Schlumberger Q4 Revenue Up 9% to $9.7B, 2026 Guidance Set
Schlumberger reported fourth-quarter revenue of $9.7 billion, up 9% sequentially, driven by an extra $300 million from ChampionX and 6% organic growth. Management guided 2026 revenue of $36.9–37.7 billion with EBITDA of $8.6–9.1 billion, and announced a 3.5% dividend increase alongside $2.4 billion in planned buybacks.
1. Analysts Boost 2026 Estimates After Q4 Results
SLB reported sequential improvement in fourth-quarter performance, with revenue climbing 9% to $9.7 billion and adjusted EBITDA margin expanding by 83 basis points to 23.9%. Barclays raised its price target on the company from $47 to $49 and maintained an Overweight rating, citing stabilizing upstream activity and a full quarter of contribution from the ChampionX acquisition. Analysts at Jefferies followed suit, lifting their 2026 earnings per share forecast by 5% to reflect stronger cash flow generation and margin upside in digital services.
2. Division Highlights Drive Margin Expansion
Digital segment revenue surged 25% sequentially to $825 million, driving pre-tax operating margin up 557 basis points to 34%. Production Systems delivered $4.1 billion in revenue, up 17% sequentially, with an underlying organic increase of 11% when excluding ChampionX. Reservoir Performance grew 4% to $1.7 billion, led by activity in Saudi Arabia, East Asia and Guyana, while Well Construction revenue dipped 1% to $2.9 billion. Management noted digital annual recurring revenue surpassed $1 billion, up 15% year-over-year, and net recurring revenue retention exceeded 100%.
3. Robust Cash Flow and Shareholder Returns
SLB generated $3.0 billion of operating cash flow and $2.3 billion of free cash flow in Q4, bringing full-year free cash flow to $4.1 billion. Net debt fell by $1.8 billion to $7.4 billion, while capital expenditures totaled $716 million in the quarter. The company returned $4.0 billion to shareholders in 2025 through $2.4 billion of buybacks and $1.6 billion in dividends, and announced a 3.5% dividend increase for 2026 with planned repurchases of $2.4 billion.
4. 2026 Guidance and Market Outlook
Assuming oil prices remain in the high-$50s to low-$60s per barrel, SLB guided 2026 revenue to a range of $36.9 billion to $37.7 billion and adjusted EBITDA of $8.6 billion to $9.1 billion, with margins expected to hold flat year-over-year. Near-term seasonality is expected to drive a high-single-digit sequential revenue decline in Q1, followed by a rebound in Q2 as international and offshore activity strengthen. Management highlighted growth in Latin America, the Middle East and Asia, and projected subsea bookings to exceed $9 billion over the next two years.