SLB N.V. Q2 2026 Earnings Call Summary
Schlumberger (NYSE: SLB) reported mixed performance in its second-quarter earnings call, with broad-based international growth and a North American rebound offsetting a 13% sequential revenue decline in the Middle East due to regional conflict. Production Systems saw margins return above 20%, while Digital segments reached approximately 35% margin thanks to favorable business mix. Data Center Solutions grew by 33% sequentially as Schlumberger shifts toward design and integration for hyperscalers. Management expects Q4 revenue to exceed $10 billion if Middle East activity recovers to about 95% of prior levels, with a downside risk of $150 million in case of flat sequential growth. Data Center Solutions is projected to reach an annualized run rate above $2 billion by the end of 2027. Free cash flow is expected to rise significantly in H2 due to working capital improvements and better collections. The company faces risks from geopolitical volatility, particularly affecting its Well Construction and Reservoir Performance divisions. Cost inflation persists but is being offset by synergies post-ChampionX acquisition. Management emphasized a gradual recovery timeline for Middle East production, with service intensity increasing over months rather than weeks.
Topics: geopolitical_impact growth_projections margins revenue