Halliburton Co., the largest hydraulic fracturing services provider in the United States, signaled an industry-wide recovery on Monday as it begins to accelerate additions to its fleet and in capital spending.

The Houston oilfield services giant, whose revenue is weighted heavily to the North American division, reported operating income jumped 23% sequentially, led by a 31% increase in North American income, with an impressive 280 basis point (bp) improvement in margins to 18.2% from 15.4% in 1Q2014.

CEO Dave Lesar, who led a conference call to discuss the results, reminded investors that in April, during a conference call regarding 1Q2014, he had said he was beginning to “feel the turn in North America” (see Shale Daily, April 21). Skeptics may have discounted the optimism, but it’s proven its worth.

“We are past feeling the turn; we are in the turn,” Lesar said Monday of North America’s market recovery.

Volumes of proppant and other materials used to complete U.S. onshore wells have jumped more than 35% from a year ago.

“We expect North America activity levels to continue to improve, with margins approaching 20% in the third quarter,” the CEO said. “We have concluded, based on the strength of this outlook, that we will immediately accelerate additions to our hydraulic fracturing fleet and logistics capabilities, with new crews available for service beginning later this year.”

As the market share leader in North America, performance by the Houston-based oilfield services giant is an indicator of upstream activity. Close to 9,400 onshore wells were drilled in the United States between April and June, up 4.3% from 2Q2013, according to Baker Hughes Inc. Revenue per well also is increasing as operators drill longer laterals and use more fracturing stages, resulting in higher service intensity — facts noted in last week’s quarterly results by Schlumberger Ltd. and Baker (see Shale Daily, July 18; July 17).

On the expectations for more onshore expansions in the United States, Halliburton has increased its 2014 capital expenditures to $3.3 billion, up from $3 billion. The operator also expanded a share buyback program to $6 billion from $1.2 billion, reflecting its bullish outlook. If the North American market were to slump, Halliburton would accelerate retirements of old fracturing equipment, but that’s likely not an issue, Lesar said.

Overall profits rose to $774 million (91 cents/share) from year-ago earnings of $644 million (69 cents). Revenue hit a record $8.05 billion, up 10% from 2Q2013. North American revenue increased 11% to $4.34 billion.

“In North America, second quarter revenue increased 11% and operating income was up 31% compared to the first quarter of 2014, outpacing a 4% increase in the United States land rig count,” said Lesar. “Service intensity levels continued to expand…”

The completions and production (C&P) segment reported a 13% jump in revenue to $4.94 billion, driven by higher stimulation activity in the U.S. land market. North America C&P operating income improved sequentially by $184 million, or 41%, on increased stimulation activity in the United States land market.

Drilling and evaluation revenue rose 5.3% to $3.11 billion. North America D&E operating income increased $4 million, or 3%, sequentially, on increased logging and fluid services in the United States, which were partially offset by reduced U.S. software sales and the effects of the Canadian spring break-up.

“Our strategy is working well and we intend to stay the course,” Lesar said. “We see strong, sustainable growth opportunities across the mature field, deepwater and unconventional markets. We continue to be excited about the North America market, and although there may be near-term choppiness in certain international markets, we see a strong pipeline of opportunities.”

Tudor, Pickering, Holt & Co.’s Jeff Tillery and Byron Pope said the results for North America were “good” when combined with fracture capacity additions that would add to the “already strong vibe/outlook. It should be no surprise that Halliburton is adding capacity; their capacity is fully committed and demand is increasing…” The company is expected to “outpace industry growth” in North America.

Halliburton also has promoted COO Jeff Miller, 50, to president effective Aug. 1. Miller also gains a seat on the board.