What was the primary driver behind the significant year-over-year improvement in net income?

The primary driver was the absence of substantial impairment charges. In the first quarter of 2020, SLB recorded $8.5 billion in pretax charges related to goodwill, intangible assets, and other impairments due to the collapse in oil prices and market conditions. These charges were not present in the first quarter of 2021, allowing the company's core operations to generate a net profit.

How has the company's revenue performance changed compared to the previous year, and what factors contributed to this?

Total revenue decreased by 30% year-over-year, from $7.46 billion in Q1 2020 to $5.22 billion in Q1 2021. This decline was significantly influenced by the lingering effects of the COVID-19 pandemic on oil demand and customer spending, as well as strategic divestitures of certain businesses (like the OneStim pressure pumping business) in the fourth quarter of 2020. Revenue in North America saw a particularly sharp decline due to these factors.

What is the company's outlook for revenue and activity, particularly in international markets?

SLB anticipates a significant ramp-up in international activity through the end of 2021 and beyond, driven by the projected rebound in oil demand. The company expects its international revenue to experience double-digit growth in the second half of 2021 compared to the same period in the prior year, indicating confidence in an ongoing international recovery.

How is SLB managing its cash flow and financial position?

SLB generated $429 million in cash flow from operations and $159 million in free cash flow in Q1 2021. The company maintained a strong liquidity position with $1.27 billion in cash and $1.64 billion in short-term investments, totaling $2.91 billion in cash and short-term investments. Long-term debt stands at $15.83 billion. While the company reduced its dividend significantly in April 2020 to preserve cash and maintain financial flexibility, it continues to manage its debt and capital structure strategically.

SLB 10-Q Quarterly Report Q1 FY2021 — Revenue, Net Income, EPS

Summary

SLB LIMITED/NV (SLB) reported a significant turnaround in its financial performance for the first quarter of 2021 compared to the same period in 2020. The company posted a net income of $312 million, or $0.21 per diluted share, a stark contrast to the net loss of $7,368 million ($5.32 per diluted share) in Q1 2020. This recovery is primarily driven by the absence of the substantial impairment charges that heavily impacted the prior year's results. Total revenue for the quarter was $5.22 billion, down 30% year-over-year, reflecting the continued impact of the pandemic and strategic divestitures. Despite the year-over-year revenue decline, the company demonstrated improved operational efficiency, with pretax segment operating margin increasing to 13% from 10.7% in Q1 2020 (when adjusted for the large impairment charges). This margin expansion highlights the success of cost reduction measures and strategic portfolio rationalization. SLB generated $429 million in cash flow from operating activities and $159 million in free cash flow, indicating a healthy ability to generate cash, though dividends paid remained significant at $174 million. The company's balance sheet remains solid with $1.27 billion in cash and $12.97 billion in total equity.

Financial Highlights

47 data points

Beta

Revenue

$5.22B

Net Income

$299.00M

0.1% Net Margin

EPS (Diluted)

$0.21

Total Assets

$42.04B

Cash & Equivalents

$1.27B

Free Cash Flow

$251.00M

Financial Statements

Beta

Revenue	$5.22B
R&D Expenses	$135.00M
Operating Income	$664.00M
Interest Expense	$136.00M
Net Income	$299.00M
EPS (Basic)	$0.21
EPS (Diluted)	$0.21
Shares Outstanding (Basic)	1.40B
Shares Outstanding (Diluted)	1.42B

Key Highlights

1Net income of $312 million ($0.21/share) in Q1 2021, a dramatic improvement from a net loss of $7,368 million ($5.32/share) in Q1 2020, largely due to the absence of significant impairment charges.
2Total revenue of $5.22 billion, a 30% decrease year-over-year, impacted by the pandemic and strategic divestitures of certain businesses.
3Pretax segment operating margin improved to 13% in Q1 2021 from 10.7% in Q1 2020, demonstrating operational leverage and cost control despite lower revenues.
4Generated $429 million in cash flow from operating activities and $159 million in free cash flow in Q1 2021.
5The company's strategy of portfolio rationalization, including divestitures in Q4 2020, is showing positive impacts on margins.
6Significant year-over-year revenue decline in North America (down 55%, or 36% excluding divestitures) compared to a more moderate decline internationally (down 19%).
7Management expressed confidence in an international activity ramp-up and anticipates double-digit international revenue growth in the second half of 2021.

SLB LIMITED/NV Quarterly Report for Q1 Ended Mar 31, 2021

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions