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Item 1. Financial Statements

2022-07-28 compared with 2022-04-28 · 134 added, 107 removed, 237 unchanged (50% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(Dollars and shares in millions, except per share amounts) 2022 2021 2022 2021

8 unchanged sentences

Restructuring Charges — — 20 —

Other Charges, Net 19 —

Other Charges (Credits) ( 14 ) ( 8 ) 5 ( 8 )

Total Costs and Expenses 960 878 1,880 1,723

Operating Income (Loss) 18 ( 13 )

Operating Income 104 25 122 12

Interest Expense, Net ( 48 ) ( 72 ) ( 96 ) ( 142 )

Other Expense, Net ( 32 ) ( 11 ) ( 48 ) ( 15 )

Loss Before Income Taxes ( 46 ) ( 87 )

Income (Loss) Before Income Taxes 24 ( 58 ) ( 22 ) ( 145 )

Income Tax Provision ( 12 ) ( 15 ) ( 40 ) ( 38 )

Net Loss ( 74 ) ( 110 )

Net Income (Loss) 12 ( 73 ) ( 62 ) ( 183 )

Net Income Attributable to Noncontrolling Interests 6 5 12 11

Net Loss Attributable to Weatherford $ ( 80 ) $ ( 116 )

Basic & Diluted Loss per Share $ ( 1.14 ) $ ( 1.66 )

Basic & Diluted Weighted Average Shares Outstanding 70 70

Net Income (Loss) Attributable to Weatherford $ 6 $ ( 78 ) $ ( 74 ) $ ( 194 )

Basic and Diluted Income (Loss) per Share $ 0.08 $ ( 1.11 ) $ ( 1.04 ) $ ( 2.77 )

Basic Weighted Average Shares Outstanding 71 70 71 70

Diluted Weighted Average Shares Outstanding 73 70 71 70

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

WEATHERFORD INTERNATIONAL PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

Three Months Ended

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended Six Months Ended

June 30, June 30,

(Dollars in millions) 2022

Net Loss $ ( 74 ) $ ( 110 )

Net Income (Loss) $ 12 $ ( 73 ) $ ( 62 ) $ ( 183 )

Foreign Currency Translation Adjustments 59 15 59 11

Comprehensive Loss ( 74 ) ( 114 )

Comprehensive Income (Loss) 71 ( 58 ) ( 3 ) ( 172 )

Comprehensive Income Attributable to Noncontrolling Interests 6 5 12 11

Comprehensive Loss Attributable to Weatherford $ ( 80 ) $ ( 120 )

Comprehensive Income (Loss) Attributable to Weatherford $ 65 $ ( 63 ) $ ( 15 ) $ ( 183 )

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars and shares in millions, except par value) March 31, 2022 December 31, 2021

(Dollars and shares in millions, except par value) June 30, 2022 December 31, 2021

Cash and Cash Equivalents $ 879 $ 951

Restricted Cash 211 162

Accounts Receivable, Net of Allowance for Credit Losses of $ 35 at March 31, 2022 and $ 31 at December 31, 2021

Accounts Receivable, Net of Allowance for Credit Losses of $ 30 at June 30, 2022 and $ 31 at December 31, 2021

Inventories, Net 716 670

1 unchanged sentence

Total Current Assets 3,010 2,911

Property, Plant and Equipment, Net of Accumulated Depreciation of $ 661 at March 31, 2022 and $ 623 at December 31, 2021

Intangible Assets, Net of Accumulated Amortization of $ 367 at March 31, 2022 and $ 328 at December 31, 2021

Property, Plant and Equipment, Net of Accumulated Depreciation of $ 718 at June 30, 2022 and $ 623 at December 31, 2021

Intangible Assets, Net of Accumulated Amortization of $ 403 at June 30, 2022 and $ 328 at December 31, 2021

Operating Lease Right-of-Use Assets 115 113

1 unchanged sentence

Total Assets $ 4,735 $ 4,774

Short-term Borrowings and Current Portion of Finance Leases $ 13 $ 12

Current Portion of Long-term Debt $ 64 $ 12

Accounts Payable 448 380

11 unchanged sentences

Ordinary Shares - Par Value $ 0.001 ;

Authorized 1,356 shares, Issued and Outstanding 70 shares at March 31, 2022 and December 31, 2021

Authorized 1,356 shares, Issued and Outstanding 70 shares at June 30, 2022 and December 31, 2021

Capital in Excess of Par Value 2,913 2,904

Retained Deficit ( 2,471 ) ( 2,397 )

Accumulated Other Comprehensive Loss ( 35 ) ( 35 )

Accumulated Other Comprehensive Income (Loss) 24 ( 35 )

Weatherford Shareholders’ Equity 466 472

5 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Three Months Ended March 31,

Six Months Ended June 30,

(Dollars in millions) 2022 2021

1 unchanged sentence

Net Loss $ ( 62 ) $ ( 183 )

Adjustments to Reconcile Net Loss to Net Cash Provided by Operating Activities:

Adjustments to Reconcile Net Loss to Net Cash (Used in) Provided by Operating Activities:

Depreciation and Amortization 177 225

8 unchanged sentences

Other Assets and Liabilities, Net ( 59 ) ( 35 )

Net Cash Provided by (Used in) Operating Activities ( 64 ) 74

Net Cash (Used in) Provided by Operating Activities ( 4 ) 120

Cash Flows From Investing Activities:

9 unchanged sentences

Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash ( 1 ) ( 1 )

Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash ( 57 ) 58

Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash ( 23 ) 102

Cash, Cash Equivalents and Restricted Cash at Beginning of Period 1,113 1,285

21 unchanged sentences

Please refer to “Note 1 – Summary of Significant Accounting Policies” of our Consolidated Financial Statements from our 2021 Annual Report for the discussion on our significant accounting policies.

Certain reclassifications have been made to the financial statements and accompanying footnotes for the three months ended March 31, 2021 to conform to the presentation for the three months ended March 31, 2022, including the change in reportable segments made during the fourth quarter of 2021.

Certain reclassifications have been made to the financial statements and accompanying footnotes for the three and six months ended June 30, 2021 to conform to the presentation for the three and six months ended June 30, 2022, including the change in reportable segments made during the fourth quarter of 2021.

New Accounting Standards

5 unchanged sentences

All of our segments are enabled by a full suite of digital, monitoring, optimization and artificial intelligence solutions providing services throughout the well life cycle, including responsible abandonment.

We now have three reportable segments:

We have three reportable segments:

(1) Drilling and Evaluation, (2) Well Construction and Completions, and (3) Production and Intervention.

Previously we had two geographic based reportable segments, Western Hemisphere and Eastern Hemisphere.

Our primary measure of segment profitability is now segment adjusted EBITDA, which is based on segment earnings before interest, taxes, depreciation, amortization, share-based compensation expense and other adjustments.

Our primary measure of segment profitability is segment adjusted EBITDA, which is based on segment earnings before interest, taxes, depreciation, amortization, share-based compensation expense and other adjustments.

Research and development expenses are included in segment adjusted EBITDA.

Corporate and other includes business activities related to all other segments (profit and loss), corporate and other expenses (overhead support and centrally managed or shared facilities costs) that do not individually meet the criteria for segment reporting.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(Dollars in millions) 2022 2021 2022 2021

13 unchanged sentences

Share-based Compensation Expense

( 6 ) ( 5 ) ( 13 ) ( 9 )

Other Adjustments (a)

Operating Income (Loss) $ 18 $ ( 13 )

(a) Other adjustments include $ 20 million of restructuring charges in the three months ended March 31, 2022 (see “Note 4 - Restructuring Charges” for additional information) and $ 19 million of other charges, net, of which $17 million were related to Ukraine ($16 million in the write-down of receivables, inventory and property, plant and equipment, and $1 million in operating support costs).

There were no other adjustments in the three months ended March 31, 2021.

14 8 ( 25 ) 8

Operating Income $ 104 $ 25 $ 122 $ 12

(a) Other adjustments in six months ended June 30, 2022 primarily include a net credit from the gain on asset sales related to our fulfillment initiatives and collections of previously impaired receivables in the three months ended June 30, 2022 offset by net charges in the three months ended March 31, 2022 that include a $ 20 million restructuring charge and a $ 17 million charge related to Ukraine.

See “Note 4 – Restructuring Charges” for additional information on restructuring around our fulfillment initiatives.

Disaggregated Revenue

Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

Revenues are recognized when control of the promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to receive, in exchange for those goods or services.

The majority of our revenue is derived from short term contracts.

Our products and services are generally sold based upon purchase orders, contracts or other legally enforceable arrangements with our customers that include fixed or determinable prices but do not generally include right of return provisions or other significant post-delivery obligations.

Our Production and Intervention segment leases drilling tools, artificial lift pumping equipment and other unmanned equipment to customers as operating leases.

We lease drilling tools, artificial lift pumping equipment and other unmanned equipment to customers as operating leases.

These equipment rental revenues are generally provided based on call-out work orders that include fixed per unit prices and are derived from short-term contracts.

Equipment revenues recognized under ASU No.

2016-02, Leases (Topic 842) were $ 31 million for the three months ended March 31, 2022 and $ 28 million for the three months ended March 31, 2021.

The following tables disaggregate our revenues from contracts with customers by geographic region and includes equipment rental revenues.

2016-02, Leases (Topic 842) were $ 35 million and $ 66 million in the three and six months ended June 30, 2022, respectively, and $ 35 million and $ 63 million for the three and six months ended June 30, 2021, respectively.

The following table disaggregates our revenues from contracts with customers by geographic region and includes equipment rental revenues.

North America in the table below consists of the U.S.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(Dollars in millions) 2022 2021 2022 2021

7 unchanged sentences

The timing of our revenue recognition, billings and cash collections results in the recording of billed and unbilled accounts receivable, contract assets, customer advances and deposits (contract liabilities classified as deferred revenues).

Receivables with customers are included in “Accounts Receivable, Net,” contract assets are included in “Other Current Assets” and contract liabilities are included in “Other Current Liabilities” on our Condensed Consolidated Balance Sheets.

Contract assets are immaterial as of March 31, 2022 and December 31, 2021.

Revenues recognized during the three months ended March 31, 2022 and 2021 that were included in the contract liabilities balance at the beginning of each year were $ 10 million and $ 18 million, respectively.

The following table summarizes these balances as of March 31, 2022 and December 31, 2021:

(Dollars in millions) March 31, 2022 December 31, 2021

Receivables with customers are included in “Accounts Receivable, Net,” short-term contract assets are included in “Other Current Assets,” long-term contract assets are included in “Other Non-Current Assets” and contract liabilities are included in “Other Current Liabilities” on our Condensed Consolidated Balance Sheets.

The following table summarizes these balances as of June 30, 2022 and December 31, 2021:

(Dollars in millions) June 30, 2022 December 31, 2021

Total Accounts Receivables $ 930 $ 825

1 unchanged sentence

Receivables for Equipment Rentals in Account Receivable, Net $ 30 $ 30

Contract Liabilities in Other Current Liabilities $ 35 $ 26

Short-Term Contract Assets in Other Current Assets $ 41 $ 47

Long-term Contract Assets in Other Non-Current Assets $ 18 $ 14

Contract Liabilities in Other Current Liabilities (a)

(a) Revenues recognized during the six months ended June 30, 2022 and 2021 that were included in the contract liabilities balance at the beginning of each year were $ 18 million and $ 25 million, respectively.

Performance Obligations

1 unchanged sentence

A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

In the following table, estimated revenue for contracts with original performance obligations greater than twelve months are expected to be recognized in the future related to performance obligations that are either unsatisfied or partially unsatisfied as of March 31, 2022.

(Dollars in millions) 2022 2023 2024 2025 Thereafter Total

(Dollars in millions) 2022

Thereafter Total

Service Revenue $ 35 $ 63 $ 65 $ 52 $ 22 $ 237

4 – Restructuring Charges

We had $ 20 million restructuring charges for the three months ended March 31, 2022, presented as “Restructuring Charges” on the accompanying Condensed Consolidated Statements of Operations.

These charges were primarily related to the launch of a multi-year footprint consolidation and workforce efficiency initiative aimed at improving fulfillment operations and included $ 14 million in severance and $ 6 million in asset retirement obligations.

No restructuring charges were recognized in the three months ended March 31, 2021.

The following table presents total restructuring charges by segment and All Other in the three months ended March 31, 2022 and 2021:

Three Months Ended March 31,

We had nil and $ 20 million in restructuring charges for the three and six months ended June 30, 2022, respectively, presented as “Restructuring Charges” on the accompanying Condensed Consolidated Statements of Operations.

The charges were primarily related to the launch of a multi-year footprint consolidation and workforce efficiency initiative aimed at improving fulfillment operations and included $ 14 million in severance and $ 6 million in asset retirement obligations.

No restructuring charges were recognized in the three and six months ended June 30, 2021.

The following table presents total restructuring charges by segment and All Other in the three and six months ended June 30, 2022 and 2021:

Three Months Ended June 30, Six Months Ended June 30,

(Dollars in millions) 2022

4 unchanged sentences

Total Restructuring Charges $ — $ — $ 20 $ —

The following table presents total restructuring reserve activity in the three months ended March 31, 2022:

(Dollars in millions) Reserve at December 31, 2021 Charges Cash Payments (Credits)/Other

Reserve at March 31, 2022

The following table presents total restructuring reserve activity in the six months ended June 30, 2022:

(Dollars in millions) December 31, 2021 Charges Cash Payments (Credits)/Other

June 30, 2022

Restructuring Reserve $ 17 $ 20 $ ( 10 ) $ — $ 27

5 – Inventories, Net

Inventories, net of reserves of $ 165 million and $ 159 million as of March 31, 2022 and December 31, 2021, respectively, are presented by category in the table below:

(Dollars in millions) March 31, 2022 December 31, 2021

Inventories, net of reserves of $ 139 million and $ 159 million as of June 30, 2022 and December 31, 2021, respectively, are presented by category in the table below:

(Dollars in millions) June 30, 2022 December 31, 2021

Finished Goods $ 634 $ 595

1 unchanged sentence

Inventories, Net $ 716 $ 670

In the three months ended March 31, 2022 and 2021, we recognized inventory charges, including excess and obsolete inventory charges, in the following captions on our Condensed Consolidated Statements of Operations:

Three Months Ended March 31,

In the three and six months ended June 30, 2022 and 2021, we recognized inventory charges, including excess and obsolete inventory charges, in the following captions on our Condensed Consolidated Statements of Operations:

Three Months Ended June 30, Six Months Ended June 30,

(Dollars in millions) 2022 2021 2022 2021

Inventory Charges in “Cost of Products” $ 9 $ 16 $ 20 $ 32

Inventory Charges in “Other Charges, Net” 4 —

Inventory Charges in “Other Charges (Credits)” — 6 4 7

Total Inventory Charges $ 9 $ 22 $ 24 $ 39

1 unchanged sentence

The components of intangible assets, net were as follows:

(Dollars in millions) March 31, 2022 December 31, 2021

Developed and Acquired Technology, Net of Accumulated Amortization of $ 276 at March 31, 2022 and $ 247 at December 31, 2021

Trade Names, Net of Accumulated Amortization of $ 91 at March 31, 2022 and $ 81 at December 31, 2021

Intangible Assets, Net of Accumulated Amortization of $ 367 at March 31, 2022 and $ 328 at December 31, 2021

Amortization expense was $ 39 million for both the three months ended March 31, 2022 and 2021, and is reported in “Selling, General and Administrative” on our Condensed Consolidated Statements of Operations.

(Dollars in millions) June 30, 2022 December 31, 2021

Developed and Acquired Technology, Net of Accumulated Amortization of $ 302 at June 30, 2022 and $ 247 at December 31, 2021

Trade Names, Net of Accumulated Amortization of $ 101 at June 30, 2022 and $ 81 at December 31, 2021

Intangible Assets, Net of Accumulated Amortization of $ 403 at June 30, 2022 and $ 328 at December 31, 2021

Amortization expense was $ 39 million and $ 78 million for both the three and six months ended June 30, 2022 and June 30, 2021, respectively, and is reported in “Selling, General and Administrative” on our Condensed Consolidated Statements of Operations.

7 – Borrowings and Other Debt Obligations

(Dollars in millions) March 31, 2022 December 31, 2021

Finance Leases Current Portion $ 13 $ 12

Short-term Borrowings and Current Portion of Finance Leases $ 13 $ 12

(Dollars in millions) June 30, 2022 December 31, 2021

Current Portion of Finance Leases $ 14 $ 12

Current Portion of Exit Notes 50 —

Current Portion of Long-term Debt $ 64 $ 12

11.00 % Exit Notes due 2024

1 unchanged sentence

8.625 % Senior Notes due 2030

Finance Leases Long-term Portion 43 44

Long-term Portion Finance Leases 42 44

Long-term Debt $ 2,366 $ 2,416

Our Exit Notes, 2028 Senior Secured Notes and 2030 Senior Notes (described below) were issued by Weatherford Bermuda and guaranteed by Weatherford International plc and Weatherford Delaware and other subsidiary guarantors party thereto.

On December 13, 2019, we issued 11.00 % senior unsecured notes (“Exit Notes”) due in 2024 for an aggregate principal amount of $ 2.1 billion.

Interest on the Exit Notes accrues at the rate of 11.00 % per annum and is payable semiannually on June 1 and December 1 and commenced June 1, 2020.

On October 20, 2021, we redeemed $ 200 million of our Exit Notes.

On October 27, 2021, we issued $ 1.6 billion of 2030 Senior Notes (defined below) and used the net proceeds and cash on hand to redeem $ 1.6 billion in principal amount of our Exit Notes at applicable prices.

At March 31, 2022, the carrying value of $ 300 million represents the remaining unpaid principal.

We have an outstanding aggregate principal amount of $ 300 million due in 2024 on our 11.00 % senior unsecured notes (“Exit Notes”) with interest payable semiannually on June 1 and December 1.

At June 30, 2022, the carrying value of $ 300 million represents the remaining unpaid principal.

On July 11, 2022, we issued a notice of election to redeem $50 million in principal plus related unpaid interest by August 10, 2022 of our Exit Notes.

2028 Senior Secured Notes

5 unchanged sentences

Interest accrues at the rate of 8.625 % per annum and is payable semiannually on June 1 and December 1 of each year, commencing on June 1, 2022.

As described above under Exit Notes, proceeds from this debt issuance were used to redeem $ 1.6 billion of its principal.

LC Credit Agreement

We have a senior secured letter of credit agreement (the “LC Credit Agreement”) in an aggregate amount of $ 215 million maturing on May 29, 2024, which is used by the Company and certain of its subsidiaries for the issuance of bid and performance letters of credit.

At March 31, 2022, we had approximately $ 169 million in outstanding letters of credit under the LC Credit Agreement (“LC Credit Agreement letters of credit”) and availability of $ 46 million.

As of March 31, 2022, we had $ 382 million of letters of credit outstanding, consisting of the $ 169 million under the LC Credit Agreement and another $ 213 million under various uncommitted bi-lateral facilities (of which there was $ 212 million in cash collateral held and recorded in “Restricted Cash” on the Condensed Consolidated Balance Sheets).

The proceeds from this debt issuance were used to redeem $ 1.6 billion of the above Exit Notes.

We have a senior secured letter of credit agreement (the “LC Agreement”) in an aggregate amount of $ 215 million maturing on May 29, 2024, which is used by the Company and certain of its subsidiaries for the issuance of bid and performance letters of credit.

At June 30, 2022, we had approximately $ 173 million in outstanding letters of credit under the LC Agreement and availability of $ 42 million.

As of June 30, 2022, we had $ 378 million of letters of credit outstanding, consisting of the $ 173 million under the LC Agreement and another $ 205 million under various uncommitted bi-lateral facilities (of which there was $ 205 million in cash collateral held and recorded in “Restricted Cash” on the Condensed Consolidated Balance Sheets).

Our letters of credit under various uncommitted bi-lateral facilities increased “Restricted Cash” since December 31, 2021 due to a requirement from a new multi-year contract.

Accrued Interest

As of March 31, 2022 and December 31, 2021, we had accrued interest of approximately $ 71 million and $ 35 million, respectively in “Other Current Liabilities” primarily related to the Exit Notes, 2028 Senior Secured Notes and 2030 Senior Notes.

As of June 30, 2022 and December 31, 2021, we had accrued interest of approximately $ 24 million and $ 35 million, respectively in “Other Current Liabilities” primarily related to the Exit Notes, 2028 Senior Secured Notes and 2030 Senior Notes.

Fair Value of Short and Long-term Borrowings

4 unchanged sentences

The fair value of our long-term debt is classified as Level 2 in the fair value hierarchy and is established based on observable inputs in less active markets.

The table below presents the fair value and carrying value of our long-term debt (excluding finance leases).

March 31, 2022 December 31, 2021

The table below presents the fair value and carrying value of our long-term debt (including the current portion of long-term debt and excluding finance leases).

June 30, 2022 December 31, 2021

(Dollars in millions) Carrying Value Fair Value Carrying Value Fair Value

5 unchanged sentences

1,585 1,338 1,584 1,660

Long-Term Debt (excluding Finance Leases) $ 2,373 $ 2,455 $ 2,372 $ 2,499

Current and Long-Term Debt (excluding Finance Leases) $ 2,374 $ 2,090 $ 2,372 $ 2,499

8 – Disputes, Litigation and Legal Contingencies

3 unchanged sentences

If one or more negative outcomes were to occur relative to these cases, the aggregate impact to our financial condition could be material.

The COVID-19 pandemic temporarily closed courts in many jurisdictions around the world.

Although many courts have reopened, we continue to experience delays in certain jurisdictions.

Accrued litigation and settlements recorded in “Other Current Liabilities” on the accompanying Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021 were $ 45 million and $ 40 million, respectively.

Accrued litigation and settlements recorded in “Other Current Liabilities” on the accompanying Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021 were $ 41 million and $ 40 million, respectively.

GAMCO Shareholder Litigation

12 unchanged sentences

9 – Shareholders’ Equity

The following summarizes our shareholders’ equity activity for the three months ended March 31, 2022 and 2021:

The following summarizes our shareholders’ equity activity for the three and six months ended June 30, 2022 and 2021:

(Dollars in millions) Capital in Excess of Par Value Retained

Deficit Accumulated

Comprehensive

Loss Non-controlling Interests “NCI” Total Shareholders’ Equity

Comprehensive Income (Loss) Non-controlling Interests “NCI” Total Shareholders’ Equity

Balance at December 31, 2021

$ 2,904 $ ( 2,397 ) $ ( 35 ) $ 24 $ 496

Net Income (Loss) — ( 80 ) — 6 ( 74 )

Equity Awards, Granted, Vested and Exercised 4 — — — 4

Other Comprehensive Loss — — — — —

Balance at March 31, 2022

$ 2,908 $ ( 2,477 ) $ ( 35 ) $ 30 $ 426

Net Income — 6 — 6 12

Other Comprehensive Income — — 59 — 59

Dividends to NCI — — — ( 11 ) ( 11 )

Equity Awards Granted, Vested and Exercised 5 — — — 5

Balance at June 30, 2022

$ 2,913 $ ( 2,471 ) $ 24 $ 25 $ 491

Balance at December 31, 2020

$ 2,897 $ ( 1,947 ) $ ( 43 ) $ 30 $ 937

Net Income (Loss) — ( 116 ) — 6 ( 110 )

2 unchanged sentences

Balance at March 31, 2021

The following table presents the changes in our accumulated other comprehensive loss by component for the three months ended March 31, 2022 and 2021:

$ 2,897 $ ( 2,063 ) $ ( 47 ) $ 34 $ 821

Net Income (Loss) — ( 78 ) — 5 ( 73 )

Other Comprehensive Income — — 15 — 15

Dividends to NCI — — — ( 4 ) ( 4 )

Equity Awards Granted, Vested and Exercised 2 — — — 2

Other — — — ( 2 ) ( 2 )

Balance at June 30, 2021

$ 2,899 $ ( 2,141 ) $ ( 32 ) $ 33 $ 759

The following table presents the changes in our accumulated other comprehensive income (loss) by component for the six months ended June 30, 2022 and 2021:

(Dollars in millions) Currency Translation Adjustment Defined Benefit Pension Total

Balance at December 31, 2021

Other Comprehensive Loss — — —

Balance at March 31, 2022 $ ( 36 ) $ 1 $ ( 35 )

$ ( 36 ) $ 1 $ ( 35 )

Other Comprehensive Income 59 — 59

Balance at June 30, 2022

$ 23 $ 1 $ 24

Balance at December 31, 2020

Other Comprehensive Loss ( 4 ) — ( 4 )

Balance at March 31, 2021 $ ( 35 ) $ ( 12 ) $ ( 47 )

10 – Loss per Share

Basic earnings (loss) per share for all periods presented equals net income (loss) divided by our weighted average shares outstanding during the period.

Diluted earnings (loss) per share is computed by dividing net income (loss) by our weighted average shares outstanding during the period including potential dilutive ordinary shares.

The following table presents our basic and diluted weighted average shares outstanding and loss per share for the three months ended March 31, 2022 and 2021:

Three Months Ended March 31,

$ ( 31 ) $ ( 12 ) $ ( 43 )

Other Comprehensive Income 11 — 11

Balance at June 30, 2021

$ ( 20 ) $ ( 12 ) $ ( 32 )

10 – Income (Loss) per Share

Basic income (loss) per share for all periods presented equals net income (loss) divided by our weighted average shares outstanding during the period.

Diluted income (loss) per share is computed by dividing net income (loss) by our weighted average shares outstanding during the period including potential dilutive ordinary shares.

Antidilutive shares represent potentially dilutive securities which are excluded from the computation of diluted income or loss per share as their impact was antidilutive.

These include potential ordinary shares for restricted share units, performance share units, phantom restricted share units, and outstanding warrants.

Our basic and diluted weighted average shares outstanding for periods presented with net loss are equivalent as the impact of the inclusion of potential dilutive securities are antidilutive.

A reconciliation of the number of shares used for the basic and diluted income (loss) per share calculation was as follows:

Three Months Ended June 30, Six Months Ended June 30,

(Dollars and shares in millions, except per share amounts) 2022 2021 2022 2021

Net Loss Attributable to Weatherford $ ( 80 ) $ ( 116 )

Basic and Diluted Weighted Average Shares Outstanding 70 70

Basic and Diluted Loss Per Share Attributable to Weatherford $ ( 1.14 ) $ ( 1.66 )

Our basic and diluted weighted average shares outstanding for the periods presented are equivalent due to the net loss attributable to shareholders.

Diluted weighted average shares outstanding for the three months ended March 31, 2022 and 2021 exclude 11 million and 9 million potential ordinary shares, respectively, for restricted share units, performance share units, phantom restricted share units, and outstanding warrants as we had net losses for those periods and their inclusion would be anti-dilutive.

Net Income (Loss) Attributable to Weatherford $ 6 $ ( 78 ) $ ( 74 ) $ ( 194 )

Basic Weighted Average Shares Outstanding 71 70 71 70

Dilutive Effect of Awards Granted in Stock Incentive Plans 2 — — —

Diluted Weighted Average Shares Outstanding 73 70 71 70

Antidilutive Shares 8 10 11 10

Basic and Diluted Income (Loss) Per Share Attributable to Weatherford $ 0.08 $ ( 1.11 ) $ ( 1.04 ) $ ( 2.77 )

11 – Income Taxes

We determined our quarterly tax provision using the year-to-date effective tax rate because small changes in estimated ordinary annual income result in significant changes in our estimated annual effective tax rate.

We determine our quarterly tax provision using the year-to-date effective tax rate because the estimated annual approach is not reliable given that small changes in estimated ordinary annual income result in significant changes in our estimated annual effective tax rate.

The year-to-date effective tax rate treats the year-to-date period as if it was the annual period and determines the income tax expense or benefit on that basis.

We provide for income taxes based on the laws and rates in effect in the countries in which operations are conducted, or in which we or our subsidiaries are considered resident for income tax purposes.

We provide for income taxes based on the laws and rates in effect in the countries in which operations are conducted, or in which we or our subsidiaries are considered residents for income tax purposes.

The relationship between our pre-tax income or loss and our income tax provision or benefit varies from period to period due to various factors which include changes in total pre-tax income or loss, the jurisdictions in which our income is earned, the tax laws in those jurisdictions and in our operating structure.

For the three months ended March 31, 2022, we recognized tax expense of $ 28 million on a loss before income taxes of $ 46 million compared to the three months ended March 31, 2021 where we recognized tax expense of $ 23 million on a loss before income taxes of $ 87 million.

In the three and six months ended June 30, 2022, we recognized tax expense of $ 12 million and $ 40 million, respectively, on an income before income taxes of $ 24 million and loss before taxes of $ 22 million, respectively, compared to the three and six months ended June 30, 2021 where we recognized tax expense of $ 15 million and $ 38 million, respectively, on a loss before income taxes of $ 58 million and $ 145 million, respectively.

The expense in the three and six months ended June 30, 2022 included a $ 27 million recognition of a benefit from previously uncertain tax positions.

Our income tax provisions are primarily driven by income in certain jurisdictions, deemed profit countries and withholding taxes on intercompany and third-party transactions that do not directly correlate to ordinary income or loss and other adjustments.

Impairments and other charges recognized do not result in significant tax benefit due to our inability to forecast realization of the tax benefit of such losses.

Impairments and other charges recognized may not result in significant tax benefit due to our inability to forecast realization of the tax benefit of such losses.

We routinely undergo tax examination in various jurisdictions.

We cannot predict the timing or outcome regarding resolution of these tax examinations or if they will have a material impact on our financial statements.

As of March 31, 2022, we anticipate that it is reasonably possible that our uncertain tax positions of $ 272 million may decrease by up to $ 11 million in the next twelve months due to expiration of statutes of limitations, settlements and/or conclusions of tax examinations.

As of June 30, 2022, we anticipate that it is reasonably possible that our uncertain tax positions of $ 239 million may decrease by up to $ 13 million in the next twelve months due to expiration of statutes of limitations, settlements and/or conclusions of tax examinations.

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