Core Insights - SLB reported Q2 2025 earnings of 74 cents per share, exceeding the Zacks Consensus Estimate of 73 cents, but down from 85 cents in the same quarter last year [1][10] - Total quarterly revenues reached $8.55 billion, surpassing the Zacks Consensus Estimate of $8.49 billion, but decreased from $9.14 billion year-over-year [1][10] - The positive quarterly results were mainly driven by international growth, strong digital revenues, and increased demand for production systems [2] Segment Performance - Digital & Integration unit revenues totaled $995 million, a 5% decline from the previous year, with pre-tax operating income slightly up to $327 million, missing the Zacks estimate of $330 million [3] - Reservoir Performance unit revenues decreased by 7% to $1.69 billion, with pre-tax operating income down 16% to $314 million, but beating the Zacks estimate of $297 million [4] - Well Construction segment revenues fell 13% to $2.96 billion, with pre-tax operating income down 26% to $551 million, aligning with the Zacks estimate [5] - Production Systems segment revenues increased slightly to $3.04 billion, with pre-tax operating income up 5% to $499 million, exceeding the Zacks estimate of $488 million [6] Financials - SLB reported free cash flow of $622 million for Q2 2025 [7] - As of June 30, 2025, the company had approximately $3.75 billion in cash and short-term investments, with long-term debt at $10.89 billion [7] Outlook - SLB's full-year 2025 capital investment guidance is approximately $2.4 billion, lower than the 2024 level of $2.6 billion [8] Stock Performance - SLB currently holds a Zacks Rank 5 (Strong Sell) [9]

Financial Data and Key Metrics Changes - The second quarter earnings per share, excluding charges and credits, was $0.74, representing a sequential increase of $0.02 and a year-over-year decrease of $0.11 [22] - Second quarter revenue was $8.5 billion, a 1% sequential increase driven by 2% growth in international markets [22][23] - Adjusted EBITDA margin for the second quarter was 24%, reflecting a sequential increase of 21 basis points [23] Business Line Data and Key Metrics Changes - Production Systems revenue increased by 3% sequentially to $3 billion, driven by strong sales in artificial lift and midstream production systems [25] - Digital and Integration revenue decreased by 1% sequentially to $1 billion, with margins expanding to 32.8% due to greater digital adoption [24][25] - Reservoir Performance revenue declined by 1% sequentially to $1.7 billion, while Well Construction revenue was essentially flat at $3 billion [25] Market Data and Key Metrics Changes - In international markets, revenue grew by 2%, with strong growth in Iraq, UAE, Kuwait, East Asia, China, and Australia [7][8] - North America experienced a revenue decline, primarily due to seasonal factors and a non-repeat of exploration data sales [9][10] - The offshore market saw certain projects delayed, particularly in Sub-Saharan Africa, but maintained a steady backlog [10] Company Strategy and Development Direction - The acquisition of ChampionX is expected to enhance the company's portfolio and capabilities, particularly in production chemicals and natural gas [5][16] - The company aims to integrate ChampionX's strengths to drive innovation and customer value creation across its service offerings [19][30] - The focus is on less cyclical, OpEx-driven market opportunities that are less sensitive to short-term commodity cycles [15][51] Management's Comments on Operating Environment and Future Outlook - The macro environment remains uncertain, particularly with OPEC+ supply releases, but the company anticipates resilience in the market outlook [14][60] - The company expects second half revenue to be between $18.2 billion and $18.8 billion, driven by the contribution from ChampionX and steady revenue in legacy businesses [20][34] - Management expressed confidence in the long-term growth potential of the offshore market and the resilience of international markets [46][62] Other Important Information - The company generated $1.1 billion in cash flow from operations and $622 million in free cash flow during the quarter, reflecting a significant increase compared to the previous quarter [26] - Capital investments for the full year are expected to be approximately $2.4 billion, influenced by the ChampionX acquisition [27] Q&A Session All Questions and Answers Question: Can you provide more detail on the guidance for the second half? - Management indicated that the guidance reflects potential growth in the second half, driven by the combination of Production Systems and ChampionX, offsetting headwinds in selective markets [39][40] Question: Are there concerns about near-term activity in deepwater projects? - Management acknowledged some projects have been delayed but remains optimistic about the pipeline of advantageous projects in the Americas and other regions [45][46] Question: What is the growth outlook for the production business? - Management highlighted three elements driving growth: customer focus on production recovery, the unique combination of offerings from ChampionX, and the integration of digital capabilities [50][51] Question: How do you view capital intensity and free cash flow metrics going forward? - Management anticipates maintaining low capital intensity and aims for a free cash flow margin above 10% of revenue, with positive contributions from ChampionX [54] Question: What insights can you provide regarding the political landscape in Mexico? - Management noted ongoing restructuring efforts in Mexico and expressed readiness to respond to future opportunities, particularly in gas development [88][89]

Financial Data and Key Metrics Changes - The second quarter earnings per share, excluding charges and credits, was $0.74, representing a sequential increase of $0.02 and a decrease of $0.11 compared to the same quarter last year [21] - The second quarter revenue was $8.5 billion, a 1% sequential increase driven by 2% growth in international markets [22] - Adjusted EBITDA margin for the second quarter was 24%, reflecting a sequential increase of 21 basis points [22] Business Line Data and Key Metrics Changes - Production Systems revenue increased by 3% sequentially to $3 billion, driven by strong sales in artificial lift and midstream production systems [24] - Digital and Integration revenue decreased by 1% sequentially to $1 billion, with margins expanding by 240 basis points to 32.8% [22][23] - Reservoir Performance revenue declined by 1% sequentially to $1.7 billion, while Well Construction revenue was essentially flat at $3 billion [24] Market Data and Key Metrics Changes - In international markets, revenue grew by 2%, with strong growth in Iraq, UAE, Kuwait, East Asia, China, and Australia [7] - North America saw a revenue decline, primarily due to seasonal spring breakup in Canada and a non-repeat of exploration data sales in U.S. offshore [8] - The macro environment remains uncertain, particularly with OPEC plus supply releases impacting market dynamics [12][13] Company Strategy and Development Direction - The acquisition of ChampionX is expected to enhance the company's portfolio, providing capabilities in producing chemicals and naturalist, which are critical for long-term asset performance [15][16] - The company aims to integrate ChampionX's capabilities to deliver a fully integrated service offering from reservoir to surface facility [18] - The focus is on creating a less cyclical and growing market opportunity that is more OpEx driven and less sensitive to short-term commodity cycles [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth of the offshore market despite current project delays, citing a steady backlog in OneSubsea [9] - The company anticipates second half revenue to be between $18.2 billion and $18.8 billion, driven by the contribution of ChampionX and steady revenue in legacy business [19][33] - Management noted that while the macro environment is uncertain, there is resilience in the Middle East and Asia markets, driven by lower breakeven costs and a focus on energy security [13][57] Other Important Information - The company generated $1.1 billion of cash flow from operations and free cash flow of $622 million during the quarter, representing a significant increase compared to the previous quarter [25] - Capital investments for the full year are expected to be approximately $2.4 billion, reflecting the impact of the ChampionX acquisition [26] - The company plans to start reporting digital business results as a separate segment beginning in the third quarter [23] Q&A Session Summary Question: Insights on customer behavior and spending trends - Management indicated that major adjustments in international markets are largely behind them, with customers prepared to adjust spending rates due to uncertainty and declining commodity prices [39] Question: Concerns about deepwater activity - Management acknowledged some near-term activity slowing but expressed optimism about a robust pipeline of advantageous projects in the Americas and other regions [44] Question: Growth outlook for the production business - Management highlighted that the focus is on extracting more value from the production recovery phase, with expectations for long-term resilience and growth in the production market [49] Question: Expectations for synergies with ChampionX - Management expects to achieve $400 million in annual pre-tax synergies within the first three years post-acquisition, with a significant portion coming from cost synergies [29][80] Question: Insights on Mexico's gas supply growth - Management noted the need for Pemex to address restructuring issues and expressed readiness to respond to gas development opportunities in Mexico [87]

Company Performance - Schlumberger reported quarterly earnings of $0.74 per share, exceeding the Zacks Consensus Estimate of $0.73 per share, but down from $0.85 per share a year ago, indicating an earnings surprise of +1.37% [1] - The company posted revenues of $8.55 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.71%, but down from $9.14 billion year-over-year [2] - Over the last four quarters, Schlumberger has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Outlook - The stock has underperformed the market, losing about 9.6% since the beginning of the year compared to the S&P 500's gain of 7.1% [3] - The current consensus EPS estimate for the coming quarter is $0.77 on revenues of $9.28 billion, and for the current fiscal year, it is $3.03 on revenues of $35.81 billion [7] - The estimate revisions trend for Schlumberger was unfavorable ahead of the earnings release, resulting in a Zacks Rank 5 (Strong Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Oil and Gas - Field Services industry, to which Schlumberger belongs, is currently in the bottom 4% of over 250 Zacks industries, suggesting a challenging environment [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [5]

Industry Outlook - SLB (Schlumberger), the world's largest oil-services provider, anticipates resilience in the oil industry [1] - The industry remains optimistic about the second half of 2025 [1] Demand Considerations - Customer demand uncertainties are present [1]

[Second-Quarter 2025 Results Overview](index=1&type=section&id=Second-Quarter%202025%20Results%20Overview) [Summary Financial Performance](index=1&type=section&id=Summary%20Financial%20Performance) SLB reported second-quarter 2025 revenue of **$8.55 billion**, a 1% sequential increase but a 6% year-on-year decrease, with GAAP diluted EPS at **$0.74** and Adjusted EBITDA reaching **$2.05 billion** Summary Financial Performance (millions, except EPS) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------------------------------ | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Revenue | $8,546 | $8,490 | $9,139 | 1% | -6% | | Income before taxes – GAAP basis | $1,285 | $1,063 | $1,421 | 21% | -10% | | Net income attributable to SLB – GAAP basis | $1,014 | $797 | $1,112 | 27% | -9% | | Diluted EPS – GAAP basis | $0.74 | $0.58 | $0.77 | 28% | -4% | | Adjusted EBITDA* | $2,051 | $2,020 | $2,288 | 2% | -10% | | Adjusted EBITDA margin* | 24.0% | 23.8% | 25.0% | 21 bps | -103 bps | - Cash flow from operations was **$1.14 billion** and free cash flow was **$622 million** for Q2 2025[4](index=4&type=chunk) - The Board approved a quarterly cash dividend of **$0.285 per share**[4](index=4&type=chunk) [CEO Commentary & Market Outlook](index=2&type=section&id=CEO%20Commentary%20%26%20Market%20Outlook) CEO Olivier Le Peuch emphasized SLB's resilient Q2 performance, driven by a diversified portfolio and strategic focus on production and recovery, with a constructive outlook for the second half of the year - SLB reported solid second-quarter results, leveraging its diversified portfolio and broad market exposure to deliver steady revenue and slightly higher adjusted EBITDA and margins sequentially, demonstrating resilience amidst softer upstream spending and macroeconomic uncertainty[6](index=6&type=chunk) - International revenue increased **2% sequentially**, driven by robust growth in parts of the Middle East, Asia, Europe, and North Africa, offsetting declines in other key markets[8](index=8&type=chunk) - Customers are increasing their focus on maximizing asset value and improving efficiency in the production phase, leading to higher demand for SLB's production and recovery solutions, particularly in the U.S. and mature basins[11](index=11&type=chunk) - SLB will increase its exposure to the less cyclical production and recovery space following the acquisition of ChampionX, which closed recently[12](index=12&type=chunk) - The industry has shown resilience, operating through uncertainty without a significant drop in upstream spending, driven by capital discipline and energy security needs[13](index=13&type=chunk) [Key Events & Strategic Developments](index=4&type=section&id=Key%20Events%20%26%20Strategic%20Developments) [Corporate Actions](index=4&type=section&id=Corporate%20Actions) SLB completed the sale of its Palliser Block interests and finalized the ChampionX acquisition to enhance production and recovery market exposure - On June 26, 2025, SLB completed the sale of its working interests in the Palliser Block in Alberta, Canada[16](index=16&type=chunk) - On July 16, 2025, SLB completed its acquisition of ChampionX, which is expected to increase its exposure to the growing production and recovery market and deliver best-in-class workflow integration across production chemicals and artificial lift[16](index=16&type=chunk) [Dividend Announcement](index=4&type=section&id=Dividend%20Announcement) SLB's Board approved a quarterly cash dividend of **$0.285 per share**, payable in October 2025 - On July 17, 2025, SLB's Board of Directors approved a quarterly cash dividend of **$0.285 per share** of outstanding common stock, payable on October 9, 2025, to stockholders of record on September 3, 2025[17](index=17&type=chunk) [Revenue & Operating Performance by Geography](index=4&type=section&id=Revenue%20%26%20Operating%20Performance%20by%20Geography) [International Revenue Performance](index=4&type=section&id=International%20Revenue%20Performance) International revenue increased **2% sequentially to $6.85 billion** but declined **8% year-on-year**, with regional variations including growth in Europe & Africa International Revenue Performance (millions) | Region | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :---------------- | :------------ | :------------ | :------------ | :---------------- | :------------------ | | International | $6,847 | $6,727 | $7,452 | 2% | -8% | [Latin America](index=4&type=section&id=Latin%20America) Latin America revenue remained flat sequentially at **$1.49 billion**, driven by mixed activity, while declining **14% year-on-year** due to reduced land drilling in Mexico Latin America Revenue (millions) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :----------- | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Latin America | $1,492 | $1,495 | $1,742 | — | -14% | - Sequential growth from offshore activity in Brazil and increased land activity in Argentina was offset by reduced sales of production systems in Guyana[19](index=19&type=chunk) - Year-on-year decline was primarily due to a significant reduction in land drilling activity in Mexico, partially offset by robust unconventional stimulation activity in Argentina[19](index=19&type=chunk) [Europe & Africa](index=4&type=section&id=Europe%20%26%20Africa) Europe & Africa revenue grew **6% sequentially to $2.37 billion** from strong artificial lift and digital sales, but decreased **3% year-on-year** due to reduced deepwater activity Europe & Africa Revenue (millions) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------- | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Europe & Africa | $2,369 | $2,235 | $2,442 | 6% | -3% | - Sequential growth was driven by significant sales of artificial lift in North Africa, subsea production systems in Nigeria, and higher digital revenue and increased sales of production systems in Europe[20](index=20&type=chunk) - Year-on-year decline was a result of reduced deepwater activity, partially offset by strong sales of artificial lift in North Africa and increased sales of production systems in Europe[21](index=21&type=chunk) [Middle East & Asia](index=5&type=section&id=Middle%20East%20%26%20Asia) Middle East & Asia revenue was flat sequentially at **$2.99 billion**, with gains in Iraq and UAE offset by declines in Saudi Arabia and Qatar, resulting in a **9% year-on-year decrease** Middle East & Asia Revenue (millions) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :---------------- | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Middle East & Asia | $2,986 | $2,997 | $3,268 | — | -9% | - Sequential performance was flat as solid drilling performance and higher production system sales in Iraq and UAE, along with increased activity across Asia, were offset by activity decline in Saudi Arabia and Qatar[22](index=22&type=chunk) - Year-on-year decline was due to reduced activity and lower production system sales in Saudi Arabia, with declines also noted in Asia, Egypt, and Qatar, partially offset by higher revenues in UAE, Kuwait, and Iraq[23](index=23&type=chunk) [North America Revenue Performance](index=5&type=section&id=North%20America%20Revenue%20Performance) North America revenue decreased **4% sequentially to $1.65 billion** due to various factors, but saw a **1% year-on-year increase** driven by data center infrastructure solutions North America Revenue (millions) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------ | :------------ | :------------ | :------------ | :---------------- | :------------------ | | North America | $1,655 | $1,719 | $1,644 | -4% | 1% | - The sequential decline stemmed from lower Asset Performance Solutions (APS) revenue in the divested Palliser block, reduced drilling activity due to the Canadian seasonal spring breakup, and lower offshore exploration data sales[24](index=24&type=chunk) - Year-on-year revenue was slightly higher, driven by strong growth in data center infrastructure solutions, largely offset by reduced APS revenue in Canada and a sharp decline in U.S. land drilling activity[25](index=25&type=chunk) [Revenue & Operating Performance by Division](index=5&type=section&id=Revenue%20%26%20Operating%20Performance%20by%20Division) [Digital & Integration](index=5&type=section&id=Digital%20%26%20Integration) Digital & Integration revenue decreased **1% sequentially to $995 million** and **5% year-on-year**, yet pretax operating margin significantly expanded to **32.8%** due to digital adoption and cost efficiencies Digital & Integration Performance (millions, except margin) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------------------ | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Revenue | $995 | $1,006 | $1,050 | -1% | -5% | | Pretax operating income | $327 | $306 | $325 | 7% | — | | Pretax operating margin | 32.8% | 30.4% | 31.0% | 240 bps | 186 bps | - Digital revenue remained steady, with double-digit sequential growth from platforms, applications, and digital operations, offset by reduced sales of exploration data[27](index=27&type=chunk) - Margin improvement was primarily driven by greater digital adoption and cost-efficiency gains[29](index=29&type=chunk) [Reservoir Performance](index=6&type=section&id=Reservoir%20Performance) Reservoir Performance revenue declined **1% sequentially to $1.69 billion** and **7% year-on-year**, but pretax operating margin improved **203 bps sequentially to 18.6%** from higher intervention activity Reservoir Performance (millions, except margin) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------------------ | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Revenue | $1,691 | $1,700 | $1,819 | -1% | -7% | | Pretax operating income | $314 | $282 | $376 | 12% | -16% | | Pretax operating margin | 18.6% | 16.6% | 20.6% | 203 bps | -205 bps | - Sequential decline was due to a slowdown in evaluation and stimulation activity across international markets, partially offset by strong intervention activity[31](index=31&type=chunk) - Year-on-year revenue dropped primarily due to reduced activity in Saudi Arabia, Namibia, and Mexico[32](index=32&type=chunk) - Sequential margin improvement stemmed from higher intervention activity and the absence of startup costs that impacted the first quarter[32](index=32&type=chunk) [Well Construction](index=7&type=section&id=Well%20Construction) Well Construction revenue was flat sequentially at **$2.96 billion** but decreased **13% year-on-year**, with pretax operating margin declining to **18.6%** due to widespread activity reductions Well Construction Performance (millions, except margin) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------------------ | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Revenue | $2,963 | $2,977 | $3,411 | — | -13% | | Pretax operating income | $551 | $589 | $742 | -6% | -26% | | Pretax operating margin | 18.6% | 19.8% | 21.7% | -119 bps | -315 bps | - Sequential revenue was essentially flat, with gains in Iraq, UAE, offshore Mexico, North Africa, and Nigeria offset by declines in Namibia, North America land markets, Argentina, and Saudi Arabia[34](index=34&type=chunk) - Year-on-year revenue fell due to a broad reduction in drilling activity across Mexico, Namibia, Saudi Arabia, North America, Guyana, and India[35](index=35&type=chunk) - Margin compression stemmed from widespread activity reductions across North America and several international markets, partially offset by cost efficiency measures[36](index=36&type=chunk) [Production Systems](index=7&type=section&id=Production%20Systems) Production Systems revenue increased **3% sequentially to $3.04 billion** and was flat year-on-year, with pretax operating margin improving to **16.4%** due to favorable activity mix and execution Production Systems Performance (millions, except margin) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential Change | Year-on-year Change | | :------------------------ | :------------ | :------------ | :------------ | :---------------- | :------------------ | | Revenue | $3,036 | $2,938 | $3,025 | 3% | — | | Pretax operating income | $499 | $475 | $473 | 5% | 5% | | Pretax operating margin | 16.4% | 16.2% | 15.6% | 28 bps | 79 bps | - Sequential growth was fueled by higher sales of artificial lift systems, midstream production solutions, valves and completions, as well as higher data center infrastructure solutions in North America[38](index=38&type=chunk) - Year-on-year revenue grew slightly as strong demand for data center infrastructure solutions, artificial lift, and completions was largely offset by reduced sales of subsea production systems and valves[39](index=39&type=chunk) - Margin expansion was driven by stronger profitability across several business lines, supported by a favorable activity mix, efficient execution, and conversion of higher-margin backlog[39](index=39&type=chunk) [Quarterly Highlights](index=9&type=section&id=Quarterly%20Highlights) [Core Business Contract Awards](index=9&type=section&id=Core%20Business%20Contract%20Awards) SLB secured significant Core business contracts, including subsea EPCI for bp's Ginger project, CO2 injection for Equinor, and integrated completion services for PDO - SLB's OneSubsea joint venture and Subsea Integration Alliance Partner, Subsea7, were awarded a substantial engineering, procurement, construction, and installation contract by bp for the Ginger project offshore Trinidad and Tobago[40](index=40&type=chunk) - SLB's OneSubsea was awarded an engineering, procurement, and construction contract by Equinor for a CO2 subsea injection system for the Northern Lights phase two offshore project in Norway, marking a decisive milestone for carbon capture and storage (CCS) at scale[40](index=40&type=chunk) - Perenco awarded SLB a multiyear contract to deliver well construction measurement services in Gabon and the Republic of Congo, deploying advanced technologies like the PowerDrive Archer™ hybrid rotary steerable system[40](index=40&type=chunk) - Petroleum Development Oman awarded SLB two five-year contracts for integrated completion services as well as wireline and tubing-conveyed perforation across its Block 6 concession, based on technology leadership and in-country value offering[40](index=40&type=chunk) - North Oil Company in Qatar awarded SLB a contract to provide Electris™ completions technologies aimed at boosting production and recovery in its Al-Shaheen field, marking the inaugural award for Electris completions in Qatar and the first globally paired with an SLB ESP[40](index=40&type=chunk) [Technology and Innovation](index=10&type=section&id=Technology%20and%20Innovation) SLB launched Electris and Retina™ imaging systems, deploying advanced technologies for enhanced drilling, production, and autonomous operations globally - SLB launched Electris, a portfolio of digitally enabled electric well completions technologies that boost production and recovery while reducing total cost of ownership, with over 100 installations across five countries[41](index=41&type=chunk) - SLB launched Retina™ at-bit imaging system, a technology that converts drill bit measurements into high-quality borehole images for optimizing drilling efficiency, formation evaluation, and safety[41](index=41&type=chunk) - In Ecuador, SLB and ENAP deployed GeoSphere HD™ and PowerDrive Archer™ to achieve precise placement and 100% pay zone contact in horizontal wells, setting a benchmark for the region[41](index=41&type=chunk) - In the United Arab Emirates, Turnwell Industries LLC OPC drilled **95%** of a 9,210-foot well section in autonomous directional control mode using SLB DrillOps™ advisory solution and Neuro™ autonomous solutions, setting a new pad record for rate of penetration[41](index=41&type=chunk) - In East Kuwait, SLB and Kuwait Oil Company enhanced production from the Mauddud Formation using tailored stimulation workflows and innovative technologies, achieving a record-setting total production rate of **4,500 barrels per day** from the first two wells[41](index=41&type=chunk)[42](index=42&type=chunk) [Digital Solutions](index=11&type=section&id=Digital%20Solutions) SLB expands digital solutions through partnerships with Mistral AI, Shell, and Cactus Drilling, deploying AI platforms, subsurface modeling, and autonomous drilling technologies - SLB will deploy its AI platform on Mistral Compute, integrating Mistral AI's large language models as primary generative AI models for the Lumi™ data and AI platform[43](index=43&type=chunk) - SLB partnered with Shell to deploy Petrel™ subsurface modeling across its assets worldwide, powered by advanced AI for seismic interpretation workflows, aiming to standardize infrastructure and accelerate scalable digital solutions[43](index=43&type=chunk) - SLB announced a strategic collaboration agreement with Cactus Drilling to expand the adoption of automated and autonomous drilling solutions, integrating Precise™ automated drilling system with DrillSync™ platform and DrillOps™/Neuro™ solutions[43](index=43&type=chunk) - Renaissance Africa Energy Company awarded SLB a software agreement to deploy advanced digital solutions like Petrel subsurface modeling, Techlog™ wellbore interpretation, and Eclipse™ reservoir simulator in Nigeria[43](index=43&type=chunk) [New Energy Initiatives](index=12&type=section&id=New%20Energy%20Initiatives) SLB advances new energy initiatives, including carbon storage solutions, emissions management, and geothermal energy partnerships, enabling the world's first full-scale cement carbon capture facility - Velesto Energy Berhad and SLB signed a three-year collaboration agreement to deploy DrillOps intelligent well delivery and insights solutions, as well as drilling emissions management solutions on designated Velesto rigs in Malaysia[44](index=44&type=chunk) - SLB launched Sequestri™ carbon storage solutions, a comprehensive portfolio of technologies and services for accelerating safer and more economic carbon storage projects, complementing its Capturi™ carbon capture solutions[44](index=44&type=chunk) - The Heidelberg Materials carbon capture plant in Brevik, Norway, enabled by SLB Capturi's Big Catch™ technology, officially opened as the world's first full-scale carbon capture facility for cement production, capturing its first CO2 in May[44](index=44&type=chunk) - SLB partnered with Google Cloud® and Project InnerSpace to drive global adoption of geothermal energy, leveraging advanced mapping technology, deep geothermal knowledge, and powerful computing[44](index=44&type=chunk) [Financial Tables](index=13&type=section&id=Financial%20Tables) [Condensed Consolidated Statement of Income](index=13&type=section&id=Condensed%20Consolidated%20Statement%20of%20Income) The consolidated statement of income reflects a year-on-year decrease in revenue, net income, and income before taxes for Q2 and the first six months of 2025 Condensed Consolidated Statement of Income (millions, except EPS) | Periods Ended June 30, | Second Quarter 2025 (millions) | Second Quarter 2024 (millions) | Six Months 2025 (millions) | Six Months 2024 (millions) | | :------------------------------------ | :------------------ | :------------------ | :-------------- | :-------------- | | Revenue | $8,546 | $9,139 | $17,035 | $17,846 | | Interest & other income (1) | 252 | 85 | 330 | 169 | | Cost of revenue (1) | 6,934 | 7,262 | 13,815 | 14,270 | | Research & engineering | 180 | 188 | 352 | 369 | | General & administrative | 87 | 94 | 184 | 215 | | Merger & integration (1) | 35 | 16 | 84 | 27 | | Restructuring & other (1) | 135 | 111 | 293 | 111 | | Interest | 142 | 132 | 289 | 245 | | Income before taxes (1) | $1,285 | $1,421 | $2,348 | $2,778 | | Tax expense (1) | 237 | 276 | 471 | 535 | | Net income (1) | $1,048 | $1,145 | $1,877 | $2,243 | | Net income attributable to SLB (1) | $1,014 | $1,112 | $1,811 | $2,180 | | Diluted earnings per share of SLB (1) | $0.74 | $0.77 | $1.32 | $1.51 | | Average shares outstanding assuming dilution | 1,366 | 1,443 | 1,373 | 1,445 | [Condensed Consolidated Balance Sheet](index=14&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) SLB's total assets slightly decreased to **$48.77 billion** as of June 30, 2025, with current liabilities increasing due to higher short-term borrowings Condensed Consolidated Balance Sheet (millions) | Asset/Liability | Jun. 30, 2025 (millions) | Dec. 31, 2024 (millions) | | :------------------------------------ | :------------ | :------------ | | **Assets** | | | | Cash and short-term investments | $3,747 | $4,669 | | Receivables | 8,586 | 8,011 | | Inventories | 4,740 | 4,375 | | Other current assets | 1,380 | 1,515 | | **Total Current Assets** | **18,453** | **18,570** | | Investment in affiliated companies | 1,676 | 1,635 | | Fixed assets | 7,399 | 7,359 | | Goodwill | 14,658 | 14,593 | | Intangible assets | 2,893 | 3,012 | | Other assets | 3,690 | 3,766 | | **Total Assets** | **$48,769** | **$48,935** | | **Liabilities and Equity** | | | | Accounts payable and accrued liabilities | $9,993 | $10,375 | | Estimated liability for taxes on income | 833 | 982 | | Short-term borrowings and current portion of long-term debt | 2,807 | 1,051 | | Dividends payable | 402 | 403 | | **Total Current Liabilities** | **14,035** | **12,811** | | Long-term debt | 10,891 | 11,023 | | Other liabilities | 2,292 | 2,751 | | **Total Liabilities** | **27,218** | **26,585** | | Equity | 21,551 | 22,350 | | **Total Liabilities and Equity** | **$48,769** | **$48,935** | [Components of Liquidity](index=15&type=section&id=Components%20of%20Liquidity) Q2 2025 cash flow from operations was **$1.14 billion** and free cash flow was **$622 million**, while Net Debt increased to **$9.95 billion** due to repurchases and acquisitions Net Debt (millions) | Metric | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Dec. 31, 2024 (millions) | | :------------------------------------ | :------------ | :------------ | :------------ | :------------ | | Cash and short-term investments | $3,747 | $3,897 | $4,003 | $4,669 | | Short-term borrowings and current portion of long-term debt | (2,807) | (3,475) | (1,033) | (1,051) | | Long-term debt | (10,891) | (10,527) | (12,156) | (11,023) | | Net Debt (1) | $(9,951) | $(10,105) | $(9,186) | $(7,405) | Cash Flow Metrics (millions) | Cash Flow Metric | Six Months 2025 (millions) | Second Quarter 2025 (millions) | Six Months 2024 (millions) | | :----------------------- | :-------------- | :------------------ | :-------------- | | Net income | $1,877 | $1,048 | $2,243 | | Cash flow from operations | $1,802 | $1,142 | $1,763 | | Capital expenditures | (769) | (371) | (862) | | APS investments | (225) | (117) | (256) | | Exploration data capitalized | (83) | (32) | (91) | | Free cash flow (4) | $725 | $622 | $554 | | Dividends paid | (773) | (387) | (751) | | Stock repurchase program | (2,300) | — | (735) | [Non-GAAP Financial Measures & Reconciliations](index=16&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) [Charges & Credits](index=16&type=section&id=Charges%20%26%20Credits) Non-GAAP financial measures, excluding specific charges and credits, provide insight into SLB's underlying business, with Q2 2025 diluted EPS at **$0.74** on this adjusted basis - Non-GAAP financial measures, excluding charges & credits, provide useful perspective on SLB's underlying business results and operating trends, and are used by management as performance measures[49](index=49&type=chunk) Second Quarter 2025 Reconciliation (millions, except EPS) | Metric | Pretax (millions) | Tax (millions) | Noncont. Interests (millions) | Net (millions) | Diluted EPS | | :------------------------------------ | :----- | :-- | :----------------- | :-- | :---------- | | SLB net income (GAAP basis) | $1,285 | $237 | $34 | $1,014 | $0.74 | | Impairment of equity method investment | 69 | 12 | — | 57 | 0.04 | | Workforce reductions | 66 | 3 | — | 63 | 0.05 | | Merger & integration | 35 | 4 | 4 | 27 | 0.02 | | Gain on sale of Palliser APS project | (149) | (4) | — | (145) | (0.11) | | SLB net income, excluding charges & credits | $1,306 | $252 | $38 | $1,016 | $0.74 | First Quarter 2025 Reconciliation (millions, except EPS) | Metric | Pretax (millions) | Tax (millions) | Noncont. Interests (millions) | Net (millions) | Diluted EPS | | :------------------------------------ | :----- | :-- | :----------------- | :-- | :---------- | | SLB net income (GAAP basis) | $1,063 | $234 | $32 | $797 | $0.58 | | Workforce reductions | 158 | 10 | — | 148 | 0.11 | | Merger & integration | 48 | 1 | 4 | 43 | 0.03 | | SLB net income, excluding charges & credits | $1,269 | $245 | $36 | $988 | $0.72 | Second Quarter 2024 Reconciliation (millions, except EPS) | Metric | Pretax (millions) | Tax (millions) | Noncont. Interests (millions) | Net (millions) | Diluted EPS | | :------------------------------------ | :----- | :-- | :----------------- | :-- | :---------- | | SLB net income (GAAP basis) | $1,421 | $276 | $33 | $1,112 | $0.77 | | Workforce reductions | 111 | 17 | — | 94 | 0.07 | | Merger & integration | 31 | 5 | 8 | 18 | 0.01 | | SLB net income, excluding charges & credits | $1,563 | $298 | $41 | $1,224 | $0.85 | [Divisional Performance Reconciliation](index=18&type=section&id=Divisional%20Performance%20Reconciliation) Reconciliation of divisional pretax operating income to consolidated income before taxes highlights corporate items and unallocated interest as key differences Three Months Ended Jun. 30, 2025 (millions) | Division | Revenue (millions) | Income Before Taxes (millions) | | :-------------------- | :------ | :------------------ | | Digital & Integration | $995 | $327 | | Reservoir Performance | 1,691 | 314 | | Well Construction | 2,963 | 551 | | Production Systems | 3,036 | 499 | | Eliminations & other | (139) | (107) | | **Pretax segment operating income** | | **$1,584** | | Corporate & other | | (169) | | Interest income(1) | | 30 | | Interest expense(1) | | (139) | | Charges & credits(2) | | (21) | | **Consolidated Income Before Taxes** | **$8,546** | **$1,285** | Six Months Ended Jun. 30, 2025 (millions) | Division | Revenue (millions) | Income Before Taxes (millions) | | :-------------------- | :------ | :------------------ | | Digital & Integration | $2,001 | $633 | | Reservoir Performance | 3,391 | 596 | | Well Construction | 5,940 | 1,140 | | Production Systems | 5,974 | 973 | | Eliminations & other | (271) | (202) | | **Pretax segment operating income** | | **$3,140** | | Corporate & other | | (347) | | Interest income(1) | | 66 | | Interest expense(1) | | (283) | | Charges & credits(2) | | (228) | | **Consolidated Income Before Taxes** | **$17,035** | **$2,348** | - The difference between SLB's consolidated income before taxes and pretax segment operating income consists of corporate items, charges and credits, and interest income and interest expense not allocated to the segments, as well as stock-based compensation expense, amortization expense associated with certain intangible assets, certain centrally managed initiatives, and other nonoperating items[60](index=60&type=chunk) [Supplementary Information (FAQs)](index=19&type=section&id=Supplementary%20Information%20(FAQs)) [Capital Investment Guidance](index=19&type=section&id=Capital%20Investment%20Guidance) SLB's full-year 2025 capital investment guidance is approximately **$2.4 billion**, reflecting the ChampionX acquisition impact and a decrease from 2024 - Capital investment (capex, exploration data costs, and APS investments) for full-year 2025 is expected to be approximately **$2.4 billion**, reflecting the ChampionX acquisition impact, down from **$2.6 billion** in 2024[56](index=56&type=chunk) [Cash Flow from Operations & Free Cash Flow](index=19&type=section&id=Cash%20Flow%20from%20Operations%20%26%20Free%20Cash%20Flow) Q2 2025 cash flow from operations was **$1.14 billion**, with free cash flow at **$622 million** - Cash flow from operations for Q2 2025 was **$1.14 billion**, and free cash flow was **$622 million**[57](index=57&type=chunk) [Interest & Other Income Details](index=19&type=section&id=Interest%20%26%20Other%20Income%20Details) Q2 2025 interest & other income totaled **$252 million**, primarily from the Palliser APS project sale, interest income, and equity method investments Interest & Other Income Components (millions) | Component | Amount (millions) | | :-------------------------- | :---------------- | | Gain on sale of Palliser APS project | $149 | | Interest income | 30 | | Earnings of equity method investments | 73 | | **Total Interest & other income** | **$252** | [Interest Income & Expense Changes](index=19&type=section&id=Interest%20Income%20%26%20Expense%20Changes) Q2 2025 interest income decreased **$4 million sequentially to $30 million**, while interest expense decreased **$5 million sequentially to $142 million** - Interest income of **$30 million** for Q2 2025 decreased **$4 million** sequentially[59](index=59&type=chunk) - Interest expense of **$142 million** for Q2 2025 decreased **$5 million** sequentially[59](index=59&type=chunk) [Income Before Taxes vs. Pretax Segment Operating Income](index=19&type=section&id=Income%20Before%20Taxes%20vs.%20Pretax%20Segment%20Operating%20Income) The difference between consolidated income before taxes and pretax segment operating income is due to corporate items, charges, unallocated interest, and nonoperating items - The difference between consolidated income before taxes and pretax segment operating income includes corporate items, charges and credits, unallocated interest income/expense, stock-based compensation expense, amortization of certain intangible assets, centrally managed initiatives, and other nonoperating items[60](index=60&type=chunk) [Effective Tax Rate (ETR)](index=19&type=section&id=Effective%20Tax%20Rate%20(ETR)) The GAAP effective tax rate for Q2 2025 was **18.4%**, while the adjusted ETR, excluding charges and credits, was **19.3%** - The GAAP ETR for Q2 2025 was **18.4%**, compared to **22.0%** for Q1 2025[61](index=61&type=chunk) - Excluding charges and credits, the ETR for Q2 2025 was **19.3%**, compared to **19.4%** for Q1 2025[61](index=61&type=chunk) [Shares Outstanding](index=19&type=section&id=Shares%20Outstanding) As of June 30, 2025, **1.351 billion** common shares were outstanding, a decrease from Q1 due to the stock repurchase program - There were **1.351 billion** shares of common stock outstanding as of June 30, 2025, down from **1.360 billion** shares outstanding as of March 31, 2025[62](index=62&type=chunk) Shares Outstanding (millions) | Shares Outstanding | Amount (millions) | | :-------------------------- | :---------------- | | Shares outstanding at March 31, 2025 | 1,360 | | Stock repurchase program | (9) | | **Shares outstanding at June 30, 2025** | **1,351** | - The weighted average number of shares outstanding was **1.352 billion** during Q2 2025 and **1.366 billion** during Q1 2025[64](index=64&type=chunk) [Adjusted EBITDA & Margin](index=20&type=section&id=Adjusted%20EBITDA%20%26%20Margin) Q2 2025 Adjusted EBITDA was **$2.05 billion** with a **24.0% margin**, showing sequential growth but a year-on-year decrease - SLB's adjusted EBITDA was **$2.051 billion** in Q2 2025, **$2.020 billion** in Q1 2025, and **$2.288 billion** in Q2 2024[65](index=65&type=chunk) - SLB's adjusted EBITDA margin was **24.0%** in Q2 2025, **23.8%** in Q1 2025, and **25.0%** in Q2 2024[66](index=66&type=chunk) Adjusted EBITDA Reconciliation (Q2 2025) (millions) | Metric | Amount (millions) | | :------------------------------------ | :---------------- | | Net income attributable to SLB | $1,014 | | Net income attributable to noncontrolling interests | 34 | | Tax expense | 237 | | Income before taxes | $1,285 | | Charges & credits | 22 | | Depreciation and amortization | 633 | | Interest expense | 142 | | Interest income | (30) | | **Adjusted EBITDA** | **$2,051** | | Revenue | $8,546 | | **Adjusted EBITDA margin** | **24.0%** | Adjusted EBITDA Reconciliation (Six Months 2025 vs. 2024) (millions) | Metric | Six Months 2025 (millions) | Six Months 2024 (millions) | Change | | :------------------------------------ | :-------------- | :-------------- | :----- | | Net income attributable to SLB | $1,811 | $2,180 | | | Net income attributable to noncontrolling interests | 66 | 63 | | | Tax expense | 471 | 535 | | | Income before taxes | $2,348 | $2,778 | | | Charges & credits | 228 | 167 | | | Depreciation and amortization | 1,273 | 1,231 | | | Interest expense | 289 | 245 | | | Interest income | (66) | (77) | | | **Adjusted EBITDA** | **$4,072** | **$4,344** | **-6%** | | Revenue | $17,035 | $17,846 | **-5%** | | **Adjusted EBITDA margin** | **23.9%** | **24.3%** | **-44 bps** | [Depreciation & Amortization Components](index=21&type=section&id=Depreciation%20%26%20Amortization%20Components) Total depreciation and amortization expense for Q2 2025 was **$633 million**, primarily from fixed assets and APS investments, totaling **$1.27 billion** for the first six months Q2 2025 Depreciation and Amortization (millions) | Component | Amount (millions) | | :------------------------------------ | :---------------- | | Depreciation of fixed assets | $408 | | Amortization of intangible assets | 82 | | Amortization of APS investments | 115 | | Amortization of exploration data costs capitalized | 28 | | **Total** | **$633** | Six Months 2025 Depreciation and Amortization (millions) | Component | Amount (millions) | | :------------------------------------ | :---------------- | | Depreciation of fixed assets | $805 | | Amortization of intangible assets | 164 | | Amortization of APS investments | 225 | | Amortization of exploration data costs capitalized | 79 | | **Total** | **$1,273** | [Core Business Divisional Performance](index=22&type=section&id=Core%20Business%20Divisional%20Performance) SLB's Core business generated **$7.69 billion** in Q2 2025 revenue, a **1% sequential increase** but **7% year-on-year decrease**, with a pretax operating margin of **17.7%** - SLB's Core business comprises the Reservoir Performance, Well Construction, and Production Systems Divisions[70](index=70&type=chunk) Core Business Revenue (Q2 2025) (millions) | Division | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential | Year-on-year | | :-------------------- | :------------ | :------------ | :------------ | :--------- | :----------- | | Reservoir Performance | $1,691 | $1,700 | $1,819 | | | | Well Construction | 2,963 | 2,977 | 3,411 | | | | Production Systems | 3,036 | 2,938 | 3,025 | | | | **Total Core Revenue** | **$7,690** | **$7,615** | **$8,255** | **1%** | **-7%** | Core Business Pretax Operating Income (Q2 2025) (millions) | Division | Jun. 30, 2025 (millions) | Mar. 31, 2025 (millions) | Jun. 30, 2024 (millions) | Sequential | Year-on-year | | :-------------------- | :------------ | :------------ | :------------ | :--------- | :----------- | | Reservoir Performance | $314 | $282 | $376 | | | | Well Construction | 551 | 589 | 742 | | | | Production Systems | 499 | 475 | 473 | | | | **Total Core Pretax Operating Income** | **$1,364** | **$1,346** | **$1,591** | **1%** | **-14%** | Core Business Pretax Operating Margin (Q2 2025) | Division | Jun. 30, 2025 | Mar. 31, 2025 | Jun. 30, 2024 | Sequential | Year-on-year | | :-------------------- | :------------ | :------------ | :------------ | :--------- | :----------- | | Reservoir Performance | 18.6% | 16.6% | 20.6% | | | | Well Construction | 18.6% | 19.8% | 21.7% | | | | Production Systems | 16.4% | 16.2% | 15.6% | | | | **Total Core Margin** | **17.7%** | **17.7%** | **19.3%** | **8 bps** | **-152 bps** | [Company Information & Disclosures](index=23&type=section&id=Company%20Information%20%26%20Disclosures) [About SLB](index=23&type=section&id=About%20SLB) SLB is a global technology company driving energy innovation across oil and gas, digital solutions, decarbonization, and new energy systems in over 100 countries - SLB is a global technology company driving energy innovation for a balanced planet, with a presence in over 100 countries[71](index=71&type=chunk) - The company focuses on innovating oil and gas, delivering digital at scale, decarbonizing industries, and developing and scaling new energy systems to accelerate the energy transition[71](index=71&type=chunk) [Conference Call Details](index=23&type=section&id=Conference%20Call%20Details) SLB held a conference call on July 18, 2025, to discuss Q2 earnings and business outlook, with access details provided for replays - SLB held a conference call on Friday, July 18, 2025, at 9:30 a.m. U.S. Eastern time to discuss earnings and business outlook[72](index=72&type=chunk) - Access details for the live call and audio/webcast replays (available until July 25, 2025) were provided[72](index=72&type=chunk) [Investor Relations & Media Contacts](index=23&type=section&id=Investor%20Relations%20%26%20Media%20Contacts) Contact information for SLB's Investor Relations and Media teams, including key personnel and contact details, is available for inquiries - Contact information for Investor Relations (James R. McDonald, Joy V. Domingo) and Media (Josh Byerly, Moira Duff) was provided, including phone numbers and email addresses[73](index=73&type=chunk) [Forward-Looking Statements](index=23&type=section&id=Forward-Looking%20Statements) The press release includes forward-looking statements on financial targets, business outlook, and strategic initiatives, which are subject to various risks and uncertainties - The press release contains forward-looking statements concerning financial and performance targets, business outlook, growth, the benefits of the ChampionX acquisition, oil and natural gas demand/prices, energy transition, capital expenditures, business strategies, and future liquidity/results of operations[73](index=73&type=chunk) - These statements are subject to risks and uncertainties, including changing global economic and geopolitical conditions, changes in customer spending, inability to achieve targets, foreign currency risk, inflation, and regulatory changes[73](index=73&type=chunk) - SLB disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events, or otherwise[74](index=74&type=chunk)

Group 1 - The core viewpoint of the article highlights that Schlumberger (SLB), a global oilfield services giant, saw a nearly 2% increase in pre-market trading due to its second-quarter adjusted earnings per share exceeding market expectations [1] Group 2 - The article indicates that Schlumberger's strong performance in the second quarter is a positive signal for the oilfield services industry, suggesting potential growth and investment opportunities [1]

Schlumberger Limited SLB will release earnings results for the second quarter, before the opening bell on Friday, July 18.Analysts expect the Westlake, Texas-based company to report quarterly earnings at 75 cents per share, down from 85 cents per share in the year-ago period. Schlumberger projects to report quarterly revenue at $8.51 billion, compared to $9.14 billion a year earlier, according to data from Benzinga Pro.On April 25, SLB reported worse-than-expected first-quarter 2025 results.SLB shares gaine ...

Financial Performance - SLB is expected to report earnings of $0.75 per share on revenue of $8.51 billion for Q2 2025, reflecting a 4% decrease in earnings and a 7% drop in revenue compared to last year [2] - For Q1 2025, SLB reported a revenue decline of 3% to $8.5 billion and a net income decrease of 25% to $797 million, with North America revenue rising by 8% while international markets saw a 5% decline [3] - The company has a current market capitalization of $48 billion, with total revenue for the past twelve months amounting to $36 billion, operating profits of $6.3 billion, and net income of $4.2 billion [4] Acquisition and Market Position - SLB's $8 billion all-stock acquisition of ChampionX received final approval from UK regulators, allowing the merger to finalize, which will integrate ChampionX's chemicals and automation into SLB's production systems [3] Historical Trends and Trading Insights - Historically, SLB's stock has increased after earnings reports 50% of the time, with a median one-day gain of 2.1% and a maximum increase of 10% [2][6] - Over the past five years, there have been 20 recorded earnings data points for SLB, yielding 10 positive and 10 negative one-day returns, with a decrease in positive returns to 42% when analyzing the last three years [6] - A strategy to assess the correlation between short-term and medium-term returns post-earnings can be effective, particularly if a strong correlation exists between 1D and 5D returns [7]

Core Points - AeroVironment Inc. will replace ChampionX Corp. in the S&P MidCap 400, while Victory Capital Holdings Inc. will replace AeroVironment in the S&P SmallCap 600, effective July 18, 2025 [1] - Schlumberger Ltd. is acquiring ChampionX in a deal expected to close on July 16, 2025, pending final conditions [1] Summary by Category Index Changes - Effective Date: July 18, 2025 - S&P MidCap 400: Addition of AeroVironment (Ticker: AVAV, Sector: Industrials) and Deletion of ChampionX (Ticker: CHX, Sector: Energy) [2] - S&P SmallCap 600: Addition of Victory Capital Holdings (Ticker: VCTR, Sector: Financials) and Deletion of AeroVironment (Ticker: AVAV, Sector: Industrials) [2]