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RigNet Inc. Finally Hits Bottom

RigNet's (NASDAQ: RNET) financial results had been on a steady decline for more than a year because of the impact low oil prices are having on the offshore-drilling market. However, that decline finally came to an end during the fourth quarter, when the company's results rebounded ever so slightly. But conditions in the offshore-drilling sector remain quite challenging, so it's not yet apparent if this was just a breather or if a recovery is about to take hold.

RigNet results: The raw numbers

Metric

Q4 2016

Q4 2015

Year-Over-Year Change

Revenue

$52.8 million

$52.2 million

1.1%

Net income (loss)

($3.8 million)

($11 million)

N/A

EPS

($0.21)

($0.63)

N/A

Data source: RigNet Inc.

What happened with RigNet this quarter?

RigNet's results showed some improvement:

  • Managed-services revenue was $47.2 million, which was flat from last quarter and down 17.3% year over year. Driving the year-over-year weakness was reduced spending by oil and gas companies on offshore-drilling projects as a result of lower oil prices.
  • Revenue from systems integration and automation (SI&A) was $5.6 million during the quarter. That's up from $3.4 million last quarter and a negative-$4.9 million in the year-ago quarter, when the company took a negative revenue adjustment of $9.6 million because of a contract dispute with a customer. Contributing to the sequential...

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