Revenues

9 Months Ended

Sep. 30, 2024

Revenues.

Revenues

Note 5—Revenues

Overview—Under most of our drilling contracts with customers, our drilling services represent a single performance obligation that is satisfied over time, the duration of which varies by contract.  As of September 30, 2024, the drilling contract with the longest expected remaining duration, excluding unexercised options, extends through August 2029.

Disaggregation—Our contract drilling revenues, disaggregated by asset group and by country in which they were earned, were as follows (in millions):

	Three months ended September 30,												Nine months ended September 30,
	2024						2023						2024						2023
	Ultra-		Harsh				Ultra-		Harsh				Ultra-		Harsh				Ultra-		Harsh
	deepwater		environment				deepwater		environment				deepwater		environment				deepwater		environment
	floaters		floaters		Total		floaters		floaters		Total		floaters		floaters		Total		floaters		floaters		Total
U.S.	$	395	$	—	$	395	$	360	$	—	$	360	$	1,171	$	—	$	1,171	$	1,077	$	—	$	1,077
Brazil		204		—		204		55		—		55		509		—		509		183		—		183
Norway		—		172		172		—		164		164		—		486		486		—		454		454
Other countries (a)		69		108		177		101		33		134		163		243		406		276		101		377
Total contract drilling revenues	$	668	$	280	$	948	$	516	$	197	$	713	$	1,843	$	729	$	2,572	$	1,536	$	555	$	2,091

(a)The aggregate contract drilling revenues earned in other countries that individually represented less than 10 percent of total contract drilling revenues.

Contract liabilities—Contract liabilities for our contracts with customers were as follows (in millions):

	September 30,		December 31
	2024		2023
Deferred contract revenues, recorded in other current liabilities	$	265	$	165
Deferred contract revenues, recorded in other long-term liabilities		231		233
Total contract liabilities	$	496	$	398

Significant changes in contract liabilities were as follows (in millions):

	Nine months ended September 30,
	2024		2023
Total contract liabilities, beginning of period	$	398	$	328
Decrease due to recognition of revenues for goods and services		(172)		(149)
Increase due to goods and services transferred over time		270		189
Total contract liabilities, end of period	$	496	$	368

Pre-operating costs—In the three and nine months ended September 30, 2024, we recognized pre-operating costs of $44 million and $92 million, respectively, recorded in operating and maintenance costs.  In the three and nine months ended September 30, 2023, we recognized pre-operating costs of $17 million and $52 million, respectively, recorded in operating and maintenance costs.  At September 30, 2024 and December 31, 2023, the carrying amount of our unrecognized pre-operating costs to obtain contracts was $247 million and $221 million, respectively, recorded in other assets, significantly increased as a result of seven rigs mobilizing or preparing for contracts that commenced in the nine months ended September 30, 2024 or are expected to commence through the six months ending June 30, 2025.