SLB Limited Common Shares
SLB · NYSE
Next quarter
Reports Oct 16, 2026.
Consensus is $0.62 EPS for Sep 2026 across 10 estimates, ranging $0.60 to $0.65.
SLB Jun 2026
- 7.84%
- -1.70%
- $0.51
- $0.55
- —
- $8.97B
Reported results
- $8.97B
- $786.00M
- $0.52
Highlights
- Earnings beat: Adjusted EPS was $0.55 versus $0.51 consensus, a 7.84% surprise; GAAP EPS was $0.52.
- Sequential recovery: Revenue rose 3% sequentially to $8.97 billion, net income attributable to SLB increased 5% to $786 million, and adjusted EBITDA grew 7% to $1.90 billion.
- Year-on-year pressure: Reported revenue increased 5% from $8.55 billion, but adjusted EPS fell 26% from $0.74, net income declined 22%, and adjusted EBITDA decreased 7%; adjusted EBITDA margin contracted to 21.2% from 24.0%.
- Middle East disruption: Middle East revenue fell 13% sequentially and 16% year on year, but growth in Latin America, Europe and Africa, Asia, and North America more than offset the decline.
- Production Systems led: Production Systems revenue rose 7% sequentially to $3.77 billion and pretax operating income increased 18% to $586 million, lifting its margin 138 basis points to 15.5%.
- ChampionX contribution: Acquired ChampionX businesses contributed $870 million of revenue and $207 million of adjusted EBITDA; excluding the acquisition, global revenue declined 5% year on year.
- Digital momentum: Digital revenue increased 9% sequentially and 18% year on year to $697 million, while pretax margin expanded to 27.8%; Digital ARR reached $1.04 billion, up 15% year on year.
- Data center expansion: Data Center Solutions revenue rose 33% sequentially and 80% year on year to $186 million; management expects the business to exceed a $1 billion annualized run rate by year-end 2026.
- Cash returns and investment: Operating cash flow was $1.36 billion and free cash flow was $716 million; SLB repurchased 12 million shares for $648 million and maintained 2026 capital investment guidance of approximately $2.5 billion.
Analysis
SLB’s second quarter was a sequential recovery that exceeded expectations, but the underlying year-on-year picture remained mixed. Adjusted EPS of $0.55 beat the $0.51 consensus estimate, while GAAP EPS was $0.52. Revenue of $8.97 billion increased 3% from the first quarter and 5% from the year-ago quarter, and net income attributable to SLB rose 5% sequentially to $786 million. Against Q2 2025, however, net income fell 22%, adjusted EPS declined 26% and adjusted EBITDA fell 7% to $1.90 billion, with margin down 284 basis points to 21.2%.
Operating recovery
The quarter’s sequential improvement was broad enough to offset substantial Middle East disruption. Pretax segment operating income rose 6% sequentially to $1.40 billion, with margin expanding 49 basis points to 15.6%. Production Systems and Digital drove the improvement, while Reservoir Performance and Well Construction each declined 2% in revenue. The comparison remains affected by $69 million of merger and integration charges tied primarily to ChampionX; excluding charges, net income attributable to SLB was $833 million versus $783 million in the first quarter.
Regional performance
International revenue rose 3% sequentially to $6.67 billion and North American revenue increased 4% to $2.24 billion. Latin America was the strongest major region, with revenue up 12% sequentially to $1.71 billion, while Europe and Africa rose 6% to $2.39 billion and Asia delivered double-digit growth. These gains offset a 13% sequential decline in Middle East revenue to $1.66 billion. Management said recovery timing remains uncertain because of production shut-ins, security constraints and logistics disruption; a full return to production capacity is expected to take time.
ChampionX integration
Production Systems was the clearest beneficiary of the ChampionX acquisition, with reported revenue up 29% year on year and pretax income up 19%. ChampionX contributed $865 million of revenue, $155 million of pretax operating income and $207 million of adjusted EBITDA in the division. Its accretive production chemicals and artificial lift businesses helped lift Production Systems’ pretax margin sequentially to 15.5%, although the pro forma division was essentially flat year on year. Excluding ChampionX, SLB’s global revenue fell 5% year on year and Core revenue declined 5%.
Digital and data centers
Digital provided both growth and margin expansion. Revenue rose 9% sequentially to $697 million, led by a 25% increase in Digital Exploration, while pretax operating income increased 44% to $194 million and margin expanded 683 basis points to 27.8%. Digital ARR reached $1.04 billion, up 15% year on year. Separately, Data Center Solutions revenue increased to $186 million from $141 million in the first quarter and $104 million a year earlier. SLB added Meta’s planned 1GW Canadian data center as a customer project and expects the business to exceed a $1 billion annualized revenue run rate by year-end 2026 and $2 billion exiting 2027.
Cash and capital allocation
Cash generation supported continued shareholder returns despite working-capital investment. Second-quarter operating cash flow was $1.36 billion and free cash flow was $716 million, compared with six-month free cash flow of $693 million versus $725 million a year earlier. SLB repurchased 12 million shares for $648 million during the quarter, bringing cumulative repurchases under its $10 billion program to approximately $7.0 billion. The board approved a quarterly dividend of $0.295 per share, while full-year 2026 capital investment guidance remained approximately $2.5 billion. Backlog was $6.4 billion at quarter-end, with about 70% expected to convert to revenue within 12 months.
