Oilfield equipment and services company slb (slb), formerly known as Schlumberger, reported first-quarter financials above expectations on Friday, supported by increases in international and North American revenue. This followed a report on Wednesday that Tops Target from Baker Hughes (bkr). Baker Hughes stock and the SLB were mixed early on Friday.
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Going into 2023, Baker Hughes, SLB and Halliburton (Hal) All expected strong demand for oil and tight supplies in the foreseeable future. All companies offer a wide range of oilfield support services and technologies. Each Oilfield Services leader also pointed to countless international growth opportunities, particularly in the Middle East.
On Friday, US crude oil futures settled near $77.30 a barrel. Oil fell to as low as $66.74 in March. Earlier in April, US oil futures hit a five-month high of $83.5 a barrel after OPEC+ announced a surprise oil production cut.
With Baker Hughes and SLB earnings, Halliburton is set to report Tuesday.
SLB earnings
estimatesAnalysts had expected SLB earnings to grow 76% to 60 cents per share in the first quarter. Wall Street expected sales to increase 24% to $7.44 billion.
resultsEPS: rose 85% to 63 cents. Revenue increased by 30% to $7.74 billion. Well construction and production systems revenue increased by 36% and 38%, respectively. Pretax income for those units rose by 73% and 80%.
International revenue, which accounts for 77% of all securities lending and borrowing, rose 29%. North America revenue earned 32%.
“Revenue growth outpaced rig count growth both in North America and internationally,” SLB CEO Olivier le Peuch said in a statement, marking the highest quarterly year-over-year growth in more than a decade.
Le Boich said pricing trends have been positive as customers have worked to adjust contracts in order to offset inflation, and as service capacity continues to tighten across international markets.
“There is broader recognition of the positive long-term outlook for oil and gas demand and the potential for a stronger recovery in demand in the second half of the year,” he added.
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“Recent OPEC+ decisions continue to keep commodity prices at supportive levels – providing operators with more confidence to implement their projects,” he said.
SLB shares
The SLB was down a bit in pre-market trading on Friday, after closing down 1.3% at 51.97 on Thursday. The shares are consolidating, with an official 56.54 buy point, according to MarketSmith Analysis.
SLB topped fourth-quarter revenue and earnings on January 20. The company reported that earnings per share grew 73% to 71 cents per share while revenue jumped 27% to $7.9 billion.
SLB expects a record level of upstream investment in the Middle East during 2023. The company said it already has a range of offshore oil and gas development plans across the region.
In 2022, SLB earnings increased by 70% to $2.18 per share. Full-year revenue was $28.1 billion, up 23% compared to 2021. This was in line with the company’s expectations. In 2023, the SLB is looking to grow by 15% compared to 2022.
Baker Hughes stock: Earnings
estimatesWall Street expected Baker Hughes earnings per share of 26 cents, up 73% from a year ago. Analysts also expect revenue to increase 14% to $5.52 billion.
resultsBaker Hughes reported that EPS jumped 86% to 28 cents while revenue increased 18% to $5.72 billion.
BKR reported revenues of $1.34 billion from operations in the Middle East and Asia, up 23% from last year. North America revenue came second, with $992 million in the first quarter.
“We were pleased with our first-quarter results and remain optimistic about the outlook for 2023,” CEO Lorenzo Simonelli said in a statement on Wednesday.
Baker Hughes stock fell 1.5% to 30.09 Thursday. On Friday, shares were up 0.5% in early trade.
On January 23, Baker Hughes missed its fourth-quarter profit and sales targets, growing revenue 8% to $5.9 billion in the fourth quarter. Dividend increased 52% to 38 cents per share. However, BKR also painted a bright picture for the oil market for 2023.
Baker Hughes executives also reported a record backlog of $25 billion, buoyed by an increase in year-end LNG equipment orders.
In 2022, orders increased by 24% to $26.7 billion. Full-year revenue rose 3% to $21.16 billion — the company’s first payment in three years. Revenue from the company’s oilfield services segment increased 10% compared to 2021. Earnings per share for the full year increased 43% to 90 cents per share.
At the end of January, Baker Hughes forecast 2023 revenue between $24 billion and $26 billion, and adjusted EBITDA between $3.6 billion and $3.8 billion.
BKR shares ranked fourth in the world Oil and gas machinery/equipment industry group. Baker Hughes has a composite rating of 79 out of 99. The stock has a relative strength rating of 75, and is exclusive IBD stock check A measure of share price movement. The EPS rating is 86.
Baker Hughes shares: another giant oil field
Associate oilfield services company Halliburton reported earnings early Tuesday, April 25th. The Street expects the company’s EPS to rise 91% to 67 cents in the first quarter on sales increasing 28% to $5.49 billion.
HAL saw fourth-quarter profit and revenue increase 100% to 72 cents and $5.58 billion, respectively. It reported 2022 earnings per share of $2.15, up 99% compared to 2021. Full-year sales were up 33% to $20.3 billion.
Analysts expect Halliburton’s 2023 earnings to grow 40% to $3.00 per share, according to FactSet. Full-year revenue is expected to increase 15% to $23.47 billion.
CEO Jeff Miller told investors that everything points to “continued oil and gas tightening in 2023.” Miller expects activity in the US to remain strong and service intensity to increase through 2023. The strong reopening of the Chinese economy is likely to impact global demand this year.
Halliburton stock advanced 0.4% early on Friday.
Please follow Kit Norton on Twitter @tweet for more coverage.
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