Sector: Energy | Focus: Oil & Gas Equipment & Services
HQ: Houston, Texas
Financial Risks
Schlumberger faces market risks related to fluctuating oil and gas prices, global economic and geopolitical conditions, customer spending, and currency exchange rates. Lower commodity prices and cautious customer spending could negatively impact revenue. The company's significant international operations expose it to foreign currency risk. Litigation risk is also present, although management believes the probability of material loss is remote. The proposed ChampionX acquisition carries risks related to integration, regulatory approvals, and the ultimate outcome of the transaction.
Financial Upside
Schlumberger's revenue increased 12% year-over-year, driven by the Aker Solutions acquisition and higher activity in the Middle East & Asia. Strong international revenue growth and improved profitability in international markets are positive signs. Digital revenue growth and improved digital margins are also positive developments. The acquisition of ChampionX, if successful, could bring new technologies and market share. The company has a large cash and short-term investment balance, and committed debt facilities, which should support future operations.
