PDS · Precision Drilling Corporation

Precision Drilling's Q1 2026 results reflect a mixed performance: revenue grew 6% year-over-year to $526 million, driven by higher drilling activity in Canada (79 average rigs vs. 74) and the U.S. (37 vs. 30), which more than offset lower international activity. However, Adjusted EBITDA declined 10% to $124 million, primarily due to a $19 million share-based compensation expense (versus $3 million in Q1 2025) as the company's stock price appreciated 39% during the quarter. Net earnings attributable to shareholders fell 50% to $17 million, also impacted by higher depreciation from revised useful life estimates. Operating margins in Canada and the U.S. were relatively stable, with Canadian margin at $14,282 per utilization day (down from $14,780) and U.S. margin at US$9,291 (down from US$9,589), though excluding turnkey and idle-but-contracted rigs, U.S. margin improved to US$9,287 from US$8,360. The company generated $63 million in cash from operations, used $4 million to repurchase 36,874 shares, and reduced debt by $25 million. Management noted improving customer sentiment and expects Q2 Canadian activity to be well above last year, with U.S. rig count returning to the high 30s in June. The 2026 capital budget was revised upward to $265 million from $245 million to fund contracted rig upgrades and anticipated higher activity. Overall, the quarter demonstrated operational resilience amid geopolitical volatility, but profitability was pressured by non-cash compensation costs.