Q2 2025 Schlumberger Ltd Earnings Call
Megan: Good morning, my name is Megan, and I'll be your conference operator today. And we'd like to welcome everyone to the second quarter SLV earnings. At this time, all participants are in a listen-only After the speaker's remarks, there will be a Q&A session.
Megan: If you would like to ask a question during this time, simply press star followed by the number one on your telephone. You may remove yourself from the queue by pressing star.
James McDonald: As a reminder, this call is being I would now turn the call over to James R. McDonald, Senior Vice President of Investor Relations and Industry Affairs. Please go ahead. Thank you, Megan.
Good morning. My name is Megan and I'll be your conference operator today and would like to welcome everyone. To the second quarter, SLB earnings call at this time. All participants are in a listen-only mode. After the speaker's marks, there will be a Q&A session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad, you may remove your cell from the queue, by pressing star 2. As a reminder, this call is being recorded. I will now turn the call over to James R MacDonald, senior vice president of investor relations. In Industry Affairs. Please go ahead.
James McDonald: Good morning and welcome to the SLB second quarter 2025 earnings conference call. Today's call is being hosted from Paris following our board meeting held earlier this week. Joining us on the call are Olivier LaPouche, Chief Executive Officer, and Stephane Biguet, Chief Financial Officer.
Thank you, Megan. Good morning and welcome to the SLB second quarter 2025 earnings conference. Call today's call is being hosted from Paris following our board meeting held earlier this week.
James McDonald: Before we begin, I would like to remind all participants that some of the statements we will be making today are forward-looking. These matters involve risks and uncertainties that could cause our results to differ materially from those projected in these statements. For more information, please refer to our latest 10-K filings and other SEC filings, which can be found on our website. Our comments today also include non-GAAP financial measures. Additional details and reconciliations for the most directly comparable GAAP financial measures can be found in our second quarter earnings press release, which is on our website.
Joining us on the call are Olivia La Push chief executive officer and Stephen B, gay, Chief Financial Officer.
before we begin I would like to remind all participants that some of the statements we will be making today are forward-looking
Speaker Change: these matters involve risk and uncertainties that could cause their results to different materials. From those projected. In these statements for more information, please refer to our latest 10K, filing and other FCC filings which can be found on our website.
Olivier Peuch: With that, I will turn the call over to Olivier. Thank you, James. Ladies and gentlemen, thank you for joining us on the call.
Olivia: Website with that. I will turn the call over to Olivia.
Olivier Peuch: Before we begin, I would like to officially welcome the Champenex team to SLB. Earlier this week, we shared the news that our transaction is now complete. And this is the start of an exciting new chapter for our company. I could not be prouder to lead the company at this juncture. building on an unmatched talent pool and portfolio of technologies to serve our customers and create value for our shareholders.
Olivia: Thank you, James ladies and gentlemen, thank you for joining us on the call.
Olivia: Before we begin, I would like to officially welcome the champion. Next team to SLB
Earlier this week we shared the news that are transaction is now complete and this is the start of an exciting, new chapter for our company.
Olivia: I could not be prouder to lead the company at this juncture.
Building on an unmatched talent, pool and portfolio of Technologies to serve a customer and create value for our shareholders.
Olivier Peuch: Now, as we move into the score, I would like to start by walking you through our second quarter performance.
Olivier Peuch: Then I will share how we see the broader microenvironment evolving, come out on our new chapter of Champenex, and what that means for our business in the Second Half of 2020.
Olivia: Now, as we look into the score, I would like to start by walking you through our second caller performance.
Olivier Peuch: After that, Stephane will provide more details on our financial performance, and then we will open the line for your questions.
Olivia: That I will share how we see the broader macro environment. Evolving come out on our new chapter of champon X and what that means for our business. In the second half of the year.
Olivier Peuch: Let's begin. This was a solid quarter for SLB as we delivered steady revenue and slight EBITDA margins expansion despite the considerable macro headwinds and marked volatility of the past few months. These results are a clear reflection of our broad operating footprint, our technology leadership, and our strong execution. In international markets, revenue grew by 2%, benefiting from pockets of growth in the Middle East, Asia and North Africa, food offsetting, sequential headwinds in Saudi Arabia and certain offshore markets. Specific to the Middle East and Asia, long-term fundamentals for oil remain strong, and both conventional and non-conventional gas are providing an additional tailwind for activity across the region.
Olivia: After that Stephan will provide more details on our financial performance and then we will open the line for your questions.
Let's begin.
Olivia: This was a solid quarter for SLB and as we delivered steady revenue and slide a bit margins expansion, despite the considerable micro edwins and Market volatility of the past few months.
These results are clear reflection of a broad, operating footprint of Technology dealership and our strong execution.
Olivia: International markets Revenue grew by 2%, benefiting from pocket of growth in the Middle East, Asia and North Africa. Full of setting sequential headwinds in Saudi Arabia and certain offshore markets.
Olivia: Specific to the Middle East and Asia. Long-term parameter for all remains strong, and both conventional and unconventional. Gas are providing an additional Tailwind.
Olivier Peuch: During the quarter, we experienced strong growth in Iraq, the UAE, Kuwait, East Asia, China, and Australia. Meanwhile, in North America, although revenue declines sequentially, we continue to outpace the market led by increased sales across most of our business lines in production systems and higher digital sales in U.S. land. The revenue decline stemmed mostly from the seasonal spring break-up in Canada and non-repeat of exploration data sales in the U.S. In the offshore market, certain projects have pushed to the right, most notably in sub-Saharan Africa. However, we continue to maintain a steady backlog in one sub-sea and there is a significant number of offshore projects preparing for refining.
Olivia: For activity across the region.
Olivia: During the quarter, we experienced strong growth in Iraq, the UAE Kuwait, East Asia China and Australia.
Olivia: Meanwhile in North America although Revenue declines sequentially. We continue to have Pace the market led by increased sales across most of our business lines in production systems and higher digital sales in US land.
Olivia: The revenue declines stand mostly from the seasonal, spring break up in Canada, and non repeat of expiration data sales in US of 4.
Olivier Peuch: Altogether, these dynamics reinforce our confidence in the long-term growth for this market.
Olivia: The offshore Market certain projects have pushed to the right. Most notably in steps are Africa. However, we continue to maintain a steady backlog in 1 subs and is a significant number of offshore projects, preparing for a Friday. All together, this Dynamics reinforce our confidence in the long term growth for this Market.
Olivier Peuch: Next, let me discuss the performance of our division. In the core, pollution systems led the way again this quarter, benefiting from increased sales of artificial lift and midstream pollution systems. Overall, our service quality and reliability continue to differentiate our offering in this space, and we have been awarded several new projects during this quarter. Meanwhile, in world construction, Rovillo has clashed sequentially with growth in Iraq, the UAE, North Africa, and Nigeria, offset by lower activity in Namibia and North America. And those of our performance already declined slightly due to lower evaluation and stimulation activity partially offset by solid intervention.
Next, let me discuss the performance of our divisions.
Olivia: In the core pollution systems led the way again, this quarter benefiting from increased sales of artificial, lift, and mid-range pollution systems. Overall, our service quality and availability continue to differentiate offering in this space and we have been awarded several new projects during this quarter.
Olivia: Meanwhile, in World construction, we do a smartish sequentially with growth in Iraq, the UAE, North Africa and Nigeria offset by lower activity, Namibia and North America.
Olivia: Performance, probably declined, slightly due to the war evaluation and stimulation activity partially offset by solid intervention work.
Olivier Peuch: Turning to digital integration, our digital revenue remains steady, with double-digit growth across the combination of our platforms, applications, and digital operations, offset by lower exploration data this quarter. We now have more than 7,800 users across the Delphi platform, opening double-digit growth year-on-year. This is a continued reflection of our customers' focus on unlocking, through digital, higher levels of performance and efficiency in their apps. Finally, we continued to execute growth in CCS, where we successfully executed several large-scale projects in the carbon market discourse. We are now participating in the entire value chain from point of capture with SLB capturing to permanent storage with SLB sequestration.
Olivia: Turning to digital and integration our digital Revenue remains steady with double digit growth across the combination of our platforms application and digital operations offset by lower exploration data this quarter.
Olivia: We now have more than 7,800 users across a dead tree. Platform representing double digit growth year on year.
Olivia: This is a continued to reflection of our customers focus on unlocking through digital higher level of performance and efficiency in the assets.
Olivia: finally, we continued to exhibit growth in CCS where we successfully executed several large scale project in the carbon Market, this quarter,
Olivier Peuch: This combined offering is being successfully utilized at the Longship CCS project in Norway and believe this will continue to present new opportunities for a carbon solution.
We are now participating in the entire value chain from point of capture with the Seb capturing to permanent storage with SLB sec.
Olivier Peuch: All in all, this quarter was challenging with lots of moving parts, yet we produced solid results. Concerning the uncertainty and market volatility, the entire SEB team has delivered a remarkable report. Having met with many customers during the quarter, I'm assured of our differential performance and the trust that our customers continue to place in us.
Olivia: This combined offering is being successfully utilized at the long ship CCS project in Norway and believe this will continue to present new opportunities for carbon solution business.
All in all this quarter was challenging with lots of moving Parts, yet we produced solid results.
Olivia: Considering the uncertainty and Market relativity, the entire acidity team has delivered to remarkably well.
Olivier Peuch: Next, I will discuss what we are seeing in the macro environment, how we expect this to evolve over the second half of the year. During the first half of the year, the oil and gas industry demonstrated its strength and resilience, proving that it can operate through uncertainty without a significant drop in upstream spending, highlighting the different attributes of this cycle. As we look to the second half of the year, the macro environment continues to be uncertain, particularly with the announcement of the OPEC Plus supply releases into well-supplied markets. For the moment, incremental barrels are being absorbed by peaks of personal demand, charnel restocking, and the replenishment of global crude inventories that are sitting below five years histo-economic.
And having met with many customers during the quarter. I'm assured of our differential performance and the trust that our customers continue to place in US.
Olivia: Next, I will discuss what we are seeing in the macro environment. How we expect this to evolve over the 7 hour for the year?
In Spain, I like in the different attributes of this cycle.
Olivia: As we look to the second half of the year, the macro environment continues to be uncertain particularly with the announcement of the OPEC plus super releases into World Supply Market.
Olivier Peuch: All in, while sustained release could exert pressure on commodity price in the near term, the removal of the overhang of OPEC plus voluntary cuts would allow for market stabilization over time. While it is difficult to predict the outcome from the combination of further super-releases, persistent geopolitical risks, and lingering tariff negotiations, it is fair to assume sustained resilience in the market outlook, absent of a dramatic shift in commodity prices. Regionally, the Middle East and Asia will continue to display the most residents in the short term, driven by lower work events and a sustained focus on energy security.
Olivia: For the moment in cam BS are being absorbed by Peak, some of the month, shocking, and the replenishment of global crude inventories that are sitting below 5 years Easter egg on average.
Olivia: Or in while sustained release. Could exact question in the near term, the removal of the overhang of four plus bonai Cuts will allow for Market stabilization over time.
Olivia: What it is difficult to predict the outcome from the combination of further, super release their system, their political risk and lingering type negotiations. It is fair to assume sustained resilience in the Market. Outlook. Absent of a dramatic shift in Co price,
Olivier Peuch: Meanwhile, Advantage Offshore Projects will lend support to a steady market across Europe, Africa, and the Middle East. In contrast, land activity across North America and Latin America have the greatest downside risk due to short cycles. Globally, we expect operators to remain focused on critical in-flight development projects and an acceleration of efficiency gains with a heavier focus on pollution recovery and continued investment in digital and AI.
Olivia: regionally the Middle East and Asia will continue to display the most residents in the short term driven by lower procurements and sustained focus on energy security.
Olivia: Meanwhile, advantage of share projects will land support to the steady market across Europe Africa and America
Olivia: in contrast an activity across North America, and Latin America, have the greatest downside risk due to short cycle, spent
Olivier Peuch: Next, let me describe this growing market and the opportunity that we see with Champagne. Today, customers are on a quest to unlock and optimize the full production potential of their assets while improving efficiency in the reservoir recovery phase of their operation. This is creating a less technical and growing market opportunity that is more OPEX-driven and is less sensitive to short-term COVID-19 risks.
Nobody. We expect operators to remain focused on critical, inflight development projects and acceleration of efficiency gains with a heavier, focus on pollution recovery and continued investments in digital and AI.
Olivia: Next, let me describe this growing market and the opportunity that we see with shinex
Olivia: Today customers are on a quest to unlock and optimize the full production potential of their assets while improving efficiency in the reservoir recovery phase of their operations.
Olivier Peuch: The addition of Champonex enhanced our portfolio by providing the capability we need to lead. Chantonex strengths in production chemicals and natural yeast enhance our portfolio in two essential and fast-growing segments that are critical to long-term asset performance. Pollution Chemicals, Champenex, and Skel. Vertical integration and a strong global manufacturing footprint to develop solutions to address the rising demand from aging infrastructure and complex weather. And I combine Ashley's portfolio as the breadth to optimize production across the full lifecycle of the web.
Olivia: This is creating a less Technical and growing Market opportunity. That is more Opex, driven. And is less sensitive to short-term cos
Olivia: the addition of Shonen X enhance our portfolio by providing the capability. We need to lead this effort.
Olivia: CH in production, and chemicals. And at least enhance our portfolio in 2, essential and fast growing segments. That are critical to long-term asset performance.
Olivia: The pollution chemicals shinex adds scales.
Olivia: Vertical integration and a strong Global manufacturing footprint to deliver solutions to address the rising demand from aging infrastructure and complex wealth.
Olivier Peuch: Additionally, Shopadex brings a unique digital production technology portfolio that will expand into new markets and new applications. Integrating these capabilities in the SLB existing portfolio will allow for greater innovation and customer value creation, as we take a further step toward delivering a fully integrated service offering anywhere in the world, from reservoir to surface facility, from completion to decommission. Geographically, these acquisitions also expand our broad global reach. Champeneux's deep presence in North America pairs well with SAB's international leadership, enabling us to bring their technologies to new markets while also deepening our capabilities in the U.S.
Olivia: Now, combine a full list portfolio as a breath to optimize pollution across the full life cycle of the, well,
Additionally shopx brings a unique, digital pollution, technology portfolio, that will expand into new markets and new applications.
Olivia: Integrating discoverability in SLB existing portfolio for greater Innovation and customer value creation. As we take a further step toward delivering a fully Integrated Service, offering anywhere in the world from where they were to suffer facility from completion. Could decommissioning.
Olivier Peuch: Taken together, this is a highly compromised. One that strengthens our portfolio, accelerates our growth in the regional market, and reinforces our ability to deliver value at every stage of the production lifecycle. And just as important, we are combining two organizations that share a strong culture of innovation, operational excellence, and customer friendliness. Overall, this would enable us to integrate the full production landscape with the best people, the deepest domain expertise, and most innovative technology solutions. gathered by a shared passion for innovation and a commitment to delivering for customers in every basin around the world.
Geographically. This acquisition also expands our world government, Google Rich, leaps presents in North America pairs. Well with SMS International Leadership enabling us to bring their Technologies to New Markets while also deepening. Our capabilities in the US
Second together. This is a highly complimentary fit.
Olivia: 1 that strengthens our portfolio. Accelerates our growth in Regional markets.
Olivia: And reinforce our ability to deliver value at every stage of the polution life cycle.
And just as important, we are combining 2 organization that share a strong culture of innovation or partial excellence, and customer focus.
Olivia: Overall, this would enable us to integrate the full collection landscape with the best people. The deepest domain, expertise, and most Innovative Technology Solutions.
Olivier Peuch: I'm truly excited to welcome the Champonex team to SLB and look forward to what we will achieve together.
Gutted by our Chef ishan, for Innovation, and the commitment to delivering for customers in every Basin around the world.
Olivier Peuch: Now before I hand over to Stephane, let me quickly share our guidelines for the second half of the year. Starting August 2025. who will begin consolidating Champenex into our water. Therefore, we expect second-half revenue to be between $18.2 billion and $18.8 billion for the second-half. This second-half increase will be a result of the five-month contribution of Champonex, combined with steady revenue in our legacy SLB business compared to the first-half, driven by growth in production systems and digital, fully offsetting the anticipated activity decline in the U.S. and certain deep-water markets.
Speaker Change: I'm truly excited to welcome the champion to SLB and look forward to what will be achieved together.
Stefan: Now, before I hand over to Stefan, let me quickly share our guidance for the second half of the year.
Stefan: Starting August 2025.
Stefan: We will begin consolidating Champion X into our results.
Stefan: Therefore, we expect second half Revenue to be between 18.2 billion and 18.8 billion for the second half.
Olivier Peuch: Moreover, our venue will be back-loaded in the fourth quarter, reflecting a full port of Champagne X, as well as a seasonal uplift from year-end digital and product. We also expect second half EBITDA margins to be flat compared to the second quarter, inclusive of the Champenex contribution and inclusive of about 20 to 40 basis points for tariff impact.
Stefan: This second half increase will be a result of the 5 months contribution of champion X combined with steady Revenue in our Legacy SLB business compared to the first half driven by growth in Collision systems and digital free of setting the anticipated activity declines in the US and certainly the broader markets.
Stéphane Biguet: I will now turn the call over to Stephane to discuss our financial results and the plan for Champenex financial integration in more detail. Thank you, Olivier, and good morning, ladies and gentlemen. Second quarter earnings per share, excluding charges and credits, was 74 cents. This represents an increase of $0.02 sequentially and a decrease of $0.11 when compared to the second quarter of last year. While the net amount of charges and credits recorded during the quarter had no impact on our APS, we did incur nine cents of charges relating to headcount reductions and the impairment of an equity equity method investment.
Stefan: Also expect to be flat compared to the second quarter. Inclusive of the champion X contribution and inclusive of about 20 to 40 basis points for T impact.
Stefan: I will not turn the call over to Stefan to discuss our financial results and a plan for Champion X financial integration in more details.
Stefan: Thank you, Olivier, and good morning, ladies and gentlemen.
Second quarter earnings per share, excluding charges and credits was 74 cents.
Stefan: This represents an increase of 2 cents sequentially and a decrease of 11 cents when compared to the second quarter of last year.
Stéphane Biguet: as well as $0.02 of merger and integration charges related to the ChampionX and OneSubsea transactions. These charges were offset by an $0.11 gain relating to the sale of our interest in the Palliser APS project in Canada. Overall, our second quarter revenue of $8.5 billion increased 1% sequentially, driven by 2% growth in the international market. Our pre-tax segment operating margins increased 20 basis points sequentially to 18.5% as margins increased in three of our four divisions. Company-wide adjusted EBITDA margin for the second quarter was 24%. We're presenting a sequential increase of 21 bases.
Stefan: While the net amount of charges and credits recorded during the quarter had no impact on our APS. We did incur 9 cents of charges relating to headcount reductions and the impairment of an equity Equity method investment.
As well as 2 cents of merger and integration charges related to the champion X and 1 subsidy transactions.
These charges were upset by an 11 cents, game relating to the sale of our interest, in the Palliser APS project in Canada.
Stefan: Overall, our second quarter revenue of 8.5 billion increased 1% sequentially.
Driven by 2% growth in the international markets.
Our pre-tax segment operating margins increased 20 basis, points sequentially to 18.5% as margin in as margins increased in 3 of our 4 divisions.
Stefan: Companywide. Adjusted ebit margin for the second quarter was 24%.
Stefan: Representing a sequential increase of 21 basis points.
Stéphane Biguet: Let me now provide you with more details for each video. Second quarter digital and integration revenue of $1 billion, decreased 1% sequentially. Digital revenue was flat, as double-digit sequential growth from the combined effects of platforms, applications, and digital operations was offset by lower exploration data sales, following a strong first quarter.
Stefan: Let me now provide you with more details for each division.
Second quarter, digital and integration revenue of 1 billion. Decrease 1% sequentially.
Digital Revenue was flat as double digit sequential growth from the combined effects of platforms applications, and digital operations.
Stéphane Biguet: Lower APS revenue in Canada drove the overall 1% revenue decrease for the Digital and integration margins expanded 240 basis points to 32.8%. driven by greater digital adoption and efficiency gains.
Stefan: Was offset by lower exploration data sales, following a strong first quarter.
Lower APS Revenue in Canada. Drove the overall 1% Revenue, decrease for the division.
Digital and integration margins, expanded 240 basis points to 42.8%.
Stefan: Driven by greater digital adoption and efficiency gains.
Stéphane Biguet: We expect digital revenue growth and margin expansion to continue in the second half of the year with a significant uptick in the fourth quarter, benefiting from year-end sales.
We expect digital Revenue growth and margin expansion to continue in the second half of the year.
Stefan: With a significant uptick in the fourth quarter.
Stefan: Benefiting from your end sales.
Stéphane Biguet: In order to provide you with increased visibility into this business as it continues to grow, I am pleased to announce that we will start reporting the results of our digital business as a separate segment beginning in the third quarter. Turning to our Reservoir Performance Division, revenue of $1.7 billion declined 1% sequentially due to a slowdown in evaluation and stimulation activity across international markets. Partially upset by strong intervention activity. Margins improved 203 basis points to 18.6% as a result of the higher intervention activity and the absence of startup costs that impacted the first quarter. while construction revenue of $3 billion was essentially flat sequentially.
Stefan: in order to provide you with increased visibility into this business, as it continues to grow, I am pleased to announce
That we will start reporting the results of our digital business, as a separate segment, beginning in the first quarter.
Stefan: Turning to our Reservoir performance division.
Stefan: Revenue of 1.7 billion declined, 1% sequentially.
Stefan: Due to a Slowdown in evaluation and stimulation activity across International markets.
Partially upset by strong intervention activity.
Margins improved, 23 basis points to 18.6%.
As a result of the higher intervention activity, and the absence of startup costs that impacted the first quarter.
Stéphane Biguet: while margins of 18.6% decreased 119 basis points, primarily due to an unfavorable technology and geography mix internationally. Finally, production systems revenue of $3 billion increased 3% sequentially, driven by strong sales in artificial lifts, midstream production systems, and valves, as well as increased data center infrastructure solutions revenue. margins increased 28 basis points to 16.4%. primarily due to continued growth and a favorable activity.
Stefan: Well, construction revenue of 3 billion was essentially flat sequentially.
While margins of 18.6% decreased 119 basis points.
Primarily due to an unfor unfavorable technology and geography mix internationally.
Stefan: Finally.
Stefan: Production systems revenue of 3 billion increased 3%. Sequentially driven by strong sales in artificial lists, Midstream production systems and valves
Stefan: As well as increased data center infrastructure Solutions Revenue.
Stefan: Margins, increased 28 basis points to 16.4%, primarily due to continued growth and a favorable activity links.
Stéphane Biguet: Now turning to our liquidity. We generated 1.1 billion of cash flow from operations. and free cash flow of $622 million during the quarter. This represents a $519 million increase in free cash flow compared to last quarter. which is largely due to seasonal improvements in working capacity.
Now, turning to our liquidity.
We generated 1.1 million of cash, flow from operations.
Stefan: This represents a 519 million increased in in free cash flow compared to last quarter.
Stefan: Which is largely due to seasonal improvements in working capital.
Stéphane Biguet: Consistent with our historical trends, we expect our free cash flow in the second half of this year to be materially higher than in the first half on improved earnings, higher customer collections, and lower inventory. capital investments, inclusive of capex and investments in APS projects and exploration data were 520 million in the second quarter. For the full year, we now expect capital investments to be approximately $2.4 billion. reflecting the impact of the ChampionX acquisition.
Stefan: Consistent with our historical Trends. We expect our free cash flow in the second half of this year, to be materially higher than in the first half on improved earnings. Higher customer Collections and lower inventories.
Stefan: Capital Investments, inclusive of capex, and investments in APS projects, and exploration data, where 520 million in the second quarter.
For the full year. We now expect Capital Investments to be approximately 2.4 billion.
Stefan: Reflecting the impact of the champion. Next acquisition.
Stéphane Biguet: Regarding our M&A activity, as I mentioned earlier, we completed the sale of our Alisur asset in Canada. Near the end of the second quarter. As a result, we received $316 million of net cash proceeds in the second quarter and an additional $22 million in the third quarter.
Stefan: regarding our m&a activity, as I mentioned earlier,
Stefan: We completed the sale of our Palliser asset.
Stefan: In Canada near the end of the second quarter.
Stefan: As a result, we received 316 million of net cash proceeds in the second quarter and an additional 22 million in the first 1.
Stéphane Biguet: For reference, we generated $215 million of revenue in the first half of the year from the Paliseras. with EBITDA margin in the low 50s and pre-tax margin in the low 30s.
Call reference. We generated 215 million of Revenue in the first half of the Year from the Palliser assets.
Stefan: With edit that margin in the low 50s and pre-tax margin in the low 30s.
Stéphane Biguet: Let me now turn to the ChampionX acquisition and what it means for SLB's future financial performance. First, from a financial reporting perspective, we will begin consolidating ChampionX, effective August 1st, 2022. This means we will consolidate two months of ChampionX results in the third quarter of 2021. The ChampionX activities will be reported under our Production Systems Division, which is where SLB's legacy production chemicals and artificial lift businesses currently sit. The only exception to this relates to ChampionX's digital activities.
Stefan: Let me now turn to the champion X acquisition and what it means for slb's future financial performance.
First from a financial reporting perspective, we will begin. Consolidating, Champion X effective, August 1st 2025
Stefan: this means we will consolidate 2 months of champion X results in the first quarter of 2025,
The champion X activities will be reported under our production systems division, which is where slb's Legacy production chemicals, and artificial businesses. Currently sit
Stéphane Biguet: which will be reported under our new digital device. It is worth mentioning that we will be aligning ChampionX with SLB's definition of digital. As a result, the digital revenue that we will report coming from the ChampionX business will be lower than what was previously disclosed by ChampionX.
Stefan: The only exception to this relates to Champion, X's digital activities.
Which will be reported under our new digital division.
It is worth mentioning that we will be aligning Champion x with slb's definition of digital.
As a result, the digital Revenue that we will report coming from the champion. X business will be lower than what was previously disclosed by Champion X.
Stéphane Biguet: We will provide you with pro forma historical financial information to assist with modeling the combined businesses together with the additional granularity into our digital business in our third quarter earnings release. As it relates to synonyms. We spent the past 12 months refining our preliminary estimates. and Developing Actionable Plans. We are now even more comfortable with our initial assessment that we will be able to generate 400 million of annual pre-tax synergies within the first three years after closing. The largest portion will come from costs, you know. which represent approximately 75% of the 400 million. Roughly half of these cost synergies will come from supply chain saving.
Stefan: We will provide you with ProForm historical financial information.
To assist with modeling the combined businesses together with the additional granularity into our digital business.
Stefan: In our third, quarter earnings release.
Stefan: As it relates to scenarios.
Stefan: We spent the past 12 months refining, our preliminary estimates and developing actionable plans.
We are now even more comfortable with our initial assessment.
Stefan: That we will be able to generate 400 million of annual pre-tax energies. Within the first 3 years after closing,
Stefan: The larger portion will come from cost synergies which represent approximately 75% of the 400 million.
Stéphane Biguet: which will be generated not only from ChampionX operations. but also from SLB's existing cost base. including the chemical spend in our legacy business. The other half of the cost synergies will come from operating costs and G&A savings.
Roughly half of these cost synergies will come from supply chain savings.
Stefan: Which will be generated not only from Champion X operations.
Stefan: But also from slb's existing cost base.
Stefan: Including the chemical spend in our Legacy businesses.
The over half of the cost, synergies will come from operating costs and GNA savings.
Stéphane Biguet: With regard to the expected annual revenue synergies of approximately $100 million when translated into incremental pre-tax income, We have only included opportunities with the highest probability of realization. These have been identified at the country and customer level.
With regard to the expected annual revenue, synergies of approximately 100 million when translated into incremental pre-tax income.
Stefan: We have only included opportunities with the highest probability of realization.
These have been identified at the country and customer level.
Stéphane Biguet: Let me now conclude with the direct impact of the acquisition on our financial needs. As it relates to margins, we have demonstrated this quarter the resiliency of SLB's margins. despite the challenging macro environment. This resilience will be reinforced by the addition of ChampionX, which has delivered continuous margin expansion over the last few quarters. for that matter. when excluding the drilling technology business that was disposed of concurrently with the closing of the SLB transaction. ChampionX finished the second quarter of 2025 with revenue of approximately $850 million. And I just did a bid of approximately $190 million.
Let me now conclude with the direct impact of the acquisition on our financial metrics.
Stefan: As it relates to margins, we have demonstrated this quarter, the resiliency of slb's margin.
Stefan: Despite the challenging macro environment.
This resilience will be reinforced by the addition of champion X which has delivered continuous margin extension over the last few quarters.
Stefan: Matter.
When excluding the drilling technology business that was disposed of concurrently with the closing of the SLB transaction.
Champion: Champion. Next finished the second quarter of 2025 with revenue of approximately 850 million.
Stéphane Biguet: delivering visible margin expansion both sequentially and year-over-year. We expect both the legacy SLB businesses and ChampionX to continue delivering strong margin performance in the second half of this year. This will, however, be partially offset by the impact of tariffs. Assuming no changes to the tariffs that are currently in place, we estimate that this will cost us between 20 and 40 basis points of margin in the second half. all together. This will result in our company-wide adjusted the bid-down margin in the second half of the year being essentially flat when compared to the second quarter of the said another way, our adjusted EBITDA margins, including the contribution of ChampionX.
Champion: And adjusted Aida of approximately 190 million.
Champion: Delivering visible margin expansion. Both sequentially.
And your overview.
Champion: We expect both the Legacy SLB businesses. And Champion X.
Champion: To continue delivering, strong margin performance in the second half of this year.
Champion: This will however be partially offset by the impact of tariffs.
Assuming no changes to the ties that are currently in place. We estimate that this will cost us between 20 and 40 basis points of margin in the second half.
Champion: All together.
Champion: This will result in our companywide digested. A betta margin.
Champion: In the second half of the Year being essentially flat when compared to the second quarter of the year.
Champion: Said, another way.
Stéphane Biguet: would have expanded by about 20 to 40 basis points in the second half if not for the impact of the time.
Champion: Our adjusted margins, including the contribution of champion X.
Champion: Would have expanded by about 20 to 40 basis points in the second half, if not for the impact of the turrets.
Stéphane Biguet: Looking forward. Our margins will be further enhanced by the 400 million in synergies that I previously discussed. With the detailed plans, our integration teams have developed We believe that we will be able to realize at least half of the synergies within the first 18 months of the transaction. As a result, we expect the transaction will be accretive.
Looking forward.
Champion: Our margins will be further enhanced by the 400 million in synergies that I previously discussed.
Champion: with the detailed plans, our integration team that developed
we believe that we will be able to realize, at least,
Champion: Half of the sceneries.
Champion: Within the first 18 months of the transaction.
Stéphane Biguet: to both margins and earnings per share on a full year basis in 2020. This reflects certain assumptions regarding the purchase accounting, which will be finalized in the coming days. Based on these assumptions, we have estimated the incremental annual recurring pre-tax intangible asset amortization expense to be approximately $80 million, over and above ChampionX's historical annual intangible asset amortization expense of approximately $50 million. This incremental amortization expense equates to approximately 4 cents of EPS on an after-tax basis. The calculation also reflects the fact that we issued 141 million shares of SLB stock in connection with this transaction.
As a result, we expect the transaction will be accretive.
Champion: To both margins and earnings per share on a full year basis in 2026.
Champion: This reflects certain assumptions regarding the purchase accounting, which will be finalized in the coming months.
Champion: Based on these assumptions, we have estimated the incremental annual recurring pre tax intangible asset amortization expense.
Champion: To be approximately 80 million over, and above Champion, X, historical, annual intangible asset amortization expense of approximately 50 million.
Champion: This incremental amortization expense equates to approximately 4 cents a VPS on an after tax basis.
Champion: The calculation also reflects the fact that we issued 141 million shares of SLB stock in connection with this transaction.
Stéphane Biguet: It is worth mentioning that since the announcement of the ChampionX transaction in April 2024, we have been accelerating the repurchasing of our To that end, since the announcement, we have reduced our total shares outstanding by 78 million. This represents 55% of the chairs we just issued in this transaction.
Champion: It is worth mentioning that.
Champion: Since the announcement of the champion X transaction in a CR 2024, we have been accelerating the repurchasing of our shares.
To that end. Since the announcement, we have reduced our total shares outstanding by 78 million.
This represents 55% of the chairs. We just issued in this transaction.
Stéphane Biguet: Finally, I wanted to briefly come back to the second-half guidance that Olivier shared earlier, where we expect second-half revenue to be between $18.2 to $18.8 billion. If we are to compare this H2 outlook to H1, by including ChampionX and excluding Palliser in H1. and considering ChampionX on a full six-month basis in H2. This would result in second-half revenue growth. from flat to low single digits when compared to the first half. driven by both our legacy portfolio and champion.
Champion: Finally, I wanted to briefly come back to the second half guidance that Olivier shared earlier.
Champion: Where we expect second half Revenue to be between 18.2.
Champion: To 18.8 billion dollars.
Champion: if we are to compare this H2, Outlook to H1,
Champion: By, including Champion X and excluding Palliser in H1.
Champion: And considering Champion x on a full 6 months basis in H2.
Champion: This would result in second half Revenue growth.
Champion: From Flat to low single digits.
Champion: When compared to the first half.
Champion: Driven by both our Legacy portfolio and Champion X.
Olivier Peuch: I will now turn the call back to Olivier. Thank you, Stephane. I believe we are ready for your questions.
I will now turn the call back to Olivia.
Olivia: Thank you Stefan. I believe we are ready for your questions.
Megan: We will now begin the Q&A. If you would like to ask a question, please press star followed by the number one on your telephone keypad.
Olivia: We will now begin the Q&A session.
David Anderson: Your first question comes from the line of David Anderson with Barkley. Your line is open. Thanks, Dean. Good morning. Thanks. And thank you for the details, Stephane. I was rapidly doing the math here. Thanks for taking care of that. So kind of essentially two halves, second half is flat with first.
Olivia: You would like to ask a question please press star. Followed by the number 1 on your telephone keypad.
David Anderson: Your first question comes from the line of David Anderson with barklay.
David Anderson: Your line is open. Uh, thanks and good morning.
Olivier Peuch: I was just wondering, Olivier, if you could provide a little bit more detail kind of behind this. You had mentioned customers selectively adjusting. I was curious if this is primarily just related to the shorter cycle programs in the U.S. land and Saudis slowing down. But more broadly, I'm curious if you've seen a noticeable change in customer behavior since OPEC started bringing barrels back. It feels like we're in a bit of a wait-and-see mode with respect to oil pricing and customer spending. Just hoping you could provide some insight into how you see this energy macro develop.
David Anderson: During Olivia, if you could provide a little bit more detail, uh, kind of behind this, you had mentioned, customers selectively adjusting activity. Um, I was curious, if this is primarily just related to the shorter cycle programs in the US land in Saudi swelling down, but more broadly. I'm curious, if you've seen a noticeable change in customer Behavior. Since OPEC started bringing barrels back, it feels like we're in a bit of a wait and see mode with respect to oil prices in C customers spending. Just hoping you could provide some insight into how you see this energy macro developing over the next few quarters.
Olivier Peuch: Thank you, Dave. So first, to be coming back to the guidance, I think the guidance reflects from the low to the high guidance, flat to LSD, with potential to go even beyond this. So we have definitely growth. We project growth in the second half compared to the first half when accounting for the moving parts in and out of our portfolio, clearly. Okay, and driven, as we said, driven by the production system Champenex, combination getting an uplift in the second half of the year, partially in the fourth quarter, and also by digital year-end sales. This combination, more than offsetting, if you like, some of the headwinds that are in selective market still affecting the drain activity and to this extent, the reserve performance portfolio.
Olivier Peuch: So all of this, coming back to your question about selective customer adjustment, I believe that the major adjustments in international markets are largely beginners, and people have been prepared and adjusting their spending rates and their activity outlook to account for uncertainty and somehow the declining commodity price that they have seen during the H1. However, as we have seen more recently, the short cycle markets have been more reactive to the persistent, slightly lower commodity price anticipated. Yes? all in, we are seeing this as a resilient market going forward, assuming that the price will stay range bound to what we have seen between the 60 and 65 or 60 and high 60s.
Speaker Change: Yeah, thank you Dave. So, so first to be to be coming back to the, to the guidance, uh, I think the guidance reflect, uh, from the law to the eye guidance, a flat to LSD. Uh, we've put on short to go over and Beyond this. So we have definitely growth. Uh, we project growth in the second half compared to the first half when accounting for the moving Parts in and out of our portfolio. Clearly, okay? And driven, as we said, driven by the production system shampoo. Next combination, getting an uplift in a second half of the Year, partly in the third fourth quarter, and also for a digital year, end sales, this combination more than of setting. If you like, uh, some of the headwinds that are in selective Market, still affecting the drink activity, and to this extent, there is our performance, uh, portfolio. So all of this, uh, to come coming back to your question. Mark selective customer adjustment. I believe that, uh, the major adjustment, uh, in international,
Speaker Change: For Market, uh, allows you, to be honest. And people have been prepared and adjusting, uh, their spending rates and their activity Outlook, uh, to account for the uncertainty and somehow the, the, uh, declining, uh, Community price that they have seen during the H1. However, as we have seen more recently, the short cycle Market has been more uh reactive to the to the persistent slightly lower uh, commodity price anticipated yet.
Olivier Peuch: And I think we believe that there are a few things at play that could change this. But most of the cuts and most of the adjustment and selective market and selective country have been done with the exception, as I of the short cycle, partly in North America and some markets internationally that are short. So hence we are, that's the reason why we got it the way we got it this far.
Speaker Change: All in, we are seeing this as a resilient Market going forward. Assuming that the price will stay at range bound to what we have seen between 60 and 65 or 60. And I 60s. And I think we believe that there are few things I play that could change this. But most of the most of the cuts and most of the adjustment and select selective market, and selective country have been have been done with exception. As I said that of the low cycle of the short cycle partly in North America and some Market internationally that are short cycle.
Speaker Change: so hence we are that's the reason why we got it the way we, we got it the same as
Olivier Peuch: And then in your release and also in your commentary, you noted a few things going on in deep water, you'd called out Namibia. and Slowing. But I was just wondering, just broadly speaking, in deep water, are you concerned about just kind of near-term activity just slowing here?
Olivier Peuch: Is Namibia sort of a one-off, or are you worried that you're starting to see some of these projects pushing to the right? Because if you look at kind of rigs and rig schedules, subsea deliveries, pipe orders, it looks like deep water is sort of poised for a pretty good uptick in kind of by mid-26. I'm just wondering. If you agree with that, or if things can sort of slide...
Olivier Peuch: Yeah, first to comment on what we have seen for the last 12 to 18 months. We have seen white space developing and indeed the least critical project to shift to the right. But we still have seen the rich pipeline of advantage projects that are key for the portfolio of international operators, partly the IOCs, to be going forward with anticipated FID. And you know, in Suriname, then the Nabibia effect is an effect of a long period of appraisal exploration success that is now going into a deep, I would say, learning and decision for the way forward.
Speaker Change: And and then in your release and also in your commentary, you you noted, a few things going on in deep water, you'd call that and maybe a, um, for some slowing. Um, but I was just wondering, just broadly speaking in in deep water. Are you concerned about just kind of near-term activity? Just slowing here is there? Maybe a sort of a 1-off? Um, or are you worried that you're starting to see some of these projects pushing to the right? Because if you look at kind of Rigs and rigs schedules, subsidy deliveries pipe orders, it looks like deep water is sort of poised for a pretty good uptick in kind of by mid 26. I'm just wondering if that's if if you agree with that or if things just sort of slide into the right a little bit.
Olivier Peuch: So I will not try to overreact onto the Nabibia temporary effect, but I'm more excited about what I see in Americas at large for oil, be it on some of the Africa assets that are going in phase three or that are reaching FID. Obviously, in Central America, the Suriname assets, the Brazil very sustained activity and Vienna sustained activity as well as Mexico combined. I think it is a market that has only upside going forward.
Speaker Change: Yeah. First you come out on what you have seen for the last 12 to 18 months, we have seen a white space developing uh and indeed the the the least critical project to shift to the right. Uh but we still have seen the the the rich pipeline of Advantage, uh, project that are uh, key for the portfolio of international operators, part part with the ioc's to be going forward with anticipated FID, and you see it in in then I would say learning and decision for the way forward. So I will not, I will not try to overreact onto the nabia, temporary effect, but I'm more excited about what I see in America at large for
Olivier Peuch: And by contrast, in the eastern hemisphere, driven by gas markets from Indonesia, a big discovery to Mozambique soon to be relaunched. And still, it's made as a very prolific and exciting basin. I think I see the condition that are set for indeed a rebound directionally in the years to come. And certainly, I think the hypothesis of 2026, I think is a valid hypothesis that I think we'll have to look forward to see unfolding.
Speaker Change: I think I see the condition that are set for indeed a rebound directionally uh in in the years to come. And certainly I think the hypothesis of 2026 I think is valid hypothesis that, I think we'll have to look forward to to see unfolding
Olivier Peuch: Thank you very much. Appreciate it. Thank you.
Thank you very much, appreciate it.
Thank you.
Scott Gruber: Your next question comes from the line of Scott Gruber with Citigroup. Yes, thank you. I'm curious about how you view the growth outlook for your now larger production business. How would you dimension both the underlying growth for the production market and then how you can enhance that growth with revenue synergies, especially as you apply your digital applications? When you put those two factors together, what's a medium term reasonable growth outlook for the production business?
Speaker Change: Your next question comes from the line of Scott goober with Citi group. Your line is open.
Scott goober: Yes, thank you. I'm curious about, um, how you view the growth Outlook? We are now larger production business? Yeah. How would you Dimension? You know, both the underlying growth for the production market and then how you can enhance that growth with with Revenue synergies, especially as you apply your your digital applications, you know, when you put those, those 2 factors together, what's a, a medium-term, uh, reasonable growth Outlook, you know, for the the production business
Olivier Peuch: I think I will not try to comment because the definition of a production market is something that I think we'll have to come back and give you a bit more detail on our combined portfolio. But I would say there are three elements that will drive synergy, that will drive this market to grow in our minds. First and foremost, I think the customers, our customers have told us, our customers and operators are focused on trying to extract more value from production recovery phase of the asset. To contrast with the early completion of development phase of the asset, they are trying to get the most of the existing aging assets to make sure that they extend the plateau, they improve the performance and they improve the recovery to extract more from the existing assets.
I think I will not try to come out on because the definition of a production Market is for me, that the thing we have to come back and give you a little bit more detail on on our combined portfolio. But I, I would say that 3 trillion months that we drive a Synergy that we drive, um, this Market to grow in our minds first and foremost, I think the the customers our customers have told us our customers and operators are focused on trying to extract more value, from production recovery, phase of their set.
Olivier Peuch: So the unique combination that we have access to with the addition of the Champonex give us an unmatched portfolio. And I think I'm not talking about only production system, actually if the production chemistry, I'm talking about intervention, I'm talking about the surface equipment, I'm talking about the ability that we have to integrate, innovate and add digital. So what will drive growth in this is our ability to partner with our customers to provide integrated offering beyond the specifics of this actually if the pollution chemistry and add digital capability to it and offer end-to-end a solution that includes well services, well intervention and includes equipment at the surface that can help enhance the production capability.
To uh compressed with 30 and competition of development, phase of the asset are trying to get the most or existing aging assets to make sure that they extend the plateau. They improve the the performance and they improve the recovery to extract more from AC asset. So the unique combination that we have access to with the addition of the shampoo next. Give us
An unmatched portfolio. When I think I'm not talking about only production system, actually, lift or pollution, chemistry. I'm talking about intervention. I'm talking about the surface equipment. I'm talking about the ability to do, we have to integrate, innovate and add digital. So what we drive growth in this is our ability to partner for our customers to provide integrated offering beyond the specific of this absure lift.
Olivier Peuch: So we see this as a market that will have more resilience, less technicality because it's inclusive of OPEX expense and long-term resilience and long-term growth that will certainly outpace the global CAPEX market for the decade to come. That's what we see and we see this as a wide space, as an innovation space and as a space where customers are very pleased to see and the feedback we have got, the engagement we have, they look forward to see what we can put together by innovation, by integration and with digital in this market.
Pollution chemistry and add digital capability to it and offer end to end a solution that includes Well Services when intervention and includes equipment at the surface uh that can can help enhance the the pollution capability. So we see this as a market that will have more resilience less technicality because it's inclusive of Opex expense and the long term resilience and long term growth that will certainly help Pace the global capex market for the decade go. That's what we see and we see this as a white space at the Innovation space and as a space where customer are
Olivier Peuch: So we're quite excited. That's a great color.
Scott goober: Are they pleased to see any feedback? We have? Got your engagement. We had they look forward to see what we can put together by Innovation by integration and with digital in this market. So we are quite excited.
Stéphane Biguet: And then your portfolio changes, you know, they're pushing the company to become less capital intensive, more free cash generative. How do you think about, you know, kind of where you can take CapEx to sales, free cash conversion, and 26 and beyond, especially as you realize the synergies, you know, for instance, can you push that free cash conversion rate toward a, you know, something like a 60% level on a sustained basis? How do we, how do we think about those capital intensity and free cash metrics over time? Scott, first, maybe on 2025 as a reference, we kind of anticipated the soft activity and brought down the total capital investment 10% lower compared to last year.
Speaker Change: Oh, it's a great color and then your portfolio changes, you know. They're they're pushing the company to become less Capital intensive, more free cash generative. How do you think about, you know, kind of where you can take capex to sales free, cash conversion and and 26 and Beyond such as you, you realize the synergies, you know, for instance can you push that free cash conversion rate toward a, you know, something like a 60% level on a on a sustained basis. How do we, how do we think about those Capital intensity, and, and free cash metrics over time now?
Stéphane Biguet: So we are basically at maintenance capex level this year and at the very low end of our 5% to 7% capex as a percentage of the revenue range. So going forward, if we see growth, we will certainly add the growth capex to that. We have that agility. And ChampionX clearly brings down that percentage a bit more, but we are already very low. We may or may not change the range, but ChampionX is helping with the low capital intensity. Regarding EBITDA to free cash flow conversion, we don't really track it that way. We prefer looking at free cash flow margin, that we are looking on a full cycle basis to be above 10% of revenue in terms of free cash flow margin.
Speaker Change: Let's go to the first mainly on, on 2025 as a reference. We we kind of anticipated, the the So Soft activity and and brought down the total capital investment. 10% lower compared to last year. So we we are basically at maintenance capex level uh, this year and at the very low end of our
Speaker Change: 5 to 7% capex as a percentage of a of a revenue, uh, range. So going forward, if we, if we see growth we will a certainly add the growth capex to that. We have that agility and Champion X clearly brings down that percentage, uh,
Stéphane Biguet: And we are exceeding this now as we speak and intend to do the same going into the following years, partially because of the positive contribution from ChampionX.
Speaker Change: In terms of free, cash flow margin. And we are exceeding this. Now as we speak and intend to, to do the same going into into the following years partially because of the positive contribution from Champion X,
Stéphane Biguet: I appreciate it, thank you. Thank you.
I appreciate it. Thank you.
Speaker Change: Thank you. Thank you.
Arun Jayaram: Your next question comes from the line of Arun Jayaram with JP Morgan. Your line is. Good morning, gentlemen. First question, global upstream spending is on track to decline in 2025 versus 2024. I was wondering if you could share with us your views on how you see this playing out for SLB across different regions internationally. I was wondering if you can comment on Mexico and Saudi and North America, and perhaps the timing of a potential inflection point in spending trends.
Speaker Change: Thank you.
Your next question comes from the line of Arun jaram with JP Morgan. Your line is open.
Speaker Change: Good morning, gentlemen. Um, first question is global Upstream spending is on track to decline in 2025 versus 2024. I was wondering if you could share with us your views on how you see this playing out for SLB across different regions internationally. So, I don't know if you can comment on Mexico and Saudi, um, and North America and perhaps the timing of a potential inflection point, uh, in spending trends.
Olivier Peuch: Okay, quite a lot packed into the question here. The first, indeed, I think it is clear now that the market is in, the total market is in slight decline in 2025 compared to 2024. We see both more in North America than we see internationally. There is more resilience in the Middle East and Asia market due to both the commitment to oil capacity expansion, the development of unconventional and conventional gas across the region. And the focus on energy security in Asia. So that's that provides a bit of a buffer. And I think that's very visible. As we have counted before, internationally, the other international market, I think, is impacted by two aspects this year.
Speaker Change: Okay, quite a lot backed into the, the question here. Um, the first indeed, that the, I think the, the, it is clear. Now, that the market is in, the total Market is in slight decline in, uh, 2025 compared to 24. We, we see it both more in, in North America than we see it in internationally. There is more resilience in the Middle East and Asia Market, uh, due to the both the commitment to all capacity expansion, the development of unconventional and
Olivier Peuch: The white space in the deep water market, the Mexico that has been reducing significant activity based on restructuring and reaching a new bottom in terms of activity. And some of the, I would say, short cycle activity in the rest of the country in Latin America. North America, I think there is no secret that the short cycle has been declining in the last couple of months more deeply than everyone would anticipate. So it will represent certainly the highest, I would say, drag on to the total capex for the year.
Speaker Change: Commercial Guys across the region and the focus on energy Security in Asia. So that's that provides a bit of a buffer and I think that's very visible. As we have counted before internationally, the other International Market I think has is impacted by 2 aspect this year the white space in Deep Water Market uh the Mexico that has been reducing significantly activity based on restructuring and and reaching a new bottom in term of activity. And some of the some of the
Olivier Peuch: Now, before we talk about inflection, I would like to talk about resilience. Now that this adjustment has been done in the first half, I believe, as we have demonstrated into our second half outlook when correcting for the in and out, we are anticipating growth. And this is because we believe that there is resilience on some part of the international market. There is still an appetite for executing the most advantaged project with some unconventional development or some large gas or oil development that are under play. And we believe that our market position that we have, which is hedged across different business lines, across different geographies, give us the resilience that I think you see in our numbers in the second half.
Speaker Change: I would say short psycho activity in the rest of partway in Latin America. North America. I think there is no secret that the, the short cycle has been declining in the last, the last couple of months, more deeply than everyone will anticipate, so it will represent certainly the the, the highest I would say dragged on to the the total capex for the year now.
Speaker Change: Before we talk about the inflection, I would like to talk about resilience now that I have this address might have been done in the first half. I believe as we have demonstrated in 2 hours, second. Half Outlook. When collecting for the in and out. Uh, we are, uh, anticipating growth and this is because we believe that there is a resilience and some part of the international market. There is still appetite for executing the most Advantage project, but some unconventional development or some large gas or oil development that are on the play. And we believe that our Market position that we have, which is
Olivier Peuch: So I think now inflection, if we look at trying to look ahead and directionally, I think looking beyond 2025, we continue to see the attribute of a cycle rebound, okay, that will be driven by several, by first the phenomena of energy market and the reaffirmation that I could use of the critical role of oil and gas supply. So, specifically, if I like to look directionally ahead and beyond 2025, we're anticipating that a combination of the liquid market rebalancing, the continued investment in oil capacity expansion in the Middle East, the accelerating global gas supply, both conventional, unconventional, and international, or in North America, and the robust pipeline that I commented before in the offshore deepwater project.
Edge across different business line, across different geography. Give us uh the resilience that I think you see our numbers in the second half. So I think uh, now inflection uh, if we look at that are trying to look ahead and directionally
Speaker Change: I think looking Beyond 2025.
Speaker Change: Uh, we believe that continue to see the attribute of a cycle rebound, okay? That will be driven by several. By first, the fundamental of energy market and we have summation of like a good use of the critical roles of online gas supply.
Speaker Change: So specifically, uh if I like to to look directionally ahead and Beyond 2025, we're anticipating that the combination of the liquid Market rebalancing.
Speaker Change: Um, the continuity investment in oil capacity expansion in the Middle East. The exciting Global gas supply, both conventional and conventional and Commercial, and international your, or in North America.
Olivier Peuch: And finally, the increase of production recovery focus for the customer, which combined with digital and an AI trend to land support your growth investment going forward. We see that this is directionally shaping up.
Speaker Change: And the robust pipeline that I recommended before in offshore, Deep Water Project.
Speaker Change: And finally, the increase of production because we focus for the customer we combined with digital and, and AI Trend to land support, your growing investment going forward.
Olivier Peuch: I will not comment on exact timing, but I think I will first remind everybody that there is resilience in this market, despite this mild uncertainty. And the future is still rich with a lot of projects nationally, rich with gas driving back activity in many parts of the world, and rich with long-term deep water projects that will add real intensity going forward. Great, thanks.
Speaker Change: We are, we see that this is directionally, uh, shaping up. Uh, I will not come on to an exact timing, but I think I will. First remind everybody that is residents in this market. This part is smart and certainty. And, uh, and the future is still rich with a lot of project nationally rich with gas driving back activity in many part of the world and reach with a long-term deeper project that will add really intensity going forward.
Olivier Peuch: And my follow-up question, appreciate the comments around your expectations around the second half outlook, plus some of the outlook comments on ChampionX.
Speaker Change: Great, thanks.
Olivier Peuch: But Olivier, Stephane, could you help us maybe break down your expectations for how you see things playing out in 3Q versus 4Q? We good?
Speaker Change: But Bolivia Stefan, could you help us where you break down your expectations for how you see things playing out in 3Q versus 4 q?
Stefan: We could.
Olivier Peuch: I think let us give you a bit more colors onto this guide that we could give and share in Q3 versus Q4. So first, at a very high level, we have gathered that the second half will be back-end loaded. And now, more specifically, to the third quarter. We expect first, this third quarter will be impacted first by the addition of two months of Champenex. That's a positive addition. By a negative addition of the full-quarter absence of Palliser following its divestiture. by also the impact, negative, I would say, of activity decline in the U.S. and certain offshore markets, and finally, and more recently, by an incident that we have had on Ecuador pipeline disruptions.
I think let let us, uh, let us, uh, give you a bit more colors on to this, uh, on to this guide that we could give and share, uh, in Q3 versus Q4. So first, uh, we have gathered that the second map will be back at back end loaded and now more specifically, uh, to, uh, the first quarter, we expect first, uh, this third quarter will impact at first, but addition of 2, months of champion X that's a positive addition.
Stefan: By, uh, negative edition of the full call absence of Palliser following his diversity.
Olivier Peuch: This would translate all in into a slightly higher revenue sequentially from Q2 to Q3.
But also the impact negative, I would say of activity decline in the US and certain of from market and finally and more recently by an incident that you have had on Ecuador pipeline disruption.
Olivier Peuch: Now, trying to contrast this with Q4. With respect to the 4th quarter, we see revenue to be higher by high single digits versus the 3rd quarter as an uptick, reflecting first a full quarter of Champaign-Aix. And secondly, the seasonal uplifts we'll see from your end, digital and products. I hope I gave you a bit more color on the top line and Q3 and a peak in Q4 that will help circle back the relative revenue in Q3 and Q4.
Stefan: this would translate all in into a slightly higher Revenue sequentially from Q2 to Q3
Now, trying to contact this Q4.
Stefan: With respect to the 4 quarter. We see Revenue to be higher by high single digits versus the first quarter as an optic reflecting First, a full quarter of an X.
Stefan: And secondly, the seasonal uplift will see from your end digital and product sales.
Stéphane Biguet: Yeah, let me just start, Olivier. Okay, yeah, I just wanted to add, yeah, sorry for that. What Olivier described, that Q3 and Q4 directional split is what leads us to say that when you when you exclude the PALISER operations from H1, reinstate ChampionX in H1 and have ChampionX for six months in the second half, this is where you see growth. There's a range where this is the range of flat to low single digit between H1 and H2 when you compare like for like. I hope it's a lot of moving pieces, but I hope it's clear.
Stefan: I hope I gave you a bit more Colour on the top line, uh, and the Q3 and uh, uptick in Q4 that will help Circle back. Uh, the relative uh, Revenue in Q3 and Q4
Stefan: Yeah, let let me just start.
Stefan: Okay. Yeah I just wanted to add uh yeah sorry for that. What what describe the the that Q3 and Q4 directional. Split is what leads us to
Uh to to say that when you when you exclude the Palliser or operations from H1 reinstate, Champion X in a 1, and a half Champion X for 6 months, in the second half, this is where you see growth. And there's a range there, this is the range of flat to low single digit between H1 and H2. When you compare like for like, I hope it's a lot of moving pieces, but I hope it's clear.
Stéphane Biguet: Yeah, that's clear.
Olivier Peuch: Thank you.
Speaker Change: Yeah, that's for sure. Thank you.
Stefan: Thank you.
Neil Mehta: Our next question goes to the line of Neil Mehta with Hey, guys. Thank you, Olivier, Stephane. A couple questions. First on ChampionX, appreciate all the comments around synergies, but maybe you can unpack as you spend more time on ChampionX assets as part of this integration process and talking to customers about the application of some of their products. Any incremental thoughts, particularly on leveraging the platform, leveraging the products into your international market? No, absolutely. I think we are very blessed to have two very highly complementary portfolios, both technically and geographically. And I think the strength of Champonex in the US, the ability to innovate locally with their customers, I think is something that we want to expand, apply to some of the other businesses who are running into North America to also have better impact, more focused impact and more fit technology to our customer base in the US, and hence benefit as a level of side synergy, if you like, from our porting model and engagement model of customers in North America.
Thank you.
Speaker Change: Our next question, goes to the line of Neil Mehta with Goldman Sachs.
Your line is open. Hey guys. Thank you Olivia Stefan a couple couple questions. First on Champion X. Um, appreciate all the comments around synergies, but maybe you can unpack as you spend more time on Champion X assets as part of this, uh, integration process, uh, and talking to customers about the application of some of their products. Uh, any incremental thoughts, particularly on leveraging. Uh, the
Speaker Change: Platform leveraging, the products into your International platform.
Olivier Peuch: But secondly, and critically, I think using the broad portfolio, both of Astrolift and obviously of chemical production and the ability to innovate of Champonex into the international market, where we have established go-to-market access and established customer relationships. So yes, we will expect this, first from a complementarity of portfolio and from a market access. But secondly, as I mentioned before, I think the customer feedback we got beyond access to certain technologies that exist today, the belief that by combining our domain subsurface, our recovery capability, including performance intervention, our digital and our integration track record, the belief that I think we can help them unlock the value of some asset internationally.
Speaker Change: No. Absolutely, I think we, we are very blessed to have 2, very highly, competitive profitable, technically and geographically. And I think the strengths of shampoo products in the US, the ability to innovate locally with that customers. I think it's something that we want to expand, uh, apply to some of the other business we are running into North America, to also have better impact more Focus impact and more fit technology to our customer base. In the US, enhance benefits. As a as a level of sight, Synergy if you like from our Port, team model and engagement model of customers in North America. But secondly and critically. I think using the the boat portfolio both of of and obviously of chemical uh production
Olivier Peuch: And they are very much interested to see what is next in our value proposition beyond just an expansion of our product portfolio into international markets. So integration, digital, domain subsurface integration, I think will be what will drive the synergy going forward beyond the geographical expansion as a matter.
Indication digital domain subsurface integration, I think will be what will drive, uh, the Synergy going forward Beyond, uh, the geographical expansion as I mentioned.
Stéphane Biguet: All right, thank you so much. And, you know, we appreciate the color around margins being relatively flattish. back half. Can you provide any segment level perspective on the margins? What, where do better or anything trending softer just so we can get a little more granularity. So in the second half, directionally, you will clearly see digital and integration, but you will see it's actually digital. In the second half, the margins will continue to increase. That's really on the back of the year-end sales, including exploration data sales. Production systems, we are quite happy with the margin journey so far.
Speaker Change: All right thank you so much. And uh you know uh we appreciate uh uh the color around margins being relatively flat in in the back half can you provide any segment level perspective on the margins? What where do you see things? Trending better? Or do you think it's trending softer? Just so we can get a little more granularity for the model?
Speaker Change: so, so in the second half, you will, uh, directionally, you will clearly see, uh,
Stéphane Biguet: So we will probably at least maintain that level. With ChampionX, the production systems, EBITDA margins will actually increase. ChampionX will be creative to production systems. And the other two core divisions, reservoir performance and well construction, We are expecting to be relatively flat with the second quarter, in line with the overall guidance of the company.
Digital and integration, but you will see, it's actually digital in the second half the margins will uh, will continue to increase. Uh, that's really on the back of the year, end sales, uh, including exploration data sales, uh, production systems, we are quite happy with the margin Journey so far. Uh, so we will probably at least maintain that level, uh, with champion X, the production systems, the a bit. The margins will actually increase until next will be a creative to to production system and the other 2, uh, core divisions, Reservoir performance and well Construction.
Speaker Change: We are, we are expecting to be relatively flat with uh with the second quarter in line with the overall guidance, for the company.
Stéphane Biguet: Thank you. Thanks.
Speaker Change: Thank you. Thank you.
Roger Read: Your next question comes from the line of Roger Read with Wells Fargo. Thank you. Good morning. And thanks again for coming up on all the the Outlook. I guess two questions I'd like to come at. In terms of the pace of synergies with Champion Act. We've had a lot more time, obviously, from the... is announced to closing here. What might look different or more accelerated on Synergy? what might look better in terms of So as we discussed on the prepared remarks, first, the majority of synergies is cost, right? And, and the bulk is both supply chain saving.
Thank you.
Speaker Change: Your next question comes from the line of Roger Reed with Wells, Fargo. Your line is open
Yeah, thank you. Good morning and, uh, thanks again for your help on all the uh, the
um,
Speaker Change: I guess uh 2 2 questions. I'd like to come out in in terms of the
Speaker Change: pace of
Speaker Change: Synergies with champion X. You've had a lot more time. Obviously from the when the deal was announced to closing here,
Speaker Change: What, um, what might look different or or more accelerated on synergies and what might look better in terms of the integration process. As you know, we look at what you may do with the top line of this business.
Speaker Change: Over the next say, 18 months.
Stéphane Biguet: So, so this is the compared to our initial estimates. It has, they are more or less in terms of overall envelope the same as what we had initially. And the pace can be a bit faster actually, because now we have done the homework. It is literally by product code and supplier and geography, so we can execute those supply chain synergies faster. So this is why initially, if you recall, it's one of the reasons why we had said at the time that the transaction will be accretive in the second year following the transaction. And now we think within the first 18 months, so on a full year basis for 2026, the transaction will be accretive.
Speaker Change: So, so, as we discussed on the prepared remarks first, the the majority of of synergies is, is cost, right? And, and, and, and the third is both supply chain saving. So, so this is the compared to our initial estimates.
Olivier Peuch: And this requires about half of the total 400 million synergies to be achieved in 2026, which we think is realistic based on our plan.
Speaker Change: It does. Uh, they are more or less in terms of overall envelope. Uh the same as what we had initially and the pace can be a bit faster, actually, because now we have done the, the homework. It is literally by, by product code and supplier and geography. So we we can execute the supply chain synergies faster. So this is why. Initially, if you recall, it's, it's 1 of the reasons why we had said, at the time that the transaction will be accurate in the second year, following the, the transaction. And now we think within the first 18 months. So on a full year basis from 2026, the transaction will be accretive. And this requires about half
Olivier Peuch: on the integration itself. I'll leave it to Olivier. No, integration, I think the team has worked hard for the last 12 months to do integration planning. I think we were very pleased to launch it yesterday live with all the Champenex employees. And I think the reception is very strong. I think we have a very strong workbook and playbook for integration that will touch all aspects of organization process and onboarding. But obviously, much more importantly, I think the way we faced together the customers and trying to create this revenue synergy, this white space with the combined portfolio.
Speaker Change: of the total 400 million synergies to, uh, to be achieved in 2026, which which we think is, is realistic based on our plans.
Speaker Change: On the integration itself, I leave it to Olivia. No integration. I think the team has worked hard for the last 12 months to do integration planning. I think we are very pleased to launch it yesterday. Live with the old shop champex employees. And I think the reception is, is very strong. I think we have a very, um, very strong workbook and playbook for integration that will touch all aspect of organization process and on boarding. Uh but obviously much more much more importantly I think the way we Face together the customers and trying to create this Revenue scenario, this
Olivier Peuch: So there is really an effort that has been made to prepare this from day one. And I think we'll be in the next two weeks and months holding out this integration playbook and be in a position to start to capture revenue synergy clearly very soon and add to this established cost synergy that will be executed from immediately. So I would say very pleased with the progress, very pleased with the reception of the Champenex team. And also very pleased, extremely pleased with the feedback that we're receiving when engaging with customers that want to preserve the Champenex strengths.
Roger Read: But at the same time, I'm excited to see the innovation, to see the expansion. As I said, integration, digital capability that we can add and subsurface domain that could unlock some more value both in North America and internationally. So good progress, strong team, fully aligned, and quite an exciting start. Very helpful. Thanks.
Speaker Change: Is the feedback uh, that we're receiving when engaging with customers that want to preserve the shampoo next ranks. But at the same time, I'm excited to see The Innovation to see the expansion, as I said, integration digital capability as we can add and subsurface domain that could unlock some more value. Both in North America internationally. So good progress, strong team fully aligned and quite an exciting start.
Olivier Peuch: Follow-up question is, Mexico has been a big topic over the last several quarters. The most recent comment President of Mexico, she indicated they would like gas supply out to 20. doesn't look like what they've been doing. to that. So, any insights in terms of what you're seeing out of the political leadership of Mexico, Pemex itself? No, I'm not here and I would not want to come out on behalf of the decision that the government and Pemex will do. I think they need to go through the motion of restructuring or addressing the critical issue they were facing and finding a bottom and then rebounding.
Speaker Change: Very helpful. Thanks. Uh, follow-up question is, uh,
Mexico has been a big topic over the last several quarters. Uh, the most recent comments from the the president of Mexico. Uh, she indicated they would like to grow gas supply out to 2030.
Does it look like what they've been doing recently with would lead to that? So in any insights, in terms of what you're seeing out of the political leadership of Mexico 10x itself and then what's been the, you know, obviously the issue in, in terms of getting accounts receivable and all that in,
Olivier Peuch: We believe we are there. We are just waiting now to see what are the next steps that could help unlock the value of obviously the assets in Mexico and the dynamic of Pemex to rebound from this. We stand ready. We have been in the country for decades and we are ready to respond to the gas development or other developments. We are not only working for Pemex in Mexico, we are working with independents, local independents that have been pretty active and we have a very exciting project for Woodside, deepwater Mexico, starting early next year that we are all prepared for, both subsea and well construction that I think we are excited about, that is adding dimension to the Mexico rebound.
Speaker Change: Well, I'm not saying I will not want to come out on behalf of the, uh, decision that the government and Opex will do I think they need to go through the motion of, uh, the structuring and or addressing, uh, the critical issue with the they were facing and and, uh, finding a bottom. And then rebounding We Believe to, uh, we are there who are just waiting now to see.
Olivier Peuch: So difficult to predict what is next. We continue to work very closely in partnership with Pemex and trying to get some more intelligence from the government, but I don't want to be commenting more on this. And again, we remain focused on doing the best and adapting to the market activity there. Great, thank you. Thank you.
Speaker Change: 1 of The Next Step that could help unlock the value of, obviously the Assets in Mexico, and dynamic of PMX to rebound. From. From this, we stand, ready, we have been in in a country for, for decades and we are really, uh, uh, to respond bit on the gas development, or, or overdevelopment. We are not only working for PMX in Mexico. We're working with independent, local, independent that have been fairly active. And we have a very exciting project for Woodside. Deep water, Mexico, Sunny early next year that we are all prepared for both subzi and and well construction that I think we're excited about that is adding Dimension to the Mexico rebound. So the difficulty the difficulty to predict what is next. We continue to work, very closely with partnership with PMX and trying to get the some more intelligence from the, from the government. But I don't want to be commenting more on this and again, we remain focused on doing the best.
Speaker Change: And adapting to the, to the market activity there.
Speaker Change: Great. Thank you.
Speaker Change: Thank you.
Josh Silverstein: Your last question comes from the line of Josh Silverstein with UBS. Your line is open. Yeah, hi, everyone. Appreciate you stripping out the business, the digital business, sorry, as highlight the value. You previously talked about top line standalone digital growth kind of Made to High Teens this year.
Speaker Change: Thank you.
Speaker Change: Your last question comes from the line of Josh Silverstein with UBS, your line is open.
Stéphane Biguet: I want to see if you're still on track for that level, and then if you could provide any details around the growth contributions from Delphi, cloud, and the AI platforms within that. Yeah, we don't split. We don't split typically. I think we have been commenting just this quarter that I think the combination of cloud legacy application that is desktop and digital operation is going at double digit. We have a significant uptick in the second half of the year. We said mid to high teens in the past. I think we are continuing to your mission to be as committed to grow and certainly to outpace significantly.
Yeah. Hi. Hi everyone. Um, appreciate you. Stripping out the business, the digital business, sorry, as a standalone unit, to highlight the value here. Um you had previously talked about Topline Standalone digital growth kind of in the mid to high teams this year. I want to see if you're still on track for that level and then if you can provide any details around the G, the uh, growth contributions from Delphi cloud and the AI platforms within that Outlook
Stéphane Biguet: That's what matters, is to outpace significantly the rest of the market and be it in mid-teens or by contrast with the much lower and declining capex. So decoupled activity, decoupled investment profile is what we are accessing. And yeah, I think as I said, it's a long digital transformation. It's a long journey we have started with the industry. And I think our leadership in cloud, between digital operation, between legacy desktop or in expansion data, as a combination, we continue to do everything to make sure that it's highly differentiated in terms of growth rate compared to the, and we expect this to be the case for the foreseeable future.
Yeah, we don't, we don't split. Um, we don't split typically, uh, I think we have been commenting. Just this quarter that I think the combination of cloud Legacy application that is desktop and digital operation, uh, is going at Double Digit. Uh, we have a significant uptick in the second half of the year. Uh, we said the mid to it in the past, I think we are continuing to to your ambition to be as committed to your to go. And certainly to outpace significantly that what matters is to have basic significantly, the rest of the market, and be it in in. So, or by by compass with the much lower and declining capex.
Stéphane Biguet: And as you have seen, the market, the margin has improved. We expect the margin to further improve in the second half, back end of the year, back in the fourth quarter and becoming accretive and remaining accretive highly in terms of margins and continuing to be accretive in terms of supply and cost. So I think we commented on some users' characteristics that are linked to the cloud adoption. We have seen this quarter to just give you a data point, 40 million CPU hours being consumed, 50% more than Q2 last year at the same time. We have seen also almost 1,000 of wells being drilled using drill plan, well for planning cloud application that we use with our customers.
Speaker Change: So, the, the copper, the, the copper, the activity, the copper the investment profile is, what we are accessing. And yeah, I think it's a long as I say, it's a long digital transformation. It's a long journey. We have started with the industry and I think our leadership bit in cloud between digital operation bit in Legacy desktop or in expansion data. Uh, as a combination, we continue to, uh, uh, do everything uh, to make sure that uh, it's the highly differences in term of growth rate compared to the and we expect this to be the case for the foreseeable future. And as you have seen the market, the the margin have improved. We expect the margin to further improve in the second. Half the back end of the year Parts in the fourth quarter and becoming active, and remaining a creative highly in term of margins and continuing to be active in term of Topline course.
Stéphane Biguet: So I think we continue to see momentum and we are confident that I think it will be for sure much higher growth than the rest and one of the highest growth business line we have in SLB.
Speaker Change: Some users, uh, uh, characteristic that are linked to, to the to the cloud adoption. Uh, we have seen this quarter to just give you a data point, uh, 40 million, uh, CPU hours being consumed, 50% more than 32 last year at the same time. Uh, we have seen also almost 1,000 of Wells being, uh, drilled using drill plan, 1 of our planning Cloud application that we use and we, our customers. So, I think we, we, we continue to see momentum.
Stéphane Biguet: And you will, from Q3, get more details and we will disclose this transparently so that the value that we can extract from this will be recognized by investors. Thanks for that. And maybe just to follow up, and I know there's more.
Speaker Change: And uh, we are confident that. I think it will be for sure uh much higher growth than the rest and 1 of the highest growth business line. We have in the in SLB and you will from Q3 uh get more details and uh and we will disclose this uh transparency. So that the value that we can extract from this with recognized by investors.
Stéphane Biguet: Are there any additional types of disclosures you might be able to provide here? AI and fast driven products towards companies that are more specifically focused on this as well. Well, obviously, we have, as you know, decided to establish a new platform called Lumi for data and AI adoption across our customers. And I think we are very pleased with the early impact this had, a lot of POV, as we call it, a lot of early, early tests and adoption across really all the sectors of our customer base, attracted by the ability to connect and to integrate data and to have a toolbox of AI capability that we offer from our partners, so that AI workflows can be enabled through our platform by customers and letting the customer play with their data and using our toolbox to then do Gen AI or to use AI capability on top.
Speaker Change: Yeah, thanks for that and and uh maybe just the follow up and I know there's more details to come on the third quarter. But um, are there any additional types of disclosures you might be able to provide here on these kind of key Ai and fast driven products towards companies that are more specifically focused on on this as well? Thanks,
Stéphane Biguet: So that's, that's what is exciting. That's what customers are coming to our platform for. And that's what the early success of Lumi is giving us. So, yes, I think continued momentum there. And this is only the early, early steps of that adoption.
Speaker Change: Now, if you see, we have as, you know, uh, decided to establish a new platform called Lumi for data and AI adoption across our customers. And I think we are very pleased uh, with the early uh, impact. This had a lot of POV as we call it. Uh, a lot of early early tests and adoption across, really, uh, all the the second of our customer base, uh, attracted by the ability to connect and to integrate uh data and to have a toolbox of AI capability uh, that we offer from our partners. Uh, so that AI workflows can be enabled uh, through our platform by customers and letting the customer play with our data and using our toolbox to then do use Genai or to use AI capability on top. That's that's what is exciting. That's what customer are coming to our platform for and that's what the early success of Lumi is giving.
Speaker Change: Us so yes I think uh continued momentum there and this is only the early early steps of that adoption.
Olivier Peuch: Thank you.
Olivier Peuch: I will now turn the call over to SLV for closing remarks. Thank you again.
Thank you.
Speaker Change: I will now turn the call over to SLB for closing remarks.
Speaker Change: Thank you, man.
Olivier Peuch: Ladies and gentlemen, as we conclude today's quarter, I would like to leave you with the following takeaways. First, SAP Diverse Portfolio and Broad Operating Footprint enabled us to overcome regional headwinds and evolving macro dynamics to deliver solid results as we demonstrated this quarter. Second, we're increasing our exposure to the growing production recovery market with the addition of Champagne. A combined portfolio, technology capability, and digital leadership will position SLB to unlock value for our customers while delivering best-in-class workflow integration across production, chemicals, and our children. And finally, global oil and gas markets have thus far proven resilient, and we are optimistic about the opportunities ahead and our ability to deliver steady growth in the second half of the year.
Speaker Change: Ladies and gentlemen, as we conclude today's code, I would like to leave you with the following takeaways first, Saab diverse portfolio. On boarding footprint, enable us to overcome a general ruins and evolving, macro Dynamics, deliver solid results as we demonstrated this quarter,
Speaker Change: Second exposure to the growing production recovery Market. With that addition of champion X
A combined portfolio technology capability and digital leadership will position SLB to unlock value for customers while delivering best-in-class, workflow integration across production, chemicals, and our list.
Olivier Peuch: With this, I conclude today's call. Thank you all for joining.
Speaker Change: And finally, Global online? Gas market, have those power problem and we are optimistic about the opportunities ahead and our ability to diversity growth in the second half of the year with this. I conclude today's call. Thank you all for joining.
Megan: This concludes today's conference call.
this concludes today's conference call, you may now disconnect