TechnipFMC NYSE: FTI reported what Chair and CEO Doug Pferdehirt described as “strong operational performance throughout the company” for the first quarter of 2026, supported by “solid execution” and early-year momentum that management said positions it to meet full-year targets.
Total company revenue for the quarter was $2.5 billion, with adjusted EBITDA of $453 million and an 18.2% margin excluding foreign exchange, according to Pferdehirt. Free cash flow was $277 million, and total shareholder distributions were $285 million in the quarter.
Subsea results and 2026 order outlook
In Subsea, Pferdehirt said quarterly orders were $1.9 billion, driven by “robust services and unannounced project activity.” He emphasized a “strengthening trend in order activity” through the year, which he said supports management’s confidence in achieving $10 billion of Subsea orders in 2026.
Subsea revenue was $2.2 billion, up 1% sequentially versus the fourth quarter, with results benefiting from higher iEPCI project activity “particularly in Brazil,” the company said. Subsea adjusted EBITDA was $441 million, up 6% sequentially, and adjusted EBITDA margin improved to 20%.
Pferdehirt also highlighted the company’s quarterly “Subsea opportunities list,” which now identifies approximately $30 billion of opportunities for potential award over the next 24 months. He said this marked the seventh consecutive quarterly increase in value and represents growth of more than 30% over the last two years using the midpoint of project values. The average project size expanded to nearly $800 million, which he attributed to more than doubling of potential developments over $1 billion versus two years ago, and the list now includes 22 distinct clients.
Middle East exposure and shifting offshore capital flows
Addressing geopolitical conflict in the Middle East, Pferdehirt said employee safety was the company’s priority and that TechnipFMC “took immediate and comprehensive measures to ensure the safety of our teams in the region,” adding it “was able to operate safely with minimal disruption.” He reiterated that only 4% of company revenue is derived from the Middle East, “almost entirely” related to onshore work within the Surface Technologies segment, and said Subsea offshore operations “have not been impacted.”
Even before the conflict, Pferdehirt said the queue of potential deepwater projects had been expanding for five years. He added that impacts to security and energy supply could have lasting effects on perceived risk in the region, potentially building momentum for offshore developments in areas with extensive infrastructure such as the U.S. Gulf and North Sea, as well as regions like West Africa.
Surface Technologies activity timing, margins, and guidance mix
Surface Technologies revenue was $284 million, down 12% sequentially. Management attributed the decline primarily to the “scheduled timing of project related activity in the Middle East,” with “only a minimal portion related to the regional conflict.” The company said the decline was partially offset by higher completion activity in North America. Surface adjusted EBITDA was $50 million, down 15% sequentially, with a 17.4% margin, down 60 basis points from the fourth quarter.
On guidance, the company said it expects second-quarter Subsea revenue to increase high single digits sequentially, with adjusted EBITDA margin improving by about 300 basis points to 23%. For Surface Technologies, it anticipates revenue to decline low single digits sequentially, with an adjusted EBITDA margin of approximately 17%. The company also expects corporate expense to decline about 25% in the second quarter.
In the Q&A, an analyst asked about Surface weakness relative to expectations. Alf (identified on the call as the executive providing the financial discussion) said backlog scheduling in the Middle East was “a far bigger effect” than the conflict and that activity levels were not as high in the first half even before the conflict. He said the company still sees strength in the back half of the year and that the U.S. business is doing well, with technologies being introduced that create efficiencies and support a more favorable margin mix.
Alf added that investors should “probably at this point expect that the revenue will be slightly lower compared to full year guidance” for Surface, but said the company is “seeing opportunity for stronger margin performance.” He said total EBITDA dollars for Surface are expected to be in line with what is implied by midpoints of guidance, while Subsea guidance remains unchanged.
Cash flow, capital discipline, and shareholder returns
Cash flow from operating activities was $332 million in the quarter, with capital expenditures of $56 million, resulting in $277 million of free cash flow, the company said. TechnipFMC repurchased $265 million of stock and paid $20 million in dividends. Cash and cash equivalents were $961 million at quarter-end, and the company ended the quarter with a net cash position of $540 million.
Responding to a question on working capital and cash flow expectations, Alf said working capital usage in the first quarter was “primarily” due to annual incentive plan payments made once a year in the first quarter and is not expected to be a similar headwind through the year. He reiterated that capital expenditures remain “well under control” and said the company expects CapEx to be “just above 3%” of revenue and to convert EBITDA to free cash flow at about 65%. He added that free cash flow is expected to be “fairly evenly distributed” across the remaining quarters of the year.
Pferdehirt also reaffirmed the company’s commitment to returning at least 70% of free cash flow to shareholders through dividends and share repurchases.
Strategy: cycle time reduction, Subsea 2.0, iEPCI, and services
Throughout the call, Pferdehirt repeatedly returned to the theme of cycle-time reduction, saying the company’s “unique mindset” asks whether actions “shorten project cycle time.” He said this improves project economics for customers and TechnipFMC, supports improved capital efficiency, and enables higher free cash flow conversion.
On 2027, Pferdehirt said the company expects increased inbound orders “in 2027 and extending through the end of the decade,” supported by iEPCI, Subsea 2.0, and Subsea services, much of it expected to be direct awarded.
When asked by Barclays about how Subsea 2.0 may affect margins, Pferdehirt said he did not have an exact number but estimated that in 2027, revenue recognized from Subsea 2.0 orders would be “in the neighborhood of about 50%, perhaps a bit north of 50%.” He added that Subsea 2.0 represents about 80% of new orders, which he said demonstrates the “glide path” toward improved efficiency as higher-quality backlog converts to revenue.
RBC asked about Subsea services contributing to first-quarter orders. Pferdehirt said the Subsea services market “continues to grow quite significantly,” noting the company has indicated services would be about $2 billion or about 20% of revenue this year, and called services a financial contributor and differentiator. He tied services growth to TechnipFMC’s expanding installed base on the seafloor that requires maintenance and inspection.
TD Cowen asked about first-quarter Subsea orders lacking announced large awards. Pferdehirt said order flow is not linear and reiterated confidence in achieving $10 billion for the year. He added that the quarter was strong given the mix of announced versus unannounced awards and said a large project was embedded in the quarter that the company expects to announce “once the customer gives us the permission.”
Separately, management discussed flexible pipe and technology work. In response to J.P. Morgan, Pferdehirt called flexible pipe “an integral part” of iEPCI and said TechnipFMC remains the market leader and continues investing. He said the company has worked “hand in hand with Petrobras for several years” on stress corrosion cracking and is “well into the qualification phase” of its solution, adding Petrobras is pleased with the technical approach and the pace of qualification. On capacity, he said the company is increasing throughput through efficiency improvements “not extending roof line.”
In new energy-related updates, Pferdehirt said carbon transportation and storage work remains important and highlighted progress in Brazil on the HISEP project with Petrobras, which he described as separating CO2 on the seabed and reinjecting it without exposure to the atmosphere. He also referenced a North Sea project involving transporting captured CO2 145 km offshore for permanent storage, saying it is enabled by the company’s all-electric system.
On the outlook for 2026 and beyond, Alf said the company has “revenue coverage of approximately 95%” for Subsea when considering the remaining $5.2 billion of backlog scheduled for 2026 plus expected services revenue, using the midpoint of guidance. He also said the company remains “very confident” in its ability to exceed $2.1 billion of total company EBITDA in 2026 and that improving operational momentum and the commercial backdrop support confidence in continued growth in 2027.
About TechnipFMC NYSE: FTI
TechnipFMC is an integrated oilfield services and technology company that designs, manufactures and delivers systems and services for the energy industry. The company's activities span the full lifecycle of oil and gas projects, with capabilities in subsea production systems, surface wellhead and intervention equipment, and onshore/offshore engineering and construction. TechnipFMC combines engineering and project management with fabrication, installation and maintenance services to help operators develop and produce hydrocarbon resources.
Its product and service portfolio includes subsea hardware such as trees, manifolds, umbilicals, risers and flowlines, as well as surface equipment for drilling, completions and well intervention.
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