Free cash flow swung from -$149.0M in 2026Q2 to $179.0M in 2026Q3, a 41.8% margin driven largely by a $182.0M working capital inflow, indicating that cash conversion remains erratic and may not be repeatable.
Seadrill Limited (SDRL) cash flow statement — 14-year operating, investing & financing cash flows
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 |
|---|
| Cash from Operations | -29M | -28M | 88M | 287M | 9M | -154M | -420M | -256M | -239M | 399M | 1.18B | 1.79B | 1.57B | 1.7B | 1.59B |
| Operating CF Margin % | - | -1.95% | 6.35% | 19.52% | 0.96% | -16.98% | -43.7% | -18.44% | -20.22% | 19.96% | 39.88% | 43.55% | 33.65% | 34.32% | 36.89% |
| Operating CF Growth % | -1629.21% | -131.82% | -69.34% | 3088.89% | 105.84% | 63.33% | -64.06% | -7.11% | -159.9% | -66.3% | -33.78% | 13.6% | -7.14% | 6.6% | - |
| Net Income | -18M | -77M | 446M | 300M | 3.67B | -577M | -4.45B | -753M | -4.48B | -2.97B | -181M | -634M | 3.98B | 2.65B | 1.11B |
| Depreciation & Amortization | 289M | 238M | 168M | 155M | 152M | 127M | 319M | 426M | 664M | 755M | 745M | 663M | 562M | 646M | 627M |
| Stock-Based Compensation | 16M | 20M | 17M | 0 | 0 | 0 | 0 | 0 | 3M | 7M | 8M | 7M | 10M | 7M | 8M |
| Deferred Taxes | 28M | 22M | -13M | -13M | -7M | -3M | -7M | -61M | -22M | -174M | -264M | -274M | 285M | 199M | 190M |
| Other Non-Cash Items | -241M | 57M | -477M | -41M | -3.71B | 297M | 3.76B | 118M | 3.48B | 2.58B | 395M | 1.63B | -2.33B | -1.43B | -145M |
| Working Capital Changes | -103M | -288M | -53M | -114M | -90M | 2M | -41M | 14M | 95M | 33M | 217M | 119M | -650M | -186M | -198M |
| Change in Receivables | -60M | 23M | 38M | -6.23M | -2M | -47M | -54M | 27M | 93M | 167M | 256M | 267M | -295M | -206M | -198M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -158M | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Payables | 11M | -47M | 65M | -35.28M | 23M | 15M | -37M | 4M | -9M | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -76M | -113M | 226M | 42M | 343M | 37M | -32M | -26M | 210M | 358M | 354M | -190M | 66M | -2.96B | -1.36B |
| Capital Expenditures | -61M | -110M | -157M | -101M | -149M | -29M | -27M | -48M | -76M | -92M | -136M | -935M | -2.87B | -4.27B | -1.56B |
| CapEx % of Revenue | 3.82% | 7.65% | 11.34% | 6.87% | 15.92% | 3.2% | 2.81% | 3.46% | 6.43% | 4.6% | 4.58% | 22.77% | 61.43% | 86.52% | 36.13% |
| Acquisitions | 1M | 0 | 0 | 45M | 3M | 0 | -22M | -25M | 0 | 0 | 0 | 0 | 0 | -554M | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -16M | -3M | 383M | 98M | 489M | 66M | 28M | 47M | 286M | 450M | 490M | 745M | 2.94B | 1.86B | 197M |
| Cash from Financing | 37M | -3M | -532M | -200M | -363M | 0 | -163M | -367M | 679M | -846M | -1.41B | -1.37B | -1.52B | 1.7B | -395M |
| Debt Issued (Net) | 0 | 0 | 0 | 98M | -399M | 0 | -36M | -34M | 518M | -793M | -1.36B | -1.34B | -92M | 2.36B | 0 |
| Equity Issued (Net) | -25M | 0 | -532M | -263M | 0 | 0 | 0 | 0 | 0 | 0 | -11M | 0 | -18M | -39M | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -1.42B | -1.29B | -1.48B |
| Share Repurchases | -25M | 0 | -532M | -263M | 0 | 0 | 0 | 0 | 200M | 0 | -11M | 0 | -18M | -39M | 0 |
| Other Financing | 62M | -3M | 0 | -35M | 36M | 0 | -127M | -333M | 161M | -53M | -38M | -30M | 4M | 662M | 1.08B |
| Net Change in Cash | -66M | -140M | -223M | 130M | 71M | -119M | -634M | -646M | 2.82B | -84M | 399M | 213M | 87M | 426M | 318M |
| Free Cash Flow | -90M | -138M | -69M | 186M | -140M | -183M | -447M | -304M | -315M | 307M | 1.05B | 853M | -1.3B | -2.58B | 33M |
| FCF Margin % | -5.64% | -9.6% | -4.98% | 12.65% | -14.96% | -20.18% | -46.51% | -21.9% | -26.65% | 15.36% | 35.3% | 20.77% | -27.77% | -52.2% | 0.77% |
| FCF Growth % | -136.84% | -100% | -137.1% | 232.86% | 23.5% | 59.06% | -47.04% | 3.49% | -202.61% | -70.71% | 22.86% | 165.67% | 49.61% | -7912.12% | - |
| FCF per Share | -1.47 | -2.22 | -0.97 | 2.51 | -2.80 | -1.83 | -4.47 | -3.04 | -1.04 | 0.61 | 2.09 | 1.73 | -2.63 | -5.24 | 0.07 |
| FCF Conversion (FCF/Net Income) | 5.00x | 0.36x | 0.20x | 0.96x | 0.00x | 0.26x | 0.09x | 0.21x | 0.05x | -0.13x | -6.54x | -2.82x | 0.40x | 0.64x | 1.44x |
| Interest Paid | 0 | 0 | 54M | 36M | 0 | 0 | 174M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 17M | 24M | 0 | 3M | 10M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Quick answers to the most common questions about buying SDRL stock.
Seadrill Limited (SDRL) generated $-28.0M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Seadrill Limited (SDRL) reported negative free cash flow of $138.0M in 2025, indicating capital requirements exceeded cash from operations.
Seadrill Limited (SDRL) spent $110.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
Key Metrics
Top Statement Risk
Volatile operating cash conversion
Metrics are mathematically derived from official filings.
Operating Cash Flow Diverges From Losses
As reported in financial statements, SDRL's operating cash flow of $195.0M in 2026Q3 stood against a net loss of $30.0M, producing an OCF-to-net-income ratio of -6.50 that reflects a sign mismatch rather than a clean earnings signal.
Operating cash flow was positive in only some recent quarters while net income swung between losses and profits, so the ratio is distorted by small or negative denominators and should not be read as a durable conversion metric. The 2026Q3 inflow appears to be driven largely by a $182.0M working capital release, suggesting that cash generation in that quarter may be timing-dependent rather than earnings-driven. Investors should monitor whether operating cash flow stays positive once working capital normalizes, as the current figures warrant further investigation.
Free Cash Flow Turns Erratic Quarter to Quarter
Based on SDRL's reported figures, free cash flow moved from $179.0M in 2026Q3 to -$149.0M in 2026Q2, a 41.8% margin swing that highlights how dependent the cash profile is on working capital timing.
Across the ten-quarter window, free cash flow has alternated between sizable positive and negative prints, with no clear sustained upward trajectory in the reported data. The 2026Q3 FCF margin of 41.8% is an outlier relative to the surrounding quarters and may not be repeatable if working capital reverses. Until several consecutive quarters of positive free cash flow are visible, the trajectory appears unproven.
Capital Intensity Elevated in Downturn Periods
According to recent SEC filings, SDRL's capex-to-revenue ratio reached 15.0% in 2024Q3 and 13.4% in 2025Q1, levels that suggest the fleet has required heavy reinvestment during periods of weak cash generation.
Capital expenditure has frequently consumed a large share of revenue, which is characteristic of a fleet business where rig maintenance and reactivations are non-discretionary. Recent quarters show capex running at a lower share of revenue, which may indicate some moderation in spending but could also reflect deferred maintenance that warrants scrutiny. Depreciation of roughly $58.0M to $77.0M per quarter in recent periods sits well above many quarterly capex levels, so the fleet's economic replacement cost may be understated by current spending.
Working Capital Swings Dominate Cash Flow
Based on reported quarterly figures, working capital changes ranged from -$141.0M in 2025Q4 to +$182.0M in 2026Q3, indicating that receivables and payables timing has been a larger driver of operating cash flow than underlying earnings.
Such large working capital movements in both directions suggest that collections timing, contract milestones, or payables management are materially affecting reported cash. The reversal from a $141.0M outflow to a $182.0M inflow within three quarters implies that the 2026Q3 cash result may partly reflect a catch-up rather than a new run rate. Investors should treat the latest quarter's operating cash flow with caution until the working capital cycle stabilizes.
Positive Quarter May Mask Persistent Losses
As reported in financial statements, SDRL's 2026Q3 free cash flow of $179.0M coexists with a net loss of $30.0M and a net margin of -7.0%, a combination that may overstate the durability of cash generation.
The headline cash result could lead investors to conclude that the business has turned the corner, yet the recurring net losses and negative net margins across much of the window suggest underlying profitability remains strained. Cash flow that is driven by working capital release rather than sustained earnings may reverse without warning. The recovery narrative therefore warrants caution until positive net income and operating cash flow are observed together over multiple consecutive quarters.