SLB Reports Second-Quarter Revenue Of $8.97 Billion As International Growth Offsets Middle East Disruptions

SLB has posted second-quarter 2026 revenue of $8.97 billion, up 3 per cent sequentially and 5 per cent year on year, as growth across international markets offset continued disruptions in the Middle East.

Net income attributable to SLB on a GAAP basis came in at $786 million, up 5 per cent from the prior quarter but down 22 per cent compared with the same period a year earlier. Diluted earnings per share were $0.52 on a GAAP basis and $0.55 excluding charges and credits.

Adjusted EBITDA reached $1.90 billion, an increase of 7 per cent sequentially, while cash flow from operations was $1.36 billion and free cash flow was $716 million.

The company’s board approved a quarterly cash dividend of $0.295 per share.

Broad Growth Outside The Middle East

SLB Chief Executive Officer Olivier Le Peuch said the company saw broad-based sequential growth across international markets, led by offshore activity in Latin America, Europe and Africa as well as Asia.

“Importantly, this quarter marked a return to year-on-year revenue growth outside the Middle East, reinforcing our view of the favourable investment backdrop for the industry,” Le Peuch added. “This growth is driven by customers’ increased focus on energy security, supply diversification and production capacity expansion.”

Excluding the Middle East, revenue grew sequentially across all divisions, supported by higher offshore activity, a rebound in US unconventionals and demand for production and recovery solutions.

Year-on-year comparisons were affected by the acquisition of ChampionX, completed in the third quarter of 2025. The acquired ChampionX businesses contributed $870 million of revenue in the second quarter. Excluding this acquisition, SLB’s global revenue decreased 5 per cent year on year, with international revenue down 6 per cent and North America revenue down 1 per cent.

Geographic Breakdown

International revenue of $6.67 billion increased 3 per cent sequentially, while North America revenue of $2.24 billion rose 4 per cent.

Latin America posted revenue of $1.71 billion, up 12 per cent sequentially. The growth was driven by higher SLB OneSubsea revenue, increased digital exploration sales and offshore drilling activity in Brazil. Production systems sales in Guyana and Mexico further supported the increase. On a year-on-year basis, revenue was up 9 per cent.

Revenue in Europe and Africa reached $2.39 billion, a 6 per cent sequential increase driven by higher SLB OneSubsea revenue in Scandinavia and Nigeria, increased artificial lift sales in Libya and intervention and stimulation activity across the area. Year on year, revenue declined 3 per cent, partly due to lower production systems sales in Turkey and Libya and a decline in SLB Capturi revenue following the completion of project milestones.

Middle East and Asia revenue of $2.57 billion declined 4 per cent sequentially, reflecting a 13 per cent decline in the Middle East partially offset by a 17 per cent increase in Asia. The Middle East accounted for approximately 65 per cent of the area’s revenue in the quarter.

Le Peuch noted the decline in the Middle East was driven by lower activity levels and operational disruptions related to the regional conflict. While activity began to recover in certain countries as conditions improved, operations in other markets remained constrained by production shut-ins and security challenges.

Asia delivered double-digit sequential growth, supported by higher drilling activity and increased production systems sales in China, digital exploration sales in Indonesia and SLB OneSubsea revenue in India and Australia.

In North America, revenue growth of 4 per cent was driven by higher sales of production chemicals, artificial lift and valves in US land, as well as increased revenue from Data Center Solutions. These gains were partially offset by lower drilling activity in Canada due to the spring breakup and reduced digital exploration sales in the Gulf of America.

Division Performance

Production Systems was the company’s largest division by revenue, generating $3.77 billion in the quarter – up 7 per cent sequentially. Growth was supported by higher revenue from SLB OneSubsea, along with increased sales of artificial lift, valves, surface production systems and completions.

The ChampionX businesses contributed $865 million to Production Systems revenue and $155 million in pretax operating income. Excluding the acquisition, Production Systems revenue decreased 1 per cent year on year, though outside the Middle East the division grew 3 per cent.

Production Systems pretax operating margin expanded 138 basis points sequentially to 15.5 per cent, driven by improved profitability in SLB OneSubsea and artificial lift along with the contribution from ChampionX. ChampionX delivered sequential pretax operating margin expansion for the third consecutive quarter.

Well Construction revenue of $2.74 billion decreased 2 per cent sequentially, reflecting Middle East disruptions. The decline was partially offset by higher offshore drilling activity in Latin America, particularly in Guyana, Brazil and Mexico. Pretax operating margin held flat at 15.2 per cent, as lower profitability in the Middle East was offset by improved results in other areas.

Reservoir Performance revenue of $1.56 billion fell 2 per cent sequentially, primarily due to lower evaluation, stimulation and intervention activity from Middle East disruptions. Revenue in Europe and Africa and Asia increased by double digits sequentially, driven by stimulation and intervention activity. Pretax operating margin contracted 121 basis points to 14.9 per cent.

Digital revenue of $697 million rose 9 per cent sequentially, driven by a 25 per cent increase in Digital Exploration revenue from higher sales of exploration data licences and transfer fees in Brazil and Indonesia. Pretax operating margin expanded 683 basis points to 27.8 per cent.

Annualised Recurring Revenue for the Digital Division reached $1.04 billion as of 30 June 2026, representing a 15 per cent increase year on year compared with $904 million a year earlier.

Data Center Solutions Growth Accelerates

SLB’s Data Center Solutions business continued to expand during the quarter. Revenue in the first six months of 2026 grew 63 per cent year on year, with second-quarter revenue of $186 million up 33 per cent sequentially and 80 per cent year on year.

Le Peuch highlighted the expanding scope of the business. “During the quarter, Meta announced plans for a new 1GW data centre in Canada, and we have been selected as a delivery partner for this project,” he explained.

“Beyond adding new hyperscaler customers and expanding our footprint internationally, we have widened our scope to include engineering and design,” Le Peuch continued. “This reflects SLB’s modular and scalable off-site manufacturing and engineering capabilities.”

The Data Center Solutions business is on track to exceed $1 billion in annualised revenue run rate by the end of 2026. The company expects to surpass $2 billion in annualised revenue run rate as it exits 2027.

SLB and Liberty Energy also announced an agreement to form an alliance that will deliver modular infrastructure and integrated power generation solutions for new data centre projects globally. Under the planned alliance, SLB will provide modular infrastructure solutions, project execution capabilities and global market reach, while Liberty will provide modular behind-the-meter power generation systems, intelligent power controls and operational expertise.

Middle East Outlook

Le Peuch addressed the Middle East situation directly, noting that while activity began to recover in certain countries during the second quarter, the timing of a full recovery remains uncertain and will depend on a durable resolution of the conflict.

“The recovery will require higher service intensity – particularly in well intervention – as well as increased equipment demand, infrastructure repair and the realignment of shipping logistics,” he explained.

First-half revenue in the Middle East declined due to lower activity and operational disruptions associated with the conflict. As activity improves, the company expects the return to full production capacity to take time.

Contract Awards

SLB secured contracts across several geographies during the quarter.

In the Gulf of America, the SLB OneSubsea joint venture was awarded a contract by bp to provide a subsea boosting system for the Thunder Horse deepwater development project. This follows subsea boosting contract awards for bp’s Kaskida and Tiber developments. All three projects leverage the same standardised subsea boosting system solution.

SLB OneSubsea also won a contract from Beacon Offshore Energy to deliver a high-pressure, high-temperature multiphase boosting system for the Shenandoah field in the Gulf of America, engineered to operate above 15,000 psi.

Offshore Indonesia, SLB OneSubsea was awarded a contract by Eni North Ganal Limited to deliver a steel tube umbilical system for the Kutei North Hub field development project. The scope includes 94.6 kilometres of umbilical for water depths of up to 2,200 metres, with a total system weight of approximately 6,700 tonnes.

In Kuwait, SLB was awarded a seven-year contract by Kuwait Oil Company under the Ahmadi Innovation Valley initiative, covering applied research, technology deployment and digital innovation including AI and industrial internet of things applications. KOC also awarded SLB a five-year contract for drill bits and a contract for cementing and related services.

In India, Oil and Natural Gas Corporation awarded SLB a deepwater drilling contract to support the drilling of 24 wells over four years. ONGC also awarded SLB a three-year enterprise-wide contract to deploy its DrillOps intelligent well delivery and insights solutions across up to 120 rigs.

Offshore Côte d’Ivoire, SLB OneSubsea was awarded a multiwell engineering, procurement and construction contract by Eni for Phase 3 of the deepwater Baleine project, covering subsea production systems for 13 wells.

Digital And Technology Developments

SLB launched its Digital Marketplace, a platform designed to help energy companies discover and deploy AI agents, domain models, tools and digital applications within their existing digital environments. The platform extends the company’s open platform strategy to its Tela agentic AI assistant.

The company also announced a memorandum of understanding with Qualcomm Technologies to enable edge AI solutions for the energy industry, combining Qualcomm Technologies’ low-power edge computing and AI processing capabilities with SLB’s Agora edge AI and IIoT solutions.

SLB completed the acquisition of Tachyus Corp., a Houston-based technology company specialising in high-speed reservoir modelling and optimisation. The acquisition strengthens SLB’s digital portfolio with physics-based reservoir modelling capabilities.

The company’s Retina at-bit imaging system saw adoption in its first year of commercialisation, with deployments in more than 50 wells across 16 locations and over 122,000 feet of data acquired. Deployments in the Gulf of America, US land, East Asia and the Middle East demonstrated the system’s value across a range of geological and operational environments.

SLB’s automated cementing technology surpassed 100 remote and automated cementing jobs following commercialisation in the first quarter of 2026. A deployment in Egypt on Shell’s Velox-1 well demonstrated the technology’s scalability.

SLB also signed a long-term framework agreement with Petróleos de Venezuela (PDVSA) to support the revitalisation and modernisation of Venezuela’s oil and gas sector, covering exploration, field development, production, digital enablement and workforce training.

Geothermal Pilot

SLB and Ormat Technologies selected Desert Peak in Nevada as the preferred location for a planned enhanced geothermal system pilot, following a multisite evaluation across existing geothermal fields. The pilot builds on the companies’ October 2025 agreement to co-develop integrated geothermal assets and progress enhanced geothermal systems from pilot to commercial deployment.

Shareholder Returns

During the quarter, SLB repurchased 12 million shares of common stock for a total purchase price of $648 million. As of 30 June 2026, there were 1.484 billion shares of common stock outstanding, down from 1.495 billion at the end of the previous quarter.

SLB’s net debt stood at $8.73 billion as of 30 June 2026, compared with $7.42 billion at the end of 2025 and $8.22 billion at the end of the first quarter.

Outlook

Le Peuch pointed to a combination of factors as providing a foundation for the company’s growth heading into 2027: improving activity in the Middle East, offshore momentum led by exploration and deepwater, demand for production and recovery solutions, continued Digital growth and increasing adoption of the Data Center Solutions business.

“The regional conflict has heightened the industry’s focus on supply diversification, which is expected to shape the next upcycle and is reinforcing the strategic importance of deepwater, exploration and production and recovery activities,” he explained.

Capital investment for the full year of 2026 is still expected to be approximately $2.5 billion, up from $2.4 billion in 2025.

Last Updated on July 24, 2026 by Nick Ross