SLB Limited (SLB) closed out a difficult year with signs of stabilization, reporting Friday that fourth-quarter results showed sequential improvement as global upstream activity found its footing. The oilfield services giant beat revenue expectations and delivered strong cash flow, all while integrating its ChampionX acquisition and making a bigger bet on artificial intelligence and data centers.

Fourth-quarter revenue came in at $9.745 billion, up 5% from the prior year and comfortably above the $9.547 billion analyst consensus. Diluted GAAP earnings per share landed at 55 cents, down from 77 cents a year earlier, while adjusted EPS (excluding charges and credits) was 78 cents, beating the 74-cent estimate despite falling from 92 cents in the year-ago period.

Net income attributable to SLB was $824 million, down from $1.095 billion a year earlier. Adjusted EBITDA reached $2.331 billion, compared with $2.382 billion in the prior-year quarter, reflecting lower year-over-year margins even as sequential trends improved.

The company generated $3.01 billion in operating cash flow and $2.29 billion in free cash flow during the quarter, including $71 million in ChampionX acquisition-related payments. Management emphasized that cash generation remained robust despite what it called a challenging operating environment.

SLB ended 2025 with $4.212 billion in cash and short-term investments. Short-term borrowings and current portions of long-term debt totaled $1.894 billion, while long-term debt stood at $9.742 billion, putting net debt at $7.424 billion.

Dividend Boost and Shareholder Returns

The board approved a 3.5% increase to the quarterly cash dividend, raising it to 29.5 cents per share. The higher payout will be distributed on April 2, 2026, to shareholders of record on February 11, 2026. Looking ahead, the company committed to returning more than $4 billion to shareholders in 2026 through dividends and share repurchases.

Segment Breakdown

Digital revenue jumped 17% year-over-year to $825 million in the fourth quarter, with pretax operating margin hitting 34.0% as profitability and activity levels improved.

Reservoir Performance revenue declined 3% to $1.748 billion, posting a pretax operating margin of 19.6%. Well Construction revenue fell 10% to $2.949 billion, with a pretax operating margin of 18.7%.

Production Systems was the standout, with revenue soaring 30% to $4.078 billion and a pretax operating margin of 16.3%. The company noted that fourth-quarter results included a full quarter of activity from the acquired ChampionX businesses, which contributed $879 million in revenue.

For the full year, SLB reported revenue of $35.708 billion, down 2% year-over-year. GAAP EPS was $2.35, while adjusted EPS came in at $2.93.

CEO Sees Better Days Ahead

"Although 2025 presented a challenging backdrop for the industry — with lower commodity prices, geopolitical uncertainty and an oversupplied oil market — we continued to build resilience across our portfolio by accelerating our strategy. This included a growing emphasis on production and recovery, increased deployment of AI solutions, and the rapid expansion of our Data Center Solutions business," CEO Olivier Le Peuch said.

Le Peuch was even more optimistic about the road ahead. "As we move into 2026, we believe that the headwinds we experienced in key regions in 2025 are behind us. In particular, we expect rig activity in the Middle East to increase compared to today's level, and our footprint in the region puts us in a strong position to benefit from this recovery," he added.

The company expects capital investment for 2026 to be approximately $2.5 billion.

SLB Price Action: Shares were up 0.57% at $49.60 during premarket trading Friday, hitting a new 52-week high.