SLB Announces Second-Quarter 2024 Results

• Revenue of $9.14 billion increased 5% sequentially and 13% year on year
• GAAP EPS of $0.77 increased 4% sequentially and 7% year on year
• EPS, excluding charges and credits, of $0.85 increased 13% sequentially and 18% year on year
• Net income attributable to SLB of $1.11 billion increased 4% sequentially and 8% year on year
• Adjusted EBITDA of $2.29 billion increased 11% sequentially and 17% year on year
• Cash flow from operations was $1.44 billion and free cash flow was $776 million
• Board approved quarterly cash dividend of $0.275 per share

LONDON–(BUSINESS WIRE)–Regulatory News:

SLB (NYSE: SLB) today announced results for the second-quarter 2024.

Second-Quarter Results

	(Stated in millions, except per share amounts)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
Revenue	$9,139		$8,707		$8,099		5%		13%
Income before taxes – GAAP basis	$1,421		$1,357		$1,293		5%		10%
Income before taxes margin – GAAP basis	15.5%		15.6%		16.0%		-4 bps		-42 bps
Net income attributable to SLB – GAAP basis	$1,112		$1,068		$1,033		4%		8%
Diluted EPS – GAAP basis	$0.77		$0.74		$0.72		4%		7%
Adjusted EBITDA*	$2,288		$2,057		$1,962		11%		17%
Adjusted EBITDA margin*	25.0%		23.6%		24.2%		142 bps		81 bps
Pretax segment operating income*	$1,854		$1,649		$1,581		12%		17%
Pretax segment operating margin*	20.3%		18.9%		19.5%		135 bps		76 bps
Net income attributable to SLB, excluding charges & credits*	$1,224		$1,082		$1,033		13%		19%
Diluted EPS, excluding charges & credits*	$0.85		$0.75		$0.72		13%		18%
Revenue by Geography
International	$7,452		$7,056		$6,297		6%		18%
North America	1,644		1,598		1,746		3%		-6%
Other	43		53		56		n/m		n/m
	$9,139		$8,707		$8,099		5%		13%

	(Stated in millions)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
Revenue by Division
Digital & Integration	$1,050		$953		$947		10%		11%
Reservoir Performance	1,819		1,725		1,643		5%		11%
Well Construction	3,411		3,368		3,362		1%		1%
Production Systems	3,025		2,818		2,313		7%		31%
Other	(166)		(157)		(166)		n/m		n/m
	$9,139		$8,707		$8,099		5%		13%
Pretax Operating Income by Division
Digital & Integration	$325		$254		$322		28%		1%
Reservoir Performance	376		339		306		11%		23%
Well Construction	742		690		731		7%		1%
Production Systems	473		400		278		18%		70%
Other	(62)		(34)		(56)		n/m		n/m
	$1,854		$1,649		$1,581		12%		17%
Pretax Operating Margin by Division
Digital & Integration	31.0%		26.6%		34.0%		435 bps		-304 bps
Reservoir Performance	20.6%		19.7%		18.6%		98 bps		205 bps
Well Construction	21.7%		20.5%		21.7%		125 bps		0 bps
Production Systems	15.6%		14.2%		12.0%		146 bps		361 bps
Other	n/m		n/m		n/m		n/m		n/m
	20.3%		18.9%		19.5%		135 bps		76 bps

SLB acquired the Aker subsea business during the fourth quarter of 2023 in connection with the formation of the OneSubsea joint venture. The acquired business generated revenue of $485 million during the second quarter of 2024. Excluding the impact of this accquisition, SLB’s global second-quarter 2024 revenue increased 7% year on year; international second-quarter 2024 revenue increased 11% year on year; and Production Systems second-quarter 2024 revenue increased 10% year on year.

*These are non-GAAP financial measures. See sections titled “Divisions” and Supplementary Information” for details.

n/m = not meaningful

Broad-Based Growth Driven by the International Markets

SLB CEO Olivier Le Peuch commented, “We achieved solid second-quarter results, with broad-based international revenue growth and margin expansion across all Divisions. Our Core business continued to build on its positive momentum and our digital business accelerated, resulting in our highest quarterly international revenue since 2014. These results demonstrate SLB’s strong position in key, resilient markets, as we continue to benefit from elevated activity in the Middle East & Asia, particularly in gas, and our clients’ increased investments in deepwater basins, exploration, and digital.

“Sequentially, revenue grew 5%, led by the Middle East & Asia, which increased 6%. The increase in this area was driven by capacity expansions, gas development projects, and production and recovery, with a majority of GeoUnits in the area achieving record revenue. We also continued to benefit from our enhanced offshore exposure, particularly in deepwater basins across Latin America, Europe & Africa, and in the US Gulf of Mexico.

Production Systems, Reservoir Performance, and Digital Lead the Way

“Our Core Divisions—Reservoir Performance, Well Construction, and Production Systems—grew combined revenue by 4% sequentially and expanded pretax segment operating margin by 120 basis points (bps). This strong performance was driven by the international markets, where revenue once again reached a new cycle high.

“Sequentially, Production Systems grew by 7% and Reservoir Performance increased by 5%, with growth led by subsea production systems and with artificial lift, valves, surface production systems, intervention, and stimulation each posting their highest quarterly revenue of the cycle. This was the result of strong activity in Europe & Africa, Latin America, and the Middle East & Asia, stemming from the combination of long-cycle development activity and the acceleration of production and recovery investments. Meanwhile, Well Construction also grew sequentially with measurements and fluids each posting cycle-high quarterly revenue. This was supported by land activity and offshore developments in the Middle East & Asia and Latin America, partially offset by lower drilling in US land.

“Our Digital & Integration Division also performed well, with revenue increasing 10% sequentially. This was entirely driven by high-margin growth in digital, where revenue reached a new quarterly high and remains on track to achieve our high-teens growth ambition for the full year. Our strong results were fueled by exploration data license sales and the increased adoption of our Cloud, AI, and Edge technology platforms.

“Overall, our financial performance in the second quarter was strong as our adjusted EBITDA margin expanded 142 bps sequentially, cash flow from operations was $1.44 billion, and free cash flow was $776 million.

“Additionally, during the first half of the year, we returned $1.49 billion to shareholders through stock repurchases and dividends, and we are on track to return $3.0 billion to shareholders in 2024.

“Thank you to the SLB team for delivering such a strong performance this quarter. I look forward to building on these positive results throughout the rest of the year.”

Enhancing Margins with Further Opportunities Ahead

“Throughout the cycle, SLB has consistently achieved industry-leading financial results by leveraging our differentiated operating footprint and leading technical and digital offerings. As we continue to navigate this cycle, we are poised to capture quality revenue growth and unlock further margin expansion through increased technology deployment and digital adoption, as well as a heightened focus on operating efficiency and the optimization of our support structure.

“Looking ahead to the second half of the year, we expect ongoing momentum in the international markets, strong digital sales, and our cost efficiency programs will enable us to expand margins and deliver our ambition to grow full-year adjusted EBITDA in the mid-teens.

“Beyond 2024, the fundamentals of this cycle remain in place, and there is a long tailwind of growth opportunities, including long-cycle gas and deepwater projects, production and recovery activity, and the secular trends of digital and decarbonization. This represents a strong backdrop to continue our margin expansion and cash generation journey.

“Our strategy across our three engines of growth—Core, Digital, and New Energy—is built to harness each of these opportunities, and we are only becoming stronger through our elevated digital offerings, the additional capabilities of OneSubsea, and the announced pending acquisition of ChampionX.

“This business environment favors SLB’s strengths. With our continued performance and ongoing emphasis on capital discipline and cost efficiency, we remain well positioned to outperform the market and deliver on our commitment to returns to shareholders.”

Other Events

During the quarter, SLB repurchased 9.9 million shares of its common stock for a total purchase price of $465 million. For the first half of the year, SLB repurchased a total of 15.3 million shares of its common stock for a total purchase price of $735 million.

On May 29, 2024, SLB issued $500 million of 5.000% Senior Notes due 2027, $500 million of 5.000% Senior Notes due 2029, and $500 million of 5.000% Senior Notes due 2034.

On June 14, 2024, SLB and Aker Carbon Capture (ACC) announced the closing of their previously announced joint venture. The new company combines technology portfolios, expertise, and operations platforms to support accelerated carbon capture adoption for industrial decarbonization at scale. Following the transaction, SLB owns 80% of the combined business and ACC owns 20%.

On July 18, 2024, SLB’s Board of Directors approved a quarterly cash dividend of $0.275 per share of outstanding common stock, payable on October 10, 2024, to stockholders of record on September 4, 2024.

Second-Quarter Revenue by Geographical Area

	(Stated in millions)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
North America	$1,644		$1,598		$1,746		3%		-6%
Latin America	1,742		1,654		1,624		5%		7%
Europe & Africa*	2,442		2,322		2,031		5%		20%
Middle East & Asia	3,268		3,080		2,642		6%		24%
Eliminations & other	43		53		56		n/m		n/m
	$9,139		$8,707		$8,099		5%		13%
International	$7,452		$7,056		$6,297		6%		18%
North America	$1,644		$1,598		$1,746		3%		-6%

SLB acquired the Aker subsea business during the fourth quarter of 2023 in connection with the formation of the OneSubsea joint venture. The acquired business generated revenue of $485 million during the second quarter of 2024. Excluding the impact of this accquisition, SLB’s global second-quarter 2024 revenue increased 7% year on year and international second-quarter 2024 revenue increased 11% year on year.

*Includes Russia and the Caspian region

n/m = not meaningful

International

Revenue in Latin America of $1.74 billion increased 5% sequentially due to higher sales of production systems in Brazil and robust stimulation and intervention activity in Argentina. Digital revenue grew in the double digits, offset by lower Asset Performance Solutions (APS) revenue. Year on year, revenue increased 7% due to higher sales of production systems in Brazil and robust drilling activity in Argentina, partially offset by lower drilling revenue in Mexico.

Europe & Africa revenue of $2.44 billion increased 5% sequentially due to higher sales of production systems in Scandinavia and West Africa and increased artificial lift revenue in North Africa from new projects. Sequential growth was boosted by a more than 20% increase in digital revenue. Year on year, revenue increased 20% driven by the acquired Aker subsea business, primarily in Scandinavia, and increased offshore exploration, drilling, and production activity in Angola, Central and East Africa. Double-digit growth in digital revenue also contributed to the year-on-year growth.

Revenue in the Middle East & Asia of $3.27 billion increased 6% sequentially due to increased sales of production systems and increased intervention and evaluation activity in Saudi Arabia. Higher digital revenue across the area and increased drilling in Iraq, United Arab Emirates, China, and East Asia also contributed to the sequential growth. Year on year, revenue increased 24% due to higher drilling, intervention, and evaluation activity as well as increased sales of production systems in Saudi Arabia. Higher drilling in United Arab Emirates, Egypt, East Asia, Indonesia, and China, as well as the acquired Aker subsea business in Australia, also contributed to the year-on-year growth.

North America

North America revenue of $1.64 billion increased 3% sequentially due to higher revenue in North America offshore driven by higher digital revenue, mainly sales of exploration data licenses and increased drilling. The sequential growth was partially offset by lower drilling revenue in US land and lower sales of production systems in the US Gulf of Mexico. Year on year, revenue declined 6% due to lower drilling in US land and reduced sales of production systems in the US Gulf of Mexico.

Second-Quarter Results by Division

Digital & Integration

	(Stated in millions)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
Revenue
International	$757		$717		$712		6%		6%
North America	291		236		234		23%		24%
Other	2		–		1		n/m		n/m
	$1,050		$953		$947		10%		11%
Pretax operating income	$325		$254		$322		28%		1%
Pretax operating margin	31.0%		26.6%		34.0%		435 bps		-304 bps
n/m = not meaningful

Digital & Integration revenue of $1.05 billion increased 10% sequentially due to higher digital revenue while APS revenue was flat. Growth in digital revenue was driven by the increased adoption of our Cloud, AI, and Edge technology platforms and higher exploration data license sales. Year on year, revenue increased 11% due to digital growing in line with our ambition of full-year growth in the high-teens while APS revenue was flat.

Digital & Integration pretax operating margin of 31% expanded 435 bps sequentially, mostly due to improved profitability in digital following strong exploration data license sales and higher uptake of digital solutions. Year on year, pretax operating margin contracted 304 bps due to lower profitability in APS from the effects of higher APS amortization expense and lower gas prices.

Reservoir Performance

	(Stated in millions)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
Revenue
International	$1,684		$1,592		$1,512		6%		11%
North America	134		130		130		3%		4%
Other	1		3		1		n/m		n/m
	$1,819		$1,725		$1,643		5%		11%
Pretax operating income	$376		$339		$306		11%		23%
Pretax operating margin	20.6%		19.7%		18.6%		98 bps		205 bps
n/m = not meaningful

Reservoir Performance revenue of $1.82 billion grew 5% sequentially due to increased intervention and stimulation activity across all geographic areas. While approximately 70% of the revenue growth came from the Middle East & Asia, this growth was widespread across land and offshore and generally from production activity. Year on year, revenue increased 11% due to increased stimulation and intervention activity, with approximately 80% of the revenue growth coming from the Middle East & Asia.

Reservoir Performance pretax operating margin of 21% expanded 98 bps sequentially with profitability improving across the international markets driven by higher activity. Year on year, pretax operating margin expanded 205 bps on improved profitability in the international markets driven by higher activity and improved pricing from increased technology intensity.

Well Construction

	(Stated in millions)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
Revenue
International	$2,768		$2,707		$2,582		2%		7%
North America	592		604		721		-2%		-18%
Other	51		57		59		n/m		n/m
	$3,411		$3,368		$3,362		1%		1%
Pretax operating income	$742		$690		$731		7%		1%
Pretax operating margin	21.7%		20.5%		21.7%		125 bps		0 bps
n/m = not meaningful

Well Construction revenue of $3.41 billion increased 1% sequentially and year on year with record quarterly revenue in measurements and fluids. This was supported by ongoing land activity and offshore developments in the Middle East & Asia and Latin America, partially offset by lower drilling in US land.

Well Construction pretax operating margin of 22% expanded 125 bps sequentially due to international activity increases in measurements and fluids. Year on year, pretax operating margin was flat as improved profitability internationally was offset by margin contraction in North America as a result of lower drilling activity.

Production Systems

	(Stated in millions)
	Three Months Ended						Change
	Jun. 30, 2024		Mar. 31, 2024		Jun. 30, 2023		Sequential		Year-on-year
Revenue
International	$2,378		$2,164		$1,628		10%		46%
North America	640		647		679		-1%		-6%
Other	7		7		6		n/m		n/m
	$3,025		$2,818		$2,313		7%		31%
Pretax operating income	$473		$400		$278		18%		70%
Pretax operating margin	15.6%		14.2%		12.0%		146 bps		361 bps

SLB acquired the Aker subsea business during the fourth quarter of 2023 in connection with the formation of the OneSubsea joint venture. The acquired business generated revenue of $485 million during the second quarter of 2024. Excluding the impact of this accquisition, SLB’s global second-quarter 2024 revenue increased 7% year on year and Production Systems second-quarter 2024 revenue increased 10% year on year.

n/m = not meaningful

Production Systems revenue of $3.03 billion increased 7% sequentially with growth led by subsea production systems and with artificial lift, valves, and surface production systems posting record quarterly revenue in this cycle. Sequential growth was driven by the international markets with strong activity in Europe & Africa, followed by Latin America and the Middle East & Asia. Year on year, revenue grew 31%, mainly due to the acquisition of the Aker subsea business. Excluding the effects of the Aker subsea acquisition, revenue grew 10% year on year driven by a 16% increase in international sales. Organic year-on-year growth was led by strong international sales of artificial lift, surface production systems, completions, and valves, partially offset by reduced sales of midstream production systems.

Production Systems pretax operating margin of 16% expanded 146 bps sequentially with improved profitability in subsea production systems and artificial lift. Year on year, pretax operating margin expanded 361 bps due to improved profitability in subsea production systems, artificial lift, and surface production systems. The margin expansions were driven by activity mix, execution efficiency, and conversion of improved-price backlog.

Quarterly Highlights

CORE

Contract Awards

SLB continues to win new contract awards that align with SLB’s core strengths, particularly in the international and offshore basins. Notable highlights include the following:

• In the Kingdom of Saudi Arabia, Saudi Aramco awarded SLB a long-term contract for unconventional gas directional drilling services and drilling bits, in support of Aramco’s strategic goal to increase gas production by more than 60% by 2030, compared to 2021 levels. SLB will provide innovative fit-for-basin technologies, services, and best-in-class practices developed in collaboration with Aramco. Cutting edge technologies, including the NeoSteer™ at-bit-rotary-steerable system and unique drilling bits developed and manufactured in Saudi Arabia, complemented with Performance Live™ and advanced drilling automation will continue to deliver record-breaking performances and mitigate operation risks.

• In Qatar, a customer awarded SLB a five-year contract for directional drilling, measurement-while-drilling, and logging-while-drilling services. The contract will extend the deployment of the GeoSphere HD™ high-definition reservoir mapping-while-drilling service and the GeoSphere 360™ 3D reservoir mapping-while-drilling service for proactive steering, waterfront identification, and acquisition of valuable information for subsurface modeling.

• In Egypt, SLB received a contract to integrate well construction solutions and technologies for the exploration and appraisal of five wells targeting the eastern Mediterranean hub with opportunity to expand the contract to include more wells. SLB will provide leading shoe-to-shoe solutions, which include the use of the AxeBlade™ ridged diamond element bit cutter technology, Rhino™ multicycle hydraulic underreamers, SonicScope™ multipole sonic-while-drilling service, StethoScope™ formation pressure-while-drilling service, and Orbit™ rising stem ball valves.

• Offshore Norway, Equinor awarded SLB OneSubsea a contract for the front-end engineering design of a 12-well, all-electric subsea production systems project in the Fram Sør Field. The project will fast-track wide-scale global adoption of electric subsea technology, setting new standards for increased operator control, subsea operational efficiency, and reduced offshore emissions. As part of the agreement, future engineering, procurement, and construction will be directly awarded to SLB OneSubsea conditional on a final investment decision.

• Also offshore Norway, Equinor awarded SLB OneSubsea a contract for the execution of the second stage of Phase 3 for Equinor’s Troll project in the North Sea. To accelerate field delivery of the subsea tieback to existing infrastructure, SLB OneSubsea will leverage configurable solutions compliant with NCS2017+ for standardized subsea production systems for application in the Norwegian Continental Shelf. The objective for Troll Phase 3, Stage 2 is to accelerate production from the reservoir of approximately 55 billion standard cubic meters of gas.

• Also offshore Norway, OKEA awarded SLB OneSubsea and Subsea7 an integrated engineering, procurement, construction, and installation contract. The alliance will develop the Bestla (formerly known as Brasse) Project in the North Sea, offshore Norway, specifically to accelerate the subsea tieback delivery to aging platforms for profitable and sustainable marginal field development.

• Offshore Angola, TotalEnergies awarded SLB OneSubsea a contract for a 13-well subsea production system scope, including associated equipment and services, in the development of the Kaminho project. The project will be developed by TotalEnergies and its Block 20/11 partners in two phases for the Cameia and Golfinho discoveries. During the Kaminho project’s first phase of development for the Cameia field, SLB OneSubsea will collaborate with TotalEnergies to deploy a highly configurable subsea production platform with standardized vertical monobore subsea tree, wellhead, and controls system.

Technology and Performance

Notable technology introductions and deployment in the quarter include the following:

• In the US Gulf of Mexico (GOM), SLB and Shell Offshore Inc. deployed Wellbore Insights on Delfi™ digital platform to enable record-setting formation flowback volumes for deep reading pressure transients on wireline. The solution enables cloud-based, wellbore dynamics modeling workflows and prejob planning in addition to real-time updates from the wellsite. Shell was able to significantly increase the volume of reservoir fluid that could be safely introduced during the sampling and testing operation, improving accuracy and enhancing the radius of investigation. Shell received a better forecast of reservoir production and avoided a costly wiper trip, which eliminated more than 400 metric tons of CO₂e and saved 72 hours of rig-time costs.

• In Mexico, SLB and Pemex deployed OpenPath Flex™ customizable acid stimulation service for the first time in its strategic fields that target deep, hot, and heterogeneous carbonate reservoirs. The initial implementation of the technology, in a well with 365-degrees-Fahrenheit bottomhole static temperature, resulted in a 3.6-fold production increase. Based on these results and additional successful treatments, Pemex has transitioned to OpenPath Flex service as the preferred stimulation system in its strategic fields.

Decarboniz

Contacts

Investors
James R. McDonald – SVP, Investor Relations & Industry Affairs, SLB

Joy V. Domingo – Director of Investor Relations, SLB

Tel: +1 (713) 375-3535

Email: investor-relations@slb.com

Media
Josh Byerly – Vice President of Communications, SLB

Moira Duff – Director of External Communications, SLB

Tel: +1 (713) 375-3407

Email: media@slb.com

Read full story here