongoing labor impacts.

The combined impact of supply chain and labor market disruptions along with the inflationary impacts of pandemic monetary and regulatory policies could have material adverse impacts on our financial results.

Disputes may arise regarding application of force majeure and other contract provisions concerning allocation of responsibility among customers, the Company, and suppliers, resulting in material added cost and/or litigation.

Disputes may arise from a variety of causes, including weather impacts, cyber, geopolitical, regulatory or other business risks, triggering application of force majeure and other contract provisions concerning allocation of responsibility among customers, the Company, and suppliers, resulting in material added cost and/or litigation.

Our customers may attempt to cancel or delay projects, cancel contracts, or may invoke force majeure clauses.

3 unchanged sentences

At this time, it is not possible to quantify all these risks, but the combination of these factors could have a material impact on our financial results.

Subsequent Event

On April 9, 2024, NOV completed the divestiture of its Pole Products business.

Pole Products is a leading manufacturer of premium spun-cast concrete, tapered steel, and innovative fiberglass poles for diverse applications.

On April 25, 2024, the Company announced that its Board of Directors authorized and approved a share repurchase program for up to $ 1 billion of the currently outstanding shares of the Company’s common stock over a period of 36 months.

Share Repurchase Program

On April 25, 2024, the Company established a share repurchase program for up to $ 1 billion of the currently outstanding shares of the Company’s common stock over a period of 36 months.

Under the share repurchase program, the Company may repurchase shares from time to time through open market purchases, in privately negotiated transactions or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, in accordance with applicable securities laws and other restrictions, including Rule 10b-18.

The timing and total amount of any stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices and other considerations.

The Company intends to fund the repurchases using its available U.S.

cash balances, which may involve the repatriation of foreign earnings not indefinitely reinvested.

However, depending on U.S cash balances, the Company may choose to borrow against its revolving credit facility or issue new debt to finance the repurchases.

As shares are repurchased, they are constructively retired and returned to an unissued state.

During the three months ended June 30, 2024 , the Company repurchased 2.0 million shares of common stock under the program for an average price of $ 18.50 per share for an aggregate amount of $ 37 million.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements