SLB Revenue Climbs 5% As Middle East Rebounds And Data Center Sales Jump 23%
The oilfield services company grew in every region from the prior quarter, and its CEO sees a "very compelling outlook for 2027."
SLB, which sells technology, equipment and services to oil and gas producers, posted third-quarter revenue of $9.45 billion, up 5% from the second quarter and 6% from a year earlier, in results released Friday. Every region grew sequentially, led by a 13% rebound in the Middle East and a data center equipment business whose sales rose 23%.
Earnings: up on the quarter, down on the year
Adjusted EBITDA, a measure of operating profit before depreciation, interest and one-off items, was $2.07 billion, up 9% from the second quarter and essentially flat from a year earlier. Earnings per share excluding charges and credits were $0.64, up 16% sequentially and down 7% from a year ago.
Under standard accounting, earnings were $0.49 a share, down 6% from the second quarter and 2% from a year earlier. A pension settlement charge of $0.12 per share weighed on that figure. Net income attributable to SLB was $735 million.
Cash flow from operations was $1.51 billion and free cash flow was $828 million. SLB bought back 12.9 million shares for $656 million in the quarter, and 34.0 million shares for $1.76 billion over the first nine months. Shares closed at $49.55 on Thursday, down about 3%.
Middle East recovery and a data center surge
Middle East revenue grew 13% from the second quarter even as some countries faced renewed disruptions in the final weeks. North America revenue rose 7%, helped by U.S. land sales of production chemicals and artificial lift equipment.
Data Center Solutions, which makes modular enclosures and cooling systems for hyperscalers and enterprises, had revenue of $230 million, up 23% from $186 million in the second quarter and 76% from a year earlier. "AI is driving unprecedented investment in data center infrastructure," CEO Olivier Le Peuch said.
The Digital division's annualized recurring revenue was $1.04 billion at the end of September, up 13% from $926 million a year earlier.
Two deals and a 2027 outlook
On August 31, SLB agreed to buy thermal management company Kelvion from Apollo-managed funds and funds advised by Triton for about $3.4 billion in cash, plus about $0.7 billion of assumed debt. Closing is expected in the first half of 2027. On September 1, SLB completed its purchase of S&P Global Energy's geoscience and petroleum engineering software business.
Le Peuch said SLB sees "a very compelling outlook for 2027, with further upside as Middle East activity recovers." He cited deepwater contract awards and a rise in activity in Venezuela.
SLB's board approved a quarterly dividend of $0.295 per share, payable January 7, 2027 to holders of record on December 2, 2026. The company holds its earnings call at 9:30 a.m. ET Friday.
Excluding the ChampionX acquisition, SLB said, third-quarter revenue rose 2% from a year earlier.
Sources
- 8-K Filing — SLB LIMITED/NV (SLB) — SEC EDGAR
- Exhibit d151271dex99.htm — SLB LIMITED/NV 8-K exhibit — SEC EDGAR
