Why Is Oceaneering International (OII) Down 1.8% Since Last Earnings Report?

It has been about a month since the last earnings report for Oceaneering International (OII). Shares have lost about 1.8% in that time frame, outperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Oceaneering International due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.Oceaneering Q3 Earnings Beat Estimates, Revenues Increase Y/YOceaneering International reported an adjusted profit of 55 cents per share for the third quarter of 2025, beating the Zacks Consensus Estimate of 42 cents. Moreover, the bottom line surpassed the year-ago quarter’s reported figure of 36 cents.  This was due to strong year-over-year operating income from its Manufactured Products, Offshore Projects Group, Integrity Management & Digital Solutions and Aerospace and Defense Technologies segments.Total revenues were $742.9 million, which beat the Zacks Consensus Estimate of $710 million and increased approximately 9.3% from the year-ago quarter’s $679.8 million, due to the strong revenue contribution from OII’s Subsea Robotics, Manufactured Products, Offshore Projects Group and Aerospace and Defense Technologies segments.In the third quarter of 2025, Houston, TX-based oil and gas equipment and services company reported adjusted EBITDA of $111.1 million, a 13.2% increase year over year.The company also repurchased 440,814 shares for approximately $10.1 million in the third quarter of 2025.Segmental InformationSubsea Robotics: The unit provides remotely operated submersible vehicles for drill support, vessel-based inspection, subsea hardware installation, pipeline surveys and maintenance services.Revenues totaled $218.8 million compared with the year-ago quarter’s $215.7 million. However, the top line missed our estimate of $226.4 million.The segment also reported an operating income of $65.1 million compared with $65.7 million a year ago. However, the figure missed our estimate of $67.3 million.The company’s segment delivered an EBITDA margin of 36% in the third quarter of 2025, remaining largely unchanged from the prior period. Revenue per day for remotely operated vehicles (“ROVs”) rose 6% to $11,254, while ROV fleet utilization declined to 65%.Manufactured Products: The segment focuses on the manufactured products business, theme park entertainment systems and automated guided vehicles.Revenues totaled $156.4 million compared with the year-ago quarter’s $143.7 million. Additionally, the top line beat our estimate of $152.8 million.The segment posted an operating profit of $24.7 million in the third quarter, up from the year-ago quarter’s $11.3 million. Moreover, the reported figure beat our estimate of $16.6 million.The backlog totaled $568 million as of Sept. 30, 2025, down 15% from the same time in 2024. For the 12 months ending Sept. 30, 2025, the book-to-bill ratio was 0.82.Offshore Projects Group: This segment involves Oceaneering’s former Subsea Projects unit, excluding survey services and global data solutions, the service and rental business, and ROV tooling.Revenues increased about 15.9% to $171 million from $147.5 million in the year-ago quarter. Moreover, the figure beat our estimate of $147.7 million.The unit’s operating income totaled $23.7 million compared with the prior-year quarter’s $20.3 million. The figure also beat our estimate of $18.4 million. The company’s operating income margin held steady at 14%.Integrity Management & Digital Solutions: This segment covers Oceaneering’s Asset Integrity unit, along with its global data solutions business.Revenues of $70.8 million decreased from the year-ago quarter’s $73.6 million. The figure also missed our estimate of $73.7 million.The segment reported an operating income of $2.8 million, up from the prior-year quarter’s $0.7 million. However, the figure also missed our projection of $5.6 million.Aerospace and Defense Technologies: The segment is engaged in Oceaneering’s government business, which focuses on defense subsea technologies, marine services and space systems.Revenues totaled $125.9 million, up from $99.2 million recorded in the third quarter of 2024.  Additionally, the figure beat our estimate of $109.4 million.The operating income increased to $16.6 million from $12.2 million in the year-ago quarter. However, it missed our estimate of $18.5 million. Operating income margin improved to 13%, demonstrating robust profitability.Capital Expenditure & Balance SheetThe capital expenditure in the third quarter, including acquisitions, totaled $31.4 million.As of Sept. 30, OII had cash and cash equivalents worth $506 million and $497.5 million, respectively, along with a long-term debt of about $486 million. The debt-to-total capital was 34.7%.OutlookThis Zacks company anticipates lower revenues in the fourth quarter of 2025 compared with the same period in 2024. This is because improvements in Subsea Robotics (“SSR”) and ADTech will only partially offset the decline in international Offshore Projects Group (“OPG”) projects. The company anticipates consolidated EBITDA will be between $80 million and $90 million.For SSR, the company expects increased revenues and operating income, with the EBITDA margin expected to be in the mid-to-upper 30% range. This improvement is based on higher ROV revenue per day and better utilization in the survey group, with projects starting in the U.S. Gulf, Europe and West Africa.For Manufactured products, the company expects significantly higher operating income despite lower revenues. This is due to better conversion of higher-margin backlog and cost reductions in non-energy products.For OPG, the company anticipates a significant decrease in revenues and operating income. This is because there will be no large-scale international intervention or installation projects like in the fourth quarter of 2024. Lower vessel activity levels in the U.S. Gulf and changes in project timing will also contribute to the decline. The company expects one charter in the international market to expire during the quarter and does not plan to renew it due to expected lower activity.For IMDS, the company expects both revenues and operating income to decrease significantly due to lower activity levels.For ADTech, OII anticipates a significant increase in both revenues and operating income, driven by higher activity in the Defense business. The company expects unallocated expenses to be around $45 million.For the full year of 2025, the company anticipates generating adjusted EBITDA between $391 million and $401 million. Based on strong free cash flow in the third quarter, the company is confident in maintaining the full-year guided range of $110 million to $130 million.The company expects consolidated EBITDA for the full year 2026 to be between $390 million and $440 million. OII anticipates free cash flow generation to remain consistent with 2025 levels. Additionally, the company expects share repurchase activity to continue.Oceaneeringexpects Subsea Robotics to experience stable ROV utilization with improved pricing and an increase in survey volume. For Manufactured Products, the company anticipates improved operating income and margins, despite a decrease in revenues, thanks to backlog conversion and cost efficiencies. In the Offshore Projects Group, the company expects a decrease in both revenues and operating income, driven by project mix and timing. For IMDS, Oceaneeringexpects both revenues and operating income to increase.Lastly, in ADTech, the company anticipates significant growth in both revenues and operating income, with stable margins, largely driven by large-scale defense projects and international opportunities.How Have Estimates Been Moving Since Then?It turns out, estimates review have trended downward during the past month.The consensus estimate has shifted -18.87% due to these changes.VGM ScoresAt this time, Oceaneering International has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of B on the value side, putting it in the top 40% for this investment strategy.Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Oceaneering International has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in the coming year. While not all picks can be winners, previous recommendations have soared +112%, +171%, +209% and +232%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Oceaneering International, Inc. (OII): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks