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Call sheet · Q1'26

Schlumberger (SLB)

Q1'26 earnings call · held 2026-04-24 · compared with the Q4'25 call · management-credibility review
8/12
Disclosure score
2 high, 4 medium, 1 low flags
Financial quality
Bottom line
SLEEPER STORY: SLB has quietly positioned itself as the only Western service company with operational readiness across the Middle East during the conflict, giving them monopolistic advantage in the recovery cycle. While everyone focuses on the obvious Q1 earnings miss, the real story is their 'standby' positioning for what could be the largest intervention cycle in decades. The binding constraint isn't demand - it's their ability to scale operations fast enough when recovery begins. Most revealing quote: 'We stand ready, so we are more in standby as we speak' - they're literally camping out waiting for the biggest opportunity in years. My view changes if OneSubsea margins don't recover by Q3 or if data center margins remain undisclosed by year-end.

The 30-second version

  • SLEEPER STORY: SLB is quietly building a monopoly position in Middle East recovery operations
  • Middle East conflict cost them $200M more than guided in Q1, but management sees this as setup for massive intervention cycle
  • Data center business suddenly name-dropping NVIDIA partnership but margins mysteriously absent

What changed this quarter

MetricQ4'25Q1'26Change
Revenue$9.7B (flat YoY)$8.7B (-7% YoY ex-ChampionX)-$1B sequential, -200bps worse than guided
EPS (ex-charges)$0.78$0.52-$0.20 YoY, -$0.26 sequential
Adj EBITDA Margin23.9%20.3%-346bps YoY, -360bps sequential
Free Cash Flow$2.3B-$23MNegative for first time, seasonal but worse
Digital Revenue$825M (+25% seq)$640M (+9% YoY)-22% sequential decline
Digital ARR$1.02B (just crossed $1B)$1.02BFlat sequential, +15% YoY
Production Systems Revenue$4.1B (+17% seq)$3.5B (+23% YoY)-15% sequential, ChampionX boosted
OneSubsea Margin18.1% (prior year)14.4%-370bps from 2025 level
Well Construction Margin18.7%15.2%-463bps YoY, pricing pressure
Net Debt$7.4B$8.2B+$797M sequential increase

Accountability tracked

8 new promises made4 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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