American company SLB, which provides oilfield services, noted that increased activity in the offshore sector contributed to revenue growth in the second quarter, helping to partially offset the impact of the conflict in the Middle East.

Second Quarter Financial Results

• The company’s revenue rose by 5%, reaching $9 billion compared to $8.5 billion in the same period last year.
• Net profit decreased by 18% year-over-year, totaling $833 million.
• Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) fell by 7% to $1.9 billion.
• Earnings per share dropped by 26%, amounting to 55 cents.

Despite the decline in profit, revenue, EBITDA, and earnings per share all exceeded the consensus forecasts for the second quarter prepared by TD Cowen.

Market Reaction

Following the release of the quarterly report, SLB’s share price rose by 10% at the start of trading in the US.

Regional Performance

• SLB’s international revenue declined by 3% to $6.7 billion, mainly due to a slowdown in operations in the Middle East caused by the military conflict between the US and Iran.
• Revenue from operations in Latin America grew by 15% year-over-year and by 12% compared to the first quarter of this year, surpassing $1.7 billion. This growth was driven by strong sales of production systems in Guyana and Mexico, increased revenue from SLB OneSubsea, higher digital sales in exploration, and expanded offshore drilling in Brazil.
• In North America, revenue increased by 36% to $2.2 billion in the second quarter compared to the same period last year. The growth was fueled by higher sales of production chemicals, artificial lift systems, and valves for onshore operations in the US, as well as increased revenue from data center solutions.

Operational and Dividend Highlights

• Operating cash flow amounted to $1.36 billion, while free cash flow reached $716 million in the second quarter.
• The SLB Board of Directors approved a quarterly dividend of 29.5 cents per share.