HomeMarket NewsSLB's Q3 Earnings Beat Expectations, But North America Sales Decline

SLB’s Q3 Earnings Beat Expectations, But North America Sales Decline

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Summary: Shares of Schlumberger (NYSE:SLB) dropped 1.9% in pre-market trading on Friday following the release of mixed Q3 results. While the company exceeded consensus earnings estimates by a penny, total revenues were roughly in line with expectations.

Fracking Drilling Rig at the Golden Hour

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In Q3, net income for Schlumberger rose to $1.12 billion, or $0.78 per share, compared to $907 million, or $0.63 per share, in the same quarter last year. This increase was driven by sustained growth in international markets, where the company reported its ninth consecutive quarter of double-digit year-over-year growth.

Total revenues for Q3 increased by 11% year-over-year and 3% quarter-over-quarter, reaching $8.31 billion. International revenue jumped by 12% year-over-year and 5% quarter-over-quarter to $6.61 billion. However, North America revenue rose by 6% year-over-year but declined by 6% quarter-over-quarter, mainly due to reduced drilling activity in the U.S. and the Gulf of Mexico.

Breaking it down by segment, Well Construction revenues for Schlumberger rose by 11% year-over-year and 2% quarter-over-quarter to $3.43 billion, aligning with FactSet consensus estimates. Production Systems revenues saw a 10% year-over-year increase and a 2% quarter-over-quarter increase to $2.37 billion, surpassing the $2.36 billion consensus. Meanwhile, Reservoir Performance revenues jumped by 15% year-over-year and 2% quarter-over-quarter to $1.68 billion, falling slightly short of the expected $1.71 billion.

In light of the results, CEO Olivier Le Peuch expressed confidence in the company’s future prospects, stating, β€œWe believe the market fundamentals remain very compelling for our business. The oil and gas industry continues to benefit from a multiyear growth cycle that has shifted to the international and offshore markets where we are the clear leader.”

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