Schlumberger(SLB) - 2025 Q1 - Quarterly Results

Financial Performance - Revenue for Q1 2025 was $8.49 billion, a decrease of 3$797 million, down 25% year-on-year[4] - Adjusted EBITDA was $2.02 billion, a decrease of 2$8,490 million, a decrease of 2.5% compared to $8,707 million in Q1 2024[46] - Net income attributable to SLB for Q1 2025 was$797 million, down 25.4% from $1,068 million in Q1 2024[46] - SLB's diluted earnings per share (EPS) for Q1 2025 was$0.58, compared to $0.74 in Q1 2024, reflecting a 21.6$8,490 million, a decrease of 8% sequentially from $9,284 million in the fourth quarter of 2024 and a decrease of 4$8,707 million in the first quarter of 2024[53] - Adjusted EBITDA for the first quarter of 2025 was $2,020 million, with an adjusted EBITDA margin of 23.8$2,382 million and 25.7% in the fourth quarter of 2024, and $2,057 million and 23.6$660 million, while free cash flow was $103 million[56] - Net income attributable to SLB for the first quarter of 2025 was$797 million, compared to $1,095 million in the fourth quarter of 2024 and$1,068 million in the first quarter of 2024[66] Revenue Breakdown - Revenue in North America increased 8% year-on-year to $1.72 billion, driven by higher digital sales and subsea production systems[27] - International revenue decreased by 5$1.70 billion, with strong unconventional stimulation offset by lower evaluation and exploration activity[33] - Well Construction revenue decreased 12% year-on-year to $2.98 billion, reflecting lower drilling activity in several regions[36] - Production Systems revenue increased 4$2.94 billion, supported by strong demand for surface production systems and data center infrastructure solutions[38] - Revenue from the Reservoir Performance division for the first quarter of 2025 was $1,700 million, down 6$2,977 million, down 11% year-on-year[68] - Revenue from the Production Systems division for the first quarter of 2025 was $2,938 million, up 4$4 billion to shareholders in 2025 through dividends and share repurchases[15] - An accelerated share repurchase transaction was completed, repurchasing $2.3 billion of common stock at an average price of$40.51[18] - Total shares outstanding as of March 31, 2025, were 1.360 billion, down from 1.401 billion at the end of the previous quarter[61] - SLB's capital allocation plans include dividend plans and share repurchase programs, reflecting a focus on returning value to shareholders[71] Digital Initiatives and Innovations - Digital revenue grew 17% year-on-year, contributing to a 6% increase in Digital & Integration revenue[13] - SLB entered into an agreement to purchase Interactive Network Technologies, Inc. to enhance its digital platform capabilities[17] - Digital & Integration revenue reached $1.01 billion, a 6% year-on-year increase driven by 17% growth in digital revenue[30] - SLB launched EWC™ electric well control technologies to enhance drilling operations and reduce costs[42] - SLB partnered with Shell to deploy Petrel™ subsurface software globally, aimed at increasing digital capabilities and operational efficiencies[43] Operational Efficiency and Cost Management - Digital & Integration pretax operating margin expanded 380 bps year-on-year to 30% due to improved profitability and cost efficiency[31] - Reservoir Performance pretax operating margin decreased 311 bps year-on-year to 17% due to reduced profitability from lower evaluation activity[34] - Well Construction pretax operating margin declined 71 bps year-on-year to 20% amid reduced activity across markets[37] - The company emphasizes the importance of operational efficiencies and cost reduction strategies in achieving its financial targets[73] Strategic Projects and Collaborations - SLB has been awarded a contract in Malaysia for a three-year digital transformation project, focusing on AI-driven safety and sustainability solutions[44] - The company is collaborating with PT. Pertamina in Indonesia to deploy AI and machine learning solutions, enhancing operational efficiency[44] - SLB's carbon capture plant in Norway is expected to capture 350,000 metric tons of CO2 annually, contributing to sustainability efforts[44] - The modular carbon capture plant in the Netherlands has a capacity to capture up to 100,000 metric tons of CO2 per year, aimed at the horticulture and food sectors[44] - SLB is developing Canada's first next-generation geothermal project, targeting up to 30 megawatts of emissions-free power generation[44] Market Risks and Future Outlook - SLB's first-quarter 2025 earnings report includes forward-looking statements regarding financial and performance targets, emphasizing uncertainty in oil and natural gas demand and prices[71] - The ongoing conflict in Ukraine is highlighted as a risk factor impacting global energy supply and market conditions[71] - SLB's financial performance is subject to various risks, including inflation, foreign currency risk, and changes in government regulations[73] - SLB's future results may vary significantly from projections due to uncertainties in global economic conditions and customer spending[73] - The company anticipates challenges in integrating the businesses of SLB and ChampionX, including retaining key personnel and maintaining customer relationships[72] - The proposed transaction between SLB and ChampionX is expected to create synergies and value, with the SEC declaring the registration statement effective on May 15, 2024[74] - Investors are encouraged to review the proxy statement/prospectus for important information regarding the proposed transaction with ChampionX[74]