SLB, formerly known as Schlumberger, announced a 13% rise in its third-quarter profit, but expressed concerns over muted revenue growth for the upcoming quarter due to budget tightening among producers and weak oil prices. Key points include:
Profit and Revenue: Net income attributable to SLB rose to $1.27 billion, with per-share profit reaching 89 cents, slightly above analysts’ expectations. However, total revenue of $9.16 billion fell short of the $9.25 billion forecast.
Market Conditions: CEO Olivier Le Peuch noted that weak oil and gas prices have led to a cautious approach from customers regarding spending and activity levels.
Future Outlook: For Q4, SLB expects limited revenue growth as North American spending is projected to be flat or slightly down, while international market spending is anticipated to grow at a low to mid-single-digit percentage rate.
International Performance: Despite the overall caution, international revenue grew by 12%, driven by increased sales in Saudi Arabia, the UAE, Iraq, and Kuwait, although this growth was the slowest in a year.
Cost Management: SLB is implementing cost-cutting measures to maintain profit margins, aiming for an adjusted margin of at least 25% for the full year.
The company’s shares fell by 3.6% following the earnings report, reflecting investor concerns about the outlook amid current market challenges.