10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2022

☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-32657

NABORS INDUSTRIES LTD.

(Exact name of registrant as specified in its charter)

Bermuda	98-0363970
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Crown House

Second Floor

4 Par-la-Ville Road

Hamilton, HM08

Bermuda

(Address of principal executive office)

(441) 292-1510

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common shares, $.05 par value per share	NBR	NYSE

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☒		Accelerated Filer ☐
Non-accelerated Filer ☐		Smaller reporting company ☐
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of common shares, par value $.05 per share, outstanding as of April 29, 2022 was 9,411,918, excluding 1,090,003 common shares held by our subsidiaries, or 10,501,921 in the aggregate.

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

Index

PART I FINANCIAL INFORMATION
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021	3
	Condensed Consolidated Statements of Income (Loss) for the Three Months Ended March 31, 2022 and 2021	4
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three Months Ended March 31, 2022 and 2021	5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021	6
	Condensed Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2022 and 2021	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33
PART II OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	35
Item 5.	Other Information	35
Item 6.	Exhibits	35
Signatures		35

2

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31,		December 31,
	2022		2021
	(In thousands, except per
	share amounts)
ASSETS
Current assets:
Cash and cash equivalents	$	394,028	$	991,471
Short-term investments		11		17
Accounts receivable, net of allowance of $90,321 and $67,292, respectively		297,209		287,572
Inventory, net		132,126		126,448
Assets held for sale		16,582		16,561
Other current assets		104,112		95,740
Total current assets		944,068		1,517,809
Property, plant and equipment, net		3,245,574		3,332,498
Restricted cash held in trust		281,549		281,523
Deferred income taxes		256,543		258,631
Other long-term assets		129,432		134,903
Total assets (1)	$	4,857,166	$	5,525,364
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable	$	278,878	$	253,748
Accrued liabilities		209,910		247,171
Income taxes payable		19,327		18,887
Current lease liabilities		5,330		5,422
Total current liabilities		513,445		525,228
Long-term debt		2,610,092		3,262,795
Other long-term liabilities		372,592		340,347
Deferred income taxes		2,478		2,773
Total liabilities (1)		3,498,607		4,131,143
Commitments and contingencies (Note 15)
Redeemable noncontrolling interest in subsidiary		677,829		675,283
Shareholders’ equity:
Common shares, par value $0.05 per share:
Authorized common shares 32,000; issued 10,475 and 9,295, respectively		523		466
Capital in excess of par value		3,593,355		3,454,563
Accumulated other comprehensive income (loss)		(9,298)		(10,634)
Retained earnings (accumulated deficit)		(1,725,213)		(1,537,988)
Less: treasury shares, at cost, 1,090 and 1,090 common shares, respectively		(1,315,751)		(1,315,751)
Total shareholders’ equity		543,616		590,656
Noncontrolling interest		137,114		128,282
Total equity		680,730		718,938
Total liabilities and equity	$	4,857,166	$	5,525,364

(1) The condensed consolidated balance sheet as of March 31, 2022 and December 31, 2021 include assets and liabilities of variable interest entities. See Note 3—Joint Ventures for additional information.

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

(Unaudited)

		Three Months Ended
		March 31,
		2022		2021
	(In thousands, except per share amounts)
Revenues and other income:
Operating revenues		$	568,539	$	460,511
Investment income (loss)			163		1,263
Total revenues and other income			568,702		461,774
Costs and other deductions:
Direct costs			372,712		290,654
General and administrative expenses			53,639		54,660
Research and engineering			11,678		7,467
Depreciation and amortization			164,359		177,276
Interest expense			46,910		42,975
Other, net			80,401		7,346
Total costs and other deductions			729,699		580,378
Income (loss) from continuing operations before income taxes			(160,997)		(118,604)
Income tax expense (benefit):
Current			9,950		10,903
Deferred			3,721		(1,178)
Total income tax expense (benefit)			13,671		9,725
Income (loss) from continuing operations, net of tax			(174,668)		(128,329)
Income (loss) from discontinued operations, net of tax			—		19
Net income (loss)			(174,668)		(128,310)
Less: Net (income) loss attributable to noncontrolling interest			(9,828)		(8,776)
Net income (loss) attributable to Nabors			(184,496)		(137,086)
Less: Preferred stock dividend			—		(3,653)
Net income (loss) attributable to Nabors common shareholders		$	(184,496)	$	(140,739)
Amounts attributable to Nabors common shareholders:
Net income (loss) from continuing operations		$	(184,496)	$	(140,758)
Net income (loss) from discontinued operations			—		19
Net income (loss) attributable to Nabors common shareholders		$	(184,496)	$	(140,739)
Earnings (losses) per share:
Basic from continuing operations		$	(22.51)	$	(20.16)
Basic from discontinued operations			—		—
Total Basic		$	(22.51)	$	(20.16)
Diluted from continuing operations		$	(22.51)	$	(20.16)
Diluted from discontinued operations			—		—
Total Diluted		$	(22.51)	$	(20.16)
Weighted-average number of common shares outstanding:
Basic			8,311		7,102
Diluted			8,311		7,102

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Net income (loss) attributable to Nabors		$	(184,496)	$	(137,086)
Other comprehensive income (loss), before tax:
Translation adjustment attributable to Nabors			(132)		2,228
Pension liability amortization and adjustment			1,480		(1,848)
Other comprehensive income (loss), before tax			1,348		380
Income tax expense (benefit) related to items of other comprehensive income (loss)			12		12
Other comprehensive income (loss), net of tax			1,336		368
Comprehensive income (loss) attributable to Nabors			(183,160)		(136,718)
Comprehensive income (loss) attributable to noncontrolling interest			9,828		8,776
Comprehensive income (loss)		$	(173,332)	$	(127,942)

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31,
	2022		2021
	(In thousands)
Cash flows from operating activities:
Net income (loss)	$	(174,668)	$	(128,310)
Adjustments to net income (loss):
Depreciation and amortization		164,360		177,277
Deferred income tax expense (benefit)		3,721		(1,178)
Impairments and other charges		—		355
Amortization of debt discount and deferred financing costs		4,984		5,400
Losses (gains) on debt buyback		36		(8,062)
Losses (gains) on long-lived assets, net		77		8,524
Losses (gains) on investments, net		1		(315)
Provision (recovery) of bad debt		—		(2,339)
Share-based compensation		3,879		6,775
Foreign currency transaction losses (gains), net		4,214		2,365
Mark-to-market loss on warrants		71,752		—
Noncontrolling interest		(9,828)		(8,777)
Other		110		398
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable		(22,775)		32,017
Inventory		(5,621)		6,039
Other current assets		(8,039)		(6,476)
Other long-term assets		2,136		(4,949)
Trade accounts payable and accrued liabilities		2,024		(17,697)
Income taxes payable		682		15,766
Other long-term liabilities		4,309		2,677
Net cash provided by (used for) operating activities		41,354		79,490
Cash flows from investing activities:
Purchases of investments		(1,534)		(14)
Sales and maturities of investments		5		10,908
Capital expenditures		(84,258)		(40,852)
Proceeds from sales of assets and insurance claims		3,671		10,839
Other		9		—
Net cash (used for) provided by investing activities		(82,107)		(19,119)
Cash flows from financing activities:
Reduction in long-term debt		(86,127)		(16,838)
Debt issuance costs		(3,858)		(2,421)
Proceeds from revolving credit facilities		40,000		95,000
Reduction in revolving credit facilities		(500,000)		(135,000)
Proceeds from issuance of common shares, net of issuance costs		257		—
Repurchase of common and preferred shares		(4,523)		—
Dividends to common and preferred shareholders		(10)		(3,662)
Distributions to noncontrolling interest		(995)		(49,077)
Other		—		(1,923)
Net cash (used for) provided by financing activities		(555,256)		(113,921)
Effect of exchange rate changes on cash and cash equivalents		(1,289)		(1,111)
Net increase (decrease) in cash and cash equivalents and restricted cash		(597,298)		(54,661)
Cash and cash equivalents and restricted cash, beginning of period		1,273,510		475,280
Cash and cash equivalents and restricted cash, end of period	$	676,212	$	420,619
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents, beginning of period		991,471		472,246
Restricted cash, beginning of period		282,039		3,034
Cash and cash equivalents and restricted cash, beginning of period	$	1,273,510	$	475,280
Cash and cash equivalents, end of period		394,028		417,544
Restricted cash, end of period		282,184		3,075
Cash and cash equivalents and restricted cash, end of period	$	676,212	$	420,619

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited)

	Mandatory Convertible						Capital		Accumulated
	Preferred Shares			Common Shares			in Excess		Other						Non-
		Par			Par		of Par		Comprehensive		Retained		Treasury		controlling		Total
(In thousands, except per share amounts)	Shares	Value		Shares	Value		Value		Income		Earnings		Shares		Interest		Equity
As of December 31, 2020	4,870	$	5	8,383	$	419	$	3,423,935	$	(11,124)	$	(946,100)	$	(1,315,751)	$	105,424	$	1,256,808
Net income (loss)	—		—	—		—		—		—		(137,086)		—		8,776		(128,310)
PSU distribution equivalent rights	—		—	—		—		—		—		(10)		—		—		(10)
Dividends to preferred shareholders ($0.75 per share)	—		—	—		—		—		—		(3,653)		—		—		(3,653)
Other comprehensive income (loss), net of tax	—		—	—		—		—		368		—		—		—		368
Share-based compensation	—		—	—		—		6,775		—		—		—		—		6,775
Accrued distribution on redeemable noncontrolling interest in subsidiary	—		—	—		—		—		—		(2,402)		—		—		(2,402)
Other	—		—	120		(2)		(1,621)		—		—		—		1		(1,622)
As of March 31, 2021	4,870	$	5	8,503	$	417	$	3,429,089	$	(10,756)	$	(1,089,251)	$	(1,315,751)	$	114,201	$	1,127,954
As of December 31, 2021	—	$	—	9,295	$	466	$	3,454,563	$	(10,634)	$	(1,537,988)	$	(1,315,751)	$	128,282	$	718,938
Net income (loss)	—		—	—		—		—		—		(184,496)		—		9,828		(174,668)
PSU distribution equivalent rights	—		—	—		—		—		—		(9)		—		—		(9)
Warrant Exercise, net of tax	—		—	1,024		52		139,436		—		—		—		—		139,488
Other comprehensive income (loss), net of tax	—		—	—		—		—		1,336		—		—		—		1,336
Noncontrolling interest contributions (distributions)	—		—	—		—		—		—		—		—		(996)		(996)
Share-based compensation	—		—	—		—		3,879		—		—		—		—		3,879
Accrued distribution on redeemable noncontrolling interest in subsidiary	—	—	—	—		—		—		—		(2,545)		—		—		(2,545)
Other	—		—	156		5		(4,523)		—		(175)		—		—		(4,693)
As of March 31, 2022	—	$	—	10,475	$	523	$	3,593,355	$	(9,298)	$	(1,725,213)	$	(1,315,751)	$	137,114	$	680,730

The accompanying notes are an integral part of these condensed consolidated financial statements.

7

Nabors Industries Ltd. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 General

Unless the context requires otherwise, references in this report to “we,” “us,” “our,” “the Company,” or “Nabors” mean Nabors Industries Ltd., together with our subsidiaries where the context requires. References in this report to “Nabors Delaware” mean Nabors Industries, Inc., a wholly owned subsidiary of Nabors.

Our business is comprised of our global land-based and offshore drilling rig operations and other rig related services and technologies. These services and technologies include tubular running services, wellbore placement solutions, directional drilling, measurement-while-drilling (“MWD”), logging-while-drilling (“LWD”) systems and services, equipment manufacturing, rig instrumentation and drilling optimization software.

With operations in over 15 countries, we are a global provider of drilling and drilling-related services for land-based and offshore oil and natural gas wells, with a fleet of rigs and drilling-related equipment which, as of March 31, 2022 included:

● 301 actively marketed rigs for land-based drilling operations in the United States and various countries throughout the world; and

● 29 actively marketed rigs for offshore platform drilling operations in the United States and multiple international markets.

The short and long-term implications of the military hostilities between Russia and Ukraine, which began on February 24, 2022, are difficult to predict at this time. We continue to actively monitor this dynamic situation and will fulfill any existing activity in full compliance with applicable international laws and sanctions. As of March 31, 2022, 1.3% of our property, plant and equipment, net was located in Russia. For the three months ending March 31, 2022, 1.4% of our operating revenues were from operations in Russia.

Note 2 Summary of Significant Accounting Policies

Interim Financial Information

The accompanying unaudited condensed consolidated financial statements of Nabors have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”). Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC” or “Commission”), certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. Therefore, these financial statements should be read together with our annual report on Form 10-K for the year ended December 31, 2021 (“2021 Annual Report”). In management’s opinion, the unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to state fairly our financial position as of March 31, 2022 and the results of operations, comprehensive income (loss), cash flows and changes in equity for the periods presented herein. Interim results for the three months ended March 31, 2022 may not be indicative of results that will be realized for the full year ending December 31, 2022.

Principles of Consolidation

Our condensed consolidated financial statements include the accounts of Nabors, as well as all majority owned and non-majority owned subsidiaries consolidated in accordance with U.S. GAAP. All significant intercompany accounts and transactions are eliminated in consolidation.

In addition to the consolidation of our majority owned subsidiaries, we also consolidate variable interest entities (“VIE”) when we are determined to be the primary beneficiary of a VIE. Determination of the primary beneficiary of a VIE is based on whether an entity has (1) the power to direct activities that most significantly impact the economic performance of the VIE and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Our joint venture, SANAD, which is equally owned by Saudi Aramco and Nabors,

8

has been consolidated. As we have the power to direct activities that most significantly impact SANAD’s economic performance, including operations, maintenance and certain sourcing and procurement, we have determined Nabors to be the primary beneficiary. See Note 3—Joint Ventures.

Inventory

Inventory is stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out or weighted-average cost methods and includes the cost of materials, labor and manufacturing overhead. Inventory included the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
Raw materials	$	108,912	$	105,638
Work-in-progress		2,336		1,368
Finished goods		20,878		19,442
	$	132,126	$	126,448

Special Purpose Acquisition Company

Nabors Energy Transition Corp. (“NETC”) is a consolidated VIE that is included in the accompanying consolidated financial statements under the following captions:

Restricted cash held in trust

As part of the initial public offering of NETC and subsequent private placement warrant transactions, $281.5 million has been deposited in an interest-bearing U.S. based trust account (“Trust Account”). The funds held in the Trust Account are invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations.

Redeemable noncontrolling interest in subsidiary

The company accounts for the non-controlling interest in NETC as subject to possible redemption in accordance with FASB ASC Topic 480 “Distinguishing Liabilities from Equity.” NETC’s common stock features certain redemption rights, which are considered to be outside the company’s control and subject to occurrence of uncertain future events. Accordingly, the $281.5 million of non-controlling interest subject to possible redemption is presented at full redemption value as temporary equity, outside of the stockholders’ equity section in the accompanying consolidated financial statements as of March 31, 2022.

Nabors will recognize any future changes in redemption value immediately as they occur – i.e., adjust the carrying amount of the instrument to its current redemption amount at each reporting period.

Note 3 Joint Ventures

During 2016, we entered into an agreement with Saudi Aramco to form a joint venture known as SANAD to own, manage and operate onshore drilling rigs in the Kingdom of Saudi Arabia. SANAD is equally owned by Saudi Aramco and Nabors.

During 2017, Nabors and Saudi Aramco each contributed $20 million in cash for the purpose of capitalizing the joint venture upon formation. In addition, since inception Nabors and Saudi Aramco have each contributed a combination of drilling rigs, drilling rig equipment and other assets, including cash, each with a value of approximately $394 million to the joint venture. The contributions were received in exchange for redeemable ownership interests which accrue interest annually, have a twenty-five year maturity and are required to be converted to authorized capital should certain events occur, including the accumulation of specified losses. In the accompanying condensed consolidated balance sheet, Nabors has reported Saudi Aramco’s share of authorized capital as a component of noncontrolling interest in equity and Saudi Aramco’s share of the redeemable ownership interests as redeemable noncontrolling interest in subsidiary, classified as mezzanine equity. As of March 31, 2022, the amount included in redeemable noncontrolling

9

interest was $396.3 million. The accrued interest on the redeemable ownership interest is a non-cash financing activity and is reported as an increase in the redeemable noncontrolling interest in subsidiary line in our condensed consolidated balance sheet. In 2021, SANAD settled approximately $120 million of the accrued interest from inception to December 2021, by making cash payments to each partner for their respective amounts. The assets and liabilities included in the condensed balance sheet below are (1) assets that can either be used to settle obligations of the VIE or be made available in the future to the equity owners through dividends, distributions or in exchange of the redeemable ownership interests (upon mutual agreement of the owners) or (2) liabilities for which creditors do not have recourse to other assets of Nabors.

The condensed balance sheet of SANAD, as included in our condensed consolidated balance sheet, is presented below.

	March 31,		December 31,
	2022		2021
	(In thousands)
Assets:
Cash and cash equivalents	$	308,761	$	293,037
Accounts receivable		79,366		88,174
Other current assets		6,703		6,662
Property, plant and equipment, net		492,676		467,587
Other long-term assets		19,006		19,010
Total assets	$	906,512	$	874,470
Liabilities:
Accounts payable	$	61,722	$	61,278
Accrued liabilities		10,812		6,021
Other liabilities		26,597		26,300
Total liabilities	$	99,131	$	93,599

Note 4 Accounts Receivable Purchase and Sales Agreements

The Company has entered into an accounts receivable sales agreement (the “A/R Sales Agreement” and, together with the A/R Purchase Agreement (as defined below), the “A/R Facility”) to sell short-term receivables from certain customer trade accounts to an unaffiliated financial institution on a revolving basis. In July 2021, we entered into the First Amendment to the A/R Sales Agreement (the “First Agreement”), which reduced the commitments of the third-party financial institutions (the “Purchasers”) from $250 million to $150 million and extended the term of the agreements by two years, to August 13, 2023.

As part of the A/R Facility, the Company continuously sells designated pools of receivables as they are originated by it and certain U.S. subsidiaries to a separate, bankruptcy-remote, special purpose entity (“SPE”) pursuant to a purchase agreement between the SPE and the Company (the “A/R Purchase Agreement”).  The SPE in turn sells, transfers, conveys and assigns to the Purchasers all the rights, title and interest in and to its pool of eligible receivables (the “Eligible Receivables”). The sale of the Eligible Receivables qualified for sale accounting treatment in accordance with ASC 860 – Transfers and Servicing. During the period of this program, cash receipts from the Purchasers at the time of the sale are classified as operating activities in our consolidated statement of cash flows and the associated receivables are derecognized from the Company’s consolidated balance sheet at the time of the sale. The remaining receivables held by the SPE were pledged to secure the collectability of the sold Eligible Receivables.  Subsequent collections on the pledged receivables, which have not been sold, will be classified as operating cash flows in our consolidated statement of cash flows at the time of collection.  The amount of receivables pledged as collateral as of March 31, 2022 and December 31, 2021 is approximately $55.3 million and $44.2 million, respectively.

The amount available for sale to the Purchasers under the A/R Sales Agreement fluctuates over time based on the total amount of Eligible Receivables generated during the normal course of business after excluding excess concentrations and certain other ineligible receivables. As of March 31, 2022, approximately $136.0 million had been sold to and as yet uncollected by the Purchasers. As of December 31, 2021, the corresponding number was approximately $113.0 million.

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Note 5 Debt

Debt consisted of the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
5.50% senior notes due January 2023 (1)	$	21,226	$	24,446
5.10% senior notes due September 2023		62,338		82,703
0.75% senior exchangeable notes due January 2024		162,065		259,839
5.75% senior notes due February 2025		526,628		548,458
6.50% senior priority guaranteed notes due February 2025		—		50,485
9.00% senior priority guaranteed notes due February 2025		218,082		218,082
7.25% senior guaranteed notes due January 2026		557,902		559,978
7.375% senior priority guaranteed notes due May 2027		700,000		700,000
7.50% senior guaranteed notes due January 2028		389,609		389,609
2018 revolving credit facility		—		460,000
	$	2,637,850	$	3,293,600
Less: deferred financing costs		27,758		30,805
Long-term debt	$	2,610,092	$	3,262,795

(1) The 5.50% senior notes due January 2023 were classified as long-term as of March 31, 2022, because we had the ability and intent to repay this obligation utilizing our 2022 Credit Agreement.

During the three months ended March 31, 2022, we repurchased $27.1 million aggregate principal amount of various outstanding Nabors Delaware’s notes for approximately $27.0 million in cash, including principal and $0.3 million in accrued and unpaid interest. In connection with these repurchases, we recognized a minimal loss for the three months ended March 31, 2022 which is included in Other, net in our condensed consolidated statement of income (loss). Also, during the three months ended March 31, 2022, $130.7 million in maturity value of our notes were tendered by warrant holders, and retired, in connection with exercises of the common stock warrants.

Exchange Transactions

During the first quarter of 2021, we entered into two private exchange transactions in which Nabors Delaware exchanged 9.0% senior priority guaranteed notes due 2025 (the “9.0% Exchange Notes”) for various amounts of existing outstanding notes. Nabors Delaware did not receive any cash proceeds from the issuance of the Exchange Notes. Collectively from the series of exchanges, Nabors Industries, Inc. issued $26.1 million aggregate principal amount of the 9.0% Exchange Notes in exchange for $40.0 million aggregate principal amount of various Nabors Delaware’s Notes.

We recorded a minimal gain in connection with the exchange transactions, which was accounted for in accordance with ASC 470-60, Troubled Debt Restructuring by Debtors. Under ASC 470-60, a gain is recorded in an amount equal to the sum of the future undiscounted payments (principal and interest) related to the new Exchange Notes plus the costs incurred in connection with the transaction, less the carrying value of the notes that were exchanged. In relation to the transactions, we recorded $9.4 million related to future contractual interest payments on the new Exchange Notes and have included this amount in accrued liabilities and other long-term liabilities.

The aggregate principal amounts and recognized gain for such transactions were as follows (in thousands):

	Three months ended March 31,
	2021
Exchanged		(in thousands)
0.75% senior exchangeable notes due January 2024	$	35,000
5.75% senior notes due February 2025		5,000
Aggregate principal amount exchanged		40,000
Aggregate principal amount of debt issued in exchanges		26,050

11

0.75% Senior Exchangeable Notes Due January 2024

In January 2017, Nabors Delaware issued $575.0 million in aggregate principal amount of 0.75% exchangeable senior unsecured notes due 2024, which are fully and unconditionally guaranteed by Nabors. The notes bear interest at a rate of 0.75% per year payable semiannually on January 15 and July 15 of each year, beginning on July 15, 2017. As of March 31, 2022, there was approximately $177.0 million in aggregate principal amount that remained outstanding.

The exchangeable notes are currently exchangeable, under certain conditions, at an exchange rate of .8018 common shares of Nabors per $1,000 principal amount of exchangeable notes (equivalent to an exchange price of approximately $1,247.19 per common share). The exchangeable notes were originally bifurcated for accounting purposes into debt and equity components of $411.2 million and $163.8 million, respectively, based on the terms of the notes and the relative fair value at the issuance date. Upon any exchange, as a result of an amendment to the notes, Nabors Delaware will settle its exchange obligation in cash.

2018 Revolving Credit Facility

In October 2018, Nabors Delaware and Nabors Drilling Canada Limited (“Nabors Canada” and together with Nabors Delaware, the “Borrowers”) entered into a credit agreement dated October 11, 2018 by and among the Borrowers, the guarantors identified therein, HSBC Bank Canada, as the Canadian lender the issuing banks and other lenders party thereto (the “U.S. Lenders”) and Citibank, N.A., as administrative agent solely for the U.S. Lenders (as may be amended, restated, supplemented or otherwise modified from time to time, the “2018 Revolving Credit Facility”). As of January 21, 2022, we repaid all amounts outstanding under the 2018 Revolving Credit Facility and the 2018 Revolving Credit Facility was terminated.

2022 Credit Agreement

On January 21, 2022, we entered into a revolving credit agreement between Nabors Delaware, the guarantors from time to time party thereto, the issuing banks (the “Issuing Banks”) and other lenders party thereto (the “Lenders”) and Citibank, N.A., as administrative agent (the “2022 Credit Agreement”). Under the 2022 Credit Agreement, the Lenders have committed to provide up to an aggregate principal amount at any time outstanding not in excess of $350.0 million (with an accordion feature for an additional $100.0 million) to Nabors Delaware under a secured revolving credit facility, including sub-facilities provided by certain of the Lenders for letters of credit in an aggregate principal amount at any time outstanding not in excess of $100.0 million.

The 2022 Credit Agreement permits the incurrence of additional indebtedness secured by liens, which may include liens on the collateral securing the facility, in an amount up to $150.0 million as well as a grower basket for term loans in an amount not to exceed $100.0 million secured by liens not on the collateral. The Company is required to maintain an interest coverage ratio (EBITDA/interest expense), which increases on a quarterly basis, and a minimum guarantor value, requiring the guarantors (other than the Company) and their subsidiaries to own at least 90% of the consolidated property, plant and equipment of the Company. The facility matures on the earlier of (a) January 21, 2026 and (b) (i) to the extent any principal amount of Nabors Delaware’s existing 5.1% senior notes due 2023, 5.5% senior notes due 2023 and 5.75% senior notes due 2025 remains outstanding on the date that is 90 days prior to the applicable maturity date for such indebtedness, then such 90^th day or (ii) to the extent 50% or more of the outstanding (as of the closing date) aggregate principal amount of the 0.75% senior exchangeable notes due 2024 remains outstanding and not refinanced or defeased on the date that is 90 days prior to the maturity date for such indebtedness, then such 90th day.

Additionally, the Company is subject to certain covenants, which are subject to certain exceptions and include, among others, (i) a covenant restricting our ability to incur liens (subject to the additional liens basket of up to $150.0 million) , (ii) a covenant restricting its ability to pay dividends or make other distributions with respect to its capital stock and to repurchase certain indebtedness and (iii) a covenant restricting the ability of the Company’s subsidiaries to incur debt (subject to the grower basket of up to $100.0 million). The agreement also includes a collateral coverage requirement that the collateral rig fair value is to be no less than the collateral coverage threshold, as defined in the agreement.  This requirement includes an independent appraisal report to be delivered every 6 months following the closing date.

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As of March 31, 2022, we had no borrowings outstanding under our 2022 Credit Agreement. The weighted average interest rate on borrowings under the 2022 Credit Agreement at March 31, 2022 was 3.23%. In order to make any future borrowings under the 2022 Credit Agreement, Nabors and certain of its wholly owned subsidiaries are subject to compliance with the conditions and covenants contained therein, including compliance with applicable financial ratios.

As of the date of this report, we were in compliance with all covenants under the 2022 Credit Agreement. We expect to remain in compliance with all covenants under the 2022 Credit Agreement during the twelve month period following the date of this report based on our current operational and financial projections. However, we can make no assurance of continued compliance if our current projections or material underlying assumptions prove to be incorrect. If we fail to comply with the covenants, the revolving credit commitment could be terminated, and any outstanding borrowings under the facility could be declared immediately due and payable.

Note 6 Shareholders’ Equity

Common shares

On July 19, 2021, we issued 147,974 shares, valued at approximately $12.9 million, in connection with the purchase of certain development stage technologies in the energy transition space. Of the shares issued, 71,280 shares are forfeitable if certain milestones are not achieved over the next two years.

Common stock warrants

On May 27, 2021, the Board declared a distribution to holders of the Company’s common shares of warrants to purchase its common shares (the “Warrants”). Holders of Nabors common shares received two-fifths of a warrant per common share held as of the record date (rounded down for any fractional warrant). Nabors issued approximately 3.2 million warrants on June 11, 2021 to shareholders of record as of June 4, 2021. As of March 31, 2022, 2.5 million warrants remain outstanding and 1.0 million of common shares have been issued as a result of exercises of warrants.

Each Warrant represents the right to purchase one common share at an initial exercise price of $166.66667 per Warrant, subject to certain adjustments (the “Exercise Price”). In addition, Warrants submitted for exercise may be eligible to receive an additional one-third common share due to the incentive share component. The incentive share is an extra amount of common shares that Nabors will award when the volume weighted average price of Nabors’ common shares on the day before any Warrant holder exercises its Warrants multiplied by three is at least 6% higher than the sum of the volume weighted average prices of Nabors’ common shares on each of the second, third and fourth days before any Warrant holder exercises its Warrants. Effective as of April 25, 2022, Warrant holders were no longer entitled to receive any incentive shares when exercising the Warrants. Payment for common shares on exercise of Warrants may be in (i) cash or (ii)“Designated Notes,” which the Company initially defined as (a) Nabors Delaware’s (i) 5.10% Notes due 2023, (ii) 0.75% Exchangeable Notes due 2024, (iii) 5.75% Notes due 2025 and (b) the Company’s 7.25% Notes due 2026, subject to compliance with applicable procedures with respect to the delivery of the Warrants and Designated Notes. Effective March 21, 2022, the 0.75% Exchangeable Notes due 2024 was removed from the list of Designated Notes. The Exercise Price and the number of common shares issuable upon exercise are subject to anti-dilution adjustments, including for share dividends, splits, subdivisions, spin-offs, consolidations, reclassifications, combinations, noncash distributions, cash dividends (other than regular quarterly cash dividends not exceeding a permitted threshold amount), certain pro rata shares repurchases, and similar transactions, including certain issuances of common shares (or securities exercisable or convertible into or exchangeable for common shares) at a price (or having a conversion price) that is less than 95% of the market price of the common shares. The Warrants expire on June 11, 2026, but the expiration date may be accelerated at any time by the Company upon 20-days’ prior notice. The Company has listed the Warrants on the over-the-counter market.

The common stock warrants are recognized as derivative liabilities in accordance with ASC 815-40. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. The fair value of the Warrants was initially measured at fair value using a Monte Carlo pricing model due to the level of market activity. As of March 31, 2022, the fair value of the Warrants was measured using their trading price to account for increased trading volume. At distribution, the fair value of the Warrants was $2.7 million. On March 31, 2022, the fair value of the Warrants was

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approximately $57.2 million. During the three months ended March 31, 2022, approximately $73.2 million of loss has been recognized for the increase in liability and included in Other, net in our consolidated statements of income (loss).

Note 7 Fair Value Measurements

Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable. We primarily apply the market approach for recurring fair value measurements and endeavor to utilize the best information available. Accordingly, we employ valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.

The use of unobservable inputs is intended to allow for fair value determinations in situations where there is little, if any, market activity for the asset or liability at the measurement date. We are able to classify fair value balances utilizing a fair value hierarchy based on the observability of those inputs.

Under the fair value hierarchy:

● Level 1 measurements include unadjusted quoted market prices for identical assets or liabilities in an active market;

● Level 2 measurements include quoted market prices for identical assets or liabilities in an active market that have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets; and

● Level 3 measurements include those that are unobservable and of a subjective nature.

Our financial liabilities that are accounted for at fair value on a recurring basis as of March 31, 2022 consisted of our common stock warrants. During the three months ended March 31, 2022, the common stock warrants transferred from using Level 3 inputs to Level 1 measurements due to increased trading volume. As of March 31, 2022, our common stock warrants were carried at fair market value and totaled $57.2 million.

Recurring Fair Value Measurements

The fair value of the common stock warrants was initially measured at fair value using a Monte Carlo option pricing model. As of December 31, 2021, the estimated fair value of the warrants is determined using Level 3 inputs. Inherent in the option pricing simulation are assumptions related to expected stock-price volatility, expected life and risk-free interest rate. The Company estimates the volatility of its common stock warrants based on implied and historical volatility of the company’s traded common stock. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is based on the Company’s ability to initiate expiration, subject to a 20 business day notice period.

Nonrecurring Fair Value Measurements

We applied fair value measurements to our nonfinancial assets and liabilities measured on a nonrecurring basis, which consist of measurements primarily related to assets held for sale, goodwill, intangible assets and other long-lived assets and assets acquired and liabilities assumed in a business combination. Based upon our review of the fair value hierarchy, the inputs used in these fair value measurements were considered Level 3 inputs.

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Fair Value of Financial Instruments

We estimate the fair value of our financial instruments in accordance with U.S. GAAP. The fair value of our long-term debt and revolving credit facilities is estimated based on quoted market prices or prices quoted from third-party financial institutions. The fair value of our debt instruments is determined using Level 2 measurements. The carrying and fair values of these liabilities were as follows:

		March 31, 2022				December 31, 2021
		Carrying		Fair		Carrying		Fair
		Value		Value		Value		Value
	(In thousands)
5.50% senior notes due January 2023		$	21,226	$	21,536	$	24,446	$	24,736
5.10% senior notes due September 2023			62,338		63,685		82,703		84,044
0.75% senior exchangeable notes due January 2024			162,065		168,155		259,839		257,730
5.75% senior notes due February 2025			526,628		513,304		548,458		508,881
6.50% senior priority guaranteed notes due February 2025			—		—		50,485		50,490
9.00% senior priority guaranteed notes due February 2025			218,082		227,346		218,082		226,914
7.25% senior guaranteed notes due January 2026			557,902		557,935		559,978		522,079
7.375% senior priority guaranteed notes due May 2027			700,000		728,049		700,000		724,906
7.50% senior guaranteed notes due January 2028			389,609		379,058		389,609		346,966
2018 revolving credit facility			—		—		460,000		460,000
		$	2,637,850	$	2,659,069	$	3,293,600	$	3,206,746
Less: deferred financing costs			27,758				30,805
		$	2,610,092			$	3,262,795

The fair values of our cash equivalents, trade receivables and trade payables approximate their carrying values due to the short-term nature of these instruments.

Note 8 Commitments and Contingencies

Contingencies

Income Tax

We operate in a number of countries and our tax returns filed in those jurisdictions are subject to review and examination by tax authorities within those jurisdictions. We do not recognize the benefit of income tax positions we believe are more likely than not to be disallowed upon challenge by a tax authority. If any tax authority successfully challenges our operational structure, intercompany pricing policies or the taxable presence of our subsidiaries in certain countries, if the terms of certain income tax treaties are interpreted in a manner that is adverse to our structure, or if we lose a material tax dispute in any country, our effective tax rate on our worldwide earnings could change substantially.

In certain jurisdictions we have recognized deferred tax assets and liabilities. Judgment and assumptions are required in determining whether deferred tax assets will be fully or partially utilized. When we estimate that all or some portion of certain deferred tax assets such as net operating loss carryforwards will not be utilized, we establish a valuation allowance for the amount we determine to be more likely than not unrealizable. We continually evaluate strategies that could allow for future utilization of our deferred assets. Any change in the ability to utilize such deferred assets will be accounted for in the period of the event affecting the valuation allowance. If facts and circumstances cause us to change our expectations regarding future tax consequences, the resulting adjustments could have a material effect on our financial results or cash flow. At this time, we consider it more likely than not that we will have sufficient taxable income in the future that will allow us to realize the deferred tax assets that we have recognized. However, it is possible that some of our recognized deferred tax assets, relating to net operating loss carryforwards, could expire unused or could carryforward indefinitely without utilization. Therefore, unless we are able to generate sufficient taxable income from our component operations, a substantial valuation allowance to reduce our deferred tax assets may be required, which would materially increase our tax expense in the period the allowance is recognized and materially adversely affect our results of operations and statement of financial condition.

15

Litigation

Nabors and its subsidiaries are defendants or otherwise involved in a number of lawsuits in the ordinary course of business. We estimate the range of our liability related to pending litigation when we believe the amount and range of loss can be estimated. We record our best estimate of a loss when the loss is considered probable. When a liability is probable and there is a range of estimated loss with no best estimate in the range, we record the minimum estimated liability related to the lawsuits or claims. As additional information becomes available, we assess the potential liability related to our pending litigation and claims and revise our estimates. Due to uncertainties related to the resolution of lawsuits and claims, the ultimate outcome may differ from our estimates. For matters where an unfavorable outcome is reasonably possible and significant, we disclose the nature of the matter and a range of potential exposure, unless an estimate cannot be made at the time of disclosure. In the opinion of management and based on liability accruals provided, our ultimate exposure with respect to these pending lawsuits and claims is not expected to have a material adverse effect on our consolidated financial position or cash flows, although they could have a material adverse effect on our results of operations for a particular reporting period.

In March 2011, the Court of Ouargla entered a judgment of approximately $19.8 million (at March 31, 2022 exchange rates) against us relating to alleged violations of Algeria’s foreign currency exchange controls, which require that goods and services provided locally be invoiced and paid in local currency. The case relates to certain foreign currency payments made to us by CEPSA, a Spanish operator, for wells drilled in 2006. Approximately $7.5 million of the total contract amount was paid offshore in foreign currency, and approximately $3.2 million was paid in local currency. The judgment includes fines and penalties of approximately four times the amount at issue. We have appealed the ruling based on our understanding that the law in question applies only to resident entities incorporated under Algerian law. An intermediate court of appeals upheld the lower court’s ruling, and we appealed the matter to the Supreme Court. On September 25, 2014, the Supreme Court overturned the verdict against us, and the case was reheard by the Ouargla Court of Appeals on March 22, 2015 in light of the Supreme Court’s opinion. On March 29, 2015, the Ouargla Court of Appeals reinstated the initial judgment against us. We appealed this decision again to the Supreme Court, which again overturned the appeals court’s decision. The case was moved back to the court of appeals, which, once again, reinstated the verdict, failing to abide by the Supreme Court’s ruling. Accordingly, we are appealing once more to the Supreme Court to try to get a final ruling on the matter. While our payments were consistent with our historical operations in the country, and, we believe, those of other multinational corporations there, as well as interpretations of the law by the Central Bank of Algeria, the ultimate resolution of this matter could result in a loss of up to $11.8 million in excess of amounts accrued.

Following a routine audit conducted in May and June of 2018 by the Atyrau Oblast Ecology Department (the “AOED”), our joint venture in Kazakhstan, KMG Nabors Drilling Company (“KNDC”), was administratively fined for not having emissions permits for KNDC owned or leased equipment, due to a change in interpretation by the AOED that the owner/lessor of the equipment that emits the pollutants must have its own permits.  Administrative fines of $0.8 million were paid by KNDC for such violations. AOED also assessed additional “environmental damages” in the amount of $3.4 million for the period. KNDC appealed and, ultimately, the Supreme Court ruled in KNDC’s favor on July 21, 2021, terminating the administrative case for lack of evidence. KNDC was reimbursed by the AOED for the environmental damages on December 27, 2021. With the potential for additional damages for later year audits, KNDC and the operator have executed an agreement formalizing the operator’s obligation to reimburse KNDC for many of the financial expenses related to this case as well as penalties and expenses related to future audit periods.  Since 2019, KNDC holds its own permits. Another audit by AOED was performed for the second half of 2018, but KNDC continues to appeal this decision in the same manner as the prior audit.  Meanwhile, KNDC received notice from government officials that certain of our employees may be held personally responsible, but considering the numerous court proceedings, the governmental officials temporarily suspended any criminal investigations. On December 10, 2021, the regional court in Atyrau Region upheld KNDC’s position and ruled in our favor. AOED still holds a right to appeal this decision to the Supreme Court until June 30, 2022, but it has canceled previously-issued audit decision that was the basis of the administrative proceeding.  AOED also has an appeal pending for review of the environmental damages and has until the end of May 2022 to provide additional information to the court.  AOED also carried out a planned audit for the period January 2019-February 2022 which had no material findings. We continue to be engaged and are monitoring the situation.

16

Off-Balance Sheet Arrangements (Including Guarantees)

We are a party to some transactions, agreements or other contractual arrangements defined as “off-balance sheet arrangements” that could have a material future effect on our financial position, results of operations, liquidity and capital resources. The most significant of these off-balance sheet arrangements include the A/R Facility (see Note 4—Accounts Receivable Purchase and Sales Agreements) and certain agreements and obligations under which we provide financial or performance assurance to third parties. Certain of these financial or performance assurances serve as guarantees, including standby letters of credit issued on behalf of insurance carriers in conjunction with our workers’ compensation insurance program and other financial surety instruments such as bonds. In addition, we have provided indemnifications, which serve as guarantees, to some third parties. These guarantees include indemnification provided by Nabors to our share transfer agent and our insurance carriers. We are not able to estimate the potential future maximum payments that might be due under our indemnification guarantees.

Management believes the likelihood that we would be required to perform or otherwise incur any material losses associated with any of these guarantees is remote. The following table summarizes the total maximum amount of financial guarantees issued by Nabors:

	Maximum Amount
	2022		2023	2024	Thereafter	Total
	(In thousands)
Financial standby letters of credit and other financial surety instruments	$	35,156	13,065	8,488	35,967	$	92,676

Note 9 Earnings (Losses) Per Share

ASC 260, Earnings per Share, requires companies to treat unvested share-based payment awards that have nonforfeitable rights to dividends or dividend equivalents as a separate class of securities in calculating earnings (losses) per share. We have granted and expect to continue to grant to employees restricted stock grants that contain nonforfeitable rights to dividends. Such grants are considered participating securities under ASC 260. As such, we are required to include these grants in the calculation of our basic earnings (losses) per share and calculate basic earnings (losses) per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. The participating security holders are not contractually obligated to share in losses. Therefore, losses are not allocated to the participating security holders.

Basic earnings (losses) per share is computed utilizing the two-class method and is calculated based on the weighted-average number of common shares outstanding during the periods presented.

Diluted earnings (losses) per share is computed using the weighted-average number of common and common equivalent shares outstanding during the periods utilizing the two-class method for stock options and unvested restricted shares.

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A reconciliation of the numerators and denominators of the basic and diluted earnings (losses) per share computations is as follows:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands, except per share amounts)
BASIC EPS:
Net income (loss) (numerator):
Income (loss) from continuing operations, net of tax		$	(174,668)	$	(128,329)
Less: net (income) loss attributable to noncontrolling interest			(9,828)		(8,776)
Less: preferred stock dividends			—		(3,653)
Less: accrued distribution on redeemable noncontrolling interest in subsidiary			(2,545)		(2,402)
Numerator for basic earnings per share:
Adjusted income (loss) from continuing operations, net of tax - basic		$	(187,041)	$	(143,160)
Income (loss) from discontinued operations, net of tax		$	—	$	19
Weighted-average number of shares outstanding - basic			8,311		7,102
Earnings (losses) per share:
Basic from continuing operations		$	(22.51)	$	(20.16)
Basic from discontinued operations			—		—
Total Basic		$	(22.51)	$	(20.16)
DILUTED EPS:
Adjusted income (loss) from continuing operations, net of tax - diluted		$	(187,041)	$	(143,160)
Income (loss) from discontinued operations, net of tax		$	—	$	19
Weighted-average number of shares outstanding - diluted			8,311		7,102
Earnings (losses) per share:
Diluted from continuing operations		$	(22.51)	$	(20.16)
Diluted from discontinued operations			—		—
Total Diluted		$	(22.51)	$	(20.16)

For all periods presented, the computation of diluted earnings (losses) per share excludes outstanding stock options with exercise prices greater than the average market price of Nabors’ common shares, because their inclusion would be anti-dilutive and because they are not considered participating securities. In any period during which the average market price of Nabors’ common shares exceeds the exercise prices of these stock options, such stock options will be included in our diluted earnings (losses) per share computation using the if-converted method of accounting. Restricted stock is included in our basic and diluted earnings (losses) per share computation using the two-class method of accounting in all periods because such stock is considered participating securities. For periods in which we experience a net loss from continuing operations, all potential common shares have been excluded from the calculation of weighted-average shares outstanding, because their inclusion would be anti-dilutive. The average number of shares from options that were excluded from diluted earnings (losses) per share that would potentially dilute earnings per share in the future were as follows:

	Three Months Ended
	March 31,
	2022		2021
Potentially dilutive securities excluded as anti-dilutive		13,194		72

Additionally, through the first quarter of 2021, we excluded 0.79 million common shares from the computation of diluted shares issuable upon the conversion of mandatory convertible preferred shares, because their effect would be anti-dilutive under the if-converted method. For the three months ended March 31, 2022, we excluded 3.4 million shares from the computation of diluted shares related to the warrants issued because their effect would be anti-dilutive under the if-converted method.

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Note 10 Supplemental Balance Sheet and Income Statement Information

Accrued liabilities included the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
Accrued compensation	$	52,181	$	51,993
Deferred revenue and proceeds on insurance and asset sales		44,970		59,816
Other taxes payable		26,783		34,333
Workers’ compensation liabilities		6,588		6,588
Interest payable		55,779		71,814
Litigation reserves		16,270		14,939
Other accrued liabilities		7,339		7,688
	$	209,910	$	247,171

Investment income (loss) includes the following:

	Three Months Ended
	March 31,
	2022		2021
	(In thousands)
Interest and dividend income	$	397	$	1,293
Gains (losses) on marketable securities		(234)		(30)
	$	163	$	1,263

Other, net included the following:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Losses (gains) on sales, disposals and involuntary conversions of long-lived assets		$	76	$	8,522
Warrant valuation			73,202		—
Litigation expenses and reserves			3,112		1,494
Foreign currency transaction losses (gains)			4,214		2,379
(Gain) loss on debt buyback			36		(8,062)
Other losses (gains)			(239)		3,013
		$	80,401	$	7,346

The changes in accumulated other comprehensive income (loss), by component, included the following:

	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total
	(In thousands (1) )
As of January 1, 2021	$	2	$	(3,616)	$	(7,510)	$	(11,124)
Other comprehensive income (loss) before reclassifications		—		(1,900)		2,228		328
Amounts reclassified from accumulated other comprehensive income (loss)		—		40		—		40
Net other comprehensive income (loss)		—		(1,860)		2,228		368
As of March 31, 2021	$	2	$	(5,476)	$	(5,282)	$	(10,756)

(1) All amounts are net of tax.

19

	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total
	(In thousands (1) )
As of January 1, 2022	$	2	$	(5,356)	$	(5,280)	$	(10,634)
Other comprehensive income (loss) before reclassifications		—		1,428		(132)		1,296
Amounts reclassified from accumulated other comprehensive income (loss)		—		40		—		40
Net other comprehensive income (loss)		—		1,468		(132)		1,336
As of March 31, 2022	$	2	$	(3,888)	$	(5,412)	$	(9,298)

(1) All amounts are net of tax.

The line items that were reclassified to net income included the following:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
General and administrative expenses		$	52	$	52
Total income (loss) from continuing operations before income tax			(52)		(52)
Tax expense (benefit)			(12)		(12)
Reclassification adjustment for (gains)/ losses included in net income (loss)		$	(40)	$	(40)

Note 11 Segment Information

The following table sets forth financial information with respect to our reportable operating segments:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Operating revenues:
U.S. Drilling		$	217,583	$	142,299
Canada Drilling			—		20,989
International Drilling			279,030		246,838
Drilling Solutions			54,182		35,706
Rig Technologies			36,736		25,748
Other reconciling items (1)			(18,992)		(11,069)
Total		$	568,539	$	460,511

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Adjusted operating income (loss): (2)
U.S. Drilling		$	(5,851)	$	(23,336)
Canada Drilling			(19)		3,907
International Drilling			(6,327)		(18,632)
Drilling Solutions			14,709		4,710
Rig Technologies			(2,751)		(2,569)
Total segment adjusted operating income (loss)		$	(239)	$	(35,920)

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		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Reconciliation of segment adjusted operating income (loss) to net income (loss):
Net income (loss)		$	(174,668)	$	(128,310)
Income (loss) from discontinued operations, net of tax			—		(19)
Income (loss) from continuing operations, net of tax			(174,668)		(128,329)
Income tax expense (benefit)			13,671		9,725
Income (loss) from continuing operations before income taxes			(160,997)	$	(118,604)
Investment (income) loss			(163)		(1,263)
Interest expense			46,910		42,975
Other, net			80,401		7,346
Other reconciling items (3)			33,610		33,626
Total segment adjusted operating income (loss) (2)		$	(239)	$	(35,920)

	March 31,		December 31,
	2022		2021
	(In thousands)
Total assets:
U.S. Drilling	$	1,540,980	$	1,606,683
Canada Drilling		529		1,392
International Drilling		2,343,972		2,380,703
Drilling Solutions		66,696		65,899
Rig Technologies		184,372		190,489
Other reconciling items (3)		720,617		1,280,198
Total	$	4,857,166	$	5,525,364

(1) Represents the elimination of inter-segment transactions related to our Rig Technologies operating segment.

(2) Adjusted operating income (loss) represents income (loss) from continuing operations before income taxes, interest expense, earnings (losses) from unconsolidated affiliates, investment income (loss), impairments and other charges and other, net. Management evaluates the performance of our operating segments using adjusted operating income (loss), which is a segment performance measure, because it believes that this financial measure reflects our ongoing profitability and performance. In addition, securities analysts and investors use this measure as one of the metrics on which they analyze our performance. A reconciliation from net income (loss) is provided in the above table.

(3) Represents the elimination of inter-segment transactions and unallocated corporate expenses and assets.

Note 12 Revenue Recognition

We recognize revenue when control of a good or service promised in a contract (i.e., performance obligation) is transferred to a customer. Control is obtained when a customer has the ability to direct the use of and obtain substantially all of the remaining benefits from that good or service. Contract drilling revenues are recorded over time utilizing the input method based on time elapsed. The measurement of progress considers the transfer of the service to the customer as we provide daily drilling services. We receive payment after the services have been performed by billing customers periodically (typically monthly). However, a portion of our revenues are recognized at a point-in-time as control is transferred at a distinct point in time such as with the sale of our top drives and other capital equipment. Within our drilling contracts, we have identified one performance obligation in which the transaction price is allocated.

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Disaggregation of revenue

In the following table, revenue is disaggregated by geographical region. The table also includes a reconciliation of the disaggregated revenue with the reportable segments:

	Three Months Ended
	March 31, 2022
		U.S. Drilling		Canada Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total
	(In thousands)
Lower 48	$	172,797	$	—	$	—	$	34,060	$	22,688	$	—	$	229,545
U.S. Offshore Gulf of Mexico		30,440		—		—		3,236		—		—		33,676
Alaska		14,346		—		—		276		—		—		14,622
Canada		—		—		—		436		979		—		1,415
Middle East & Asia		—		—		190,696		10,026		10,800		—		211,522
Latin America		—		—		68,895		5,929		—		—		74,824
Europe, Africa & CIS		—		—		19,439		219		2,269		—		21,927
Eliminations & other		—		—		—		—		—		(18,992)		(18,992)
Total	$	217,583	$	—	$	279,030	$	54,182	$	36,736	$	(18,992)	$	568,539

	Three Months Ended
	March 31, 2021
		U.S. Drilling		Canada Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total
	(In thousands)
Lower 48	$	109,534	$	—	$	—	$	18,448	$	12,539	$	—	$	140,521
U.S. Offshore Gulf of Mexico		27,193		—		—		2,736		—		—		29,929
Alaska		5,572		—		—		136		—		—		5,708
Canada		—		20,989		—		454		900		—		22,343
Middle East & Asia		—		—		168,187		8,991		9,078		—		186,256
Latin America		—		—		55,908		4,567		12		—		60,487
Europe, Africa & CIS		—		—		22,743		374		3,219		—		26,336
Eliminations & other		—		—		—		—		—		(11,069)		(11,069)
Total	$	142,299	$	20,989	$	246,838	$	35,706	$	25,748	$	(11,069)	$	460,511

Contract balances

We perform our obligations under a contract with a customer by transferring goods or services in exchange for consideration from the customer. We recognize a contract asset or liability when we transfer goods or services to a customer and bill an amount which differs from the revenue allocated to the related performance obligations.

The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) on our condensed consolidated balance sheet. In general, we receive payments from customers based on dayrates as stipulated in our contracts (e.g., operating rate, standby rate). The invoices billed to the customer are based on the varying rates applicable to the operating status on each rig. Accounts receivable are recorded when the right to consideration becomes unconditional.

Dayrate contracts also may contain fees charged to the customer for up-front rig modifications, mobilization and demobilization of equipment and personnel. These fees are associated with contract fulfillment activities, and the related revenue (subject to any constraint on estimates of variable consideration) is allocated to a single performance obligation and recognized ratably over the initial term of the contract. Mobilization fees are generally billable to the customer in the initial phase of a contract and generate contract liabilities until they are recognized as revenue. Demobilization fees are generally received at the end of the contract and generate contract assets when they are recognized as revenue prior to becoming receivables from the customer.

We receive reimbursements from our customers for the purchase of supplies, equipment, personnel services and other services provided at their request. Reimbursable revenues are variable and subject to uncertainty as the amounts received and timing thereof are dependent on factors outside of our influence. Accordingly, these revenues are constrained and not recognized until the uncertainty is resolved, which typically occurs when the related costs are incurred on behalf of the customer. We are generally considered a principal in these transactions and record the associated revenues at the gross amounts billed to the customer.

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The opening and closing balances of our receivables, contract assets and current and long-term contract liabilities are as follows:

			Contract		Contract		Contract		Contract
	Contract		Assets		Assets		Liabilities		Liabilities
	Receivables		(Current)		(Long-term)		(Current)		(Long-term)
	(In millions)
As of December 31, 2021	$	350.0	$	24.9	$	1.9	$	42.9	$	29.3
As of March 31, 2022	$	385.6	$	27.5	$	1.9	$	34.4	$	27.8

Approximately 37% of the contract liability balance at the beginning of the period is expected to be recognized as revenue during 2022, of which 10% was recognized during the three months ended March 31, 2022, and 28% is expected to be recognized during 2023. The remaining 35% of the contract liability balance at the beginning of the period is expected to be recognized as revenue during 2024 or thereafter.

Additionally, 88% of the contract asset balance at the beginning of the period is expected to be recognized as expense during 2022, of which 46% was recognized during the three months ended March 31, 2022, and 12% is expected to be recognized during 2023. This disclosure does not include variable consideration allocated entirely to a wholly unsatisfied performance obligation or promise to transfer a distinct good or service that forms part of a single performance obligation.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

We often discuss expectations regarding our future markets, demand for our products and services, and our performance in our annual, quarterly and current reports, press releases, and other written and oral statements. Statements relating to matters that are not historical facts are “forward-looking statements” within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These “forward-looking statements” are based on an analysis of currently available competitive, financial and economic data and our operating plans. They are inherently uncertain and investors should recognize that events and actual results could turn out to be significantly different from our expectations. By way of illustration, when used in this document, words such as “anticipate,” “believe,” “expect,” “plan,” “intend,” “estimate,” “project,” “will,” “should,” “could,” “may,” “predict” and similar expressions are intended to identify forward-looking statements.

You should consider the following key factors when evaluating these forward-looking statements:

● actual and potential political or economic instability, civil disturbance, war or acts of terrorism involving any of the countries in which we do business;

● the novel coronavirus (“COVID-19”) pandemic and its impact on our operations as well as oil and gas markets and prices;

● fluctuations and volatility in worldwide prices of and demand for oil and natural gas;

● fluctuations in levels of oil and natural gas exploration and development activities;

● fluctuations in the demand for our services;

● competitive and technological changes and other developments in the oil and gas and oilfield services industries;

● our ability to renew customer contracts in order to maintain competitiveness;

● the existence of operating risks inherent in the oil and gas and oilfield services industries;

● the possibility of the loss of one or a number of our large customers;

● the impact of long-term indebtedness and other financial commitments on our financial and operating flexibility;

● our access to and the cost of capital, including the impact of a further downgrade in our credit rating, covenant restrictions, availability under our secured revolving credit facility, and future issuances of debt or equity securities;

● our dependence on our operating subsidiaries and investments to meet our financial obligations;

● our ability to retain skilled employees;

● our ability to complete, and realize the expected benefits of, strategic transactions;

● changes in tax laws and the possibility of changes in other laws and regulations;

● the possibility of changes to U.S. trade policies and regulations including the imposition of trade embargoes or sanctions; and

● general economic conditions, including the capital and credit markets.

Our business depends, to a large degree, on the level of spending by oil and gas companies for exploration, development and production activities. Therefore, a sustained increase or decrease in the price of oil or natural gas, that

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has a material impact on exploration, development and production activities, could also materially affect our financial position, results of operations and cash flows.

The above description of risks and uncertainties is by no means all-inclusive but highlights certain factors that we believe are important for your consideration. For a more detailed description of risk factors that may affect us or our industry, please refer to Item 1A. — Risk Factors in our 2021 Annual Report.

Management Overview

This section is intended to help you understand our results of operations and our financial condition. This information is provided as a supplement to, and should be read in conjunction with, our condensed consolidated financial statements and the accompanying notes thereto.

We are a leading provider of advanced technology for the energy industry. With operations in over 15 countries, Nabors has established a global network of people, technology and equipment to deploy solutions that deliver safe, efficient and sustainable energy production. By leveraging its core competencies, particularly in drilling, engineering, automation, data science and manufacturing, Nabors aims to innovate the future of energy and enable the transition to a lower carbon world.

Outlook

The demand for our services and products is a function of the level of spending by oil and gas companies for exploration, development and production activities. The level of exploration, development and production activities is to a large extent tied to the prices of oil and natural gas, which can fluctuate significantly, are highly volatile and tend to be highly sensitive to supply and demand cycles. Additionally, some oil and gas companies may intentionally limit their capital spending to a percentage of their operating cash flows which may differ from how they have historically made capital allocation decisions.

During 2020, the oil markets experienced unprecedented volatility. The COVID-19 outbreak, and its development into a pandemic, along with policies and actions taken by governments and behaviors of companies and customers around the world, had a significant negative impact on demand for oil and gas and by extension our services, which negatively impacted our operating results and cash flow throughout 2020 and into 2021. The Lower-48 drilling rig market began to stabilize during the second half of 2020 and continued to improve at a measured rate throughout 2021. We expect continued measured but steady increases in activity throughout the remainder of 2022 for the Lower-48 market. Our International markets also experienced factors and conditions that led to similar reductions in activity throughout 2020, but the impact varied considerably from country to country. Since 2020, we have seen a substantial resumption of activity to near pre-COVID-19 levels. As government-imposed restrictions continue to ease, we expect our international activity to generally increase through the remainder of the year.

More recently, several global commodity markets, including oil and gas, have been impacted by the effects of the war in Ukraine. These consequences include severe economic sanctions against the Russian government as well as certain Russian businesses and individuals, in addition to a reorientation of the global sources of oil and gas supply and a significant increase in the related commodity prices. While higher commodity prices have historically led to an increase in oilfield activity, the ultimate outcome of these events and the impact on our business remains uncertain.

Recent Developments

2022 Credit Agreement

On January 21, 2022, we entered into a revolving credit agreement between Nabors Delaware, the guarantors from time to time party thereto, the issuing banks (the “Issuing Banks”) and other lenders party thereto (the “Lenders”) and Citibank, N.A., as administrative agent (the “2022 Credit Agreement”). The 2022 Credit Agreement replaced the 2018 Revolving Credit Facility. Under the 2022 Credit Agreement, the Lenders have committed to provide up to an aggregate principal amount at any time outstanding not in excess of $350.0 million (with an accordion feature for an additional $100.0 million) to Nabors Delaware under a secured revolving credit facility, including sub-facilities provided by certain of the Lenders for letters of credit in an aggregate principal amount at any time outstanding not in excess of $100.0 million. The facility matures on the earlier of (a) January 21, 2026 and (b) (i) to the extent any principal amount of

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Nabors Delaware’s existing 5.1% senior notes due 2023, 5.5% senior notes due 2023 and 5.75% senior notes due 2025 remains outstanding on the date that is 90 days prior to the applicable maturity date for such indebtedness, then such 90^th day or (ii) to the extent 50% or more of the outstanding (as of the closing date) aggregate principal amount of the 0.75% senior exchangeable notes due 2024 remains outstanding and not refinanced or defeased on the date that is 90 days prior to the maturity date for such indebtedness, then such 90th day.

Financial Results

Comparison of the three months ended March 31, 2022 and 2021

Operating revenues for the three months ended March 31, 2022 totaled $568.5 million, representing an increase of $108.0 million, or 23%, compared to the three months ended March 31, 2021. All of our operating segments, with the exception of Canada Drilling due to its sale, experienced an increase in operating revenues over this period. For a more detailed description of operating results see Segment Results of Operations below.

Net loss from continuing operations attributable to Nabors common shareholders totaled $184.5 million ($22.51 per diluted share) for the three months ended March 31, 2022 compared to a net loss from continuing operations attributable to Nabors common shareholders of $140.8 million ($20.16 per diluted share) for the three months ended March 31, 2021, or a $43.7 million increase in the net loss. The majority of the increase in net loss is attributable to $73.2 million in mark-to-market losses from the common stock warrants that were outstanding during the first quarter of 2022. These losses were partially offset by improved market conditions in all our segments from the prior year, together with lower depreciation.

General and administrative expenses for the three months ended March 31, 2022 totaled $53.6 million, representing a decrease of $1.0 million, or 2%, compared to the three months ended March 31, 2021.

Research and engineering expenses for the three months ended March 31, 2022 totaled $11.7 million, representing an increase of $4.1 million, or 56%, compared to the three months ended March 31, 2021. This is primarily reflective of an increase in research and development activities, along with the higher general operating activity levels, as market conditions have improved.

Depreciation and amortization expense for the three months ended March 31, 2022 was $164.4 million, representing a decrease of $12.9 million, or 7%, compared to the three months ended March 31, 2021. The decrease is attributable to the combination of a reduction in depreciation as a result of the many assets that have recently reached the end of their useful lives and limited capital expenditures over recent years. The decrease is also due to the sale of Canada Drilling assets in July 2021.

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Segment Results of Operations

The following tables set forth certain information with respect to our reportable segments and rig activity:

		Three Months Ended
		March 31,
		2022		2021		Increase/(Decrease)
	(In thousands, except percentages and rig activity)
U.S. Drilling
Operating revenues		$	217,583	$	142,299	$	75,284	53	%
Adjusted operating income (loss) (1)		$	(5,851)	$	(23,336)	$	17,485	75	%
Average rigs working (2)			90.3		60.5		29.8	49	%
Canada Drilling
Operating revenues		$	—	$	20,989	$	(20,989)	(100)	%
Adjusted operating income (loss) (1)		$	(19)	$	3,907	$	(3,926)	(100)	%
Average rigs working (2)			—		13.7		(13.7)	(100)	%
International Drilling
Operating revenues		$	279,030	$	246,838	$	32,192	13	%
Adjusted operating income (loss) (1)		$	(6,327)	$	(18,632)	$	12,305	66	%
Average rigs working (2)			72.0		64.8		7.2	11	%
Drilling Solutions
Operating revenues		$	54,182	$	35,706	$	18,476	52	%
Adjusted operating income (loss) (1)		$	14,709	$	4,710	$	9,999	212	%
Rig Technologies
Operating revenues		$	36,736	$	25,748	$	10,988	43	%
Adjusted operating income (loss) (1)		$	(2,751)	$	(2,569)	$	(182)	(7)	%

(1) Adjusted operating income (loss) is our measure of segment profit and loss. See Note 11—Segment Information to the consolidated financial statements included in Item 1 of the report.

(2) Represents a measure of the average number of rigs operating during a given period. For example, one rig operating 45 days during a quarter represents approximately 0.5 average rigs working for the quarter. On an annual period, one rig operating 182.5 days represents approximately 0.5 average rigs working for the year.

U.S. Drilling

Operating revenues for our U.S. Drilling segment increased by $75.3 million or 53% during the three months ended March 31, 2022 compared to the corresponding period in 2021. This increase was due to a 49% increase in the average rigs working, reflecting increased drilling activity as market conditions and demand for our drilling services have rebounded and increased since the prior year.

Canada Drilling

Operating revenues decreased during the three months ended March 31, 2022 compared to the corresponding prior year period due to the sale of the Canada Drilling assets in July 2021.

International Drilling

Operating revenues for our International Drilling segment increased by $32.2 million or 13% compared to the corresponding prior year period. This increase was due to an 11% increase in the average rigs working, reflecting increased drilling activity as market conditions and demand for our drilling services have rebounded and increased since the prior year.

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Drilling Solutions

Operating revenues for this segment increased by $18.5 million or 52% during the three months ended March 31, 2022 compared to the corresponding period in 2021 as market conditions and demand for our services have rebounded and drilling activity has increased since the prior year.

Rig Technologies

Operating revenues for our Rig Technologies segment increased by $11.0 million or 43% during the three months ended March 31, 2022 compared to the corresponding period as market conditions and demand for our services have improved slightly since the prior year.

Other Financial Information

Interest expense

Interest expense for the three months ended March 31, 2022 was $46.9 million, representing an increase of $3.9 million, or 9%, compared to the three months ended March 31, 2021. The increase was primarily due to the issuance of $700 million in 7.375% senior priority guaranteed notes due May 2027 in November 2021, partially offset by a reduction to our overall debt levels, outstanding notes and credit facilities.

Other, net

Other, net for the three months ended March 31, 2022 was $80.4 million of loss. Approximately $73.2 million of this amount related to mark-to-market losses from the common stock warrants. In addition, there were $4.2 million in foreign currency loss and an increase of $3.1 million in litigation reserves.

Other, net for the three months ended March 31, 2021 was $7.3 million of loss, which included a net gain on debt buybacks of $8.1 million. This was offset by net losses on sales and disposals of assets of approximately $8.5 million, foreign currency loss of $2.4 million and an increase in litigation reserves of $1.5 million.

Income taxes

Our worldwide tax expense for the three months ended March 31, 2022 was $13.7 million compared to $9.7 million for the three months ended March 31, 2021. The increase in tax expense was primarily attributable to the improvement in income before income taxes, excluding the mark-to-market losses related to the common stock warrants, and the geographic mix of our pre-tax earnings (losses).

Liquidity and Capital Resources

Financial Condition and Sources of Liquidity

Our primary sources of liquidity are cash and investments, availability under our revolving credit facility and cash generated from operations. As of March 31, 2022, we had cash and short-term investments of $394.0 million and working capital of $430.6 million. As of December 31, 2021, we had cash and short-term investments of $991.5 million and working capital of $1.0 billion.

At March 31, 2022, we had no borrowings outstanding under the 2022 Credit Agreement, which has a total borrowing capacity of $350.0 million.

The 2022 Credit Agreement requires us to maintain an interest coverage ratio (EBITDA/interest expense), which increases on a quarterly basis, and a minimum guarantor value, requiring the guarantors (other than the Company) and their subsidiaries to own at least 90% of the consolidated property, plant and equipment of the Company. Additionally, the Company is subject to certain covenants, which are subject to certain exceptions and include, among others, (i) a covenant restricting our ability to incur liens (subject to the additional liens basket of up to $150.0 million), (ii) a covenant restricting its ability to pay dividends or make other distributions with respect to its capital stock and to repurchase certain indebtedness and (iii) a covenant restricting the ability of the Company’s subsidiaries to incur debt

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(subject to the grower basket of up to $100.0 million). As of March 31, 2022, we were in compliance with both the interest coverage ratio and the minimum guarantor value requirements under the 2022 Credit Agreement. We also had $62.6 million of letters of credit outstanding under the 2022 Credit Agreement.

As of the date of this report, we were in compliance with all covenants under the 2022 Credit Agreement. If we fail to perform our obligations under the covenants, the revolving credit commitments under the 2022 Credit Agreement could be terminated, and any outstanding borrowings under the facilities could be declared immediately due and payable. If necessary, we have the ability to manage our covenant compliance by taking certain actions including reductions in discretionary capital or other types of controllable expenditures, monetization of assets, amending or renegotiating the revolving credit agreement, accessing capital markets through a variety of alternative methods, or any combination of these alternatives. We expect to remain in compliance with all covenants under the 2022 Credit Agreement during the twelve month period following the date of this report based on our current operational and financial projections. However, we can make no assurance of continued compliance if our current projections or material underlying assumptions prove to be incorrect. If we fail to comply with the covenants, the revolving credit commitment could be terminated, and any outstanding borrowings under the facility could be declared immediately due and payable.

Our ability to access capital markets or to otherwise obtain sufficient financing may be affected by our senior unsecured debt ratings as provided by the major credit rating agencies in the United States and our historical ability to access these markets as needed. While there can be no assurances that we will be able to access these markets in the future, we believe that we will be able to access capital markets or otherwise obtain financing in order to satisfy any payment obligation that might arise upon maturity, exchange or purchase of our notes and our debt facilities, loss of availability of our revolving credit facilities and our A/R Facility (see—Accounts Receivable Purchase and Sales Agreements, below), and that any cash payment due, in addition to our other cash obligations, would not ultimately have a material adverse impact on our liquidity or financial position. The major U.S. credit rating agencies have previously downgraded our senior unsecured debt rating to non-investment grade. These and any further ratings downgrades could adversely impact our ability to access debt markets in the future, increase the cost of future debt, and potentially require us to post letters of credit for certain obligations

We had 18 letter-of-credit facilities with various banks as of March 31, 2022. Availability under these facilities as of March 31, 2022 was as follows:

	March 31,
	2022
	(In thousands)
Credit available	$	620,552
Less: Letters of credit outstanding, inclusive of financial and performance guarantees		77,064
Remaining availability	$	543,488

Accounts Receivable Purchase and Sales Agreements

On September 13, 2019, we entered into an accounts receivables sales agreement (the “A/R Sales Agreement”) and an accounts receivables purchase agreement (the “A/R Purchase Agreement” and, together with the A/R Sales Agreement, the “A/R Facility”), whereby the originators sold or contributed, and will on an ongoing basis continue to sell or contribute, certain of their domestic trade accounts receivables to a wholly-owned, bankruptcy-remote special purpose entity (“SPE”). The SPE in turn, sells, transfers, conveys and assigns to third-party Purchasers, all the rights, title and interest in and to its pool of eligible receivables.

On July 13, 2021, we entered into the First Amendment to the A/R Purchase Agreement which extends the term of the A/R Facility by two years, to August 13, 2023. However, the expiration of the agreement could be accelerated to July 19, 2022, if any of the 5.5% Senior Notes due 2023 of Nabors Delaware remain outstanding as of such date. The amendment also reduced the commitments of the third-party Purchasers from $250 million to $150 million, with the possibility of being increased up to $200 million.

The amount available for purchase under the A/R Facility fluctuates over time based on the total amount of eligible receivables generated during the normal course of business after excluding excess concentrations and certain other ineligible receivables. The maximum purchase commitment of the third-party Purchasers under the A/R Facility is approximately $150.0 million and the amount of receivables purchased by the third-party Purchasers as of March 31, 2022 was $136.0 million.

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The originators, Nabors Delaware, the SPE, and the Company provide representations, warranties, covenants and indemnities under the A/R Facility and the Indemnification Guarantee. See further details at Note 4—Accounts Receivable Purchase and Sales Agreements.

Future Cash Requirements

Our current cash and investments, projected cash flows from operations, proceeds from equity or debt issuances and the facilities under our 2022 Credit Agreement are expected to adequately finance our purchase commitments, capital expenditures, acquisitions, scheduled debt service requirements, and all other expected cash requirements for at least the next 12 months. However, we can make no assurances that our current operational and financial projections will prove to be correct. A sustained period of highly depressed oil and natural gas prices could have a significant effect on our customers’ capital expenditure spending and therefore our operations, cash flows and liquidity.

Purchase commitments outstanding at March 31, 2022 totaled approximately $251.8 million, primarily for capital expenditures, other operating expenses and purchases of inventory. We can reduce planned expenditures if necessary or increase them if market conditions and new business opportunities warrant it. The level of our outstanding purchase commitments and our expected level of capital expenditures over the next 12 months represent a number of capital programs that are currently underway or planned.

See our discussion of guarantees issued by Nabors that could have a potential impact on our financial position, results of operations or cash flows in future periods included below under “Off-Balance Sheet Arrangements (Including Guarantees).”

There have been no material changes to the contractual cash obligations that were included in our 2021 Annual Report.

On August 25, 2015, our Board authorized a share repurchase program (the “program”) under which we may repurchase, from time to time, up to $400.0 million of our common shares by various means, including in the open market or in privately negotiated transactions. Authorization for the program, which was renewed in February 2019, does not have an expiration date and does not obligate us to repurchase any of our common shares. Since establishing the program, we have repurchased 0.3 million of our common shares for an aggregate purchase price of approximately $121.1 million under this program. The repurchased shares, which are held by our subsidiaries, are registered and tradable subject to applicable securities law limitations and have the same voting and other rights as other outstanding shares. As of March 31, 2022, the remaining amount authorized under the program that may be used to purchase shares was $278.9 million. As of March 31, 2022, our subsidiaries held 1.1 million of our common shares.

We may from time to time seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity securities, both in open-market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors and may involve material amounts.

Cash Flows

Our cash flows depend, to a large degree, on the level of spending by oil and gas companies for exploration, development and production activities. Sustained decreases in the price of oil or natural gas could have a material impact on these activities and could also materially affect our cash flows. Certain sources and uses of cash, such as the level of discretionary capital expenditures or acquisitions, purchases and sales of investments, dividends, loans, issuances and repurchases of debt and of our common shares are within our control and are adjusted as necessary based on market conditions. We discuss our cash flows for the three months ended March 31, 2022 and 2021 below.

Operating Activities. Net cash provided by operating activities totaled $41.4 million during the three months ended March 31, 2022, compared to net cash provided of $79.5 million during the corresponding 2021 period. Operating cash flows are our primary source of capital and liquidity.  Cash from operating results (before working capital changes) was $68.6 million for the three months ended March 31, 2022, an increase of $16.5 million when compared to $52.1 million in the corresponding 2021 period. This was due to the increase in activity across most of our business for the three month period ended March 31, 2022 compared to the three month period ended March 31, 2021. Changes in working

30

capital items such as collection of receivables, other deferred revenue arrangements and payments of operating payables are also significant factors affecting operating cash flows and can be highly volatile in periods of increasing or decreasing activity levels. Changes in working capital items used $27.3 million in cash flows during the three months ended March 31, 2022, a $54.7 million unfavorable change as compared to the $27.4 million in cash flows provided from working capital in the corresponding 2021 period.  This is reflective of the increased working capital requirements that are a result of activity level increases.

Investing Activities. Net cash used for investing activities totaled $82.1 million during the three months ended March 31, 2022 compared to net cash used of $19.1 million during the corresponding 2021 period. Our primary use of cash for investing activities is capital expenditures for rig-related enhancements, new construction and equipment, as well as sustaining capital expenditures. During the three months ended March 31, 2022 and 2021, we used cash for capital expenditures totaling $84.3 million and $40.9 million, respectively.

We received $3.7 million in proceeds from sales of assets and insurance claims during the three months ended March 31, 2022 compared to $10.8 million for the corresponding 2021 period. We also received $10.9 million in sales and maturities of investments for the three months ended March 31, 2021.

Financing Activities. Net cash used for financing activities totaled $555.3 million during the three months ended March 31, 2022. During the three months ended March 31, 2022, we repaid $460.0 million in net amounts under our revolving credit facility and $86.1 million of long-term debt.

Net cash used for financing activities totaled $113.9 million during the three months ended March 31, 2021. During the three months ended March 31, 2021, we used $49.1 million for a redeemable non-controlling interest distribution, $40.0 million in net amounts repaid under our revolving credit facility and by a $16.8 million repayment on our senior notes. Additionally, we paid dividends totaling $3.6 million to our preferred shareholders.

Summarized Combined Financial Information for Guarantee of Securities of Subsidiaries

Nabors Delaware is an indirect, wholly owned subsidiary of Nabors. Nabors fully and unconditionally guarantees the due and punctual payment of the principal of, premium, if any, and interest on Nabors Delaware’s registered notes, which are its (i) 5.10% Senior Notes due 2023 (the “2023 Notes”), (ii) 5.50% Senior Notes due 2023 (the “5.50% 2023 Notes”) and (iii) 5.75% Senior Notes due 2025 (the “2025 Notes” and, together with the 2023 Notes and the 5.50% 2023 Notes, the “Registered Notes”), and any other obligations of Nabors Delaware under the Registered Notes when and as they become due and payable, whether at maturity, upon redemption, by acceleration or otherwise, if Nabors Delaware is unable to satisfy these obligations. Nabors’ guarantee of Nabors Delaware’s obligations under the Registered Notes are its unsecured and unsubordinated obligation and have the same ranking with respect to Nabors’ indebtedness as the Registered Notes have with respect to Nabors Delaware’s indebtedness. In the event that Nabors is required to withhold or deduct on account of any Bermudian taxes due from any payment made under or with respect to its guarantees, subject to certain exceptions, Nabors will pay additional amounts so that the net amount received by each holder of Registered Notes will equal the amount that such holder would have received if the Bermudian taxes had not been required to be withheld or deducted.

The following summarized financial information is included so that separate financial statements of Nabors Delaware are not required to be filed with the SEC. The condensed consolidating financial statements present investments in both consolidated and unconsolidated affiliates using the equity method of accounting.

In lieu of providing separate financial statements for issuers and guarantors (the “Obligated Group”), we have presented the accompanying supplemental summarized combined balance sheet and income statement information for the Obligated Group based on Rule 13-01 of the SEC’s Regulation S-X that we early adopted effective April 1, 2020.

All significant intercompany items among the Obligated Group have been eliminated in the supplemental summarized combined financial information. The Obligated Group’s investment balances in Subsidiary Non-Guarantors have been excluded from the supplemental combined financial information. Significant intercompany balances and activity for the Obligated Group with other related parties, including Subsidiary Non-Guarantors (referred to as “affiliates”), are presented separately in the accompanying supplemental summarized financial information.

31

Summarized combined Balance Sheet and Income Statement information for the Obligated Group follows (in thousands):

	March 31,		December 31,
Summarized Combined Balance Sheet Information	2022		2021
Assets
Current Assets	$	1,257	$	462,872
Non-Current Assets		439,714		431,651
Noncurrent assets - affiliates		5,937,401		6,149,188
Total Assets		6,378,372		7,043,711
Liabilities and Stockholders' Equity
Current liabilities		58,378		75,112
Noncurrent liabilities		2,758,053		3,367,502
Noncurrent liabilities - affiliates		—		4,471
Total Liabilities		2,816,431		3,447,085
Stockholders' Equity		3,561,941		3,596,626
Total Liabilities and Stockholders' Equity		6,378,372		7,043,711

		Three Months Ended March 31,	Year Ended December 31,
Summarized Combined Income Statement Information	2022		2021
Total revenues, earnings (loss) from consolidated affiliates and other income	$	(55,129)	$	(277,147)
Income from continuing operations, net of tax		(173,604)		(441,310)
Dividends on preferred stock		—		(3,653)
Net income (loss) attributable to Nabors common shareholders		(173,604)		(444,963)

Other Matters

Recent Accounting Pronouncements

See Note 2—Summary of Significant Accounting Policies.

Off-Balance Sheet Arrangements (Including Guarantees)

We are a party to transactions, agreements or other contractual arrangements defined as “off-balance sheet arrangements” that could have a material future effect on our financial position, results of operations, liquidity and capital resources. The most significant of these off-balance sheet arrangements include the A/R Facility (see —Accounts Receivable Purchase and Sales Agreements, above) and certain agreements and obligations under which we provide financial or performance assurance to third parties. Certain of these financial or performance assurances serve as guarantees, including standby letters of credit issued on behalf of insurance carriers in conjunction with our workers’ compensation insurance program and other financial surety instruments such as bonds. In addition, we have provided indemnifications, which serve as guarantees, to some third parties. These guarantees include indemnification provided by us to our share transfer agent and our insurance carriers. We are not able to estimate the potential future maximum payments that might be due under our indemnification guarantees. Management believes the likelihood that we would be required to perform or otherwise incur any material losses associated with any of these guarantees is remote.

The following table summarizes the total maximum amount of financial guarantees issued by Nabors:

	Maximum Amount
	2022		2023	2024	Thereafter	Total
	(In thousands)
Financial standby letters of credit and other financial surety instruments	$	35,156	13,065	8,488	35,967	$	92,676

32

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We may be exposed to market risks arising from the use of financial instruments in the ordinary course of business as discussed in our 2021 Annual Report. Other than changes in the fair value of our warrants due to changes in trading values as discussed in “Note 6 Shareholders’ Equity” to our Condensed Consolidated Financial Statements , there were no material changes in our exposure to market risk during the three months ended March 31, 2022 from those disclosed in our 2021 Annual Report.

ITEM 4. CONTROLS AND PROCEDURES

We maintain a set of disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) designed to provide reasonable assurance that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management as appropriate to allow timely decisions regarding required disclosure. We have investments in certain unconsolidated entities that we do not control or manage. Because we do not control or manage these entities, our disclosure controls and procedures with respect to these entities are necessarily more limited than those we maintain with respect to our consolidated subsidiaries.

The Company’s management, with the participation of the Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based on this evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report.

There were no changes in our internal control over financial reporting during the quarter ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

See Note 8 — Commitments and Contingencies — Litigation for information regarding our legal proceedings.

ITEM 1A. RISK FACTORS

Except as set forth below, there have been no material changes from the risk factors previously disclosed in Part 1, Item 1A, of our 2021 Annual Report on Form 10-K, which in addition to the information set forth elsewhere in this report and the 2021 Annual Report, should be carefully considered when evaluating us. These risks are not the only risks we face. Additional risks not presently known to us or that we currently deem immaterial may also impair our business.

Our business may be affected by changes in applicable sanctions or export controls laws and regulations, including those targeting Russia.

Our international operations expose us to compliance obligations and risks under applicable economic sanctions, export controls and trade embargoes, such as those imposed, administered and enforced by the United States and the United Kingdom and other relevant sanctions authorities (collectively, “Sanctions”). In response to ongoing military hostilities between Russia and Ukraine, the United States, the United Kingdom, the European Union, and other jurisdictions imposed new and additional economic sanctions, export controls and other trade restrictions (“collectively, “Sanctions Measures”) targeting Russia, Belarus and certain regions of Ukraine, including Sanctions Measures that impose: (i) restrictions on engaging in specified activities or transactions, or any and all activities and transactions, with, involving or for the benefit of certain designated Russian and Belarusian entities or individuals (collectively, “Sanctions Targets”); (ii) a specific prohibition on new investment in the Russian energy sector, broadly defined to include the procurement, exploration, extraction, drilling, mining, harvesting, production, refinement, liquefaction, gasification, regasification, conversion, enrichment, fabrication or transport of petroleum, natural gas, liquified natural gas, natural gas liquids, or petroleum products or other products capable of producing energy; and (iii) a broad prohibition on new investment in Russia.

33

Pursuant to applicable Sanctions, we may be obliged to limit our business activities, may incur costs in order to implement and maintain compliance programs, and may be subject to investigations, enforcement actions or penalties relating to actual or alleged instances of noncompliance with the Sanctions Measures. It may also be necessary for us to take certain actions, including suspending or winding down our operations in Russia, in order to maintain compliance with, or satisfy obligations under, applicable Sanctions.

We are committed to compliance with all applicable Sanctions and have implemented and maintain dedicated policies and procedures that we believe to be customary and appropriate to promote and maintain our compliance with applicable Sanctions. However, we can provide no assurances that these policies and procedures will always be effective in identifying Sanctions Targets and their property interests or in preventing violations of applicable Sanctions by us or employees, agents or other persons acting on our behalf.

The full scale of the impact of the Sanctions Measures and Russia’s responses to the Sanctions Measures (such as counter-sanctions and the potential nationalization of assets in Russia) is currently unclear but such developments could adversely affect our operations and the oil and gas sector generally, which could have a material adverse effect on our business, results of operations, financial condition and cash flow. In addition, U.S. and other governments have increased their oversight and enforcement activities with respect to Sanctions laws and regulations and it is expected that the relevant agencies will continue to increase these investigative and enforcement activities. A violation of Sanctions could result in severe criminal or civil penalties and reputational harm, which could separately adversely affect our business and results of operations.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

We withheld the following shares of our common stock to satisfy tax withholding obligations in connection with grants of stock awards during the three months ended March 31, 2022 from the distributions described below. These shares may be deemed to be “issuer purchases” of shares that are required to be disclosed pursuant to this Item, but were not purchased as part of a publicly announced program to purchase common shares:

					Approximated
				Total Number	Dollar Value of
				of Shares	Shares that May
	Total	Average		Purchased as	Yet Be
	Number of	Price		Part of Publicly	Purchased
Period	Shares	Paid per		Announced	Under the
(In thousands, except per share amounts)	Repurchased	Share (1)		Program	Program (2)
January 1 - January 31	24	$	83.00	—	278,914
February 1 - February 28	8	$	124.33	—	278,914
March 1 - March 31	3	$	140.28	—	278,914

(1) Shares were withheld from employees and directors to satisfy certain tax withholding obligations due in connection with grants of shares under our 2013 Stock Plan and 2016 Stock Plan. Each of the 2016 Stock Plan, the 2013 Stock Plan, the 2003 Employee Stock Plan and the 1999 Stock Option Plan for Non-Employee Directors provide for the withholding of shares to satisfy tax obligations, but do not specify a maximum number of shares that can be withheld for this purpose. These shares were not purchased as part of a publicly announced program to purchase common shares.

(2) In August 2015, our Board authorized a share repurchase program under which we may repurchase up to $400.0 million of our common shares in the open market or in privately negotiated transactions. The program was renewed by the Board in February 2019. Through March 31, 2022, we repurchased 0.3 million of our common shares for an aggregate purchase price of approximately $121.1 million under this program. As of March 31, 2022, we had $278.9 million that remained authorized under the program that may be used to repurchase shares. The repurchased shares, which are held by our subsidiaries, are registered and tradable subject to applicable securities law limitations and have the same voting, dividend and other rights as other outstanding shares. As of March 31, 2022, our subsidiaries held 1.1 million of our common shares.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

34

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit No.	Description
31.1	Rule 13a-14(a)/15d-14(a) Certification of Anthony G. Petrello, Chairman, President and Chief Executive Officer*
31.2	Rule 13a-14(a)/15d-14(a) Certification of William Restrepo, Chief Financial Officer*
32.1	Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Anthony G. Petrello, Chairman, President and Chief Executive Officer and William Restrepo, Chief Financial Officer.*
101.INS	Inline XBRL Instance Document*
101.SCH	Inline XBRL Schema Document*
101.CAL	Inline XBRL Calculation Linkbase Document*
101.LAB	Inline XBRL Label Linkbase Document*
101.PRE	Inline XBRL Presentation Linkbase Document*
101.DEF	Inline XBRL Definition Linkbase Document*
104	Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document)

*Filed herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

NABORS INDUSTRIES LTD.
By:	/s/ ANTHONY G. PETRELLO
	Anthony G. Petrello
	Chairman, President and
	Chief Executive Officer
	(Principal Executive Officer)
By:	/s/ WILLIAM RESTREPO
	William Restrepo
	Chief Financial Officer (Principal Financial Officer and Accounting Officer)
Date:	May 2, 2022

35

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a)

I, Anthony G. Petrello, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Nabors Industries Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:     May 2, 2022	/s/ ANTHONY G. PETRELLO
	Anthony G. Petrello
	Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a)

I, William Restrepo, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Nabors Industries Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 2, 2022	/s/ WILLIAM RESTREPO
	William Restrepo
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Nabors Industries Ltd. (the “Company”) for the quarter ended March 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Anthony G. Petrello, Chairman, President and Chief Executive Officer of the Company, and I, William Restrepo, Chief Financial Officer of the Company, each certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1)  the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)  the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ ANTHONY G. PETRELLO

Anthony G. Petrello

Chairman, President and Chief Executive Officer

/s/ WILLIAM RESTREPO

William Restrepo

Chief Financial Officer

Date: May 2, 2022

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2022	Apr. 29, 2022
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2022
Entity File Number	001-32657
Entity Registrant Name	NABORS INDUSTRIES LTD.
Entity Incorporation, State or Country Code	D0
Entity Tax Identification Number	98-0363970
Entity Address, Address Line One	Crown House
Entity Address, Address Line Two	Second Floor
Entity Address, Address Line Three	4 Par-la-Ville Road
Entity Address, City or Town	Hamilton
Entity Address, Country	BM
Entity Address, Postal Zip Code	HM08
City Area Code	441
Local Phone Number	292-1510
Title of 12(b) Security	Common shares, $.05 par value per share
Trading Symbol	NBR
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		9,411,918
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001163739
Amendment Flag	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 394,028	$ 991,471
Short-term investments	11	17
Accounts receivable, net of allowance of $90,321 and $67,292, respectively	297,209	287,572
Inventory, net	132,126	126,448
Assets held for sale	16,582	16,561
Other current assets	104,112	95,740
Total current assets	944,068	1,517,809
Property, plant and equipment, net	3,245,574	3,332,498
Restricted cash held in trust	281,549	281,523
Deferred income taxes	256,543	258,631
Other long-term assets	129,432	134,903
Total assets	4,857,166	5,525,364
Current liabilities:
Trade accounts payable	278,878	253,748
Accrued liabilities	209,910	247,171
Income taxes payable	19,327	18,887
Current lease liabilities	5,330	5,422
Total current liabilities	513,445	525,228
Long-term debt	2,610,092	3,262,795
Other long-term liabilities	372,592	340,347
Deferred income taxes	2,478	2,773
Total liabilities	3,498,607	4,131,143
Commitments and contingencies (Note 15)
Redeemable noncontrolling interest in subsidiary	677,829	675,283
Shareholders' equity:
Common shares, par value $0.05 per share: Authorized common shares 32,000; issued 10,475 and 9,295, respectively	523	466
Capital in excess of par value	3,593,355	3,454,563
Accumulated other comprehensive income (loss)	(9,298)	(10,634)
Retained earnings (accumulated deficit)	(1,725,213)	(1,537,988)
Less: treasury shares, at cost, 1,090 and 1,090 common shares, respectively	(1,315,751)	(1,315,751)
Total shareholders' equity	543,616	590,656
Noncontrolling interest	137,114	128,282
Total equity	680,730	718,938
Total liabilities and equity	$ 4,857,166	$ 5,525,364

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
CONDENSED CONSOLIDATED BALANCE SHEETS
Accounts receivable, net of allowance	$ 90,321	$ 67,292
Common shares, par value (in dollars per share)	$ 0.05	$ 0.05
Common shares, shares authorized	32,000	32,000
Common shares, shares issued	10,475	9,295
Treasury shares, at cost	1,090	1,090

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Revenues and other income:
Operating revenues	$ 568,539	$ 460,511
Investment income (loss)	163	1,263
Total revenues and other income	568,702	461,774
Costs and other deductions:
Direct costs	372,712	290,654
General and administrative expenses	53,639	54,660
Research and engineering	11,678	7,467
Depreciation and amortization	164,359	177,276
Interest expense	46,910	42,975
Other, net	80,401	7,346
Total costs and other deductions	729,699	580,378
Income (loss) from continuing operations before income taxes	(160,997)	(118,604)
Income tax expense (benefit):
Current	9,950	10,903
Deferred	3,721	(1,178)
Total income tax expense (benefit)	13,671	9,725
Income (loss) from continuing operations, net of tax	(174,668)	(128,329)
Income (loss) from discontinued operations, net of tax		19
Net income (loss)	(174,668)	(128,310)
Less: Net (income) loss attributable to noncontrolling interest	(9,828)	(8,776)
Net income (loss) attributable to Nabors	(184,496)	(137,086)
Less: Preferred stock dividend		(3,653)
Net income (loss) attributable to Nabors common shareholders	(184,496)	(140,739)
Amounts attributable to Nabors common shareholders:
Net income (loss) from continuing operations	(184,496)	(140,758)
Net income (loss) from discontinued operations		19
Net income (loss) attributable to Nabors common shareholders	$ (184,496)	$ (140,739)
Earnings (losses) per share:
Basic from continuing operations (in dollars per share)	$ (22.51)	$ (20.16)
Total Basic (in dollars per share)	(22.51)	(20.16)
Diluted from continuing operations (in dollars per share)	(22.51)	(20.16)
Total Diluted (in dollars per share)	$ (22.51)	$ (20.16)
Weighted-average number of common shares outstanding:
Basic (in shares)	8,311	7,102
Diluted (in shares)	8,311	7,102

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net income (loss) attributable to Nabors	$ (184,496)	$ (137,086)
Other comprehensive income (loss), before tax:
Translation adjustment attributable to Nabors	(132)	2,228
Pension liability amortization and adjustment	1,480	(1,848)
Other comprehensive income (loss), before tax	1,348	380
Income tax expense (benefit) related to items of other comprehensive income (loss)	12	12
Other comprehensive income (loss), net of tax	1,336	368
Comprehensive income (loss) attributable to Nabors	(183,160)	(136,718)
Comprehensive income (loss) attributable to noncontrolling interest	9,828	8,776
Comprehensive income (loss)	$ (173,332)	$ (127,942)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities:
Net income (loss)	$ (174,668)	$ (128,310)
Adjustments to net income (loss):
Depreciation and amortization	164,360	177,277
Deferred income tax expense (benefit)	3,721	(1,178)
Impairments and other charges		355
Amortization of debt discount and deferred financing costs	4,984	5,400
Losses (gains) on debt buyback	36	(8,062)
Losses (gains) on long-lived assets, net	77	8,524
Losses (gains) on investments, net	1	(315)
Provision (recovery) of bad debt		(2,339)
Share-based compensation	3,879	6,775
Foreign currency transaction losses (gains), net	4,214	2,365
Mark-to-market loss on warrants	71,752
Noncontrolling interest	(9,828)	(8,777)
Other	110	398
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable	(22,775)	32,017
Inventory	(5,621)	6,039
Other current assets	(8,039)	(6,476)
Other long-term assets	2,136	(4,949)
Trade accounts payable and accrued liabilities	2,024	(17,697)
Income taxes payable	682	15,766
Other long-term liabilities	4,309	2,677
Net cash provided by (used for) operating activities	41,354	79,490
Cash flows from investing activities:
Purchases of investments	(1,534)	(14)
Sales and maturities of investments	5	10,908
Capital expenditures	(84,258)	(40,852)
Proceeds from sales of assets and insurance claims	3,671	10,839
Other	9
Net cash (used for) provided by investing activities	(82,107)	(19,119)
Cash flows from financing activities:
Reduction in long-term debt	(86,127)	(16,838)
Debt issuance costs	(3,858)	(2,421)
Proceeds from revolving credit facilities	40,000	95,000
Reduction in revolving credit facilities	(500,000)	(135,000)
Proceeds from issuance of common shares, net of issuance costs	257
Repurchase of common and preferred shares	(4,523)
Dividends to common and preferred shareholders	(10)	(3,662)
Distributions to noncontrolling interest	(995)	(49,077)
Other		(1,923)
Net cash (used for) provided by financing activities	(555,256)	(113,921)
Effect of exchange rate changes on cash and cash equivalents	(1,289)	(1,111)
Net increase (decrease) in cash and cash equivalents and restricted cash	(597,298)	(54,661)
Cash and cash equivalents and restricted cash, beginning of period	1,273,510	475,280
Cash and cash equivalents and restricted cash, end of period	676,212	420,619
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents, beginning of period	991,471	472,246
Restricted cash, beginning of period	282,039	3,034
Cash and cash equivalents and restricted cash, beginning of period	1,273,510	475,280
Cash and cash equivalents, end of period	394,028	417,544
Restricted cash, end of period	282,184	3,075
Cash and cash equivalents and restricted cash, end of period	$ 676,212	$ 420,619

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands	Mandatory Convertible Preferred Shares Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income	Retained Earnings (Accumulated Deficit)	Treasury Stock	Noncontrolling Interest	Total
Balance at the beginning of the period at Dec. 31, 2020	$ 5	$ 419	$ 3,423,935	$ (11,124)	$ (946,100)	$ (1,315,751)	$ 105,424	$ 1,256,808
Balance (in shares) at Dec. 31, 2020	4,870	8,383
Increase (Decrease) in Equity
Net income (loss)					(137,086)		8,776	(128,310)
PSU distribution equivalent rights					(10)			(10)
Dividends declared to preferred shareholders					(3,653)			(3,653)
Other comprehensive income (loss), net of tax				368				368
Share-based compensation			6,775					6,775
Accrued distribution on redeemable noncontrolling interest in subsidiary					(2,402)			(2,402)
Other		$ (2)	(1,621)				1	(1,622)
Other (in shares)		120
Balance at the end of the period at Mar. 31, 2021	$ 5	$ 417	3,429,089	(10,756)	(1,089,251)	(1,315,751)	114,201	1,127,954
Balance (in shares) at Mar. 31, 2021	4,870	8,503
Balance at the beginning of the period at Dec. 31, 2021		$ 466	3,454,563	(10,634)	(1,537,988)	(1,315,751)	128,282	718,938
Balance (in shares) at Dec. 31, 2021		9,295
Increase (Decrease) in Equity
Net income (loss)					(184,496)		9,828	(174,668)
PSU distribution equivalent rights					(9)			(9)
Warrant Exercise		$ 52	139,436					139,488
Warrant Exercise (in shares)		1,024
Other comprehensive income (loss), net of tax				1,336				1,336
Share-based compensation			3,879					3,879
Noncontrolling interest contributions (distributions)							(996)	(996)
Accrued distribution on redeemable noncontrolling interest in subsidiary					(2,545)			(2,545)
Other		$ 5	(4,523)		(175)			(4,693)
Other (in shares)		156
Balance at the end of the period at Mar. 31, 2022		$ 523	$ 3,593,355	$ (9,298)	$ (1,725,213)	$ (1,315,751)	$ 137,114	$ 680,730
Balance (in shares) at Mar. 31, 2022		10,475

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical)	3 Months Ended
	Mar. 31, 2021 $ / shares
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Dividends declared to preferred shareholders (in dollars per share)	$ 0.75

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General

3 Months Ended

Mar. 31, 2022

General.

General

Note 1 General

Unless the context requires otherwise, references in this report to “we,” “us,” “our,” “the Company,” or “Nabors” mean Nabors Industries Ltd., together with our subsidiaries where the context requires. References in this report to “Nabors Delaware” mean Nabors Industries, Inc., a wholly owned subsidiary of Nabors.

Our business is comprised of our global land-based and offshore drilling rig operations and other rig related services and technologies. These services and technologies include tubular running services, wellbore placement solutions, directional drilling, measurement-while-drilling (“MWD”), logging-while-drilling (“LWD”) systems and services, equipment manufacturing, rig instrumentation and drilling optimization software.

With operations in over 15 countries, we are a global provider of drilling and drilling-related services for land-based and offshore oil and natural gas wells, with a fleet of rigs and drilling-related equipment which, as of March 31, 2022 included:

● 301 actively marketed rigs for land-based drilling operations in the United States and various countries throughout the world; and

● 29 actively marketed rigs for offshore platform drilling operations in the United States and multiple international markets.

The short and long-term implications of the military hostilities between Russia and Ukraine, which began on February 24, 2022, are difficult to predict at this time. We continue to actively monitor this dynamic situation and will fulfill any existing activity in full compliance with applicable international laws and sanctions. As of March 31, 2022, 1.3% of our property, plant and equipment, net was located in Russia. For the three months ending March 31, 2022, 1.4% of our operating revenues were from operations in Russia.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2022

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Note 2 Summary of Significant Accounting Policies

Interim Financial Information

The accompanying unaudited condensed consolidated financial statements of Nabors have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”). Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC” or “Commission”), certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. Therefore, these financial statements should be read together with our annual report on Form 10-K for the year ended December 31, 2021 (“2021 Annual Report”). In management’s opinion, the unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to state fairly our financial position as of March 31, 2022 and the results of operations, comprehensive income (loss), cash flows and changes in equity for the periods presented herein. Interim results for the three months ended March 31, 2022 may not be indicative of results that will be realized for the full year ending December 31, 2022.

Principles of Consolidation

Our condensed consolidated financial statements include the accounts of Nabors, as well as all majority owned and non-majority owned subsidiaries consolidated in accordance with U.S. GAAP. All significant intercompany accounts and transactions are eliminated in consolidation.

In addition to the consolidation of our majority owned subsidiaries, we also consolidate variable interest entities (“VIE”) when we are determined to be the primary beneficiary of a VIE. Determination of the primary beneficiary of a VIE is based on whether an entity has (1) the power to direct activities that most significantly impact the economic performance of the VIE and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Our joint venture, SANAD, which is equally owned by Saudi Aramco and Nabors,

has been consolidated. As we have the power to direct activities that most significantly impact SANAD’s economic performance, including operations, maintenance and certain sourcing and procurement, we have determined Nabors to be the primary beneficiary. See Note 3—Joint Ventures.

Inventory

Inventory is stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out or weighted-average cost methods and includes the cost of materials, labor and manufacturing overhead. Inventory included the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
Raw materials	$	108,912	$	105,638
Work-in-progress		2,336		1,368
Finished goods		20,878		19,442
	$	132,126	$	126,448

Special Purpose Acquisition Company

Nabors Energy Transition Corp. (“NETC”) is a consolidated VIE that is included in the accompanying consolidated financial statements under the following captions:

Restricted cash held in trust

As part of the initial public offering of NETC and subsequent private placement warrant transactions, $281.5 million has been deposited in an interest-bearing U.S. based trust account (“Trust Account”). The funds held in the Trust Account are invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations.

Redeemable noncontrolling interest in subsidiary

The company accounts for the non-controlling interest in NETC as subject to possible redemption in accordance with FASB ASC Topic 480 “Distinguishing Liabilities from Equity.” NETC’s common stock features certain redemption rights, which are considered to be outside the company’s control and subject to occurrence of uncertain future events. Accordingly, the $281.5 million of non-controlling interest subject to possible redemption is presented at full redemption value as temporary equity, outside of the stockholders’ equity section in the accompanying consolidated financial statements as of March 31, 2022.

Nabors will recognize any future changes in redemption value immediately as they occur – i.e., adjust the carrying amount of the instrument to its current redemption amount at each reporting period.

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Joint Ventures

3 Months Ended

Mar. 31, 2022

Joint Ventures

Joint Ventures

Note 3 Joint Ventures

During 2016, we entered into an agreement with Saudi Aramco to form a joint venture known as SANAD to own, manage and operate onshore drilling rigs in the Kingdom of Saudi Arabia. SANAD is equally owned by Saudi Aramco and Nabors.

During 2017, Nabors and Saudi Aramco each contributed $20 million in cash for the purpose of capitalizing the joint venture upon formation. In addition, since inception Nabors and Saudi Aramco have each contributed a combination of drilling rigs, drilling rig equipment and other assets, including cash, each with a value of approximately $394 million to the joint venture. The contributions were received in exchange for redeemable ownership interests which accrue interest annually, have a twenty-five year maturity and are required to be converted to authorized capital should certain events occur, including the accumulation of specified losses. In the accompanying condensed consolidated balance sheet, Nabors has reported Saudi Aramco’s share of authorized capital as a component of noncontrolling interest in equity and Saudi Aramco’s share of the redeemable ownership interests as redeemable noncontrolling interest in subsidiary, classified as mezzanine equity. As of March 31, 2022, the amount included in redeemable noncontrolling

interest was $396.3 million. The accrued interest on the redeemable ownership interest is a non-cash financing activity and is reported as an increase in the redeemable noncontrolling interest in subsidiary line in our condensed consolidated balance sheet. In 2021, SANAD settled approximately $120 million of the accrued interest from inception to December 2021, by making cash payments to each partner for their respective amounts. The assets and liabilities included in the condensed balance sheet below are (1) assets that can either be used to settle obligations of the VIE or be made available in the future to the equity owners through dividends, distributions or in exchange of the redeemable ownership interests (upon mutual agreement of the owners) or (2) liabilities for which creditors do not have recourse to other assets of Nabors.

The condensed balance sheet of SANAD, as included in our condensed consolidated balance sheet, is presented below.

	March 31,		December 31,
	2022		2021
	(In thousands)
Assets:
Cash and cash equivalents	$	308,761	$	293,037
Accounts receivable		79,366		88,174
Other current assets		6,703		6,662
Property, plant and equipment, net		492,676		467,587
Other long-term assets		19,006		19,010
Total assets	$	906,512	$	874,470
Liabilities:
Accounts payable	$	61,722	$	61,278
Accrued liabilities		10,812		6,021
Other liabilities		26,597		26,300
Total liabilities	$	99,131	$	93,599

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Accounts Receivable Purchase and Sales Agreement

3 Months Ended

Mar. 31, 2022

Accounts Receivable Purchase and Sales Agreement

Accounts Receivable Purchase and Sales Agreement

Note 4 Accounts Receivable Purchase and Sales Agreements

The Company has entered into an accounts receivable sales agreement (the “A/R Sales Agreement” and, together with the A/R Purchase Agreement (as defined below), the “A/R Facility”) to sell short-term receivables from certain customer trade accounts to an unaffiliated financial institution on a revolving basis. In July 2021, we entered into the First Amendment to the A/R Sales Agreement (the “First Agreement”), which reduced the commitments of the third-party financial institutions (the “Purchasers”) from $250 million to $150 million and extended the term of the agreements by two years, to August 13, 2023.

As part of the A/R Facility, the Company continuously sells designated pools of receivables as they are originated by it and certain U.S. subsidiaries to a separate, bankruptcy-remote, special purpose entity (“SPE”) pursuant to a purchase agreement between the SPE and the Company (the “A/R Purchase Agreement”).  The SPE in turn sells, transfers, conveys and assigns to the Purchasers all the rights, title and interest in and to its pool of eligible receivables (the “Eligible Receivables”). The sale of the Eligible Receivables qualified for sale accounting treatment in accordance with ASC 860 – Transfers and Servicing. During the period of this program, cash receipts from the Purchasers at the time of the sale are classified as operating activities in our consolidated statement of cash flows and the associated receivables are derecognized from the Company’s consolidated balance sheet at the time of the sale. The remaining receivables held by the SPE were pledged to secure the collectability of the sold Eligible Receivables.  Subsequent collections on the pledged receivables, which have not been sold, will be classified as operating cash flows in our consolidated statement of cash flows at the time of collection.  The amount of receivables pledged as collateral as of March 31, 2022 and December 31, 2021 is approximately $55.3 million and $44.2 million, respectively.

The amount available for sale to the Purchasers under the A/R Sales Agreement fluctuates over time based on the total amount of Eligible Receivables generated during the normal course of business after excluding excess concentrations and certain other ineligible receivables. As of March 31, 2022, approximately $136.0 million had been sold to and as yet uncollected by the Purchasers. As of December 31, 2021, the corresponding number was approximately $113.0 million.

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Debt

3 Months Ended

Mar. 31, 2022

Debt

Debt

Note 5 Debt

Debt consisted of the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
5.50% senior notes due January 2023 (1)	$	21,226	$	24,446
5.10% senior notes due September 2023		62,338		82,703
0.75% senior exchangeable notes due January 2024		162,065		259,839
5.75% senior notes due February 2025		526,628		548,458
6.50% senior priority guaranteed notes due February 2025		—		50,485
9.00% senior priority guaranteed notes due February 2025		218,082		218,082
7.25% senior guaranteed notes due January 2026		557,902		559,978
7.375% senior priority guaranteed notes due May 2027		700,000		700,000
7.50% senior guaranteed notes due January 2028		389,609		389,609
2018 revolving credit facility		—		460,000
	$	2,637,850	$	3,293,600
Less: deferred financing costs		27,758		30,805
Long-term debt	$	2,610,092	$	3,262,795

(1) The 5.50% senior notes due January 2023 were classified as long-term as of March 31, 2022, because we had the ability and intent to repay this obligation utilizing our 2022 Credit Agreement.

During the three months ended March 31, 2022, we repurchased $27.1 million aggregate principal amount of various outstanding Nabors Delaware’s notes for approximately $27.0 million in cash, including principal and $0.3 million in accrued and unpaid interest. In connection with these repurchases, we recognized a minimal loss for the three months ended March 31, 2022 which is included in Other, net in our condensed consolidated statement of income (loss). Also, during the three months ended March 31, 2022, $130.7 million in maturity value of our notes were tendered by warrant holders, and retired, in connection with exercises of the common stock warrants.

Exchange Transactions

During the first quarter of 2021, we entered into two private exchange transactions in which Nabors Delaware exchanged 9.0% senior priority guaranteed notes due 2025 (the “9.0% Exchange Notes”) for various amounts of existing outstanding notes. Nabors Delaware did not receive any cash proceeds from the issuance of the Exchange Notes. Collectively from the series of exchanges, Nabors Industries, Inc. issued $26.1 million aggregate principal amount of the 9.0% Exchange Notes in exchange for $40.0 million aggregate principal amount of various Nabors Delaware’s Notes.

We recorded a minimal gain in connection with the exchange transactions, which was accounted for in accordance with ASC 470-60, Troubled Debt Restructuring by Debtors. Under ASC 470-60, a gain is recorded in an amount equal to the sum of the future undiscounted payments (principal and interest) related to the new Exchange Notes plus the costs incurred in connection with the transaction, less the carrying value of the notes that were exchanged. In relation to the transactions, we recorded $9.4 million related to future contractual interest payments on the new Exchange Notes and have included this amount in accrued liabilities and other long-term liabilities.

The aggregate principal amounts and recognized gain for such transactions were as follows (in thousands):

	Three months ended March 31,
	2021
Exchanged		(in thousands)
0.75% senior exchangeable notes due January 2024	$	35,000
5.75% senior notes due February 2025		5,000
Aggregate principal amount exchanged		40,000
Aggregate principal amount of debt issued in exchanges		26,050

0.75% Senior Exchangeable Notes Due January 2024

In January 2017, Nabors Delaware issued $575.0 million in aggregate principal amount of 0.75% exchangeable senior unsecured notes due 2024, which are fully and unconditionally guaranteed by Nabors. The notes bear interest at a rate of 0.75% per year payable semiannually on January 15 and July 15 of each year, beginning on July 15, 2017. As of March 31, 2022, there was approximately $177.0 million in aggregate principal amount that remained outstanding.

The exchangeable notes are currently exchangeable, under certain conditions, at an exchange rate of .8018 common shares of Nabors per $1,000 principal amount of exchangeable notes (equivalent to an exchange price of approximately $1,247.19 per common share). The exchangeable notes were originally bifurcated for accounting purposes into debt and equity components of $411.2 million and $163.8 million, respectively, based on the terms of the notes and the relative fair value at the issuance date. Upon any exchange, as a result of an amendment to the notes, Nabors Delaware will settle its exchange obligation in cash.

2018 Revolving Credit Facility

In October 2018, Nabors Delaware and Nabors Drilling Canada Limited (“Nabors Canada” and together with Nabors Delaware, the “Borrowers”) entered into a credit agreement dated October 11, 2018 by and among the Borrowers, the guarantors identified therein, HSBC Bank Canada, as the Canadian lender the issuing banks and other lenders party thereto (the “U.S. Lenders”) and Citibank, N.A., as administrative agent solely for the U.S. Lenders (as may be amended, restated, supplemented or otherwise modified from time to time, the “2018 Revolving Credit Facility”). As of January 21, 2022, we repaid all amounts outstanding under the 2018 Revolving Credit Facility and the 2018 Revolving Credit Facility was terminated.

2022 Credit Agreement

On January 21, 2022, we entered into a revolving credit agreement between Nabors Delaware, the guarantors from time to time party thereto, the issuing banks (the “Issuing Banks”) and other lenders party thereto (the “Lenders”) and Citibank, N.A., as administrative agent (the “2022 Credit Agreement”). Under the 2022 Credit Agreement, the Lenders have committed to provide up to an aggregate principal amount at any time outstanding not in excess of $350.0 million (with an accordion feature for an additional $100.0 million) to Nabors Delaware under a secured revolving credit facility, including sub-facilities provided by certain of the Lenders for letters of credit in an aggregate principal amount at any time outstanding not in excess of $100.0 million.

The 2022 Credit Agreement permits the incurrence of additional indebtedness secured by liens, which may include liens on the collateral securing the facility, in an amount up to $150.0 million as well as a grower basket for term loans in an amount not to exceed $100.0 million secured by liens not on the collateral. The Company is required to maintain an interest coverage ratio (EBITDA/interest expense), which increases on a quarterly basis, and a minimum guarantor value, requiring the guarantors (other than the Company) and their subsidiaries to own at least 90% of the consolidated property, plant and equipment of the Company. The facility matures on the earlier of (a) January 21, 2026 and (b) (i) to the extent any principal amount of Nabors Delaware’s existing 5.1% senior notes due 2023, 5.5% senior notes due 2023 and 5.75% senior notes due 2025 remains outstanding on the date that is 90 days prior to the applicable maturity date for such indebtedness, then such 90^th day or (ii) to the extent 50% or more of the outstanding (as of the closing date) aggregate principal amount of the 0.75% senior exchangeable notes due 2024 remains outstanding and not refinanced or defeased on the date that is 90 days prior to the maturity date for such indebtedness, then such 90th day.

Additionally, the Company is subject to certain covenants, which are subject to certain exceptions and include, among others, (i) a covenant restricting our ability to incur liens (subject to the additional liens basket of up to $150.0 million) , (ii) a covenant restricting its ability to pay dividends or make other distributions with respect to its capital stock and to repurchase certain indebtedness and (iii) a covenant restricting the ability of the Company’s subsidiaries to incur debt (subject to the grower basket of up to $100.0 million). The agreement also includes a collateral coverage requirement that the collateral rig fair value is to be no less than the collateral coverage threshold, as defined in the agreement.  This requirement includes an independent appraisal report to be delivered every 6 months following the closing date.

As of March 31, 2022, we had no borrowings outstanding under our 2022 Credit Agreement. The weighted average interest rate on borrowings under the 2022 Credit Agreement at March 31, 2022 was 3.23%. In order to make any future borrowings under the 2022 Credit Agreement, Nabors and certain of its wholly owned subsidiaries are subject to compliance with the conditions and covenants contained therein, including compliance with applicable financial ratios.

As of the date of this report, we were in compliance with all covenants under the 2022 Credit Agreement. We expect to remain in compliance with all covenants under the 2022 Credit Agreement during the twelve month period following the date of this report based on our current operational and financial projections. However, we can make no assurance of continued compliance if our current projections or material underlying assumptions prove to be incorrect. If we fail to comply with the covenants, the revolving credit commitment could be terminated, and any outstanding borrowings under the facility could be declared immediately due and payable.

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Shareholders' Equity

3 Months Ended

Mar. 31, 2022

Shareholders' Equity

Shareholders' Equity

Note 6 Shareholders’ Equity

Common shares

On July 19, 2021, we issued 147,974 shares, valued at approximately $12.9 million, in connection with the purchase of certain development stage technologies in the energy transition space. Of the shares issued, 71,280 shares are forfeitable if certain milestones are not achieved over the next two years.

Common stock warrants

On May 27, 2021, the Board declared a distribution to holders of the Company’s common shares of warrants to purchase its common shares (the “Warrants”). Holders of Nabors common shares received two-fifths of a warrant per common share held as of the record date (rounded down for any fractional warrant). Nabors issued approximately 3.2 million warrants on June 11, 2021 to shareholders of record as of June 4, 2021. As of March 31, 2022, 2.5 million warrants remain outstanding and 1.0 million of common shares have been issued as a result of exercises of warrants.

Each Warrant represents the right to purchase one common share at an initial exercise price of $166.66667 per Warrant, subject to certain adjustments (the “Exercise Price”). In addition, Warrants submitted for exercise may be eligible to receive an additional one-third common share due to the incentive share component. The incentive share is an extra amount of common shares that Nabors will award when the volume weighted average price of Nabors’ common shares on the day before any Warrant holder exercises its Warrants multiplied by three is at least 6% higher than the sum of the volume weighted average prices of Nabors’ common shares on each of the second, third and fourth days before any Warrant holder exercises its Warrants. Effective as of April 25, 2022, Warrant holders were no longer entitled to receive any incentive shares when exercising the Warrants. Payment for common shares on exercise of Warrants may be in (i) cash or (ii)“Designated Notes,” which the Company initially defined as (a) Nabors Delaware’s (i) 5.10% Notes due 2023, (ii) 0.75% Exchangeable Notes due 2024, (iii) 5.75% Notes due 2025 and (b) the Company’s 7.25% Notes due 2026, subject to compliance with applicable procedures with respect to the delivery of the Warrants and Designated Notes. Effective March 21, 2022, the 0.75% Exchangeable Notes due 2024 was removed from the list of Designated Notes. The Exercise Price and the number of common shares issuable upon exercise are subject to anti-dilution adjustments, including for share dividends, splits, subdivisions, spin-offs, consolidations, reclassifications, combinations, noncash distributions, cash dividends (other than regular quarterly cash dividends not exceeding a permitted threshold amount), certain pro rata shares repurchases, and similar transactions, including certain issuances of common shares (or securities exercisable or convertible into or exchangeable for common shares) at a price (or having a conversion price) that is less than 95% of the market price of the common shares. The Warrants expire on June 11, 2026, but the expiration date may be accelerated at any time by the Company upon 20-days’ prior notice. The Company has listed the Warrants on the over-the-counter market.

The common stock warrants are recognized as derivative liabilities in accordance with ASC 815-40. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. The fair value of the Warrants was initially measured at fair value using a Monte Carlo pricing model due to the level of market activity. As of March 31, 2022, the fair value of the Warrants was measured using their trading price to account for increased trading volume. At distribution, the fair value of the Warrants was $2.7 million. On March 31, 2022, the fair value of the Warrants was

approximately $57.2 million. During the three months ended March 31, 2022, approximately $73.2 million of loss has been recognized for the increase in liability and included in Other, net in our consolidated statements of income (loss).

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Fair Value Measurements

3 Months Ended

Mar. 31, 2022

Fair Value Measurements

Fair Value Measurements

Note 7 Fair Value Measurements

Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable. We primarily apply the market approach for recurring fair value measurements and endeavor to utilize the best information available. Accordingly, we employ valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.

The use of unobservable inputs is intended to allow for fair value determinations in situations where there is little, if any, market activity for the asset or liability at the measurement date. We are able to classify fair value balances utilizing a fair value hierarchy based on the observability of those inputs.

Under the fair value hierarchy:

● Level 1 measurements include unadjusted quoted market prices for identical assets or liabilities in an active market;

● Level 2 measurements include quoted market prices for identical assets or liabilities in an active market that have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets; and

● Level 3 measurements include those that are unobservable and of a subjective nature.

Our financial liabilities that are accounted for at fair value on a recurring basis as of March 31, 2022 consisted of our common stock warrants. During the three months ended March 31, 2022, the common stock warrants transferred from using Level 3 inputs to Level 1 measurements due to increased trading volume. As of March 31, 2022, our common stock warrants were carried at fair market value and totaled $57.2 million.

Recurring Fair Value Measurements

The fair value of the common stock warrants was initially measured at fair value using a Monte Carlo option pricing model. As of December 31, 2021, the estimated fair value of the warrants is determined using Level 3 inputs. Inherent in the option pricing simulation are assumptions related to expected stock-price volatility, expected life and risk-free interest rate. The Company estimates the volatility of its common stock warrants based on implied and historical volatility of the company’s traded common stock. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is based on the Company’s ability to initiate expiration, subject to a 20 business day notice period.

Nonrecurring Fair Value Measurements

We applied fair value measurements to our nonfinancial assets and liabilities measured on a nonrecurring basis, which consist of measurements primarily related to assets held for sale, goodwill, intangible assets and other long-lived assets and assets acquired and liabilities assumed in a business combination. Based upon our review of the fair value hierarchy, the inputs used in these fair value measurements were considered Level 3 inputs.

Fair Value of Financial Instruments

We estimate the fair value of our financial instruments in accordance with U.S. GAAP. The fair value of our long-term debt and revolving credit facilities is estimated based on quoted market prices or prices quoted from third-party financial institutions. The fair value of our debt instruments is determined using Level 2 measurements. The carrying and fair values of these liabilities were as follows:

		March 31, 2022				December 31, 2021
		Carrying		Fair		Carrying		Fair
		Value		Value		Value		Value
	(In thousands)
5.50% senior notes due January 2023		$	21,226	$	21,536	$	24,446	$	24,736
5.10% senior notes due September 2023			62,338		63,685		82,703		84,044
0.75% senior exchangeable notes due January 2024			162,065		168,155		259,839		257,730
5.75% senior notes due February 2025			526,628		513,304		548,458		508,881
6.50% senior priority guaranteed notes due February 2025			—		—		50,485		50,490
9.00% senior priority guaranteed notes due February 2025			218,082		227,346		218,082		226,914
7.25% senior guaranteed notes due January 2026			557,902		557,935		559,978		522,079
7.375% senior priority guaranteed notes due May 2027			700,000		728,049		700,000		724,906
7.50% senior guaranteed notes due January 2028			389,609		379,058		389,609		346,966
2018 revolving credit facility			—		—		460,000		460,000
		$	2,637,850	$	2,659,069	$	3,293,600	$	3,206,746
Less: deferred financing costs			27,758				30,805
		$	2,610,092			$	3,262,795

The fair values of our cash equivalents, trade receivables and trade payables approximate their carrying values due to the short-term nature of these instruments.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies

Commitments and Contingencies

Note 8 Commitments and Contingencies

Contingencies

Income Tax

We operate in a number of countries and our tax returns filed in those jurisdictions are subject to review and examination by tax authorities within those jurisdictions. We do not recognize the benefit of income tax positions we believe are more likely than not to be disallowed upon challenge by a tax authority. If any tax authority successfully challenges our operational structure, intercompany pricing policies or the taxable presence of our subsidiaries in certain countries, if the terms of certain income tax treaties are interpreted in a manner that is adverse to our structure, or if we lose a material tax dispute in any country, our effective tax rate on our worldwide earnings could change substantially.

In certain jurisdictions we have recognized deferred tax assets and liabilities. Judgment and assumptions are required in determining whether deferred tax assets will be fully or partially utilized. When we estimate that all or some portion of certain deferred tax assets such as net operating loss carryforwards will not be utilized, we establish a valuation allowance for the amount we determine to be more likely than not unrealizable. We continually evaluate strategies that could allow for future utilization of our deferred assets. Any change in the ability to utilize such deferred assets will be accounted for in the period of the event affecting the valuation allowance. If facts and circumstances cause us to change our expectations regarding future tax consequences, the resulting adjustments could have a material effect on our financial results or cash flow. At this time, we consider it more likely than not that we will have sufficient taxable income in the future that will allow us to realize the deferred tax assets that we have recognized. However, it is possible that some of our recognized deferred tax assets, relating to net operating loss carryforwards, could expire unused or could carryforward indefinitely without utilization. Therefore, unless we are able to generate sufficient taxable income from our component operations, a substantial valuation allowance to reduce our deferred tax assets may be required, which would materially increase our tax expense in the period the allowance is recognized and materially adversely affect our results of operations and statement of financial condition.

Litigation

Nabors and its subsidiaries are defendants or otherwise involved in a number of lawsuits in the ordinary course of business. We estimate the range of our liability related to pending litigation when we believe the amount and range of loss can be estimated. We record our best estimate of a loss when the loss is considered probable. When a liability is probable and there is a range of estimated loss with no best estimate in the range, we record the minimum estimated liability related to the lawsuits or claims. As additional information becomes available, we assess the potential liability related to our pending litigation and claims and revise our estimates. Due to uncertainties related to the resolution of lawsuits and claims, the ultimate outcome may differ from our estimates. For matters where an unfavorable outcome is reasonably possible and significant, we disclose the nature of the matter and a range of potential exposure, unless an estimate cannot be made at the time of disclosure. In the opinion of management and based on liability accruals provided, our ultimate exposure with respect to these pending lawsuits and claims is not expected to have a material adverse effect on our consolidated financial position or cash flows, although they could have a material adverse effect on our results of operations for a particular reporting period.

In March 2011, the Court of Ouargla entered a judgment of approximately $19.8 million (at March 31, 2022 exchange rates) against us relating to alleged violations of Algeria’s foreign currency exchange controls, which require that goods and services provided locally be invoiced and paid in local currency. The case relates to certain foreign currency payments made to us by CEPSA, a Spanish operator, for wells drilled in 2006. Approximately $7.5 million of the total contract amount was paid offshore in foreign currency, and approximately $3.2 million was paid in local currency. The judgment includes fines and penalties of approximately four times the amount at issue. We have appealed the ruling based on our understanding that the law in question applies only to resident entities incorporated under Algerian law. An intermediate court of appeals upheld the lower court’s ruling, and we appealed the matter to the Supreme Court. On September 25, 2014, the Supreme Court overturned the verdict against us, and the case was reheard by the Ouargla Court of Appeals on March 22, 2015 in light of the Supreme Court’s opinion. On March 29, 2015, the Ouargla Court of Appeals reinstated the initial judgment against us. We appealed this decision again to the Supreme Court, which again overturned the appeals court’s decision. The case was moved back to the court of appeals, which, once again, reinstated the verdict, failing to abide by the Supreme Court’s ruling. Accordingly, we are appealing once more to the Supreme Court to try to get a final ruling on the matter. While our payments were consistent with our historical operations in the country, and, we believe, those of other multinational corporations there, as well as interpretations of the law by the Central Bank of Algeria, the ultimate resolution of this matter could result in a loss of up to $11.8 million in excess of amounts accrued.

Following a routine audit conducted in May and June of 2018 by the Atyrau Oblast Ecology Department (the “AOED”), our joint venture in Kazakhstan, KMG Nabors Drilling Company (“KNDC”), was administratively fined for not having emissions permits for KNDC owned or leased equipment, due to a change in interpretation by the AOED that the owner/lessor of the equipment that emits the pollutants must have its own permits.  Administrative fines of $0.8 million were paid by KNDC for such violations. AOED also assessed additional “environmental damages” in the amount of $3.4 million for the period. KNDC appealed and, ultimately, the Supreme Court ruled in KNDC’s favor on July 21, 2021, terminating the administrative case for lack of evidence. KNDC was reimbursed by the AOED for the environmental damages on December 27, 2021. With the potential for additional damages for later year audits, KNDC and the operator have executed an agreement formalizing the operator’s obligation to reimburse KNDC for many of the financial expenses related to this case as well as penalties and expenses related to future audit periods.  Since 2019, KNDC holds its own permits. Another audit by AOED was performed for the second half of 2018, but KNDC continues to appeal this decision in the same manner as the prior audit.  Meanwhile, KNDC received notice from government officials that certain of our employees may be held personally responsible, but considering the numerous court proceedings, the governmental officials temporarily suspended any criminal investigations. On December 10, 2021, the regional court in Atyrau Region upheld KNDC’s position and ruled in our favor. AOED still holds a right to appeal this decision to the Supreme Court until June 30, 2022, but it has canceled previously-issued audit decision that was the basis of the administrative proceeding.  AOED also has an appeal pending for review of the environmental damages and has until the end of May 2022 to provide additional information to the court.  AOED also carried out a planned audit for the period January 2019-February 2022 which had no material findings. We continue to be engaged and are monitoring the situation.

Off-Balance Sheet Arrangements (Including Guarantees)

We are a party to some transactions, agreements or other contractual arrangements defined as “off-balance sheet arrangements” that could have a material future effect on our financial position, results of operations, liquidity and capital resources. The most significant of these off-balance sheet arrangements include the A/R Facility (see Note 4—Accounts Receivable Purchase and Sales Agreements) and certain agreements and obligations under which we provide financial or performance assurance to third parties. Certain of these financial or performance assurances serve as guarantees, including standby letters of credit issued on behalf of insurance carriers in conjunction with our workers’ compensation insurance program and other financial surety instruments such as bonds. In addition, we have provided indemnifications, which serve as guarantees, to some third parties. These guarantees include indemnification provided by Nabors to our share transfer agent and our insurance carriers. We are not able to estimate the potential future maximum payments that might be due under our indemnification guarantees.

Management believes the likelihood that we would be required to perform or otherwise incur any material losses associated with any of these guarantees is remote. The following table summarizes the total maximum amount of financial guarantees issued by Nabors:

	Maximum Amount
	2022		2023	2024	Thereafter	Total
	(In thousands)
Financial standby letters of credit and other financial surety instruments	$	35,156	13,065	8,488	35,967	$	92,676

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Earnings (Losses) Per Share

3 Months Ended

Mar. 31, 2022

Earnings (Losses) Per Share

Earnings (Losses) Per Share

Note 9 Earnings (Losses) Per Share

ASC 260, Earnings per Share, requires companies to treat unvested share-based payment awards that have nonforfeitable rights to dividends or dividend equivalents as a separate class of securities in calculating earnings (losses) per share. We have granted and expect to continue to grant to employees restricted stock grants that contain nonforfeitable rights to dividends. Such grants are considered participating securities under ASC 260. As such, we are required to include these grants in the calculation of our basic earnings (losses) per share and calculate basic earnings (losses) per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. The participating security holders are not contractually obligated to share in losses. Therefore, losses are not allocated to the participating security holders.

Basic earnings (losses) per share is computed utilizing the two-class method and is calculated based on the weighted-average number of common shares outstanding during the periods presented.

Diluted earnings (losses) per share is computed using the weighted-average number of common and common equivalent shares outstanding during the periods utilizing the two-class method for stock options and unvested restricted shares.

A reconciliation of the numerators and denominators of the basic and diluted earnings (losses) per share computations is as follows:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands, except per share amounts)
BASIC EPS:
Net income (loss) (numerator):
Income (loss) from continuing operations, net of tax		$	(174,668)	$	(128,329)
Less: net (income) loss attributable to noncontrolling interest			(9,828)		(8,776)
Less: preferred stock dividends			—		(3,653)
Less: accrued distribution on redeemable noncontrolling interest in subsidiary			(2,545)		(2,402)
Numerator for basic earnings per share:
Adjusted income (loss) from continuing operations, net of tax - basic		$	(187,041)	$	(143,160)
Income (loss) from discontinued operations, net of tax		$	—	$	19
Weighted-average number of shares outstanding - basic			8,311		7,102
Earnings (losses) per share:
Basic from continuing operations		$	(22.51)	$	(20.16)
Basic from discontinued operations			—		—
Total Basic		$	(22.51)	$	(20.16)
DILUTED EPS:
Adjusted income (loss) from continuing operations, net of tax - diluted		$	(187,041)	$	(143,160)
Income (loss) from discontinued operations, net of tax		$	—	$	19
Weighted-average number of shares outstanding - diluted			8,311		7,102
Earnings (losses) per share:
Diluted from continuing operations		$	(22.51)	$	(20.16)
Diluted from discontinued operations			—		—
Total Diluted		$	(22.51)	$	(20.16)

For all periods presented, the computation of diluted earnings (losses) per share excludes outstanding stock options with exercise prices greater than the average market price of Nabors’ common shares, because their inclusion would be anti-dilutive and because they are not considered participating securities. In any period during which the average market price of Nabors’ common shares exceeds the exercise prices of these stock options, such stock options will be included in our diluted earnings (losses) per share computation using the if-converted method of accounting. Restricted stock is included in our basic and diluted earnings (losses) per share computation using the two-class method of accounting in all periods because such stock is considered participating securities. For periods in which we experience a net loss from continuing operations, all potential common shares have been excluded from the calculation of weighted-average shares outstanding, because their inclusion would be anti-dilutive. The average number of shares from options that were excluded from diluted earnings (losses) per share that would potentially dilute earnings per share in the future were as follows:

	Three Months Ended
	March 31,
	2022		2021
Potentially dilutive securities excluded as anti-dilutive		13,194		72

Additionally, through the first quarter of 2021, we excluded 0.79 million common shares from the computation of diluted shares issuable upon the conversion of mandatory convertible preferred shares, because their effect would be anti-dilutive under the if-converted method. For the three months ended March 31, 2022, we excluded 3.4 million shares from the computation of diluted shares related to the warrants issued because their effect would be anti-dilutive under the if-converted method.

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Supplemental Balance Sheet and Income Statement Information

3 Months Ended

Mar. 31, 2022

Supplemental Balance Sheet and Income Statement Information

Supplemental Balance Sheet and Income Statement Information

Note 10 Supplemental Balance Sheet and Income Statement Information

Accrued liabilities included the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
Accrued compensation	$	52,181	$	51,993
Deferred revenue and proceeds on insurance and asset sales		44,970		59,816
Other taxes payable		26,783		34,333
Workers’ compensation liabilities		6,588		6,588
Interest payable		55,779		71,814
Litigation reserves		16,270		14,939
Other accrued liabilities		7,339		7,688
	$	209,910	$	247,171

Investment income (loss) includes the following:

	Three Months Ended
	March 31,
	2022		2021
	(In thousands)
Interest and dividend income	$	397	$	1,293
Gains (losses) on marketable securities		(234)		(30)
	$	163	$	1,263

Other, net included the following:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Losses (gains) on sales, disposals and involuntary conversions of long-lived assets		$	76	$	8,522
Warrant valuation			73,202		—
Litigation expenses and reserves			3,112		1,494
Foreign currency transaction losses (gains)			4,214		2,379
(Gain) loss on debt buyback			36		(8,062)
Other losses (gains)			(239)		3,013
		$	80,401	$	7,346

The changes in accumulated other comprehensive income (loss), by component, included the following:

	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total
	(In thousands (1) )
As of January 1, 2021	$	2	$	(3,616)	$	(7,510)	$	(11,124)
Other comprehensive income (loss) before reclassifications		—		(1,900)		2,228		328
Amounts reclassified from accumulated other comprehensive income (loss)		—		40		—		40
Net other comprehensive income (loss)		—		(1,860)		2,228		368
As of March 31, 2021	$	2	$	(5,476)	$	(5,282)	$	(10,756)

(1) All amounts are net of tax.

	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total
	(In thousands (1) )
As of January 1, 2022	$	2	$	(5,356)	$	(5,280)	$	(10,634)
Other comprehensive income (loss) before reclassifications		—		1,428		(132)		1,296
Amounts reclassified from accumulated other comprehensive income (loss)		—		40		—		40
Net other comprehensive income (loss)		—		1,468		(132)		1,336
As of March 31, 2022	$	2	$	(3,888)	$	(5,412)	$	(9,298)

(1) All amounts are net of tax.

The line items that were reclassified to net income included the following:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
General and administrative expenses		$	52	$	52
Total income (loss) from continuing operations before income tax			(52)		(52)
Tax expense (benefit)			(12)		(12)
Reclassification adjustment for (gains)/ losses included in net income (loss)		$	(40)	$	(40)

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Segment Information

3 Months Ended

Mar. 31, 2022

Segment Information

Segment Information

Note 11 Segment Information

The following table sets forth financial information with respect to our reportable operating segments:

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Operating revenues:
U.S. Drilling		$	217,583	$	142,299
Canada Drilling			—		20,989
International Drilling			279,030		246,838
Drilling Solutions			54,182		35,706
Rig Technologies			36,736		25,748
Other reconciling items (1)			(18,992)		(11,069)
Total		$	568,539	$	460,511

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Adjusted operating income (loss): (2)
U.S. Drilling		$	(5,851)	$	(23,336)
Canada Drilling			(19)		3,907
International Drilling			(6,327)		(18,632)
Drilling Solutions			14,709		4,710
Rig Technologies			(2,751)		(2,569)
Total segment adjusted operating income (loss)		$	(239)	$	(35,920)

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Reconciliation of segment adjusted operating income (loss) to net income (loss):
Net income (loss)		$	(174,668)	$	(128,310)
Income (loss) from discontinued operations, net of tax			—		(19)
Income (loss) from continuing operations, net of tax			(174,668)		(128,329)
Income tax expense (benefit)			13,671		9,725
Income (loss) from continuing operations before income taxes			(160,997)	$	(118,604)
Investment (income) loss			(163)		(1,263)
Interest expense			46,910		42,975
Other, net			80,401		7,346
Other reconciling items (3)			33,610		33,626
Total segment adjusted operating income (loss) (2)		$	(239)	$	(35,920)

	March 31,		December 31,
	2022		2021
	(In thousands)
Total assets:
U.S. Drilling	$	1,540,980	$	1,606,683
Canada Drilling		529		1,392
International Drilling		2,343,972		2,380,703
Drilling Solutions		66,696		65,899
Rig Technologies		184,372		190,489
Other reconciling items (3)		720,617		1,280,198
Total	$	4,857,166	$	5,525,364

(1) Represents the elimination of inter-segment transactions related to our Rig Technologies operating segment.

(2) Adjusted operating income (loss) represents income (loss) from continuing operations before income taxes, interest expense, earnings (losses) from unconsolidated affiliates, investment income (loss), impairments and other charges and other, net. Management evaluates the performance of our operating segments using adjusted operating income (loss), which is a segment performance measure, because it believes that this financial measure reflects our ongoing profitability and performance. In addition, securities analysts and investors use this measure as one of the metrics on which they analyze our performance. A reconciliation from net income (loss) is provided in the above table.

(3) Represents the elimination of inter-segment transactions and unallocated corporate expenses and assets.

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Revenue Recognition

3 Months Ended

Mar. 31, 2022

Revenue Recognition

Revenue Recognition

Note 12 Revenue Recognition

We recognize revenue when control of a good or service promised in a contract (i.e., performance obligation) is transferred to a customer. Control is obtained when a customer has the ability to direct the use of and obtain substantially all of the remaining benefits from that good or service. Contract drilling revenues are recorded over time utilizing the input method based on time elapsed. The measurement of progress considers the transfer of the service to the customer as we provide daily drilling services. We receive payment after the services have been performed by billing customers periodically (typically monthly). However, a portion of our revenues are recognized at a point-in-time as control is transferred at a distinct point in time such as with the sale of our top drives and other capital equipment. Within our drilling contracts, we have identified one performance obligation in which the transaction price is allocated.

Disaggregation of revenue

In the following table, revenue is disaggregated by geographical region. The table also includes a reconciliation of the disaggregated revenue with the reportable segments:

	Three Months Ended
	March 31, 2022
		U.S. Drilling		Canada Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total
	(In thousands)
Lower 48	$	172,797	$	—	$	—	$	34,060	$	22,688	$	—	$	229,545
U.S. Offshore Gulf of Mexico		30,440		—		—		3,236		—		—		33,676
Alaska		14,346		—		—		276		—		—		14,622
Canada		—		—		—		436		979		—		1,415
Middle East & Asia		—		—		190,696		10,026		10,800		—		211,522
Latin America		—		—		68,895		5,929		—		—		74,824
Europe, Africa & CIS		—		—		19,439		219		2,269		—		21,927
Eliminations & other		—		—		—		—		—		(18,992)		(18,992)
Total	$	217,583	$	—	$	279,030	$	54,182	$	36,736	$	(18,992)	$	568,539

	Three Months Ended
	March 31, 2021
		U.S. Drilling		Canada Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total
	(In thousands)
Lower 48	$	109,534	$	—	$	—	$	18,448	$	12,539	$	—	$	140,521
U.S. Offshore Gulf of Mexico		27,193		—		—		2,736		—		—		29,929
Alaska		5,572		—		—		136		—		—		5,708
Canada		—		20,989		—		454		900		—		22,343
Middle East & Asia		—		—		168,187		8,991		9,078		—		186,256
Latin America		—		—		55,908		4,567		12		—		60,487
Europe, Africa & CIS		—		—		22,743		374		3,219		—		26,336
Eliminations & other		—		—		—		—		—		(11,069)		(11,069)
Total	$	142,299	$	20,989	$	246,838	$	35,706	$	25,748	$	(11,069)	$	460,511

Contract balances

We perform our obligations under a contract with a customer by transferring goods or services in exchange for consideration from the customer. We recognize a contract asset or liability when we transfer goods or services to a customer and bill an amount which differs from the revenue allocated to the related performance obligations.

The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) on our condensed consolidated balance sheet. In general, we receive payments from customers based on dayrates as stipulated in our contracts (e.g., operating rate, standby rate). The invoices billed to the customer are based on the varying rates applicable to the operating status on each rig. Accounts receivable are recorded when the right to consideration becomes unconditional.

Dayrate contracts also may contain fees charged to the customer for up-front rig modifications, mobilization and demobilization of equipment and personnel. These fees are associated with contract fulfillment activities, and the related revenue (subject to any constraint on estimates of variable consideration) is allocated to a single performance obligation and recognized ratably over the initial term of the contract. Mobilization fees are generally billable to the customer in the initial phase of a contract and generate contract liabilities until they are recognized as revenue. Demobilization fees are generally received at the end of the contract and generate contract assets when they are recognized as revenue prior to becoming receivables from the customer.

We receive reimbursements from our customers for the purchase of supplies, equipment, personnel services and other services provided at their request. Reimbursable revenues are variable and subject to uncertainty as the amounts received and timing thereof are dependent on factors outside of our influence. Accordingly, these revenues are constrained and not recognized until the uncertainty is resolved, which typically occurs when the related costs are incurred on behalf of the customer. We are generally considered a principal in these transactions and record the associated revenues at the gross amounts billed to the customer.

The opening and closing balances of our receivables, contract assets and current and long-term contract liabilities are as follows:

			Contract		Contract		Contract		Contract
	Contract		Assets		Assets		Liabilities		Liabilities
	Receivables		(Current)		(Long-term)		(Current)		(Long-term)
	(In millions)
As of December 31, 2021	$	350.0	$	24.9	$	1.9	$	42.9	$	29.3
As of March 31, 2022	$	385.6	$	27.5	$	1.9	$	34.4	$	27.8

Approximately 37% of the contract liability balance at the beginning of the period is expected to be recognized as revenue during 2022, of which 10% was recognized during the three months ended March 31, 2022, and 28% is expected to be recognized during 2023. The remaining 35% of the contract liability balance at the beginning of the period is expected to be recognized as revenue during 2024 or thereafter.

Additionally, 88% of the contract asset balance at the beginning of the period is expected to be recognized as expense during 2022, of which 46% was recognized during the three months ended March 31, 2022, and 12% is expected to be recognized during 2023. This disclosure does not include variable consideration allocated entirely to a wholly unsatisfied performance obligation or promise to transfer a distinct good or service that forms part of a single performance obligation.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2022

Summary of Significant Accounting Policies

Interim Financial Information

Interim Financial Information

The accompanying unaudited condensed consolidated financial statements of Nabors have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”). Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC” or “Commission”), certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. Therefore, these financial statements should be read together with our annual report on Form 10-K for the year ended December 31, 2021 (“2021 Annual Report”). In management’s opinion, the unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to state fairly our financial position as of March 31, 2022 and the results of operations, comprehensive income (loss), cash flows and changes in equity for the periods presented herein. Interim results for the three months ended March 31, 2022 may not be indicative of results that will be realized for the full year ending December 31, 2022.

Principles of Consolidation

Principles of Consolidation

Our condensed consolidated financial statements include the accounts of Nabors, as well as all majority owned and non-majority owned subsidiaries consolidated in accordance with U.S. GAAP. All significant intercompany accounts and transactions are eliminated in consolidation.

In addition to the consolidation of our majority owned subsidiaries, we also consolidate variable interest entities (“VIE”) when we are determined to be the primary beneficiary of a VIE. Determination of the primary beneficiary of a VIE is based on whether an entity has (1) the power to direct activities that most significantly impact the economic performance of the VIE and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Our joint venture, SANAD, which is equally owned by Saudi Aramco and Nabors,

has been consolidated. As we have the power to direct activities that most significantly impact SANAD’s economic performance, including operations, maintenance and certain sourcing and procurement, we have determined Nabors to be the primary beneficiary. See Note 3—Joint Ventures.

Inventory

Inventory

Inventory is stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out or weighted-average cost methods and includes the cost of materials, labor and manufacturing overhead. Inventory included the following:

	March 31,		December 31,
	2022		2021
	(In thousands)
Raw materials	$	108,912	$	105,638
Work-in-progress		2,336		1,368
Finished goods		20,878		19,442
	$	132,126	$	126,448

Special Purpose Acquisition Company

Special Purpose Acquisition Company

Nabors Energy Transition Corp. (“NETC”) is a consolidated VIE that is included in the accompanying consolidated financial statements under the following captions:

Restricted cash held in trust

As part of the initial public offering of NETC and subsequent private placement warrant transactions, $281.5 million has been deposited in an interest-bearing U.S. based trust account (“Trust Account”). The funds held in the Trust Account are invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations.

Redeemable noncontrolling interest in subsidiary

The company accounts for the non-controlling interest in NETC as subject to possible redemption in accordance with FASB ASC Topic 480 “Distinguishing Liabilities from Equity.” NETC’s common stock features certain redemption rights, which are considered to be outside the company’s control and subject to occurrence of uncertain future events. Accordingly, the $281.5 million of non-controlling interest subject to possible redemption is presented at full redemption value as temporary equity, outside of the stockholders’ equity section in the accompanying consolidated financial statements as of March 31, 2022.

Nabors will recognize any future changes in redemption value immediately as they occur – i.e., adjust the carrying amount of the instrument to its current redemption amount at each reporting period.

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2022

Summary of Significant Accounting Policies

Inventory

	March 31,		December 31,
	2022		2021
	(In thousands)
Raw materials	$	108,912	$	105,638
Work-in-progress		2,336		1,368
Finished goods		20,878		19,442
	$	132,126	$	126,448

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Joint Ventures (Tables)

3 Months Ended

Mar. 31, 2022

Joint Ventures

Schedule of condensed balance sheet of SANAD

	March 31,		December 31,
	2022		2021
	(In thousands)
Assets:
Cash and cash equivalents	$	308,761	$	293,037
Accounts receivable		79,366		88,174
Other current assets		6,703		6,662
Property, plant and equipment, net		492,676		467,587
Other long-term assets		19,006		19,010
Total assets	$	906,512	$	874,470
Liabilities:
Accounts payable	$	61,722	$	61,278
Accrued liabilities		10,812		6,021
Other liabilities		26,597		26,300
Total liabilities	$	99,131	$	93,599

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Debt (Tables)

3 Months Ended

Mar. 31, 2022

Debt

Debt

	March 31,		December 31,
	2022		2021
	(In thousands)
5.50% senior notes due January 2023 (1)	$	21,226	$	24,446
5.10% senior notes due September 2023		62,338		82,703
0.75% senior exchangeable notes due January 2024		162,065		259,839
5.75% senior notes due February 2025		526,628		548,458
6.50% senior priority guaranteed notes due February 2025		—		50,485
9.00% senior priority guaranteed notes due February 2025		218,082		218,082
7.25% senior guaranteed notes due January 2026		557,902		559,978
7.375% senior priority guaranteed notes due May 2027		700,000		700,000
7.50% senior guaranteed notes due January 2028		389,609		389,609
2018 revolving credit facility		—		460,000
	$	2,637,850	$	3,293,600
Less: deferred financing costs		27,758		30,805
Long-term debt	$	2,610,092	$	3,262,795

(1) The 5.50% senior notes due January 2023 were classified as long-term as of March 31, 2022, because we had the ability and intent to repay this obligation utilizing our 2022 Credit Agreement.

The aggregate principal amounts and recognized gain

The aggregate principal amounts and recognized gain for such transactions were as follows (in thousands):

	Three months ended March 31,
	2021
Exchanged		(in thousands)
0.75% senior exchangeable notes due January 2024	$	35,000
5.75% senior notes due February 2025		5,000
Aggregate principal amount exchanged		40,000
Aggregate principal amount of debt issued in exchanges		26,050

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Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Measurements

Fair value of financial instruments

		March 31, 2022				December 31, 2021
		Carrying		Fair		Carrying		Fair
		Value		Value		Value		Value
	(In thousands)
5.50% senior notes due January 2023		$	21,226	$	21,536	$	24,446	$	24,736
5.10% senior notes due September 2023			62,338		63,685		82,703		84,044
0.75% senior exchangeable notes due January 2024			162,065		168,155		259,839		257,730
5.75% senior notes due February 2025			526,628		513,304		548,458		508,881
6.50% senior priority guaranteed notes due February 2025			—		—		50,485		50,490
9.00% senior priority guaranteed notes due February 2025			218,082		227,346		218,082		226,914
7.25% senior guaranteed notes due January 2026			557,902		557,935		559,978		522,079
7.375% senior priority guaranteed notes due May 2027			700,000		728,049		700,000		724,906
7.50% senior guaranteed notes due January 2028			389,609		379,058		389,609		346,966
2018 revolving credit facility			—		—		460,000		460,000
		$	2,637,850	$	2,659,069	$	3,293,600	$	3,206,746
Less: deferred financing costs			27,758				30,805
		$	2,610,092			$	3,262,795

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies

Summary of total maximum amount of financial guarantees issued

	Maximum Amount
	2022		2023	2024	Thereafter	Total
	(In thousands)
Financial standby letters of credit and other financial surety instruments	$	35,156	13,065	8,488	35,967	$	92,676

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Earnings (Losses) Per Share (Tables)

3 Months Ended

Mar. 31, 2022

Earnings (Losses) Per Share

Earnings (losses) per share computations

		Three Months Ended
		March 31,
		2022		2021
	(In thousands, except per share amounts)
BASIC EPS:
Net income (loss) (numerator):
Income (loss) from continuing operations, net of tax		$	(174,668)	$	(128,329)
Less: net (income) loss attributable to noncontrolling interest			(9,828)		(8,776)
Less: preferred stock dividends			—		(3,653)
Less: accrued distribution on redeemable noncontrolling interest in subsidiary			(2,545)		(2,402)
Numerator for basic earnings per share:
Adjusted income (loss) from continuing operations, net of tax - basic		$	(187,041)	$	(143,160)
Income (loss) from discontinued operations, net of tax		$	—	$	19
Weighted-average number of shares outstanding - basic			8,311		7,102
Earnings (losses) per share:
Basic from continuing operations		$	(22.51)	$	(20.16)
Basic from discontinued operations			—		—
Total Basic		$	(22.51)	$	(20.16)
DILUTED EPS:
Adjusted income (loss) from continuing operations, net of tax - diluted		$	(187,041)	$	(143,160)
Income (loss) from discontinued operations, net of tax		$	—	$	19
Weighted-average number of shares outstanding - diluted			8,311		7,102
Earnings (losses) per share:
Diluted from continuing operations		$	(22.51)	$	(20.16)
Diluted from discontinued operations			—		—
Total Diluted		$	(22.51)	$	(20.16)

Potentially dilutive securities excluded as anti-dilutive

	Three Months Ended
	March 31,
	2022		2021
Potentially dilutive securities excluded as anti-dilutive		13,194		72

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Supplemental Balance Sheet, Income Statement and Cash Flow Information (Tables)

3 Months Ended

Mar. 31, 2022

Supplemental Balance Sheet and Income Statement Information

Accrued liabilities

	March 31,		December 31,
	2022		2021
	(In thousands)
Accrued compensation	$	52,181	$	51,993
Deferred revenue and proceeds on insurance and asset sales		44,970		59,816
Other taxes payable		26,783		34,333
Workers’ compensation liabilities		6,588		6,588
Interest payable		55,779		71,814
Litigation reserves		16,270		14,939
Other accrued liabilities		7,339		7,688
	$	209,910	$	247,171

Schedule of investment income (loss)

	Three Months Ended
	March 31,
	2022		2021
	(In thousands)
Interest and dividend income	$	397	$	1,293
Gains (losses) on marketable securities		(234)		(30)
	$	163	$	1,263

Other, net

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Losses (gains) on sales, disposals and involuntary conversions of long-lived assets		$	76	$	8,522
Warrant valuation			73,202		—
Litigation expenses and reserves			3,112		1,494
Foreign currency transaction losses (gains)			4,214		2,379
(Gain) loss on debt buyback			36		(8,062)
Other losses (gains)			(239)		3,013
		$	80,401	$	7,346

Schedule of changes in accumulated other comprehensive income (loss)

	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total
	(In thousands (1) )
As of January 1, 2021	$	2	$	(3,616)	$	(7,510)	$	(11,124)
Other comprehensive income (loss) before reclassifications		—		(1,900)		2,228		328
Amounts reclassified from accumulated other comprehensive income (loss)		—		40		—		40
Net other comprehensive income (loss)		—		(1,860)		2,228		368
As of March 31, 2021	$	2	$	(5,476)	$	(5,282)	$	(10,756)

(1) All amounts are net of tax.

	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total
	(In thousands (1) )
As of January 1, 2022	$	2	$	(5,356)	$	(5,280)	$	(10,634)
Other comprehensive income (loss) before reclassifications		—		1,428		(132)		1,296
Amounts reclassified from accumulated other comprehensive income (loss)		—		40		—		40
Net other comprehensive income (loss)		—		1,468		(132)		1,336
As of March 31, 2022	$	2	$	(3,888)	$	(5,412)	$	(9,298)

(1) All amounts are net of tax.

Schedule of line items that were reclassified from net income

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
General and administrative expenses		$	52	$	52
Total income (loss) from continuing operations before income tax			(52)		(52)
Tax expense (benefit)			(12)		(12)
Reclassification adjustment for (gains)/ losses included in net income (loss)		$	(40)	$	(40)

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2022

Segment Information

Financial information with respect to operating segments

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Operating revenues:
U.S. Drilling		$	217,583	$	142,299
Canada Drilling			—		20,989
International Drilling			279,030		246,838
Drilling Solutions			54,182		35,706
Rig Technologies			36,736		25,748
Other reconciling items (1)			(18,992)		(11,069)
Total		$	568,539	$	460,511

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Adjusted operating income (loss): (2)
U.S. Drilling		$	(5,851)	$	(23,336)
Canada Drilling			(19)		3,907
International Drilling			(6,327)		(18,632)
Drilling Solutions			14,709		4,710
Rig Technologies			(2,751)		(2,569)
Total segment adjusted operating income (loss)		$	(239)	$	(35,920)

		Three Months Ended
		March 31,
		2022		2021
	(In thousands)
Reconciliation of segment adjusted operating income (loss) to net income (loss):
Net income (loss)		$	(174,668)	$	(128,310)
Income (loss) from discontinued operations, net of tax			—		(19)
Income (loss) from continuing operations, net of tax			(174,668)		(128,329)
Income tax expense (benefit)			13,671		9,725
Income (loss) from continuing operations before income taxes			(160,997)	$	(118,604)
Investment (income) loss			(163)		(1,263)
Interest expense			46,910		42,975
Other, net			80,401		7,346
Other reconciling items (3)			33,610		33,626
Total segment adjusted operating income (loss) (2)		$	(239)	$	(35,920)

	March 31,		December 31,
	2022		2021
	(In thousands)
Total assets:
U.S. Drilling	$	1,540,980	$	1,606,683
Canada Drilling		529		1,392
International Drilling		2,343,972		2,380,703
Drilling Solutions		66,696		65,899
Rig Technologies		184,372		190,489
Other reconciling items (3)		720,617		1,280,198
Total	$	4,857,166	$	5,525,364

(1) Represents the elimination of inter-segment transactions related to our Rig Technologies operating segment.

(2) Adjusted operating income (loss) represents income (loss) from continuing operations before income taxes, interest expense, earnings (losses) from unconsolidated affiliates, investment income (loss), impairments and other charges and other, net. Management evaluates the performance of our operating segments using adjusted operating income (loss), which is a segment performance measure, because it believes that this financial measure reflects our ongoing profitability and performance. In addition, securities analysts and investors use this measure as one of the metrics on which they analyze our performance. A reconciliation from net income (loss) is provided in the above table.

(3) Represents the elimination of inter-segment transactions and unallocated corporate expenses and assets.

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Revenue Recognition (Tables)

3 Months Ended

Mar. 31, 2022

Revenue Recognition

Summary of revenue is disaggregation by geographical region

	Three Months Ended
	March 31, 2022
		U.S. Drilling		Canada Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total
	(In thousands)
Lower 48	$	172,797	$	—	$	—	$	34,060	$	22,688	$	—	$	229,545
U.S. Offshore Gulf of Mexico		30,440		—		—		3,236		—		—		33,676
Alaska		14,346		—		—		276		—		—		14,622
Canada		—		—		—		436		979		—		1,415
Middle East & Asia		—		—		190,696		10,026		10,800		—		211,522
Latin America		—		—		68,895		5,929		—		—		74,824
Europe, Africa & CIS		—		—		19,439		219		2,269		—		21,927
Eliminations & other		—		—		—		—		—		(18,992)		(18,992)
Total	$	217,583	$	—	$	279,030	$	54,182	$	36,736	$	(18,992)	$	568,539

	Three Months Ended
	March 31, 2021
		U.S. Drilling		Canada Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total
	(In thousands)
Lower 48	$	109,534	$	—	$	—	$	18,448	$	12,539	$	—	$	140,521
U.S. Offshore Gulf of Mexico		27,193		—		—		2,736		—		—		29,929
Alaska		5,572		—		—		136		—		—		5,708
Canada		—		20,989		—		454		900		—		22,343
Middle East & Asia		—		—		168,187		8,991		9,078		—		186,256
Latin America		—		—		55,908		4,567		12		—		60,487
Europe, Africa & CIS		—		—		22,743		374		3,219		—		26,336
Eliminations & other		—		—		—		—		—		(11,069)		(11,069)
Total	$	142,299	$	20,989	$	246,838	$	35,706	$	25,748	$	(11,069)	$	460,511

Summary of contract assets, current and long-term contract liabilities

			Contract		Contract		Contract		Contract
	Contract		Assets		Assets		Liabilities		Liabilities
	Receivables		(Current)		(Long-term)		(Current)		(Long-term)
	(In millions)
As of December 31, 2021	$	350.0	$	24.9	$	1.9	$	42.9	$	29.3
As of March 31, 2022	$	385.6	$	27.5	$	1.9	$	34.4	$	27.8

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General (Details)	3 Months Ended
	Mar. 31, 2022 item country
General
The minimum number of countries in which the entity operates | country	15
Actively marketed rigs for offshore based drilling operations	29
United States and Canada
General
Actively marketed rigs for land based drilling operations	301
Geographic Concentration Risk | Sales Revenue | RUSSIA
General
Concentration risk (as a percent)	1.40%
Geographic Concentration Risk | Property, Plant and Equipment, Net. | RUSSIA
General
Concentration risk (as a percent)	1.30%

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Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Inventory, net
Raw materials	$ 108,912	$ 105,638
Work-in-progress	2,336	1,368
Finished goods	20,878	19,442
Total inventory	$ 132,126	$ 126,448

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Summary of Significant Accounting Policies - SPAC (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Summary of Significant Accounting Policies
Restricted cash held in trust	$ 281,549	$ 281,523
Redeemable noncontrolling interest in subsidiary	$ 677,829	$ 675,283

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Joint Ventures (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2017	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2020
Joint Ventures
Redeemable noncontrolling interest	$ 675,283		$ 677,829
Assets:
Cash and cash equivalents	991,471		394,028	$ 417,544	$ 472,246
Accounts receivable	287,572		297,209
Other current assets	95,740		104,112
Property, plant and equipment, net	3,332,498		3,245,574
Other long-term assets	134,903		129,432
Total assets	5,525,364		4,857,166
Liabilities:
Accounts payable	253,748		278,878
Accrued liabilities	247,171		209,910
Other liabilities	340,347		372,592
Total liabilities	4,131,143		3,498,607
SANAD
Joint Ventures
Settled accrued interest	120,000
Assets:
Cash and cash equivalents	293,037		308,761
Accounts receivable	88,174		79,366
Other current assets	6,662		6,703
Property, plant and equipment, net	467,587		492,676
Other long-term assets	19,010		19,006
Total assets	874,470		906,512
Liabilities:
Accounts payable	61,278		61,722
Accrued liabilities	6,021		10,812
Other liabilities	26,300		26,597
Total liabilities	$ 93,599		99,131
SANAD | Saudi Aramco
Joint Ventures
Cash contribution for joint venture		$ 20,000
Additional contribution amount		$ 394,000
Maturity period		25 years
Redeemable noncontrolling interest			$ 396,300

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Accounts Receivable Sales Agreement (Details) - Accounts Receivable Sales Agreement. - USD ($) $ in Millions	1 Months Ended
	Jul. 31, 2021	Mar. 31, 2022	Dec. 31, 2021
Accounts Receivable Sales Agreement
Agreement amount	$ 250.0
Agreement amount	$ 150.0
Agreement expiration term extension (in years)	2 years
Accounts receivables sold to purchasers		$ 136.0	$ 113.0
Trade receivables pledged as collateral		$ 55.3	$ 44.2

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Debt (Details)		1 Months Ended	3 Months Ended
	Jan. 21, 2022 USD ($)	Jan. 31, 2017 USD ($) $ / shares	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Mar. 31, 2021
Debt
Long-term Debt, Gross			$ 2,637,850,000	$ 3,293,600,000
Less: deferred financing costs			27,758,000	30,805,000
Long-term Debt			2,610,092,000	3,262,795,000
Long-term debt			$ 2,610,092,000	$ 3,262,795,000
Interest rate on senior notes (as a percent)			5.50%	5.10%
Warrant Exercise			$ 139,488,000
Accordion feature	$ 100,000,000.0
Maximum amount of grower basket for term loans	$ 100,000,000.0
Percentage of property, plant and equipment to be owned by the revolver guarantor and its subsidiaries	90.00%
Weighted average interest rate (as a percent)			3.23%
Letter of Credit
Debt
Maximum borrowing capacity	$ 100,000,000.0
Nabors Delaware [Member]
Debt
Aggregate amount of senior notes			$ 27,100,000
2018 revolving credit facility
Debt
Long-term Debt, Gross				$ 460,000,000
Senior Notes.
Debt
Repayment of long-term debt including accrued and unpaid interest			27,000,000.0
Reduction in total available borrowing capacity			130,700,000
Payment of accrued and unpaid interest			300,000
5.50% senior notes due January 2023
Debt
Long-term Debt, Gross			$ 21,226,000	$ 24,446,000
Interest rate on senior notes (as a percent)			5.50%	5.50%
5.10% senior notes due September 2023
Debt
Long-term Debt, Gross			$ 62,338,000	$ 82,703,000
Interest rate on senior notes (as a percent)			5.10%	5.10%
0.75% senior exchangeable notes due January 2024
Debt
Long-term Debt, Gross			$ 162,065,000	$ 259,839,000
Interest rate on senior notes (as a percent)			0.75%	0.75%
5.75% senior notes due February 2025
Debt
Long-term Debt, Gross			$ 526,628,000	$ 548,458,000
Interest rate on senior notes (as a percent)			5.75%	5.75%
7.25% senior notes due January 2026
Debt
Interest rate on senior notes (as a percent)			7.25%
7.50% senior notes due January 2028
Debt
Interest rate on senior notes (as a percent)			7.50%
6.50% senior priority guaranteed notes due February 2025
Debt
Long-term Debt, Gross				$ 50,485,000
Interest rate on senior notes (as a percent)			6.50%	6.50%
9.00% senior priority guaranteed notes due February 2025
Debt
Long-term Debt, Gross			$ 218,082,000	$ 218,082,000
Interest rate on senior notes (as a percent)			9.00%	9.00%
7.25% senior guaranteed notes due January 2026
Debt
Long-term Debt, Gross			$ 557,902,000	$ 559,978,000
Interest rate on senior notes (as a percent)			7.25%	7.25%
7.375% senior priority guaranteed notes due May 2027
Debt
Long-term Debt, Gross			$ 700,000,000	$ 700,000,000
Interest rate on senior notes (as a percent)			7.375%	7.375%
7.50% senior guaranteed notes due January 2028
Debt
Long-term Debt, Gross			$ 389,609,000	$ 389,609,000
Interest rate on senior notes (as a percent)			7.50%	7.50%
2022 Credit Agreement
Debt
Long-term Debt, Gross			$ 0
Maximum borrowing capacity	350,000,000.0
Maximum amount of grower basket for term loans	$ 150,000,000.0
Threshold percentage of outstanding principal amount of relevant debt to remaining outstanding	50.00%
Threshold amount beyond which the debt instrument covenant restricts the company's ability to incur liens	$ 150,000,000.0
Threshold amount beyond which the debt instrument covenant restricts the company's subsidiaries to incur debt	$ 100,000,000.0
Debt Exchange Transactions
Debt
Future contractual interest payments			9,400,000
Aggregate principal amount exchanged			40,000,000
Aggregate principal amount of debt issued in exchanges			26,050,000
Debt Exchange Transactions | Nabors Delaware [Member]
Debt
Aggregate principal amount exchanged			40,000,000.0
Debt Exchange Transactions | 0.75% senior exchangeable notes due January 2024
Debt
Long-term Debt			177,000,000.0
Aggregate amount of senior notes		$ 575,000,000.0
Interest rate on senior notes (as a percent)		0.75%
Debt exchangeable notes		$ 411,200,000
Equity component		$ 163,800,000
Exchange rate of common shares		0.8018
Principal amount of notes		$ 1,000
Exchange price per common share (in dollars per share) | $ / shares		$ 1,247.19
Aggregate principal amount exchanged			35,000,000
Debt Exchange Transactions | 5.75% senior notes due February 2025
Debt
Aggregate principal amount exchanged			5,000,000
Debt Exchange Transactions | 9.00% senior priority guaranteed notes due February 2025
Debt
Aggregate amount of senior notes			$ 26,100,000
Interest rate on senior notes (as a percent)			9.00%		9.00%

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Shareholders Equity (Details) $ / shares in Units, $ in Thousands			3 Months Ended
	Jul. 19, 2021 USD ($) shares	Jun. 11, 2021 shares	Mar. 31, 2022 USD ($) D $ / shares shares	Mar. 31, 2021 $ / shares	Dec. 31, 2021 $ / shares shares	May 27, 2021 USD ($) item $ / shares shares
Common Shares
Common shares, shares authorized			32,000,000		32,000,000
Common shares, par value (in dollars per share) | $ / shares			$ 0.05		$ 0.05
Shares issued in connection with acquisition of carbon capture and hydrogen technologies	147,974
Value of shares issued in connection with acquisition of carbon capture and hydrogen technologies | $	$ 12,900
Number of shares that are forfeitable if certain milestones are not achieved over the next two years	71,280
Proceeds from issuance of common shares, net of issuance costs | $			$ 257
Preferred Stock, Dividends Per Share, Declared | $ / shares				$ 0.75
Number of right share for each outstanding common share						1
Number of warrants received per common share held		0.40
Number of warrants issued		3,200,000
Warrants outstanding			2,500,000
Number of common shares issued as a result of exercise of warrants			1,000,000.0
Exercise price (in dollars per share) | $ / shares						$ 166.66667
Number of additional securities						0.333
Multiplying factor for exercise of warrants | item						3
Percentage volume weighted average price of stock times factor must exceed sum of volume weighted average prices of second, third and fourth days before exercise						6.00%
Interest rate (as a percent)			5.50%		5.10%
Conversion price percentage						95.00%
Number of business day notice period | D			20
Fair value of the Warrants | $			$ 57,200			$ 2,700
Loss on fair value adjustment for warrants | $			$ 73,202
5.10% senior notes due September 2023
Common Shares
Interest rate (as a percent)			5.10%		5.10%
0.75% senior exchangeable notes due January 2024
Common Shares
Interest rate (as a percent)			0.75%		0.75%
5.75% senior notes due February 2025
Common Shares
Interest rate (as a percent)			5.75%		5.75%
7.25% senior notes due January 2026
Common Shares
Interest rate (as a percent)			7.25%

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Fair Value Measurements (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022 USD ($) D	Dec. 31, 2021 USD ($)	May 27, 2021 USD ($)
Fair Value of Financial Instruments
Common stock warrants, fair value	$ 57,200		$ 2,700
Number of business day notice period | D	20
Interest rate on senior notes (as a percent)	5.50%	5.10%
Less: deferred financing costs	$ 27,758	$ 30,805
5.50% senior notes due January 2023
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	5.50%	5.50%
5.10% senior notes due September 2023
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	5.10%	5.10%
0.75% senior exchangeable notes due January 2024
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	0.75%	0.75%
5.75% senior notes due February 2025
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	5.75%	5.75%
6.50% senior priority guaranteed notes due February 2025
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	6.50%	6.50%
9.00% senior priority guaranteed notes due February 2025
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	9.00%	9.00%
7.25% senior guaranteed notes due January 2026
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	7.25%	7.25%
7.375% senior priority guaranteed notes due 2027
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	7.375%	7.375%
7.50% senior guaranteed notes due January 2028
Fair Value of Financial Instruments
Interest rate on senior notes (as a percent)	7.50%	7.50%
Fair Value
Fair Value of Financial Instruments
Debt	$ 2,659,069	$ 3,206,746
Fair Value | 2018 revolving credit facility
Fair Value of Financial Instruments
Debt		460,000
Fair Value | 5.50% senior notes due January 2023
Fair Value of Financial Instruments
Debt	21,536	24,736
Fair Value | 5.10% senior notes due September 2023
Fair Value of Financial Instruments
Debt	63,685	84,044
Fair Value | 0.75% senior exchangeable notes due January 2024
Fair Value of Financial Instruments
Debt	168,155	257,730
Fair Value | 5.75% senior notes due February 2025
Fair Value of Financial Instruments
Debt	513,304	508,881
Fair Value | 6.50% senior priority guaranteed notes due February 2025
Fair Value of Financial Instruments
Debt		50,490
Fair Value | 9.00% senior priority guaranteed notes due February 2025
Fair Value of Financial Instruments
Debt	227,346	226,914
Fair Value | 7.25% senior guaranteed notes due January 2026
Fair Value of Financial Instruments
Debt	557,935	522,079
Fair Value | 7.375% senior priority guaranteed notes due 2027
Fair Value of Financial Instruments
Debt	728,049	724,906
Fair Value | 7.50% senior guaranteed notes due January 2028
Fair Value of Financial Instruments
Debt	379,058	346,966
Carrying Value
Fair Value of Financial Instruments
Debt	2,637,850	3,293,600
Less: deferred financing costs	27,758	30,805
Debt, net of financing costs	2,610,092	3,262,795
Carrying Value | 2018 revolving credit facility
Fair Value of Financial Instruments
Debt		460,000
Carrying Value | 5.50% senior notes due January 2023
Fair Value of Financial Instruments
Debt	21,226	24,446
Carrying Value | 5.10% senior notes due September 2023
Fair Value of Financial Instruments
Debt	62,338	82,703
Carrying Value | 0.75% senior exchangeable notes due January 2024
Fair Value of Financial Instruments
Debt	162,065	259,839
Carrying Value | 5.75% senior notes due February 2025
Fair Value of Financial Instruments
Debt	526,628	548,458
Carrying Value | 6.50% senior priority guaranteed notes due February 2025
Fair Value of Financial Instruments
Debt		50,485
Carrying Value | 9.00% senior priority guaranteed notes due February 2025
Fair Value of Financial Instruments
Debt	218,082	218,082
Carrying Value | 7.25% senior guaranteed notes due January 2026
Fair Value of Financial Instruments
Debt	557,902	559,978
Carrying Value | 7.375% senior priority guaranteed notes due 2027
Fair Value of Financial Instruments
Debt	700,000	700,000
Carrying Value | 7.50% senior guaranteed notes due January 2028
Fair Value of Financial Instruments
Debt	$ 389,609	$ 389,609

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Commitments and Contingencies - Litigation (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended	12 Months Ended
	Mar. 31, 2011	Mar. 31, 2022	Dec. 31, 2018
Court of Ouargla Algeria Foreign Currency Controls
Commitments and Contingencies, Disclosure
Litigation amount as per judgment	$ 19.8
Payment of contract amount in foreign currency	7.5
Payment of contract amount in domestic currency	$ 3.2
Court of Ouargla Algeria Foreign Currency Controls | Maximum
Commitments and Contingencies, Disclosure
Potential judgment in excess of accrual		$ 11.8
Atyrau Oblast Ecology Department | Minimum
Commitments and Contingencies, Disclosure
Environmental damages			$ 3.4
KMG Nabors Drilling Company Joint Venture
Commitments and Contingencies, Disclosure
Administrative fines			$ 0.8

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Commitments and Contingencies - Financial Guarantees (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Summary of total maximum amount of financial guarantees issued
2022	$ 35,156
2023	13,065
2024	8,488
Thereafter	35,967
Total	$ 92,676

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Earnings (Losses) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Net income (loss) (numerator):
Income (loss) from continuing operations, net of tax	$ (174,668)	$ (128,329)
Less: net (income) loss attributable to noncontrolling interest	(9,828)	(8,776)
Less: preferred stock dividends		(3,653)
Less: accrued distribution on redeemable noncontrolling interest in subsidiary	(2,545)	(2,402)
Adjusted income (loss) from continuing operations, net of tax - basic	$ (187,041)	(143,160)
Income (loss) from discontinued operations, net of tax		$ 19
Weighted-average number of shares outstanding - basic	8,311	7,102
Earnings (losses) Per Share:
Basic from continuing operations (in dollars per share)	$ (22.51)	$ (20.16)
Total Basic (in dollars per share)	$ (22.51)	$ (20.16)
DILUTED EPS:
Adjusted income (loss) from continuing operations, net of tax - basic	$ (187,041)	$ (143,160)
Adjusted income (loss) from continuing operations, net of tax - diluted	$ (187,041)	(143,160)
Income (loss) from discontinued operations, net of tax		$ 19
Weighted-average number of shares outstanding - basic	8,311	7,102
Weighted-average number of shares outstanding - diluted	8,311	7,102
Earnings (losses) per share:
Diluted from continuing operations (in dollars per share)	$ (22.51)	$ (20.16)
Total Diluted (in dollars per share)	$ (22.51)	$ (20.16)

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Earnings (Losses) Per Share - Exclusions from Diluted Earnings (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded as anti-dilutive	13,194	72
Mandatory Convertible Preferred Shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded as anti-dilutive	3,400	790

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Supplemental Balance Sheet, Income Statement and Cash Flow Information - Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Accrued liabilities
Accrued compensation	$ 52,181	$ 51,993
Deferred revenue and proceeds on insurance and asset sales	44,970	59,816
Other taxes payable	26,783	34,333
Workers' compensation liabilities	6,588	6,588
Interest payable	55,779	71,814
Litigation reserves	16,270	14,939
Other accrued liabilities	7,339	7,688
Accrued liabilities	$ 209,910	$ 247,171

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Supplemental Balance Sheet, Income Statement and Cash Flow Information - Investment income (loss) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Investment income (loss)
Interest and dividend income	$ 397	$ 1,293
Gains (losses) on marketable securities	(234)	(30)
Investment income (loss)	$ 163	$ 1,263

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Supplemental Balance Sheet, Income Statement and Cash Flow Information - Other, net (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Other, net
Losses (gains) on sales, disposals and involuntary conversions of long-lived assets	$ 76	$ 8,522
Warrant valuation	73,202
Litigation expenses and reserves	3,112	1,494
Foreign currency transaction losses (gains)	4,214	2,379
(Gain) loss on debt buyback	36	(8,062)
Other losses (gains)	(239)	3,013
Other, net	$ 80,401	$ 7,346

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Supplemental Balance Sheet, Income Statement and Cash Flow Information - Accumulated Other Comp Inc (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Changes in accumulated other comprehensive income (loss)
Balance at the beginning of the period	$ 590,656
Other comprehensive income (loss), net of tax	1,336	$ 368
Balance at the end of the period	543,616
Accumulated Other Comprehensive Income
Changes in accumulated other comprehensive income (loss)
Balance at the beginning of the period	(10,634)	(11,124)
Other comprehensive income (loss) before reclassifications	1,296	328
Amounts reclassified from accumulated other comprehensive income (loss)	40	40
Other comprehensive income (loss), net of tax	1,336	368
Balance at the end of the period	(9,298)	(10,756)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
Changes in accumulated other comprehensive income (loss)
Balance at the beginning of the period	2	2
Balance at the end of the period	2	2
Accumulated Defined Benefit Plans Adjustment [Member]
Changes in accumulated other comprehensive income (loss)
Balance at the beginning of the period	(5,356)	(3,616)
Other comprehensive income (loss) before reclassifications	1,428	(1,900)
Amounts reclassified from accumulated other comprehensive income (loss)	40	40
Other comprehensive income (loss), net of tax	1,468	(1,860)
Balance at the end of the period	(3,888)	(5,476)
Accumulated Translation Adjustment [Member]
Changes in accumulated other comprehensive income (loss)
Balance at the beginning of the period	(5,280)	(7,510)
Other comprehensive income (loss) before reclassifications	(132)	2,228
Other comprehensive income (loss), net of tax	(132)	2,228
Balance at the end of the period	$ (5,412)	$ (5,282)

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Supplemental Balance Sheet, Income Statement and Cash Flow Information - Reclass Accumulated Other (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Unrealized (gains) losses on available-for-sale securities that were reclassified from net income
Interest expense	$ 46,910	$ 42,975
General and administrative expenses	53,639	54,660
Income (loss) from continuing operations before income taxes	(160,997)	(118,604)
Tax expense (benefit)	13,671	9,725
Net income (loss)	(174,668)	(128,310)
Reclassification out of Accumulated Other Comprehensive Income [Member]
Unrealized (gains) losses on available-for-sale securities that were reclassified from net income
General and administrative expenses	52	52
Income (loss) from continuing operations before income taxes	(52)	(52)
Tax expense (benefit)	(12)	(12)
Net income (loss)	$ (40)	$ (40)

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Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Operating revenues and earnings (losses) from unconsolidated affiliates:
Total operating revenues	$ 568,539	$ 460,511
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Net income (loss)	(174,668)	(128,310)
Income (loss) from discontinued operations, net of tax		(19)
Income (loss) from continuing operations, net of tax	(174,668)	(128,329)
Income tax expense (benefit)	13,671	9,725
Income (loss) from continuing operations before income taxes	(160,997)	(118,604)
Investment income (loss)	(163)	(1,263)
Interest expense	46,910	42,975
Other, net	(80,401)	(7,346)
Adjusted operating income (loss)	(239)	(35,920)
ASSETS
Total assets	4,857,166		$ 5,525,364
Operating Segments
Operating revenues and earnings (losses) from unconsolidated affiliates:
Total operating revenues	568,539	460,511
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	(239)	(35,920)
Intersegment Eliminations
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	33,610	33,626
ASSETS
Total assets	720,617		1,280,198
US Segment | Operating Segments
Operating revenues and earnings (losses) from unconsolidated affiliates:
Total operating revenues	217,583	142,299
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	(5,851)	(23,336)
ASSETS
Total assets	1,540,980		1,606,683
Canada Segment | Operating Segments
Operating revenues and earnings (losses) from unconsolidated affiliates:
Total operating revenues		20,989
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	(19)	3,907
ASSETS
Total assets	529		1,392
International Excluding Canada | Operating Segments
Operating revenues and earnings (losses) from unconsolidated affiliates:
Total operating revenues	279,030	246,838
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	(6,327)	(18,632)
ASSETS
Total assets	2,343,972		2,380,703
Drilling Solutions | Operating Segments
Operating revenues and earnings (losses) from unconsolidated affiliates:
Total operating revenues	54,182	35,706
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	14,709	4,710
ASSETS
Total assets	66,696		65,899
Rig Technologies | Operating Segments
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Adjusted operating income (loss)	(2,751)	$ (2,569)
ASSETS
Total assets	$ 184,372		$ 190,489

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Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Disaggregation of Revenue [Line Items]
Operating revenues	$ 568,539	$ 460,511
Operating Segments
Disaggregation of Revenue [Line Items]
Operating revenues	568,539	460,511
Operating Segments | Lower 48
Disaggregation of Revenue [Line Items]
Operating revenues	229,545	140,521
Operating Segments | U.S. Offshore Gulf Of Mexico
Disaggregation of Revenue [Line Items]
Operating revenues	33,676	29,929
Operating Segments | Alaska
Disaggregation of Revenue [Line Items]
Operating revenues	14,622	5,708
Operating Segments | CANADA
Disaggregation of Revenue [Line Items]
Operating revenues	1,415	22,343
Operating Segments | Middle East & Asia
Disaggregation of Revenue [Line Items]
Operating revenues	211,522	186,256
Operating Segments | Latin America
Disaggregation of Revenue [Line Items]
Operating revenues	74,824	60,487
Operating Segments | Europe, Africa & CIS
Disaggregation of Revenue [Line Items]
Operating revenues	21,927	26,336
Operating Segments | US Segment
Disaggregation of Revenue [Line Items]
Operating revenues	217,583	142,299
Operating Segments | US Segment | Lower 48
Disaggregation of Revenue [Line Items]
Operating revenues	172,797	109,534
Operating Segments | US Segment | U.S. Offshore Gulf Of Mexico
Disaggregation of Revenue [Line Items]
Operating revenues	30,440	27,193
Operating Segments | US Segment | Alaska
Disaggregation of Revenue [Line Items]
Operating revenues	14,346	5,572
Operating Segments | Canada Segment
Disaggregation of Revenue [Line Items]
Operating revenues		20,989
Operating Segments | Canada Segment | CANADA
Disaggregation of Revenue [Line Items]
Operating revenues		20,989
Operating Segments | International Excluding Canada
Disaggregation of Revenue [Line Items]
Operating revenues	279,030	246,838
Operating Segments | International Excluding Canada | Middle East & Asia
Disaggregation of Revenue [Line Items]
Operating revenues	190,696	168,187
Operating Segments | International Excluding Canada | Latin America
Disaggregation of Revenue [Line Items]
Operating revenues	68,895	55,908
Operating Segments | International Excluding Canada | Europe, Africa & CIS
Disaggregation of Revenue [Line Items]
Operating revenues	19,439	22,743
Operating Segments | Drilling Solutions
Disaggregation of Revenue [Line Items]
Operating revenues	54,182	35,706
Operating Segments | Drilling Solutions | Lower 48
Disaggregation of Revenue [Line Items]
Operating revenues	34,060	18,448
Operating Segments | Drilling Solutions | U.S. Offshore Gulf Of Mexico
Disaggregation of Revenue [Line Items]
Operating revenues	3,236	2,736
Operating Segments | Drilling Solutions | Alaska
Disaggregation of Revenue [Line Items]
Operating revenues	276	136
Operating Segments | Drilling Solutions | CANADA
Disaggregation of Revenue [Line Items]
Operating revenues	436	454
Operating Segments | Drilling Solutions | Middle East & Asia
Disaggregation of Revenue [Line Items]
Operating revenues	10,026	8,991
Operating Segments | Drilling Solutions | Latin America
Disaggregation of Revenue [Line Items]
Operating revenues	5,929	4,567
Operating Segments | Drilling Solutions | Europe, Africa & CIS
Disaggregation of Revenue [Line Items]
Operating revenues	219	374
Operating Segments | Rig Services
Disaggregation of Revenue [Line Items]
Operating revenues	36,736	25,748
Operating Segments | Rig Services | Lower 48
Disaggregation of Revenue [Line Items]
Operating revenues	22,688	12,539
Operating Segments | Rig Services | CANADA
Disaggregation of Revenue [Line Items]
Operating revenues	979	900
Operating Segments | Rig Services | Middle East & Asia
Disaggregation of Revenue [Line Items]
Operating revenues	10,800	9,078
Operating Segments | Rig Services | Latin America
Disaggregation of Revenue [Line Items]
Operating revenues		12
Operating Segments | Rig Services | Europe, Africa & CIS
Disaggregation of Revenue [Line Items]
Operating revenues	2,269	3,219
Operating Segments | Other
Disaggregation of Revenue [Line Items]
Operating revenues	(18,992)	(11,069)
Intersegment Eliminations | Other.
Disaggregation of Revenue [Line Items]
Operating revenues	(18,992)	(11,069)
Intersegment Eliminations | Other | Other.
Disaggregation of Revenue [Line Items]
Operating revenues	(18,992)	(11,069)
Other reconciling items (3)
Disaggregation of Revenue [Line Items]
Operating revenues	$ 18,992	$ 11,069

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Revenue Recognition - Changes in Contract Assets and Contract Liabilities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Accounts receivables current
Contract Receivables	$ 385.6	$ 350.0
Contract with customer assets current
Contract Assets (Current)	27.5	24.9
Contract with customer non-current asset
Contract Assets (Long-term)	1.9	1.9
Contract with customer liability current
Contract Liabilities (Current)	34.4	42.9
Contract with customer liability non-current
Contract Liabilities (Long-term)	$ 27.8	$ 29.3
Contract Asset Balance
2022	88.00%
Contract percentage recognized	46.00%
2023	12.00%
Revenue recognized (as a percent)	10.00%

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Revenue Recognition - Remaining Performance Obligation (Details)	3 Months Ended
	Mar. 31, 2022
Remaining performance obligations
Revenue recognized (as a percent)	10.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Remaining performance obligations
Percentage of remaining performance obligation expected to be recognized in period	37.00%
Revenue, Remaining performance obligation, expected timing of satisfaction period	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Remaining performance obligations
Percentage of remaining performance obligation expected to be recognized in period	28.00%
Revenue, Remaining performance obligation, expected timing of satisfaction period	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Remaining performance obligations
Percentage of remaining performance obligation expected to be recognized in period	35.00%
Revenue, Remaining performance obligation, expected timing of satisfaction period	12 months