10-QPeriod: Q1 FY2025

SLB LIMITED/NV Quarterly Report for Q1 Ended Mar 31, 2025

Filed April 25, 2025For Securities:SLB

Summary

SLB LIMITED/NV (SLB) reported a decrease in revenue and net income for the first quarter of 2025 compared to the same period in 2024. Total revenue was $8.49 billion, down from $8.71 billion in Q1 2024, while net income attributable to SLB decreased to $797 million ($0.58 per diluted share) from $1.068 billion ($0.74 per diluted share) in the prior year. The company experienced a notable decline in its Well Construction segment, which saw revenue drop 12% year-over-year, largely due to reduced drilling activity in key regions like Mexico and Saudi Arabia. However, the Production Systems segment showed resilience with a 4% revenue increase, driven by strong demand in North America. The company also highlighted significant restructuring and merger-related charges impacting profitability in the current quarter. SLB demonstrated a strong commitment to returning capital to shareholders, notably with a substantial stock repurchase program amounting to $2.3 billion in Q1 2025, alongside a 3.6% increase in its quarterly dividend. Despite the revenue headwinds and increased charges, the company maintained a positive free cash flow of $103 million and believes its liquidity position is sufficient to meet future business requirements.

Financial Highlights

46 data points
Beta

Revenue

$8.49B

Net Income

$797.00M

9.4% Net Margin

EPS (Diluted)

$0.58

Total Assets

$49.00B

Cash & Equivalents

$2.94B

Free Cash Flow

$262.00M

Financial Statements
Beta
Revenue$8.49B
R&D Expenses$172.00M
Interest Expense$147.00M
Net Income$797.00M
EPS (Basic)$0.58
EPS (Diluted)$0.58
Shares Outstanding (Basic)1.37B
Shares Outstanding (Diluted)1.38B

Key Highlights

  • 1Total revenue for Q1 2025 was $8.49 billion, a 3% decrease compared to $8.71 billion in Q1 2024.
  • 2Net income attributable to SLB for Q1 2025 was $797 million, down from $1.068 billion in Q1 2024, resulting in diluted EPS of $0.58 versus $0.74.
  • 3Significant charges of $158 million for workforce reductions and $48 million for merger and integration costs impacted Q1 2025 results.
  • 4Well Construction segment revenue declined 12% year-over-year, driven by reduced drilling activity in several international markets.
  • 5Production Systems segment revenue increased 4% year-over-year, boosted by strong demand in North America.
  • 6The company executed a large stock repurchase program totaling $2.3 billion in Q1 2025 and increased its quarterly dividend by 3.6%.
  • 7Free cash flow for Q1 2025 was $103 million, a positive turnaround from a negative free cash flow of $(222) million in Q1 2024.

Frequently Asked Questions

The primary drivers for the revenue decrease were softer international markets, particularly a significant reduction in drilling activity in Mexico and lower activity in Saudi Arabia, Russia, Egypt, Australia, and India. The Well Construction segment, which is heavily impacted by drilling activity, saw a 12% year-over-year revenue decline. This was partially offset by growth in North America, driven by digital sales and production systems.

SLB incurred $158 million in severance charges for workforce reductions and $48 million in merger and integration-related costs during the first quarter of 2025. These charges directly reduced reported net income and also increased the effective tax rate for the quarter.

SLB is actively returning capital to shareholders through dividends and share repurchases. In Q1 2025, the company increased its quarterly cash dividend by 3.6% to $0.285 per share and completed an accelerated share repurchase program of $2.3 billion. The company also generated $103 million in free cash flow and maintains a strong liquidity position with $3.9 billion in cash and short-term investments, which it believes is sufficient for future business needs.

SLB faces risks related to fluctuating commodity prices, global economic and geopolitical conditions, changes in customer spending on exploration and production, regulatory requirements, supply chain challenges, and the potential impact of energy transition initiatives. The company also notes risks associated with the pending ChampionX acquisition, including regulatory approvals and integration challenges.