Borr Drilling came into this print looking like a classic high beta recovery stock that had stalled. The share price is down about 36% over the past three months, and it slipped another 1.7% today to close at US$4.04, even as many investors still point to a low P/S multiple and bullish long range forecasts.

The headline this quarter is not revenue or rig utilization. It is the sharp hit to profitability, with Q2 2026 net loss widening to US$241.4m and adjusted EBITDA down to US$43.8m as one off refinancing and rig transition costs bit hard. The market move was modest; the earnings reality was anything but.

Is Borr Drilling a rare deep value opportunity at 1.2x P/S, or is the widened Q2 loss a sign that the low multiple is deserved? Compare the story against the full valuation analysis for Borr Drilling

Q2 2026 Earnings Summary

• Revenue, Q2 2026 vs. Q2 2025: US$232.3m vs. US$267.7m (decline of 13.2%)
• Net Loss, Q2 2026 vs. Q2 2025: US$241.4m loss vs. US$35.1m profit (moved from profit to a large loss)
• Basic EPS, Q2 2026 vs. Q2 2025: US$0.785 loss per share vs. US$0.147 earnings per share (swing into loss)
• Trailing 12-month Net Income, Q2 2026 vs. Q2 2025: US$243.6m loss vs. US$54.2m profit (shift from profit to loss over the year)

Prefer clean, visual charts instead of another dense wall of earnings tables for Borr Drilling? See the full picture of the company, including its recent earnings and balance sheet impact, in the visual company report for Borr Drilling.

Borr Drilling: Contracts Support Bull Story, Earnings Lag

Bulls argue that Borr Drilling is a premium jack up fleet owner that should convert tight supply and strong contract wins into higher, more stable cash flow. The latest quarter partially supports that idea, but only on the commercial side. Contract coverage for 2026 sits at 73% at about US$134k per day, with 21 commitments added since the start of the year and multi year extensions in Mexico. That is exactly the kind of backlog build the bullish narrative relies on.

The earnings line tells a different story. Adjusted EBITDA almost halved quarter on quarter to US$43.8m and Q2 swung to a US$241.4m net loss, hit by refinancing charges and higher transition costs as rigs, including Odin, moved between contracts. The thesis that a young fleet automatically delivers stronger margins is not yet proving out in the reported profit and loss.

Compare that contract momentum with how institutions are positioning. See the consensus price target analysis for Borr Drilling to check whether analysts think Borr Drilling’s story lines up with the current share price.

Borr Drilling Bears See Execution Risks Confirmed

The core bearish worry on Borr Drilling is that heavy leverage, refinancing needs and operational slips like Odin will keep earnings under pressure even as the fleet grows. Q2 results largely back that concern. The company reported a US$241.4m net loss, with a US$176.3m debt extinguishment hit showing that balance sheet repair still carries a real income statement cost. Bears also flag that repeated refinancing can slow deleveraging and raise dilution risk. The new senior and convertible notes reduce near term refinancing pressure but do not yet answer that longer term question.

On operations, critics pointed to Odin delays and transition issues as a structural weak spot. Q2 again missed the milestone of a clean ramp. Adjusted EBITDA fell to US$43.8m as Odin preparation and six rig transitions inflated operating costs and cut revenue days. Consecutive quarters of execution drag give the bearish narrative more credibility.

With net losses, refinancing costs and leverage all pulling in the wrong direction, you need to verify whether Borr Drilling’s balance sheet can actually support this turnaround. Analyze the full debt and liquidity picture in our financial health analysis of Borr Drilling stock.

Stay Ahead With Simply Wall St

Borr Drilling now sits at a low P/S multiple with widening Q2 losses and higher refinancing costs, which makes timing even more important. Register for free with Simply Wall St and add Borr Drilling to your Watchlist to track its share price against fair value and watch how the earnings story develops before deciding on an entry point. Once you are invested, use the Portfolio Command Center to cut through noise and focus on essential updates across all your holdings. Round out your process by tapping into crowd insights through the Community so you can spot potential catalysts or risks early and stay ahead of the market.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.