Schlumberger Ltd.'s second-quarter earnings fell 30% on plunging
revenue, as the oil-services sector continues to grapple with weak
oil prices.
Schlumberger reported a profit of $1.12 billion, or 88 cents a
share, down from $1.6 billion, or $1.21 a share, a year earlier.
Revenue dropped 25% to $9.01 billion.
Aanalysts polled by Thomson Reuters, however, had expected
per-share profit of 79 cents and revenue of $8.97 billion. And the
company's stock price rose 1.3% to $85 in recent after-hours
trading, as per-share earnings and revenue nonetheless beat
expectations.
Second-quarter revenue in North America declined 39%. For its
operations outside North America, Schlumberger reported revenue
fell 19%.
Chief Executive Paal Kibsgaard said he expects investment by oil
exploration and production companies to decline more this year than
previously expected. Spending in North America is expected to
tumble by more than 35%, compared with a previous estimate for a
decline of more than 30%, driven by reduced land activity and
increased pricing pressure.
Schlumberger helps oil producers drill and frack wells. It
competes with Halliburton Co. and Baker Hughes Inc., which are
planning to merge.
"We believe that the North American rig count may now be
touching the bottom, and that a slow increase in both land drilling
and completion activity could occur in the second half of the
year," Mr. Kibsgaard stated.
In the international market, Schlumberger expects investment to
decline more than 15%, compared with its earlier view for a decline
of roughly 15%.
Schlumberger and its rivals have been cutting costs to reflect
weaker demand for their services from oil producers spurred by weak
prices for crude. Halliburton and Baker Hughes also have been
cutting jobs in recent quarters.
Halliburton plans to release its second-quarter results on
Monday, while Baker Hughes is set to report on Tuesday.
Write to Tess Stynes at tess.stynes@wsj.com
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