Schlumberger (SLB.US) Q2 profits down 26% year-on-year but beat expectations; North American revenue surges 36% easing Middle Eastern geopolitical impact

According to Zhitong Finance APP, leading US oilfield service company Schlumberger (SLB.US) exceeded market expectations in its second-quarter profits, as strong performance in major markets helped offset the impact of instability in the Middle East. Schlumberger's earnings report released on Friday showed that second-quarter revenue reached $8.97 billion, a year-on-year increase of 5%, better than market expectations; adjusted earnings per share were $0.55, down 26% year-on-year, but still above the expected $0.51.

The US-Iran conflict has lasted for nearly five months, and geopolitical uncertainties continue to loom over the core oil-producing areas of the Middle East. The Middle East is Schlumberger's largest market, accounting for 34% of its total revenue in 2025. The company had warned that due to market disruptions, earnings per share in the second quarter would drop by 6 to 8 cents.

Schlumberger's financial report shows that second-quarter revenue in the Middle East and Asia was $2.57 billion, a 14% decrease year-on-year and a 4% decrease quarter-on-quarter, with revenue from the Middle East falling 13% quarter-on-quarter.

North America revenue was $2.24 billion, up 36% year-on-year and 4% quarter-on-quarter.

Schlumberger CEO Olivier Le Peuch stated that the company achieved solid performance in the second quarter, benefiting from broad and sustained growth in international markets such as Latin America, Europe, Africa, and Asia, which significantly offset the ongoing turmoil in the Middle East.

“Importantly, revenue outside the Middle East returned to year-on-year growth this quarter, further confirming our positive outlook on the industry’s investment environment. This growth was driven by clients’ increasing focus on energy security, supply diversification, and capacity expansion,” said Le Peuch.

Schlumberger is the second major oilfield service company to release its results this week. Previously, Halliburton (HAL.US) reported mixed second-quarter results — North America business grew but failed to offset the geopolitical impact in the Middle East, and its adjusted operating profit missed expectations. Baker Hughes (BKR.US) will report its results on Sunday.

April to June marks the first full quarter since the escalation of the US-Israel war against Iran, with production restricted or completely halted in several countries including Iraq, Qatar, and Kuwait. The market had previously expected Schlumberger to report a 31% decline in earnings per share, the largest drop since the fourth quarter of 2020; Baker Hughes’ earnings per share were expected to fall by 21%. Both companies have significant exposure in the Middle East.

As of press time, Schlumberger shares are up 3.8% pre-market, Halliburton, Baker Hughes are up 0.6%.