SLB, the renowned oil services provider formerly known as Schlumberger, experienced a fall in its stock price after failing to meet third-quarter revenue expectations.
Stock Performance
The company’s stock (ticker: SLB) was down 2.1% in premarket trading, reaching $58.70. Despite this recent decline, its shares have still shown a 7% increase over the past three months.
Q3 Financial Results
SLB reported a net income of 78 cents per share for the quarter, compared to 63 cents in the same period last year. Although this figure slightly exceeded Wall Street estimates of 77 cents, it fell slightly short of expectations for revenue, which rose 11% to $8.31 billion but missed the anticipated $8.32 billion mark.
Oil Price Influence
The performance of oil services companies is largely driven by oil prices, as higher prices encourage greater exploration and production activities. Over the past three months, crude prices have increased by approximately 18%, thereby positively impacting the industry.
Strong International Revenue
Olivier Le Peuch, the CEO of SLB, attributed the company’s success to its international operations. SLB witnessed a 12% growth in income from overseas, compared to a 6% gain in North America.
Le Peuch confidently stated, “The oil and gas industry continues to benefit from a multiyear growth cycle that has shifted to the international and offshore markets where we are the clear leader.”
In conclusion, SLB’s third-quarter revenue miss led to a minor decline in stock value. However, the company is supported by the ongoing growth of the oil and gas industry, especially in international and offshore markets where it exhibits strong leadership.