Artificial Intelligence

Weatherford Announces Fourth Quarter and Full Year 2022 Results

Published

2 years ago

February 7, 2023

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Fourth quarter revenues of $1,209 million, increased 8% sequentially and 25% year-over-year; full year revenues of $4,331 million, increased 19% from prior year, the highest growth rate in over 10 years
Fourth quarter operating income of $169 million, increased 40% sequentially and 412% year-over-year; full year operating income of $412 million, increased 255% from prior year
Fourth quarter net income of $72 million, increased 157% sequentially; full year net income of $26 million, compared to net loss of $450 million in the prior year
Fourth quarter adjusted EBITDA^[1] was $266 million, a 22.0% margin with a 290 basis point sequential improvement and 73% improvement year-over-year; full year adjusted EBITDA^[1] of $817 million, a 18.9% margin, representing a 43% increase year-over-year and a 320 basis point improvement
Fourth quarter net cash provided by operating activities was $193 million and free cash flow^[1] was $171 million; full year net cash provided by operating activities was $349 million and free cash flow^[1] was $299 million
Credit rating upgrades from Standard & Poor from “B-” to “B”
Credit facility increased from $370 million to $400 million
Total debt repayments of $214 million from January 1, 2022 through January 31, 2023, including the previously announced $175 million and an additional $39 million
Over $6.5 billion of global commercial wins in full year 2022

HOUSTON, Feb. 07, 2023 (GLOBE NEWSWIRE) — Weatherford International plc (NASDAQ: WFRD) (“Weatherford” or the “Company”) announced today its results for the fourth quarter of 2022 and full year 2022.

Revenues for the fourth quarter of 2022 were $1,209 million, an increase of 8% sequentially and 25% year-over-year. Operating income was $169 million in the fourth quarter of 2022, compared to $121 million in the third quarter of 2022 and $33 million in the fourth quarter of 2021. The Company’s fourth quarter of 2022 net income was $72 million, compared to $28 million in the third quarter of 2022 and a net loss of $161 million in the fourth quarter of 2021.

Fourth quarter 2022 cash flows provided by operations were $193 million, compared to $160 million in the third quarter of 2022 and $88 million in the fourth quarter of 2021. Capital expenditures were $49 million in the fourth quarter of 2022, compared to $39 million in the third quarter of 2022 and $41 million in the fourth quarter of 2021.

Revenues for the full year 2022 were $4,331 million, compared to revenues of $3,645 million in 2021. Operating income for the full year was $412 million, compared to $116 million in 2021. The Company’s full year 2022 net income was $26 million, compared to a $450 million net loss in 2021. Full year cash flows provided by operations were $349 million, compared to $322 million in 2021. Capital expenditures for full year 2022 were $132 million, compared to $85 million in 2021.

Fourth quarter 2022:

Adjusted EBITDA^[1] was $266 million, an increase of 24% sequentially and 73% year-over-year
Adjusted EBITDA^[1] margin of 22.0% was our highest margin quarter in more than 12 years
Free cash flow^[1] was $171 million, an increase of $38 million sequentially and $122 million year-over-year

Full year 2022:

Adjusted EBITDA^[1] of $817 million, an increase of $246 million, or 43%, compared to full year 2021
Free cash flow^[1] of $299 million, an increase of $21 million compared to full year 2021
2022 marks three consecutive years of positive free cash flow^[^1]

Girish Saligram, President and Chief Executive Officer, commented, “The outstanding results of the fourth quarter 2022 and full year are a concrete marker of the success of our turnaround initiatives for Weatherford. I am incredibly proud of and grateful to our 17,700 One Weatherford team members who have come together to deliver a year of many firsts and excellent operating results. Our commercial wins, revenue growth, margin expansion, and free cash flow are all demonstrative of exceptional performance to close the year with significant momentum.

There are many significant milestones in these results – the first time in over three decades that we generated positive free cash flow for three consecutive years, achieving the lowest net leverage ratio in more than 15 years, growing revenue year-over-year by 19%, the highest growth rate in over 10 years, and generating positive net income of $26 million, a first in over 10 years^[2]. These results clearly demonstrate the effectiveness of our new operating paradigm and reaffirm our ability to sustainably expand margins over the cycle while generating positive free cash flow.

We have taken bold actions to strengthen our Company and balance sheet resulting in clear outcomes. Our results, ranging from the free cash flow performance, which gave us the ability to pay down debt meaningfully, to securing a credit facility and improving our credit rating, underscore the substantial improvements we have made and allow us greater flexibility to drive our priorities throughout our next chapter.

The overall macro-environment for the sector continues to be supported by strong fundamentals despite continued inflationary and geopolitical headwinds. Our ability to carry our momentum forward is evident in the commercial wins in 2022, including over $6.5 billion of contract wins across our broad customer footprint. In the coming quarters, we will begin to see the impact of our new contracts, technology advancements, and partnerships as we continue to focus on margins, cash flow, and positioning the Company for success over the long term.

We expect full year 2023 revenue to grow by low double digits to mid-teens year-over-year and for EBITDA margins to expand at least 100 basis points year-over-year.

2023 marks a new phase for Weatherford as we shift from being a turnaround to a true value creating engine. Although there are still opportunities to drive additional efficiencies in our structure and processes, our mindset in this new phase is evolving to a longer-range vision of creating a business that will withstand cycles and perform as the sector evolves while maintaining our commitment to transparency, credibility, and performance.”

Operational Highlights

Kuwait Oil Company awarded Weatherford a five-year contract to provide directional drilling and logging while drilling services, which provide fit-for-purpose solutions to overcome complex challenges.
A major IOC in the Middle East awarded Weatherford with a five-year contract to provide fishing equipment and services. Our consistent service quality and safety performance enabled this win, and we are excited to continue delivering excellence and creating value for our customer.
Weatherford secured a two-year, sole-provider award with Petrobras for the provision of our newly enhanced chemical injection system addressing the reliability and conveyance requirements of the pre-salt play. Our early engagement and commitment to solving Petrobras’ challenges in Brazil drove the development of an advanced Weatherford chemical injection wireline retrievable system that will be deployed beginning the first quarter of 2024.
Weatherford was awarded three contracts in Latin America to deliver integrated drilling and completion services in onshore and offshore operations, including shallow water developments and exploration wells, enabled by our technological and operational leadership.
As previously announced, Weatherford received a three-year contract from Aramco to deliver multiple services in a lump-sum turnkey project, with the possibility to extend for two years; and also received a five-year contract exceeding $500 million from Petroleum Development Oman to deliver integrated drilling services in the Marmul and Grater Saqar fields.
Weatherford entered into a strategic partnership with Ardyne, a leader in specialized well-decommissioning technology to deliver significant value to customers globally by offering the industry’s most comprehensive portfolio of Plug & Abandonment (P&A) and Slot Recovery solutions. Weatherford will invest in Ardyne’s specialized single-trip abandonment and slot-recovery technology to pair with the premier Firma™ P&A offering from Weatherford. This combined offering addresses a vital niche in late-life well management by allowing operators to tap into additional reserves or sustainability abandon nonproductive wells with a significant reduction in rig time in complex well environments.
Weatherford signed a multi-year agreement with DataRobot, a leader in artificial intelligence (AI) to deliver advanced AI solutions in its digital platforms, including Foresite® production optimization and Centro™ well construction platforms. By forging this new relationship with DataRobot, Weatherford will accelerate the development of machine learning (ML) and AI-enabled offerings with its Digital Solutions portfolio to deliver disruptive and innovative technologies to the market.

Liquidity

We closed the fourth quarter of 2022 with total cash of approximately $1.1 billion as of December 31, 2022, down $31 million sequentially, despite having paid down $125 million of our 11% Exit Notes and repurchased $8 million of our 6.5% Senior Secured Notes in the same quarter. Net cash provided by operating activities of $193 million improved $33 million sequentially and free cash flow^[1] of $171 million improved $38 million sequentially. These improvements were driven mainly by higher adjusted EBITDA^[1], as well as improved working capital efficiencies especially around inventory utilization.

During the fourth quarter of 2022, Standard & Poor upgraded our credit ratings to “B” from “B-”. Additionally, we increased the aggregate amount available under our credit facility to $400 million. For the full year, we made total debt repayments and repurchases of $183 million, comprised of $175 million of our 11% Exit Notes, and $8 million of our 6.5% Senior Secured Notes, achieving a net leverage ratio^[3] of 1.4x which is our lowest in over 15 years. In January of 2023, we paid down an additional $20 million of our 11% Exit Notes and repurchased $11 million of our 6.5% Senior Secured Notes.

^[1]EBITDA represents income before interest expense, net, income taxes, depreciation and amortization expense. Adjusted EBITDA excludes, among other items, restructuring charges, share-based compensation expense, as well as other charges and credits. Free cash flow is calculated as cash flows provided by (used in) operating activities, less capital expenditures plus proceeds from the disposition of assets. EBITDA, adjusted EBITDA, and free cash flow are non-GAAP measures. Each measure is defined and reconciled to the most directly comparable GAAP measure in the tables below.
^[2] Positive net income for the first time in over 10 years excludes the gain from bankruptcy emergence.
^[3] Net leverage ratio is a non-GAAP measure and is calculated by net debt (total short and long-term debt less cash and cash equivalents and restricted cash) divided by adjusted EBITDA for the trailing 12 months.

Results by Reportable Segment

Drilling & Evaluation (“DRE”)

	Three Months Ended									Variance
($ in Millions)	December 31, 2022			September 30, 2022			December 31, 2021			Seq.		YoY
Revenues:
DRE Revenues	$	371		$	348		$	287		7	%	29	%
DRE Segment Adjusted EBITDA	$	111		$	85		$	55		31	%	102	%
% Margin		29.9	%		24.4	%		19.2	%	550bps		1,070bps

Fourth quarter 2022 DRE revenues of $371 million increased by $23 million, or 7% sequentially, mainly due to higher activity and price recoveries for drilling services and higher wireline and managed pressure drilling activity in Latin America and the Middle East/North Africa/Asia regions. Year-over-year DRE revenues increased by $84 million, or 29%, due to increased activity across all products lines.

Fourth quarter 2022 DRE segment adjusted EBITDA of $111 million increased by $26 million, or 31% sequentially, largely due to higher fall-through for drilling services activities and certain contract pricing adjustments during the quarter. Year-over-year DRE segment adjusted EBITDA increased by $56 million, or 102%, mainly due to higher activity across all product lines.

Well Construction and Completions (“WCC”)

	Three Months Ended									Variance
($ in Millions)	December 31, 2022			September 30, 2022			December 31, 2021			Seq.		YoY
Revenues:
WCC Revenues	$	403		$	391		$	348		3	%	16	%
WCC Segment Adjusted EBITDA	$	87		$	78		$	72		12	%	21	%
% Margin		21.6	%		19.9	%		20.7	%	170bps		90bps

Fourth quarter 2022 WCC revenues of $403 million increased by $12 million, or 3% sequentially, primarily driven by higher cementation and liner hanger products revenue in the Middle East/North Africa /Asia and Latin America regions. Year-over-year WCC revenues increased by $55 million, or 16%, mainly due to higher cementation products and tubular running services revenue.

Fourth quarter 2022 WCC segment adjusted EBITDA of $87 million increased by $9 million, or 12% sequentially, largely due to higher fall-through and execution efficiencies for cementation and liner hanger products in the Middle East/North Africa/Asia and Latin America regions. Year-over-year WCC segment adjusted EBITDA increased by $15 million, or 21%, mainly driven by increased fall through from higher cementation products revenue.

Production and Intervention (“PRI”)

	Three Months Ended									Variance
($ in Millions)	December 31, 2022			September 30, 2022			December 31, 2021			Seq.		YoY
Revenues:
PRI Revenues	$	407		$	357		$	298		14	%	37	%
PRI Segment Adjusted EBITDA	$	88		$	66		$	47		33	%	87	%
% Margin		21.6	%		18.5	%		15.8	%	310bps		580bps

Fourth quarter 2022 PRI revenues of $407 million increased by $50 million, or 14% sequentially, primarily driven by higher international pressure pumping and artificial lift activity in North America. Year-over-year PRI revenues increased by $109 million, or 37%, driven by higher activity across all regions.

Fourth quarter 2022 PRI segment adjusted EBITDA of $88 million, increased $22 million, or 33% sequentially, mainly due to higher margin fall-through for pressure pumping overall. Year-over-year PRI segment adjusted EBITDA increased by $41 million, or 87%, mainly due to improved margin performance across all regions.

About Weatherford

Weatherford delivers innovative energy services that integrate proven technologies with advanced digitalization to create sustainable offerings for maximized value and return on investment. Our world-class experts partner with customers to optimize their resources and realize the full potential of their assets. Operators choose us for strategic solutions that add efficiency, flexibility, and responsibility to any energy operation. The Company operates in approximately 75 countries and has approximately 17,700 team members representing more than 110 nationalities and 345 operating locations. Visit weatherford.com for more information and connect with us on social media.

Conference Call Details

Weatherford will host a conference call on Wednesday, February 8, 2023, to discuss the Company’s results for the fourth quarter and full year ended December 31, 2022. The conference call will begin at 9:00 a.m. Eastern Time (8:00 a.m. Central Time).

Listeners are encouraged to download the accompanying presentation slides which will be available in the investor relations section of the Company’s website.

Listeners can participate in the conference call via a live webcast at https://www.weatherford.com/investor-relations/investor-news-and-events/events/ or by dialing +1 877-328-5344 (within the U.S.) or +1 412-902-6762 (outside of the U.S.) and asking for the Weatherford conference call. Participants should log in or dial in approximately 10 minutes prior to the start of the call.

A telephonic replay of the conference call will be available until February 22, 2023, at 5:00 p.m. Eastern Time. To access the replay, please dial +1 877-344-7529 (within the U.S.) or +1 412-317-0088 (outside of the U.S.) and reference conference number 8778393. A replay and transcript of the earnings call will also be available in the investor relations section of the Company’s website.

Contacts
For Investors:
Mohammed Topiwala
Director, Investor Relations and M&A
+1 713-836-7777
[email protected]

For Media:
Kelley Hughes
Director, Global Communications
+1 713-836-4193
[email protected]

Forward-Looking Statements

This news release contains projections and forward-looking statements concerning, among other things, the Company’s quarterly and full-year revenues, operating income and losses, segment adjusted EBITDA, adjusted EBITDA, free cash flow, forecasts or expectations regarding business outlook, prospects for its operations, capital expenditures, expectations regarding future financial results, and are also generally identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “outlook,” “budget,” “intend,” “strategy,” “plan,” “guidance,” “may,” “should,” “could,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are based upon the current beliefs of Weatherford’s management and are subject to significant risks, assumptions, and uncertainties. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in our forward-looking statements. Readers are cautioned that forward-looking statements are only predictions and may differ materially from actual future events or results, including: global political, economic and market conditions, political disturbances, changes in global trade policies, weak local economic conditions and international currency fluctuations; general global economic repercussions related to U.S. and global inflationary pressures and potential recessionary concerns; various effects from the Russia Ukraine conflict including, but not limited to, extended business interruptions, sanctions, treaties and regulations imposed by various countries, associated operational and logistical challenges, and impacts to the overall global energy supply; cybersecurity issues, as we may experience a higher rate of cybersecurity attacks, intrusions or incidents in the current environment of remote connectivity; our ability to comply with, and respond to, climate change, environmental, social and governance and other sustainability initiatives and future legislative and regulatory measures both globally and in specific geographic regions; further spread and the potential for a resurgence of a pandemic in a given geographic area and related disruptions to our business, employees, customers, suppliers and other partners; the price and price volatility of, and demand for, oil and natural gas; the macroeconomic outlook for the oil and gas industry; our ability to generate cash flow from operations to fund our operations; our ability to effectively and timely adapt our technology portfolio, products and services to address and participate in changes to the market demands for the transition to alternate sources of energy such as geothermal, carbon capture and responsible abandonment, including our digitalization efforts; and the realization of additional cost savings and operational efficiencies.

These risks and uncertainties are more fully described in Weatherford’s reports and registration statements filed with the SEC, including the risk factors described in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Accordingly, you should not place undue reliance on any of the Company’s forward-looking statements. Any forward-looking statements speaks only as of the date on which such statement is made, and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law, and we caution you not to rely on them unduly.

Weatherford International plc
Selected Statements of Operations (Unaudited)

	Three Months Ended									Year Ended
*($ in Millions, Except Per Share Amounts)*	December 31, 2022			September 30, 2022			December 31, 2021			December 31, 2022			December 31, 2021
Revenues:
Drilling and Evaluation	$	371		$	348		$	287		$	1,328		$	1,066
Well Construction and Completions		403			391			348			1,521			1,353
Production and Intervention		407			357			298			1,395			1,127
Segment Revenues		1,181			1,096			933			4,244			3,546
All Other		28			24			32			87			99
Total Revenues		1,209			1,120			965			4,331			3,645

Segment Adjusted EBITDA:
Drilling and Evaluation	$	111		$	85		$	55		$	324		$	186
Well Construction and Completions		87			78			72			299			256
Production and Intervention		88			66			47			261			191
Segment Adjusted EBITDA^[1]		286			229			174			884			633
Corporate and Other^[2]		(20	)		(15	)		(20	)		(67	)		(62	)
Total Adjusted EBITDA		266			214			154			817			571
Depreciation and Amortization		(84	)		(88	)		(103	)		(349	)		(440	)
Share-based Compensation Expense		(7	)		(5	)		(12	)		(25	)		(25	)
Other Adjustments^[3]		(6	)		—			(6	)		(31	)		10
Total Operating Income		169			121			33			412			116
Other Income (Expense):
Interest Expense, Net		(39	)		(44	)		(49	)		(179	)		(260	)
Loss on Extinguishment of Debt and Bond Redemption Premium		(3	)		(2	)		(111	)		(5	)		(170	)
Other Expense, Net		(30	)		(12	)		(10	)		(90	)		(29	)
Income (Loss) Before Income Taxes		97			63			(137	)		138			(343	)
Income Tax Provision		(21	)		(26	)		(20	)		(87	)		(86	)
Net Income (Loss)		76			37			(157	)		51			(429	)
Net Income Attributable to Noncontrolling Interests		4			9			4			25			21
Net Income (Loss) Attributable to Weatherford	$	72		$	28		$	(161	)	$	26		$	(450	)

Basic Income (Loss) Per Share	$	1.01		$	0.39		$	(2.30	)	$	0.37		$	(6.43	)
Basic Weighted Average Shares Outstanding		71			71			70			71			70

Diluted Income (Loss) Per Share	$	0.99		$	0.39		$	(2.30	)	$	0.36		$	(6.43	)
Diluted Weighted Average Shares Outstanding		73			72			70			72			70

Segment adjusted EBITDA is our primary measure of segment profitability and is based on segment earnings before interest, taxes, depreciation, amortization, share-based compensation expense and other adjustments. Research and development expenses are included in segment adjusted EBITDA.
Corporate and other includes business activities related to all other segments (profit and loss), corporate and other expenses (overhead support and centrally managed or shared facilities costs) that do not individually meet the criteria for segment reporting.
Other adjustments in the twelve months ended December 31, 2022 primarily include a $22 million restructuring charge. Other adjustments in the twelve months ended December 31, 2021 primarily included gains on asset sales.

Weatherford International plc
Revenues by Geographic Areas (Unaudited)

	Three Months Ended						Variance
*($ in Millions)*	December 31, 2022		September 30, 2022		December 31, 2021		Seq.		YoY
Revenues by Geographic Areas:
Middle East/North Africa/Asia	$	387	$	354	$	330	9	%	17	%
North America		301		297		238	1	%	26	%
Latin America		290		280		216	4	%	34	%
Europe/Sub-Sahara Africa/Russia		231		189		181	22	%	28	%
Total Revenues	$	1,209	$	1,120	$	965	8	%	25	%

Weatherford International plc
Selected Balance Sheet Data (Unaudited)

*($ in Millions)*	December 31, 2022		December 31, 2021
Assets:
Cash and Cash Equivalents	$	910	$	951
Restricted Cash		202		162
Accounts Receivable, Net		989		825
Inventories, Net		689		670

Property, Plant and Equipment, Net		918		996
Intangibles, Net		506		657

Liabilities:
Accounts Payable		460		380
Accrued Salaries and Benefits		367		343
Current Portion of Long-term Debt		45		12
Long-term Debt		2,203		2,416

Shareholders’ Equity:
Total Shareholders’ Equity		551		496

Components of Net Debt^[1]:
Current Portion of Long-term Debt		45		12
Long-term Debt		2,203		2,416
Less: Cash and Cash Equivalents		910		951
Less: Restricted Cash		202		162
Net Debt^[1]	$	1,136	$	1,315

^[1] Net debt is a non-GAAP measure calculated as total short and long-term debt less cash and cash equivalents and restricted cash.

Weatherford International plc
Selected Cash Flows Information (Unaudited)

	Three Months Ended									Year Ended
*($ in Millions)*	December 31, 2022			September 30, 2022			December 31, 2021			December 31, 2022			December 31, 2021
Cash Flows From Operating Activities:
Net Income (Loss)	$	76		$	37		$	(157	)	$	51		$	(429	)
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided By Operating Activities:
Depreciation and Amortization		84			88			103			349			440
Asset Write-downs and Other (Credits) Charges		(1	)		—			—			5			—
Inventory Charges		6			6			12			36			62
Gain on Disposition of Assets		(19	)		(8	)		—			(41	)		(22	)
Loss on Extinguishment of Debt and Bond Redemption Premium		3			2			111			5			170
Deferred Income Tax Provision (Benefit)		(20	)		18			(25	)		4			(10	)
Share-Based Compensation		7			5			12			25			25
Working Capital^[1]		(12	)		(58	)		14			(165	)		32
Other Operating Activities^[2]		69			70			18			80			54
Net Cash Provided By Operating Activities		193			160			88			349			322

Cash Flows From Investing Activities:
Capital Expenditures for Property, Plant and Equipment		(49	)		(39	)		(41	)		(132	)		(85	)
Proceeds from Disposition of Assets		27			12			2			82			41
Payments for Other Investing Activities		(10	)		(2	)		(42	)		(4	)		(39	)
Net Cash Used In Investing Activities		(32	)		(29	)		(81	)		(54	)		(83	)

Cash Flows From Financing Activities:
Borrowings of Long-term Debt		—			—			1,582			—			2,073
Repayments of Long-term Debt		(136	)		(55	)		(1,803	)		(198	)		(2,313	)
Bond Redemption Premium		(3	)		(2	)		(109	)		(5	)		(131	)
Payments for Other Financing Activities		(20	)		(7	)		(8	)		(45	)		(32	)
Net Cash Used In Financing Activities	$	(159	)	$	(64	)	$	(338	)	$	(248	)	$	(403	)

Free Cash Flow^[3]:
Net Cash Provided By Operating Activities	$	193		$	160		$	88		$	349		$	322
Capital Expenditures for Property, Plant and Equipment		(49	)		(39	)		(41	)		(132	)		(85	)
Proceeds from Disposition of Assets		27			12			2			82			41
Free Cash Flow^[3]	$	171		$	133		$	49		$	299		$	278

^[1] Working capital is defined as the cash changes in accounts receivable plus inventory less accounts payable.
^[2] Other operating activities is primarily accruals, net of cash payments for operational expenses, interest, taxes, employee costs and leases.
^[3] Free cash flow is a non-GAAP measure calculated as cash flows provided by operating activities, less capital expenditures for property, plant and equipment plus proceeds from the disposition of assets. Management believes free cash flow is useful to understand liquidity and should be considered in addition to but not substitute cash flows provided by operating activities.

We report our financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, Weatherford’s management believes that certain non-GAAP financial measures (as defined under the SEC’s Regulation G and Item 10(e) of Regulation S-K) may provide users of this financial information additional meaningful comparisons between current results and results of prior periods and comparisons with peer companies. The non-GAAP amounts shown in the following tables should not be considered as substitutes for operating income, provision for income taxes, net income or other data prepared and reported in accordance with GAAP, but should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

Weatherford International plc
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
($ in Millions, Except Per Share Amounts)

	Three Months Ended									Year Ended
	December 31, 2022			September 30, 2022			December 31, 2021			December 31, 2022			December 31, 2021
Operating Income:
GAAP Operating Income	$	169		$	121		$	33		$	412		$	116
Other (Credits) Charges		6			(2	)		6			9			(10	)
Restructuring Charges		—			2			—			22			—
Operating Non-GAAP Adjustments		6			—			6			31			(10	)
Non-GAAP Adjusted Operating Income	$	175		$	121		$	39		$	443		$	106

Income (Loss) Before Income Taxes:
GAAP Income (Loss) Before Income Taxes	$	97		$	63		$	(137	)	$	138		$	(343	)
Operating Non-GAAP Adjustments		6			—			6			31			(10	)
Loss on Extinguishment of Debt and Bond Redemption Premium		3			2			111			5			170
Non-GAAP Adjustments Before Taxes		9			2			117			36			160
Non-GAAP Income (Loss) Before Income Taxes	$	106		$	65		$	(20	)	$	174		$	(183	)

Provision for Income Taxes:
GAAP Provision for Income Taxes	$	(21	)	$	(26	)	$	(20	)	$	(87	)	$	(86	)
Tax Effect on Non-GAAP Adjustments		1			(1	)		—			—			—
Non-GAAP Provision for Income Taxes	$	(20	)	$	(27	)	$	(20	)	$	(87	)	$	(86	)

Net Income (Loss) Attributable to Weatherford:
GAAP Net Income (Loss)	$	72		$	28		$	(161	)	$	26		$	(450	)
Non-GAAP Adjustments, net of tax		10			1			117			36			160
Non-GAAP Net Income (Loss)	$	82		$	29		$	(44	)	$	62		$	(290	)

Diluted Income (Loss) Per Share Attributable to Weatherford:
GAAP Diluted Income (Loss) per Share	$	0.99		$	0.39		$	(2.30	)	$	0.36		$	(6.43	)
Non-GAAP Adjustments, net of tax		0.13			0.01			1.67			0.50			2.29
Non-GAAP Diluted Income (Loss) per Share	$	1.12		$	0.40		$	(0.63	)	$	0.86		$	(4.14	)

Weatherford International plc
Reconciliation of GAAP to Non-GAAP Financial Measures
Net Income (Loss) to Adjusted EBITDA (Unaudited)

	Three Months Ended								Year Ended
*($ in Millions)*	December 31, 2022		September 30, 2022			December 31, 2021			December 31, 2022		December 31, 2021
Net Income (Loss) Attributable to Weatherford	$	72	$	28		$	(161	)	$	26	$	(450	)
Net Income Attributable to Noncontrolling Interests		4		9			4			25		21
Net Income (Loss)		76		37			(157	)		51		(429	)
Interest Expense, Net		39		44			49			179		260
Loss on Extinguishment of Debt and Bond Redemption Premium		3		2			111			5		170
Income Tax Provision		21		26			20			87		86
Depreciation and Amortization		84		88			103			349		440
EBITDA^[1]		223		197			126			671		527

Other Adjustments:
Other (Credits) Charges		6		(2	)		6			9		(10	)
Restructuring Charges		—		2			—			22		—
Share-Based Compensation		7		5			12			25		25
Other Expense, Net^[2]		30		12			10			90		29
Adjusted EBITDA^[3]	$	266	$	214		$	154		$	817	$	571

Supplemental Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA to Free Cash Flow (Unaudited)

		Three Months Ended									Year Ended
*($ in Millions)*		December 31, 2022			September 30, 2022			December 31, 2021			December 31, 2022			December 31, 2021
Adjusted EBITDA^[3]		$	266		$	214		$	154		$	817		$	571
	Cash From (Used) for Working Capital		(12	)		(58	)		14			(165	)		32
	Capital Expenditures for Property, Plant and Equipment		(49	)		(39	)		(41	)		(132	)		(85	)
	Cash Paid for Taxes		(28	)		(16	)		(18	)		(86	)		(62	)
	Cash Paid for Severance and Restructuring		(1	)		(3	)		(4	)		(14	)		(30	)
	Proceeds from Disposition of Assets		27			12			2			82			41
	Excess and Obsolete Inventory Charges		6			6			12			32			55
	Increase (Decrease) in Accruals, Net^[3]		46			36			28			(15	)		25
	Cash Paid for Interest		(84	)		(19	)		(98	)		(220	)		(269	)
Free Cash Flow^[1]		$	171		$	133		$	49		$	299		$	278

EBITDA represents income before interest expense, net, income taxes, depreciation and amortization expense. Adjusted EBITDA excludes, among other items, restructuring charges, share-based compensation expense, as well as other charges and credits. Free cash flow is calculated as cash flows provided by (used in) operating activities, less capital expenditures plus proceeds from the disposition of assets. EBITDA, adjusted EBITDA, and free cash flow are non-GAAP measures. Each measure is defined and reconciled to the most directly comparable GAAP measure.
Other Expense, Net is primarily is primarily comprised of letter of credit fees, other financing charges and foreign exchange losses, primarily attributed to currency losses in countries with no or limited markets to hedge.
Increase (Decrease) in Accruals, Net on operating activity to include net employee benefits and net payments for leases.

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Artificial Intelligence

ADQ Appoints Modon as Master Developer for Ras El Hekma Megaproject in Egypt

Published

1 day ago

October 4, 2024

CISION (PR Newswire)

adq-appoints-modon-as-master-developer-for-ras-el-hekma-megaproject-in-egypt

In the presence of Mohamed bin Zayed Al Nahyan and Abdel Fattah El-Sisi
The event marked the signing of several significant agreements aimed at driving the development of the new destinationABU DHABI, UAE, Oct. 4, 2024 /PRNewswire/ — In the presence of President His Highness Sheikh Mohamed bin Zayed Al Nahyan, and His Excellency Abdel Fattah El-Sisi, President of the Arab Republic of Egypt, ADQ, an Abu Dhabi-based investment and holding company, appointed Modon Holding PSC as the master developer for the Ras El Hekma megaproject.

In addition to being master developer for the entire development spanning 170 million square metres, Modon Holding will undertake the responsibility of the developer role for the first phase of the envisaged city consisting of 50 million square metres.
The remaining 120 million square metres, which are part of the master plan presented by Modon Holding, will be developed in partnership with prominent developers from Egypt, the UAE, and the international community under the oversight of the recently established ADQ subsidiary Ras El Hekma Urban Development Project Company and Modon Holding.
This iconic project represents a major milestone for Modon Holding by significantly increasing its land under development outside the UAE. Ras El Hekma is located around 350 kilometres northwest of Cairo and envisioned as a fully functional, smart, sustainable, and inclusive urban community situated against the scenic coastline.
The project is expected to become a powerful economic engine, with cumulative investments anticipated to reach US$110 billion by 2045, an annual GDP contribution of around US$25 billion, and approximately 750,000 jobs to be created, both directly and indirectly.
Upon completion, the development will be home to two million people and feature more than 40 kilometres of green spines, set to make Ras El Hekma the greenest megaproject in the region.
As a result of Ras El Hekma’s location within a four-hour flight for over 400 million outbound tourists, the establishment of tourism infrastructure will be a priority during the first phases of the development, encompassing an international airport as well as high-speed rail connectivity. The masterplan also includes residential areas, office spaces, hospitality venues, retail, leisure, and recreation facilities.
Ras El Hekma will have an international marina and a special free zone. Additionally, Modon Holding will look to develop infrastructure to support a range of high-growth industries, including business services, financial services, light manufacturing, and technology.
His Excellency Jassem Mohamed Bu Ataba Al Zaabi, Chairman of Modon Holding, said, “Ras El Hekma is destined to become a regional crown jewel in a country already famed for its rich and diverse attractions. Modon Holding is proud to bring this 170-million-square-metre visionary megaproject to life, leveraging our expertise and innovative approach. With our partners, we are poised to transform Ras El Hekma into a dynamic economic powerhouse and a global model for urban development.”
His Excellency Mohamed Hassan Alsuwaidi, Managing Director and Group Chief Executive Officer of ADQ, said, “As a project of unprecedented scale and impact, Ras El Hekma will be a catalyst for the development of Egypt’s economy by offering opportunities for businesses and stimulate tourism. Modon Holding brings a wealth of expertise in master planning and will pioneer state-of-the-art, innovative solutions, creating a destination that will deliver long-term value for Egypt and its people.”
Bill O’Regan, Group CEO of Modon Holding, said, “The Ras El Hekma destination is one of the Group’s most significant investment and development projects outside the UAE. The project provides an incredible development pipeline, and Modon Holding looks forward to delivering a destination that will be an exceptional experience for visitors and residents alike.”
During the ceremony, Modon Holding PSC engaged with the initial major partners to join in the development of the Ras El Hekma megaproject on Egypt’s stunning Mediterranean coast.
Ras El Hekma is set to become a leading urban and tourist hub, boasting a wide array of attractions and amenities. Modon Holding aims to harness its large-scale development expertise, collaborating with local, regional, and global partners to bring this visionary destination masterplan to life.
These collaborative efforts, combined with a focus on diverse entertainment, sports, cultural events, and top-tier community management, will position Ras El Hekma as a premier Mediterranean destination.
While the immediate focus is on tourism and hospitality, Modon’s long-term vision for the 170-square-metre site also includes business services, financial services, light manufacturing, and technology.
Modon Engages First Batch of Investors and Partners in Landmark Ceremony
On 4th October, in a momentous ceremony attended by President His Highness Sheikh Mohamed bin Zayed Al Nahyan and Egyptian President His Excellency Abdel Fattah El-Sisi, Modon proudly initiated the engagement of its first group of investors and partners.
The event marked the signing of several significant agreements aimed at driving the development of the new destination:
– A framework agreement with Orascom Construction, designating them as one of the primary contractors for the initial phase of the project.
– A memorandum of understanding with Elsewedy Electric to explore opportunities for supplying building materials and collaborating on industrial parks, manufacturing, operations, and maintenance.
– A memorandum of understanding with Abu Dhabi Airports to collaborate in airport strategic planning, design, development, and operational support.
– A memorandum of understanding with TAQA to explore cooperation opportunities in relation to the development, financing, and operation of greenfield utilities infrastructure projects, water desalination projects, electricity transmission and distribution projects and wastewater projects.
– A memorandum of understanding with Valderrama for the development and operation of golf communities.
– A memorandum of understanding with e& Egypt to facilitate the design and implementation of smart city infrastructure, including digital connectivity, fiber networks, and 5G; smart building technologies and IoT-enabled solutions for residential and commercial properties; city-wide data collection, monitoring, and analytics systems; smart utilities, encompassing automated energy management, water, and waste systems; smart transportation systems; and any other mutually agreed smart city services.
– A memorandum of understanding with Candy International aims to explore luxury real estate development opportunities, leveraging Candy’s extensive international reach.
– A memorandum of understanding with Montage International for the development and management of luxury hotels in Ras El Hekma.
– A memorandum of understanding with Accor and Ennismore to operate hotels and resorts in Ras El Hekma.
– Finally, a memorandum of understanding with Burjeel Holding to develop multi-specialty healthcare facilities, implement innovative healthcare solutions, provide medical training programmes, and collaborate on public health initiatives and community wellness programmes.
These strategic partnerships underscore Modon’s commitment to creating a world-class destination, fostering innovation, and enhancing the quality of life for Ras El Hekma’s future residents.
His Excellency Jassem Mohamed Bu Ataba Al Zaabi, said, “Ras El Hekma represents a visionary and multifaceted endeavour that promises to make a substantial contribution to the Egyptian economy. Crafting a masterplan of such scale demands specialised expertise and capabilities across diverse industries, which can only be realised through robust strategic partnerships. We look forward to working with our partners present and future in harnessing the full potential of this extraordinary location.”
Bill O’Regan, said, “Ras El Hekma is an extraordinarily ambitious and complex project that will significantly contribute to the Egyptian economy through various stages of planning, design, and construction, ultimately bringing this new destination to life. Developing and delivering a masterplan of this magnitude requires sector-specific expertise and capabilities across a wide range of industries and is achievable only through strong strategic partnerships.”
About ADQEstablished in 2018, ADQ is an Abu Dhabi-based investment and holding company with a broad portfolio of major enterprises. Its investments span key sectors of the UAE’s diversified economy including energy and utilities, food and agriculture, healthcare and life sciences, and transport and logistics, amongst others. As a strategic partner to the Government of Abu Dhabi, ADQ is committed to accelerating the transformation of the Emirate into a globally competitive and knowledge-based economy.
For more information, visit adq.ae or write to [email protected]. You can also follow ADQ on Instagram, LinkedIn and X.
About Modon HoldingModon develops vibrant communities, unique hospitality and lifestyle experiences, and world-class sports facilities. Based in Abu Dhabi, Modon Holding is a Private Joint Stock company listed on the ADX Growth Market with the shareholding of ADQ and the IHC Group being our majority shareholders. Through a diversified business portfolio in the UAE, we are engaged in strategic investment and innovation on an unrivalled scale, shaping future smart living. Our goal is to deliver long-term, sustainable value, laying the foundations for intelligent, connected living.
Ras El-Hekma Urban Development Project CompanyA wholly owned subsidiary of ADQ, an Abu Dhabi-based investment and holding company, Ras El Hikma Urban Development Project Company S.A.E. (RED) is mandated to oversee the execution of the Ras El Hekma project, a 170 million square meter visionary megacity located on Egypt’s north coast. Established in March 2024 and based in Egypt, RED holds the ownership rights of the Ras El-Hekma as well as responsibility for the implementation of the multi-phase project together with its partners, which include Modon Holding as the master developer.
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Artificial Intelligence

Electronic Access Control Systems Market Set for Significant Expansion, with Projected Growth to USD 16 Billion by 2031: Market Research Intellect

Published

2 days ago

October 4, 2024

CISION (PR Newswire)

The Electronic Access Control System market is driven by increasing security concerns and advancements in technology. As businesses and institutions face growing threats, there is a rising demand for sophisticated access control solutions to protect assets and data. Technological innovations, including biometrics, IoT integration, and cloud-based systems, enhance system functionality and appeal. Additionally, the trend toward smart buildings and stringent regulatory requirements further fuels the market’s expansion, reflecting a broadening need for advanced security solutions.
LEWES, Del., Oct. 4, 2024 /PRNewswire/ — The Electronic Access Control System market is projected to grow from approximately USD 10 billion in 2024 to USD 16 billion by 2031, achieving a compound annual growth rate (CAGR) of around 7.5%. This growth is driven by rising security needs, advancements in technology, and increased adoption of smart and connected security solutions across various sectors.

Download PDF Brochure: https://www.marketresearchintellect.com/download-sample/?rid=194769
202 – Pages126 – Tables37 – Figures
Scope Of The Report
REPORT ATTRIBUTES
DETAILS
STUDY PERIOD
2020-2031
BASE YEAR
2023
FORECAST PERIOD
2024-2031
HISTORICAL PERIOD
2020-2023
UNIT
Value (USD Billion)
KEY COMPANIES PROFILED
Honeywell International Inc., Johnson Controls International plc, ASSA ABLOY Group, Allegion plc, Schlage (a brand of Allegion), Bosch Security Systems, Tyco International Ltd., and HID Global (an ASSA ABLOY Group brand).
SEGMENTS COVERED
By Type, By Application And By Geography
CUSTOMIZATION SCOPE
Free report customization (equivalent to up to 4 analyst working days) with purchase. Addition or alteration to country, regional & segment scope
Electronic Access Control System Market Overview
Market Size and Growth:The Electronic Access Control System market is experiencing robust growth, expected to expand from approximately USD 10 billion in 2024 to USD 16 billion by 2031, representing a compound annual growth rate (CAGR) of about 7.5%. This growth trajectory is driven by the increasing need for enhanced security solutions across various sectors, including commercial, residential, and industrial applications. The rising concerns over security breaches and unauthorized access are prompting organizations to invest in advanced access control technologies. Additionally, the growing adoption of smart buildings and connected infrastructure contributes to the market’s expansion, as these technologies offer more efficient and scalable security solutions. As the demand for higher security standards continues to rise, the EACS market is poised for substantial growth in the coming years.Technological Advancements:The EACS market is significantly influenced by rapid technological advancements. Innovations such as biometric authentication, including fingerprint and facial recognition, are enhancing the capabilities of access control systems, providing more secure and user-friendly solutions. The integration of Internet of Things (IoT) technology allows for remote monitoring and management of access control systems, increasing their flexibility and effectiveness. Cloud-based solutions are also gaining traction, offering scalable and cost-effective options for businesses of all sizes. These technological advancements not only improve security but also streamline system management and integration with other smart technologies. As the technology continues to evolve, the EACS market is expected to benefit from more sophisticated, efficient, and adaptable access control solutions that meet the growing demands for security and convenience.Market Drivers:The primary drivers of the EACS market include heightened security concerns and the need for compliance with regulatory standards. Organizations across various sectors are increasingly investing in advanced access control solutions to safeguard their assets, sensitive information, and personnel. The growing frequency of security breaches and unauthorized access incidents further amplifies the need for reliable and robust security systems. Additionally, the trend toward smart buildings and the integration of IoT technology are driving market growth by offering more sophisticated and interconnected security solutions. Regulatory requirements related to data protection and physical security are also influencing the adoption of EACS, as businesses seek to meet these standards while ensuring the safety and security of their operations.Regional Insights:The EACS market shows varying growth patterns across different regions. North America and Europe lead the market due to their high adoption rates of advanced security technologies and stringent regulatory requirements. In these regions, the emphasis on high-security standards and the presence of major market players contribute to significant market growth. Conversely, the Asia-Pacific region is emerging as a key growth area due to rapid urbanization, industrialization, and increasing investments in infrastructure development. Countries such as China and India are witnessing a surge in demand for electronic access control systems as they modernize their infrastructure and enhance security measures. The diverse regional dynamics reflect varying levels of market maturity and growth opportunities, influencing the overall global market landscape.Download Sample Report Now: https://www.marketresearchintellect.com/download-sample/?rid=194769Market Segmentation:The EACS market can be segmented based on type, application, and technology. Key types include biometric systems, card-based systems, and electronic locks. Biometric systems are gaining popularity for their high security and convenience, while card-based systems remain widely used due to their affordability and ease of integration. Electronic locks offer versatile security options for both residential and commercial applications. In terms of application, the market serves commercial buildings, residential complexes, government facilities, and industrial sites. Each segment has unique requirements and preferences, driving the development of specialized solutions. Technology-wise, advancements such as IoT integration, cloud-based systems, and mobile access are shaping the market, offering improved functionality and user experience. Understanding these segments helps stakeholders tailor their offerings to meet diverse market needs effectively.Challenges:Despite its growth, the EACS market faces several challenges. High initial investment costs can deter small and medium-sized enterprises (SMEs) from adopting advanced access control solutions. Integration complexities, particularly with existing security infrastructure, can also pose hurdles for implementation. Additionally, concerns about data privacy and cybersecurity risks associated with connected systems may affect market adoption. The rapid pace of technological advancements requires continuous updates and upgrades, adding to the cost and complexity of maintaining access control systems. Addressing these challenges involves developing cost-effective solutions, enhancing system compatibility, and ensuring robust cybersecurity measures. Overcoming these obstacles is crucial for market players to successfully expand their customer base and capture emerging opportunities in the evolving security landscape.Competitive Landscape:The EACS market is characterized by intense competition, with numerous players vying for market share. Major companies include Honeywell, Johnson Controls, ASSA ABLOY, and Allegion, each offering a range of innovative products and solutions. These players focus on technological advancements, strategic partnerships, and mergers and acquisitions to strengthen their market positions. Additionally, emerging players and startups are introducing novel solutions, contributing to market dynamism and innovation. Competitive strategies involve differentiating products through advanced features, improving customer service, and expanding distribution channels. As the market evolves, companies must stay ahead of technological trends and customer demands to maintain a competitive edge and drive growth in a rapidly changing environment.Future Outlook:The future outlook for the EACS market is promising, with continued growth expected as security concerns and technological advancements drive demand. Emerging trends such as the integration of artificial intelligence (AI) and machine learning are likely to enhance system capabilities, providing more proactive and intelligent security solutions. The growing emphasis on smart cities and connected infrastructure will further propel market growth, as EACS plays a crucial role in modernizing urban environments. Additionally, increasing awareness of data privacy and security will lead to greater adoption of advanced access control systems. As the market evolves, stakeholders should focus on innovation, user experience, and addressing emerging security challenges to capitalize on future opportunities and sustain long-term growth.Geographic Dominance:
The Electronic Access Control System market exhibits significant geographic dominance, with North America and Europe leading due to their advanced infrastructure and stringent regulatory standards. North America, particularly the United States, holds a substantial share of the market, driven by high security concerns, technological advancements, and a robust presence of major EACS providers. Europe follows closely, with countries like the UK, Germany, and France investing heavily in security solutions due to strict regulations and high adoption rates. Meanwhile, the Asia-Pacific region is emerging as a major growth area, fueled by rapid urbanization, industrial expansion, and increasing investments in smart infrastructure. Countries such as China and India are witnessing rising demand for advanced access control systems as they modernize and enhance their security measures. The diverse regional dynamics highlight varying levels of market maturity and growth potential across the globe.
Electronic Access Control System Market Key Players Shaping the Future
The Electronic Access Control System market is significantly influenced by key players such as Honeywell International Inc., Johnson Controls International plc, ASSA ABLOY Group, Allegion plc, Schlage (a brand of Allegion), Bosch Security Systems, Tyco International Ltd., and HID Global (an ASSA ABLOY Group brand). These companies are at the forefront of technological innovation and market development, shaping the future of access control solutions through their advanced products and strategic initiatives.
Electronic Access Control System Market Segment Analysis
The Electronic Access Control System market is segmented based on By Type, By Application and Geography, offering a comprehensive analysis of the industry.
By Type:
Biometric Systems: These systems use unique biological characteristics, such as fingerprints, facial recognition, and iris scans, to provide secure access. They offer high security and are increasingly adopted in sensitive areas.Card-Based Systems: These systems use magnetic stripe cards, smart cards, or proximity cards to control access. They are popular due to their affordability, ease of use, and integration capabilities.Electronic Locks: These include keypads, smart locks, and other electronic mechanisms that can be controlled remotely or via electronic credentials. They are versatile and used in various residential and commercial settings.By Application:
Commercial Buildings: EACS in commercial buildings includes office complexes, retail spaces, and hospitality venues. These systems focus on managing employee access, visitor control, and security integration.Residential Complexes: Access control systems for residential complexes include apartment buildings and gated communities, emphasizing security and convenience for residents.Government Facilities: High-security access control solutions are used in government buildings, military bases, and other critical infrastructure to ensure tight security and regulatory compliance.Industrial Sites: EACS for industrial sites manage access to sensitive areas, protect valuable assets, and ensure safety compliance in manufacturing and industrial environments.By Geography:
North America: This region leads the market due to high adoption rates of advanced security technologies, stringent regulations, and a strong presence of major market players.Europe: Europe follows closely, with significant market activity in countries such as the UK, Germany, and France, driven by regulatory standards and high security needs.Asia-Pacific: The Asia-Pacific region is emerging as a key growth area, with increasing urbanization, industrial expansion, and investments in smart infrastructure driving demand for EACS.Latin America: Growth in Latin America is fueled by increasing security concerns and infrastructural development, with a growing adoption of electronic access solutions.Middle East and Africa: The market in this region is expanding due to rising security needs and infrastructure projects, with increasing investments in advanced access control technologies. Automotive And Transportation:
The Electronic Access Control System market within the automotive and transportation sector is experiencing notable growth, driven by advancements in vehicle security and the need for enhanced access management. In vehicles, EACS technology includes electronic locks, biometric systems, and keyless entry solutions that improve convenience and security for drivers and passengers. These systems are increasingly integrated into both commercial and personal vehicles, offering features such as remote access control, advanced theft prevention, and personalized settings. In the transportation sector, EACS is utilized for secure access to restricted areas within transportation hubs, including airports, train stations, and cargo facilities. This enhances the management of personnel and vehicle access, contributing to overall safety and operational efficiency. As the demand for smarter and more secure transportation solutions grows, the EACS market is expected to expand, driven by ongoing innovations and the increasing adoption of connected technologies.
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Artificial Intelligence

System-on-Chip (SoC) Market worth $205.97 billion by 2029 – Exclusive Report by MarketsandMarkets™

Published

2 days ago

October 4, 2024

CISION (PR Newswire)

DELRAY BEACH, Fla., Oct. 4, 2024 /PRNewswire/ — The System-on-Chip (SoC) market is projected to grow from USD 138.46 billion in 2024 and is estimated to reach USD 205.97 billion by 2029; it is expected to grow at a Compound Annual Growth Rate (CAGR) of 8.3% from 2024 to 2029 according to a new report by MarketsandMarkets™. The growth of the System-on-Chip (SoC) market is driven with the increasing trend of SoC in automotive industry along with the adoption of IoT and connected devices that require SoCs to carry out real time processing. Moreover, the surging adoption of AI and machine learning technologies is likely to fuel the demand for system-on-chips.

Download PDF Brochure: https://www.marketsandmarkets.com/pdfdownloadNew.asp?id=99622125
Browse in-depth TOC on “System-on-Chip (SoC) Market”
250 – Tables73 – Figures326 – Pages
System-on-Chip (SoC) Market Report Scope:
Report Coverage
Details
Market Revenue in 2024
$ 138.46 billion
Estimated Value by 2029
$ 205.97 billion
Growth Rate
Poised to grow at a CAGR of 8.3%
Market Size Available for
2020–2029
Forecast Period
2024–2029
Forecast Units
Value (USD Million/Billion)
Report Coverage
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
Segments Covered
By Core Count, Core Architecture, Device and Region
Geographies Covered
North America, Europe, Asia Pacific, and Rest of World
Key Market Challenge
Rapid technological changes challenge SoC longevity
Key Market Opportunities
Growing penetration of AI PCs and GenAI smartphones
Key Market Drivers
Rising adoption of ADAS in autonomous vehicles to fuel the growth of automotive SoCs
By core architecture, RISC-V is projected to grow at a high CAGR for system-on-chip market during the forecast period
The market for System-on-Chips (SoC) for RISC-V architecture segment is expected to grow at highest CAGR during the forecast period. The RISC-V architecture is bound to grow at a higher rate in view of the flexibility, cost, and scalability advantages it has over others, driving wide adoption across diversified applications. The open-source nature of the architecture is one of the major growth drivers because it reduces licensing costs and accelerates innovation since customizations are allowed for use cases as per various needs. This flexibility is valuable in the emerging and high-growth sectors of AI, 5G, and IoT, where a solution that is tailor-made to complex requirements needs to be provided. For instance, in May 2024, Arteris, Inc. (US) and Andes Technology Corporation (Taiwan) partnered to develop the Andes Qilai RISC-V platform. It incorporates the high-performance RISC-V processor IPs from Andes Technology Corporation (Taiwan) and the FlexNoC interconnect IP from Arteris, Inc. (US). Their joint effort shows their efforts towards advancing RISC-V based SoC designs for a wide range of applications, which include AI, 5G, Networking, Mobile, Storage, AIoT, and Space. With open-source RISC-V model, such developments further continue to accelerate innovation and drive adoption in these high-growth areas, positioning RISC-V as the choice for future technology roadmaps.
The automotive segment in System-on-Chip (SoC) market will account for the high CAGR from 2024 to 2029
The SoC market for automotive segment will grow at highest CAGR during the forecast period. The SoCs integrated in automotive applications enable enhanced performance, reduced power consumption, and compact designs, which makes them essential for numerous vehicle systems. The automotive segment will experience growth due to the increasing adoption of advanced driver assistance systems (ADAS), infotainment systems, and the rising popularity of electric vehicles. EVs rely heavily on sophisticated electronics for battery management, powertrain control, and energy efficiency optimization, all of which require advanced SoCs. For instance, in June 2024, Intel Corporation (US) launched OLEA U310 SoC chip for automotive applications. It is developed to improve the performance of electric vehicles. This chip combines hardware and software in one SoC to enable seamless operation across various EV station platforms. They are designed to manage the complex systems within EVs. It ensures optimal performance, safety, and extended range. The increasing complexity of autonomous driving systems, along with the demand for safer and more reliable vehicles fuels the adoption of SoCs in the automotive industry, driving significant growth in this segment.
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Asia Pacific is expected to register the highest CAGR during the forecast period
The system-on-chip (SoC) industry in Asia Pacific includes economies such as South Korea, Japan, China, and India and Rest of Asia Pacific. The Rest of Asia Pacific countries include Australia, Singapore, the Philippines, Taiwan, Thailand, and Indonesia. There is a presence of leading SoC manufacturers in this region including MediaTek Inc. (Taiwan), Samsung (South Korea), Infineon Technologies AG (Germany), and Renesas Electronics Corporation (Japan). The Asia-Pacific region is still the biggest revenue generator in terms of SoC market globally due to the fast-growing consumer electronics and mobile device-related sectors. Other regions considered as major manufacturing centers in the world are China, South Korea, Japan, and India for making the latest smartphones, tablets, and other consumer electronic products that require state-of-the-art SoCs for delivering high performance, energy efficiency, and integrated functionalities. A highly and technologically advanced population in the region has always formed the basis for a sustained demand in terms of innovative and feature-rich devices, thereby showing sustainable growth in the SoC market. Automotive and industrial automation are another major sector driving the SoC market in Asia Pacific. This region contains some of the largest automobile manufacturers in the world, such as Hyundai Motor Company (South Korea), Toyota (Japan), and Tata Motors Limited (India). These car manufacturers are now putting SoCs into their automobiles so that they are equipped with ADAS capabilities, infotainment features, and autonomous driving technologies.
Key Players
Key companies operating in the System-on-Chip (SoC) companies are Qualcomm Technologies, Inc. (US), MediaTek Inc. (Taiwan), Samsung (South Korea), Apple Inc. (US), Broadcom (US), Intel Corporation (US), Advanced Micro Devices, Inc. (US), NVIDIA Corporation (US), HiSilicon (China), Microchip Technology Inc. (US), among others.
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