SLB Earnings Beat Estimates. Why the Stock Is Dropping.

SLB, the company formerly known as Schlumberger, posted third-quarter adjusted earnings and revenue that slightly beat analysts’ expectations. (Photograph by Spencer Platt/Getty Images)

Key Points

• SLB reported third-quarter adjusted earnings of 69 cents per share, exceeding analyst forecasts of 65 cents per share.
• Third-quarter revenue for SLB reached $8.93 billion, slightly surpassing Wall Street expectations of $8.92 billion.
• SLB’s CEO noted resilient international markets, particularly in the Middle East and Asia, despite a fully supplied oil market.

Oilfield services provider SLB provider posted third-quarter earnings and revenue that topped analysts’ estimates, though management warned about continued uncertainty in the oil market.

The company formerly known as Schlumberger reported adjusted earnings of 69 cents a share, which came in above the 65 cents a share analysts had forecast, according to FactSet.

Revenue grew sequentially to $8.93 billion, narrowly beating the $8.92 billion Wall Street was expecting, though it declined slightly from the previous year.

CEO Olivier Le Peuch indicated the results were in line with the company’s expectations, and stressed the quarter’s revenue growth, which occurred “despite the backdrop of a fully supplied oil market, an uncertain geopolitical environment and subdued commodity prices.”

Although some regions remain challenged, international markets in particular “are demonstrating resilience, with several countries across the Middle East and Asia continuing to show robust growth,” Le Peuch added.

Shares of the Houston-based company, which provides technology for drilling and processing, fell 1.2% to $32.54 on Friday. The benchmark S&P 500 was up slightly.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com