SLB - SLB slips after Q2 earnings top estimates but revenue misses

2023-07-21 09:15:08 ET

SLB ( NYSE: SLB ) -2.7% pre-market Friday after reporting Q2 adjusted earnings that beat estimates by a penny but missing revenue expectations.

The company formerly called Schlumberger said Q2 net income rose to $1.03B, or $0.72/share, from $959M, or $0.67/share, in the year-earlier quarter, while revenues rose 19% to $8.1B, with International revenue jumping 21% Y/Y to $6.29B and North American sales increasing 14% to $1.74B.

Q2 revenues by segment: Well Construction up 25% Y/Y to $3.36B, Production Systems up 22% to $2.31B, Reservoir Performance up 23% to $1.64B, Digital & Integration down 1% to $947M.

Q2 free cash flow swung to positive $986M from negative $119M in the year-ago period; cash flow from operations quadrupled to $1.61B from $408M a year earlier.

"We continue to see positive upstream investment momentum in the international and offshore markets," CEO Olivier Le Peuch said. "Both sequentially and year on year, we saw broad international revenue growth that resulted in margins expanding across all divisions and geographical areas."

SLB's ( SLB ) outlook is lifted by "numerous multiyear contract awards," and "strong FCF generation sets the stage for a possible dividend increase heading into 2024," Benchmark analyst Kurt Hallead said, according to Bloomberg.

More on SLB:

• Financial and valuation comparison to sector peers
• Analysis: Schlumberger: A Buy Going Into Q2 Earnings
• Stock price return: Up 11% YTD, up 67.5% in the past 12 months

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