- Revenue of $9.16 billion was steady sequentially and increased 10% year on year
- GAAP EPS of $0.83 increased 8% sequentially and 6% year on year
- EPS, excluding charges and credits, of $0.89 increased 5% sequentially and 14% year on year
- Net income attributable to SLB of $1.19 billion increased 7% sequentially and 6% year on year
- Adjusted EBITDA of $2.34 billion increased 2% sequentially and 13% year on year
- Cash flow from operations was $2.45 billion and free cash flow was $1.81 billion
- Board approved quarterly cash dividend of $0.275 per share
NEW YORK–(BUSINESS WIRE)–SLB (NYSE: SLB) today announced results for the third quarter of 2024.
Third-Quarter Results
| (Stated in millions, except per share amounts) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| Revenue |
$9,159 |
$9,139 |
$8,310 |
– |
10% |
||||
| Income before taxes – GAAP basis |
$1,507 |
$1,421 |
$1,395 |
6% |
8% |
||||
| Income before taxes margin – GAAP basis |
16.5% |
15.5% |
16.8% |
91 bps |
-33 bps |
||||
| Net income attributable to SLB – GAAP basis |
$1,186 |
$1,112 |
$1,123 |
7% |
6% |
||||
| Diluted EPS – GAAP basis |
$0.83 |
$0.77 |
$0.78 |
8% |
6% |
||||
| Adjusted EBITDA* |
$2,343 |
$2,288 |
$2,081 |
2% |
13% |
||||
| Adjusted EBITDA margin* |
25.6% |
25.0% |
25.0% |
55 bps |
54 bps |
||||
| Pretax segment operating income* |
$1,902 |
$1,854 |
$1,683 |
3% |
13% |
||||
| Pretax segment operating margin* |
20.8% |
20.3% |
20.3% |
48 bps |
51 bps |
||||
| Net income attributable to SLB, excluding charges & credits* |
$1,271 |
$1,224 |
$1,123 |
4% |
13% |
||||
| Diluted EPS, excluding charges & credits* |
$0.89 |
$0.85 |
$0.78 |
5% |
14% |
||||
| Revenue by Geography | |||||||||
| International |
$7,425 |
$7,452 |
$6,614 |
– |
12% |
||||
| North America |
1,687 |
1,644 |
1,643 |
3% |
3% |
||||
| Other |
47 |
43 |
53 |
n/m |
n/m |
||||
|
$9,159 |
$9,139 |
$8,310 |
– |
10% |
|||||
| (Stated in millions) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| Revenue by Division | |||||||||
| Digital & Integration |
$1,088 |
$1,050 |
$982 |
4% |
11% |
||||
| Reservoir Performance |
1,823 |
1,819 |
1,680 |
– |
9% |
||||
| Well Construction |
3,312 |
3,411 |
3,430 |
-3% |
-3% |
||||
| Production Systems |
3,103 |
3,025 |
2,367 |
3% |
31% |
||||
| Other |
(167) |
(166) |
(149) |
n/m |
n/m |
||||
|
$9,159 |
$9,139 |
$8,310 |
– |
10% |
|||||
| Pretax Operating Income by Division | |||||||||
| Digital & Integration |
$386 |
$325 |
$314 |
19% |
23% |
||||
| Reservoir Performance |
367 |
376 |
344 |
-2% |
7% |
||||
| Well Construction |
714 |
742 |
759 |
-4% |
-6% |
||||
| Production Systems |
519 |
473 |
319 |
10% |
63% |
||||
| Other |
(84) |
(62) |
(53) |
n/m |
n/m |
||||
|
$1,902 |
$1,854 |
$1,683 |
3% |
13% |
|||||
| Pretax Operating Margin by Division | |||||||||
| Digital & Integration |
35.5% |
31.0% |
32.0% |
456 bps |
353 bps |
||||
| Reservoir Performance |
20.1% |
20.6% |
20.5% |
-53 bps |
-37 bps |
||||
| Well Construction |
21.5% |
21.7% |
22.1% |
-19 bps |
-58 bps |
||||
| Production Systems |
16.7% |
15.6% |
13.5% |
110 bps |
325 bps |
||||
| Other |
n/m |
n/m |
n/m |
n/m |
n/m |
||||
|
20.8% |
20.3% |
20.3% |
48 bps |
51 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 $532 million during the third quarter of 2024. Excluding the impact of this acquisition, SLB’s global third-quarter 2024 revenue increased 4% year on year; international third-quarter 2024 revenue increased 4% year on year; and Production Systems third-quarter 2024 revenue increased 9% year on year. | |||||||||
| *These are non-GAAP financial measures. See sections titled “Divisions” and Supplementary Information” for details. | |||||||||
| n/m = not meaningful | |||||||||
SLB Expands Margins and Earnings, Despite Cautious Macro Environment
“SLB delivered strong third-quarter results, achieving earnings growth and margin expansion in line with our full-year adjusted EBITDA margin goal of 25% or higher,” said SLB Chief Executive Officer Olivier Le Peuch. “These results were achieved by our ongoing focus on cost optimization, greater adoption of our digital products and solutions, and the contribution of long-cycle projects in deep water and gas.
“This performance was achieved despite an environment where short-cycle activity growth softened, and some international producers exercised cautious spending triggered by lower oil prices and ample global supply, while land activity in the U.S. remained subdued. Revenue grew in the Middle East & Asia and offshore North America but was offset by a decline in Latin America, while Europe & Africa held steady,” Le Peuch said.
Digital Leads Results as Customers Focus on Cloud Computing and Automation
“As we continue to see the transformative impact of digital technology across the industry, we delivered a 4% sequential increase in Digital & Integration revenue. This was driven by our digital business, which grew 7% sequentially and 25% year on year. Digital & Integration pretax segment operating margin expanded by 456 basis points (bps) sequentially, mostly driven by our digital business.
“Our customers are increasingly embracing digital technology to shorten planning cycle times, boost automation, and extract efficiency. Our cloud-based platform offerings have emerged as integral tools for unlocking data and AI across the energy value chain, enabling data-driven decision-making and streamlined operations. Our leadership in this area was on full display as we welcomed more than 1,000 customers and partners to the SLB Digital Forum in September to share progress, innovate together, and explore new digital opportunities.
“At the event, we announced exciting new collaborations and partnerships with NVIDIA, Amazon Web Services, Aramco, and others. Additionally, we launched the Lumi™ data and AI platform, which integrates advanced AI capabilities—including generative AI—with workflows across the energy value chain. More details can be found in the quarterly highlights of this release.
“In the Core Divisions—comprising Reservoir Performance, Well Construction, and Production Systems—revenue was essentially flat sequentially. Production Systems revenue increased 3% sequentially, posting record quarterly revenue with pretax segment operating margin expanding year on year for the ninth consecutive quarter. Reservoir Performance revenue was flat sequentially, while Well Construction revenue declined by 3% due to lower drilling activities,” Le Peuch said.
With Strong Cash Flow, SLB Accelerates Returns to Shareholders
“Overall, in the third quarter, we achieved an adjusted EBITDA margin of 25.6%, a 55-bps sequential increase. Cash flow from operations was $2.45 billion, and free cash flow was $1.81 billion. Additionally, we returned close to $900 million to shareholders through stock repurchases and dividends, bringing total return to shareholders for the first nine months of the year to $2.38 billion.
“With strong cash flows and visibility into continued strong cash flow generation, we have accelerated our share repurchase program, taking advantage of current share price levels. We now expect to exceed the $3.0 billion return to shareholders commitment we made earlier this year.
“I would like to thank the SLB team for their unwavering dedication and outstanding execution, consistently delivering for both our customers and shareholders,” Le Peuch said.
International, Digital, and Cost Optimization to Remain the Focus
“Although some customers have adopted a more cautious approach to their near-term capital expenditures and discretionary spending amid lower commodity prices, most projects are progressing as planned. Recent geopolitical events have further highlighted the importance of long-term energy security and reducing potential supply disruptions.
“SLB is well positioned to navigate the evolving market conditions by leveraging its unique exposure to long-cycle projects in international, deepwater, and gas markets. Additionally, SLB’s digital leadership and growing presence in emerging low-carbon markets—such as carbon capture and storage and geothermal—are supporting a more balanced portfolio.
“Although the rate of upstream spending growth has moderated in the last few months due to the macroenvironment, we continue to expect a sustained level of upstream investment in the years to come. In this context, we anticipate delivering strong cash flows and a full-year adjusted EBITDA margin at or above 25%, supported by our international leadership, robust digital sales, and ongoing cost optimization initiatives.
“Overall, our business remains well positioned to deliver further margin expansion and increased returns to shareholders,” Le Peuch said.
Other Events
During the quarter, SLB repurchased 11.3 million shares of its common stock for a total purchase price of $501 million. For the first nine months of the year, SLB repurchased a total of 26.6 million shares of its common stock for a total purchase price of $1.24 billion.
On October 17, 2024, SLB entered into a definitive agreement to sell its working interests in the Palliser Block located in Alberta, Canada. The transaction, which is subject to regulatory approval and other customary closing conditions, is expected to close late in the fourth quarter of 2024.
On October 17, 2024, SLB’s Board of Directors approved a quarterly cash dividend of $0.275 per share of outstanding common stock, payable on January 9, 2025, to stockholders of record on December 4, 2024.
Third-Quarter Revenue by Geographical Area
| (Stated in millions) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| North America |
$1,687 |
$1,644 |
$1,643 |
3% |
3% |
||||
| Latin America |
1,689 |
1,742 |
1,681 |
-3% |
– |
||||
| Europe & Africa* |
2,434 |
2,442 |
2,091 |
– |
16% |
||||
| Middle East & Asia |
3,302 |
3,268 |
2,842 |
1% |
16% |
||||
| Eliminations & other |
47 |
43 |
53 |
n/m |
n/m |
||||
|
$9,159 |
$9,139 |
$8,310 |
– |
10% |
|||||
| International |
$7,425 |
$7,452 |
$6,614 |
– |
12% |
||||
| North America |
$1,687 |
$1,644 |
$1,643 |
3% |
3% |
||||
| 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 $532 million during the third quarter of 2024. Excluding the impact of this acquisition, SLB’s global third-quarter 2024 revenue increased 4% year on year and international third-quarter 2024 revenue increased 4% year on year. | |||||||||
| *Includes Russia and the Caspian region | |||||||||
| n/m = not meaningful | |||||||||
International
Revenue in Latin America of $1.69 billion decreased 3% sequentially, reflecting lower production system sales in Brazil and reduced drilling activity in Mexico and Guyana. Year over year, revenue was flat, as strong activity in Argentina and higher production system sales in Brazil were offset by drilling activity declines in Mexico.
Europe & Africa revenue of $2.44 billion was flat sequentially as higher sales of artificial lift in North Africa were offset by lower sales of subsea production systems in Scandinavia and reduced drilling, intervention, and stimulation activity in sub-Saharan Africa. Year on year, revenue increased 16% driven by the acquired Aker subsea business, primarily in Scandinavia, and increased drilling, intervention, and stimulation activity in North Africa.
Revenue in the Middle East & Asia of $3.30 billion increased 1% sequentially, with strong sales of production systems in Australia, Saudi Arabia, Iraq, Kuwait, and Qatar and increased drilling in East Asia and United Arab Emirates offsetting weaker performance in Egypt and India. Year on year, revenue grew 16% due to higher stimulation, intervention, and evaluation activity as well as increased sales of production systems in Saudi Arabia, UAE, Iraq, Kuwait, Qatar, and Oman. Increased drilling in East Asia and Indonesia and the acquired Aker subsea business in Australia also contributed to the year-on-year growth.
North America
North America revenue of $1.69 billion increased 3% sequentially due to strong sales of production systems in the U.S. Gulf of Mexico and higher drilling in Canada land, partially offset by lower drilling revenue in U.S. land. Year on year, revenue increased 3% due to higher sales of subsea production systems and increased evaluation and stimulation activity in the U.S. Gulf of Mexico, partially offset by lower drilling revenue in U.S. land.
Third-Quarter Results by Division
Digital & Integration
| (Stated in millions) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| Revenue | |||||||||
| International |
$830 |
$757 |
$737 |
10% |
13% |
||||
| North America |
258 |
291 |
242 |
-11% |
6% |
||||
| Other |
– |
2 |
3 |
n/m |
n/m |
||||
|
$1,088 |
$1,050 |
$982 |
4% |
11% |
|||||
| Pretax operating income |
$386 |
$325 |
$314 |
19% |
23% |
||||
| Pretax operating margin |
35.5% |
31.0% |
32.0% |
456 bps |
353 bps |
||||
| n/m = not meaningful | |||||||||
Digital & Integration revenue of $1.09 billion increased 4% sequentially due to higher digital revenue while Asset Performance Solutions (APS) revenue was flat. Digital revenue grew 7% sequentially driven by the increased adoption internationally of our cloud, AI, and edge technology platforms. Year on year, revenue increased 11% due to digital growing 25%, while APS revenue declined 3%.
Digital & Integration pretax operating margin of 36% expanded 456 bps sequentially, mostly due to improved profitability in digital, following higher uptake of digital products and solutions and cost efficiencies. Year on year, pretax operating margin expanded 353 bps due to increased profitability in digital, partially offset by lower profitability in APS from the effects of higher amortization expense and lower gas prices.
Reservoir Performance
| (Stated in millions) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| Revenue | |||||||||
| International |
$1,676 |
$1,684 |
$1,554 |
– |
8% |
||||
| North America |
145 |
134 |
125 |
8% |
16% |
||||
| Other |
2 |
1 |
1 |
n/m |
n/m |
||||
|
$1,823 |
$1,819 |
$1,680 |
– |
9% |
|||||
| Pretax operating income |
$367 |
$376 |
$344 |
-2% |
7% |
||||
| Pretax operating margin |
20.1% |
20.6% |
20.5% |
-53 bps |
-37 bps |
||||
| n/m = not meaningful | |||||||||
Reservoir Performance revenue of $1.82 billion was flat sequentially as higher intervention activity was offset by lower evaluation activity while stimulation revenue was flat. Geographically, revenue grew in offshore North America and Latin America, partially offset by declines in Europe & Africa and Middle East & Asia. Year on year, revenue increased 9% due to increased stimulation and intervention activity, partially offset by lower evaluation revenue.
Reservoir Performance pretax operating margin of 20% contracted 53 bps sequentially due to lower profitability in evaluation, partially offset by improved profitability in intervention. Year on year, pretax operating margin contracted 37 bps due to an unfavorable technology mix.
Well Construction
| (Stated in millions) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| Revenue | |||||||||
| International |
$2,675 |
$2,768 |
$2,707 |
-3% |
-1% |
||||
| North America |
581 |
592 |
663 |
-2% |
-12% |
||||
| Other |
56 |
51 |
60 |
n/m |
n/m |
||||
|
$3,312 |
$3,411 |
$3,430 |
-3% |
-3% |
|||||
| Pretax operating income |
$714 |
$742 |
$759 |
-4% |
-6% |
||||
| Pretax operating margin |
21.5% |
21.7% |
22.1% |
-19 bps | -58 bps | ||||
| n/m = not meaningful | |||||||||
Well Construction revenue of $3.31 billion declined 3% sequentially and year on year on lower revenue in measurements and fluids. This was driven by lower drilling activity in Latin America, U.S. land, and Saudi Arabia.
Well Construction pretax operating margin of 22% declined 19 bps sequentially and 58 bps year on year due to reduced activity both in North America and internationally.
Production Systems
| (Stated in millions) | |||||||||
| Three Months Ended | Change | ||||||||
| Sept. 30, 2024 |
Jun. 30, 2024 |
Sept. 30, 2023 |
Sequential | Year-on-year | |||||
| Revenue | |||||||||
| International |
$2,373 |
$2,378 |
$1,740 |
– |
36% |
||||
| North America |
723 |
640 |
626 |
13% |
15% |
||||
| Other |
7 |
7 |
1 |
n/m |
n/m |
||||
|
$3,103 |
$3,025 |
$2,367 |
3% |
31% |
|||||
| Pretax operating income |
$519 |
$473 |
$319 |
10% |
63% |
||||
| Pretax operating margin |
16.7% |
15.6% |
13.5% |
110 bps | 325 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 $532 million during the third quarter of 2024. Excluding the impact of this acquisition, Production Systems third-quarter 2024 revenue increased 9% year on year. | |||||||||
| n/m = not meaningful | |||||||||
Production Systems revenue of $3.10 billion increased 3% sequentially with growth led by higher sales of surface production systems, completions, and artificial lift, partially offset by reduced sales of subsea and midstream production systems. Year on year, revenue grew 31%, mainly due to the acquisition of the Aker subsea business and strong international sales across the portfolio.
Production Systems pretax operating margin of 17% expanded 110 bps sequentially with improved profitability in surface production systems, completions, and artificial lift. Year on year, pretax operating margin expanded 325 bps due to improved profitability in surface production systems, artificial lift, and valves.
Quarterly Highlights
CORE
Contract Awards
SLB continues to win new contract awards that align with SLB’s strengths in the Core, particularly in the international and offshore basins. Notable highlights include the following:
- In the UAE, SLB, ADNOC Drilling Company, and Patterson-UTI announced the formation of the Turnwell Industries LLC OPC joint venture (JV). The JV will focus on the acceleration of UAE’s unconventional oil and gas program, with an initial 144 wells scheduled for completion by the end of 2025. SLB will provide integrated drilling, stimulation, and completion services, as well as project management, digital capabilities, and subsurface support.
- In Kuwait, Kuwait Oil Company (KOC) has awarded SLB a lump sum turnkey (LSTK) drilling contract to drill and deliver wells in south and east Kuwait. SLB will manage the planning, construction, and drilling of 141 wells over a period of three years. This LSTK contract will enable improved efficiency and faster deployment of technologies.
- In Oman, Shell Development Oman LLC has awarded SLB a two-year integrated well construction contract covering up to 23 wells in Block 10 and Block 11 with the potential to extend an additional three years. SLB will provide bits and drilling tools, cementing, drilling fluids, drilling services, and mud logging.
- In the North Sea, bp awarded SLB OneSubsea™ and Subsea7 an integrated engineering, procurement, construction, and installation contract for the Murlach development (formerly Skua Field), 240 kilometers east of Aberdeen in the U.K. North Sea. The Murlach project will include the first-ever implementation of SLB OneSubsea standard, configurable vertical monobore tree systems in the U.K. North Sea, which will be deployed by Subsea7 via vessel to reduce rig days.
- In Brazil, Petrobras awarded SLB OneSubsea a major contract for two ultradeepwater projects. The contract covers standardized presalt subsea production systems and services to develop the Atapu and Sepia oil fields in the Santos Basin. SLB OneSubsea will supply Petrobras-standard configured presalt vertical trees, subsea distribution units, control systems, and pipeline systems, along with related installation, commissioning, and life-of-field services. These projects will add to Petrobras’ presalt investments and enable Petrobras to add two new FPSO platforms, each with a daily capacity of 225,000 barrels of oil and 10 million cubic meters of gas.
- Also in Brazil, Equinor awarded SLB a contract for the deepwater development of the Raia Project with first oil expected in 2028. SLB will provide directional drilling services, fluids, cementing, and logging and completion tools for six wells. The area contains a recoverable volume of natural gas and oil condensate of more than 1 billion barrels of oil equivalent.
- Also in Brazil, Petrobras awarded SLB a 10-year contract for the delivery of encapsulated submersible pump services for up to 200 systems in Bahia state. This performance-based contract underscores the reliability and excellence of SLB equipment and services.
- Offshore Norway, Equinor awarded SLB a multiyear integrated drilling and reservoir evaluation contract spanning a wide range of operations. This includes integrated drilling and wireline services for an exploration drilling campaign on the Norwegian continental shelf; IriSphere™ look-ahead-while-drilling service for Stage II of the Troll Phase 3 project; wireline services for an exploration drilling campaign in the Barents Sea; and drilling and wireline services in the Irpa subsea development to create a tieback that extends the lifespan of Aasta Hansteen Field. Work for this integrated-domain contract will begin in 2025.
- In Namibia, an operator awarded SLB a three-year integrated contract for well construction and reservoir characterization services. This contract includes the utilization of the SLB Ora™ intelligent wireline formation testing platform.
Technology and Innovation
Notable technology introductions and deployment in the quarter include the following:
- In the U.S., ExxonMobil and SLB collaborated on the longest well section in the Permian Basin, delivering the first-ever four-mile well in the Second Bone Spring formation. Utilizing SLB’s PowerDrive Orbit G2™ rotary steerable system with a ruggedized pad design, the single-run lateral was achieved by steering at a complex high angle in harsh downhole conditions. This approach also led to a significant reduction in drilling time, releasing the well in 16.4 days.
- In Kuwait, SLB and KOC implemented an advanced well intervention workflow, integrating distributed temperature sensing, 3D far-field sonic service, and production logging tools. Deploying ACTive™ real-time downhole coiled tubing services, SLB provided detailed reservoir insights and enabled the precise deployment of engineered stimulation fluids. This intervention identified a critical thief zone, mapped the surrounding microfractures, and improved water intake patterns, ultimately resulting in an increase of 200 barrels of oil per day from four nearby wells. One previously shut-in well achieved 1,800 barrels of oil per day postintervention. Based on this success, KOC has approved the expansion of this workflow across the Sabriyah Mauddud flank, with four additional wells slated for similar interventions.
- In Angola, SLB and TotalEnergies deployed the first offshore application of OneSTEP EF™ efficient, low-risk sandstone stimulation solution in the Canela Field. The candidate well, situated in a sandstone reservoir, faced multiple damage mechanisms, including mudcake, lost circulation material, organic deposits, silt, clay, and fines migration. After deploying the solution, the well’s flow rate increased by 250% and has become TotalEnergies’ top producing well in Angola.
Decarbonization
SLB is focused on developing and implementing technologies that can reduce emissions and environmental impact with practical, quantifiably proven solutions. Highlights include the following:
- In the U.S., SLB OneSubsea has signed a memorandum of understanding with C-Power to explore the use of converted energy from ocean waves as a lower-cost, lower-carbon power source for subsea energy applications. The joint industry project, cosponsored by the U.S. Department of Energy, will be conducted by SLB OneSubsea in collaboration with its Integration Alliance partner, Subsea7.
- In Norway, SLB and Equinor successfully deployed the world’s first offshore electric-powered light-string coiled tubing package. This innovative package was designed together with Equinor to bridge the gap between conventional offshore wireline and coiled tubing capabilities. When compared with the traditional coiled tubing package, the light-string package requires 48% less rig floor footprint, 33% fewer personnel on board, and up to 75% less rig-up and rig-down time.
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 – SVP of Communications, SLB
Moira Duff – Director of External Communications, SLB
Tel: +1 (713) 375-3407
Email: media@slb.com
