Shares of SLB took a tumble on Friday morning after the oil-field services company, formerly known as Schlumberger, reported lower-than-expected revenue for the second quarter.
SLB (SLB) stock fell 1.7% in premarket trading. However, it had seen a rise of 15% over the past three months up until Thursday’s market close.
Adjusted earnings for SLB in Q2 reached 72 cents per share, marking a 44% increase from the same period last year. The company’s revenue amounted to $8.1 billion, reflecting a 20% YoY increase.
Analysts had predicted SLB to report earnings of 71 cents per share on revenue totaling $8.2 billion, according to a FactSet poll.
CEO Olivier Le Peuch stated, “We continue to see positive upstream investment momentum in the international and offshore markets. As international spending builds further momentum in the second half of 2023 and North America moderates as anticipated, this cycle continues to align closely with SLB’s strengths, affirming our confidence in our full-year financial ambitions.”
Experts anticipate an increase in offshore oil drilling as several companies have emerged from bankruptcy and are benefiting from higher leasing rates for their rigs.
SLB reported a cash flow of $1.61 billion for the quarter. The company also expects free cash flow to be stronger in the second half, positioning it for a more robust annual FCF compared to the previous year.