SLB, formerly Schlumberger, reported on Friday slightly better-than-expected fourth-quarter earnings and revenue, while increasing its quarterly dividend. Shares of SLB jumped higher Friday.
The oilfield services giant saw Q4 EPS grow 7% to 92 cents with sales increasing 3% to $9.28 billion. Analysts expected earnings of 90 cents per share and revenue totaling $9.18 billion, according to FactSet.
SLB also announced it is increasing its quarterly dividend by 3.6% to $0.285 per share and that it has entered into an accelerated share repurchase (ASR) transaction to repurchase $2.3 billion of company common stock. With this plan, SLB said it is targeting returning a minimum of $4 billion to shareholders in 2025, up from $3.3 billion in 2024.
Meanwhile, for the full year, SLB saw revenue increase 10% to $36.29 billion with annual profit growing 14% to $3.41 per share. The company's digital services segment, which includes AI and cloud-based platforms, was a standout in 2024, with revenue increasing 20% vs. 2023. SLB's reservoir performance segment saw sales grow 9%. Well construction revenue fell about 1% compared to 2023.
SLB Chief Executive Olivier Le Peuch said in the earnings release Friday that the full-year performance was led by revenue growth in Middle East & Asia and Europe & Africa. Le Peuch added that its digital & integration segment was "driven by increased demand for digital products and solutions" and that there has been increased interest in customers "maximizing recovery from existing assets."
"AI is the X factor for our industry, and I am confident that SLB will continue to be a leader in this area, enabling us to deliver sustained outperformance for our customers, partners and shareholders," Le Peuch said.
SLB in late 2024 announced new partnerships and collaborations with Nvidia, Amazon.com's AWS and Aramco.
SLB Stock And Oil Prices
Shares surged 6% to 43.57 during market action on Friday, after climbing 1% to 41.09 on Thursday. SLB stock, which has gained more than 13% in January, has moved above its 50-day moving average for the first time since early December.
In October, SLB saw slightly better-than-expected third-quarter earnings while revenue missed expectations. At the time, the oil services firm said short-cycle activity growth softened in the third quarter and that some international producers "exercised cautious spending triggered by lower oil prices and ample global supply."
U.S. oil prices along with U.S. natural gas prices are moving higher to begin 2025. West Texas Intermediate oil futures traded just below $79 per barrel Friday, their highest levels since July. Natural gas prices retreated about 4%, but are still above $4 per million British thermal units, trading around two year highs.
Meanwhile, the oil and gas pipeline stocks are beginning to show signs of strength. The 47 stocks in the IBD-tracked Oil & Gas-Transport/Pipeline industry group have collectively gained nearly 10% this month. Group-leading stock Kinder Morgan broke out above a traditional 28.81 buy point from a cup base on Tuesday.
Kinder Morgan reports fourth-quarter earnings and revenue on Wednesday. Analyst project 28% EPS growth with sales increasing around 4%.
SLB stock has a 64 Composite Rating out of a best-possible 99. Shares also have a 19 Relative Strength Rating and a 93 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
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