Energy services firm reports quarterly performance and full-year financial results for 2025.
Oceaneering International, Inc. reported its financial results for the fourth quarter and full year of 2025, highlighting steady annual growth, strong cash generation, and a strategic shift toward defense and aerospace technologies as its primary driver in 2026.
Fourth Quarter 2025: Mixed Performance Amid Year-Over-Year Comparisons
For the fourth quarter of 2025, Oceaneering reported revenue of $669 million, representing a 6% decrease compared to the same period in 2024. The decline was largely attributed to unusually high levels of international intervention and installation projects in the Offshore Projects Group (OPG) segment during the fourth quarter of the prior year, which created a difficult comparison base.
Operating income for the quarter came in at $65.4 million, down 16% year over year, while adjusted EBITDA totaled $90.5 million, reflecting an 11% decline from the fourth quarter of 2024. Despite these decreases, the company’s bottom line showed a sharp increase. Net income rose to $178 million, up 217%, primarily due to a discrete tax benefit related to the release of valuation allowances on deferred tax assets.
From a cash flow perspective, the company delivered strong results. Cash flow from operating activities reached $221 million, and free cash flow totaled $191 million. Oceaneering also continued returning capital to shareholders, repurchasing 419,005 shares for approximately $10.1 million during the quarter.
Full Year 2025: Continued Growth and Improved Profitability
For the full year, Oceaneering delivered solid financial growth across key metrics. Total revenue reached $2.8 billion, representing a 5% increase over 2024. Operating income climbed to $305 million, up 24%, while net income surged 140% to $354 million. Adjusted EBITDA for the year rose 16% to $401 million, marking the company’s seventh consecutive year of adjusted EBITDA growth.
Cash flow performance remained strong for the full year. The company generated $319 million in operating cash flow and $208 million in free cash flow. At year-end, cash and cash equivalents totaled $689 million, compared with $498 million at the end of 2024, reflecting improved liquidity.
Share repurchase activity also continued throughout the year. Oceaneering repurchased 1.81 million shares for approximately $40.3 million. As of December 31, 2025, roughly 5.4 million shares remained authorized for repurchase under the current program.
CEO Commentary: Strong Execution and Growing Backlog
President and Chief Executive Officer Rod Larson emphasized the company’s operational execution and financial discipline throughout the year.
He noted that the company delivered fourth-quarter adjusted EBITDA at the high end of its guidance range and generated robust free cash flow, largely driven by the timing of customer collections. While fourth-quarter revenue and adjusted EBITDA declined compared to the prior year, Larson said the results were consistent with expectations given the unusually strong project activity in late 2024.
For the full year, Larson highlighted solid performance across all operating segments. Each segment posted EBITDA improvements, with Manufactured Products and Aerospace and Defense Technologies (ADTech) delivering the largest percentage increases.
Oceaneering secured $3.7 billion in orders during 2025, finishing the year with a book-to-bill ratio of 1.33. The company’s backlog includes several multi-year contracts, most notably a landmark ADTech award representing the largest initial contract value in its history.
Looking ahead, Larson said the company expects ADTech to serve as its primary growth engine in 2026, supported by existing backlog and increased spending across defense and government markets. He also noted that energy-related businesses are expected to see stronger performance in the second half of the year as offshore activity improves.
Segment Performance in the Fourth Quarter
Oceaneering’s results varied across its business segments during the fourth quarter of 2025.
Subsea Robotics (SSR)
Revenue for the Subsea Robotics segment totaled $212 million, essentially flat compared to the fourth quarter of 2024. However, operating income improved 7% to $67.8 million, and the EBITDA margin expanded to 38%.
The margin improvement was driven by a 7% increase in ROV (remotely operated vehicle) revenue per day utilized, which rose to $11,550. This increase more than offset a decline in fleet utilization, which fell from 66% to 62% year over year.
Manufactured Products
The Manufactured Products segment delivered a strong performance despite lower revenue. Operating income increased significantly to $20.4 million, while operating margin expanded to 15%, even though revenue declined 7%.
Backlog for the segment stood at $511 million at the end of 2025. The book-to-bill ratio for the 12-month period ending December 31, 2025, was 0.84, indicating somewhat lower order intake relative to revenue during the year.
Offshore Projects Group (OPG)
The Offshore Projects Group experienced the most significant decline. Operating income fell 62% to $15 million on a 29% decrease in revenue. Operating margin dropped to 11%.
These results reflected the absence of the high-margin international projects that had boosted the segment’s performance in the fourth quarter of 2024.
Integrity Management and Digital Solutions (IMDS)
The IMDS segment reported an 11% decline in revenue, along with a significant drop in operating income and margin. The revenue decline was primarily due to reduced activity in Europe and West Africa, while operating income was further impacted by a loss related to the resolution of a commercial dispute.
Aerospace and Defense Technologies (ADTech)
ADTech was the standout segment during the quarter. Operating income increased 43% to $14.2 million on a 29% increase in revenue. Operating margin remained relatively stable at 11%.
The segment’s growth reflects rising demand across defense and government markets, which the company expects to continue into 2026.
Corporate Expenses
At the corporate level, unallocated expenses rose 26% to $52 million. The increase was primarily driven by additional accruals for performance-based compensation.
2026 Full-Year Outlook
Based on current market conditions and backlog, Oceaneering issued its financial guidance for the full year 2026.
- Net income: expected between $178 million and $203 million
- Consolidated EBITDA: projected between $390 million and $440 million
- Free cash flow: forecast between $100 million and $120 million
- Capital expenditures: expected between $105 million and $115 million
The company also indicated that it plans to continue its share repurchase activity during the year.
Management expects ADTech to drive growth, while energy-focused segments are likely to see stronger performance in the second half of the year as offshore activity picks up.
First Quarter 2026 Guidance
For the first quarter of 2026, the company anticipates lower revenue compared to the first quarter of 2025, with EBITDA expected to fall in the range of $80 million to $90 million. This outlook reflects reduced activity levels in energy markets at the start of the year, which are expected to improve as 2026 progresses.
Segment Expectations for Q1 2026
- SSR: Slight revenue increase, but operating income expected to decline due to changes in geographic mix.
- Manufactured Products: Operating income forecast to rise significantly on slightly lower revenue.
- OPG: Both revenue and operating income projected to decrease significantly due to lower volume and project mix.
- IMDS: Revenue and operating income expected to remain relatively flat.
- ADTech: Revenue expected to increase significantly, with marginal expansion in operating income due to project mix.
- Corporate expenses: Expected to remain around $50 million, driven by wage inflation, higher IT costs, and foreign exchange impacts.
Strategic Outlook: Defense and Technology at the Center
Oceaneering’s 2025 results reflect a company in transition. While its traditional energy-focused segments experienced uneven quarterly performance, the full-year results demonstrated steady growth and improved profitability.
The company’s emphasis on ADTech signals a strategic shift toward more stable, long-term government and defense contracts. With a growing backlog, strong cash position, and continued share repurchases, Oceaneering appears positioned to balance cyclical energy market dynamics with more predictable aerospace and defense revenue streams.
As offshore activity is expected to improve later in 2026, the company is positioning itself to benefit from both energy market recovery and sustained defense spending, creating a diversified growth profile for the coming years.
