Tidewater's Q1 2025 Earnings Call: Contradictions in Market Outlook, Backlog Coverage, and Vessel Strategy

Market outlook and demand for offshore services, backlog coverage and utilization expectations, market recovery and vessel stacking strategy, and vessel stacking and maintenance costs are the key contradictions discussed in Tidewater's latest 2025Q1 earnings call.



First Quarter Financial Performance:
- Tidewater reported revenue of $333.4 million for Q1 2025, with a significant day rate of $22,303, showing a new quarterly record.
- The performance was driven by higher average day rates and improved utilization, despite being their largest drydock quarter.

Share Repurchase and Capital Allocation:
- The company fully utilized its $90 million share repurchase activity, reducing the outstanding share count by 2.5 million shares.
- This was viewed as an opportunistic move to take advantage of market inefficiencies and as a mechanism for returning capital to shareholders.

Global Market and Regional Dynamics:
- The outlook for offshore markets showed a divergence, with Brazil and the Middle East experiencing strength while North America and the UK faced challenges.
- The company expects demand to outpace supply in the intermediate term, supported by new subsea projects and FPSO deliveries.

Guidance and Outlook:
- Tidewater reiterated its full-year revenue guidance of $1.32 billion to $1.38 billion, with a gross margin range of 48% to 50%.
- The guidance reflects optimism due to strong backlog coverage and continued positive customer outlook despite macroeconomic uncertainties.