Schlumberger 3Q16: Turns a Profit, but Profits Down 82% Y/Y

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SchlumbergerSchlumberger, the world's biggest oilfield services company, issued their third quarter update yesterday. It was a mixed bag, with some good news and some not-so-good news. Like Halliburton, their chief rival, Schlumberger turned a profit in 3Q16 (see Halliburton 3Q16 Earnings Surprise: Turns a Profit!). Halliburton made a measly $7 million in 3Q16, while Schlumberger made $176 million. Halliburton went from losing $3.2 billion in 2Q16 to making a $7M profit, while Schlumberger went from losing $2.2 billion in 2Q16 to making $176M. However, if you look at the third quarter for each company compared with a year earlier, Halliburton's 3Q16 profit was up 113% from 3Q15 to 3Q16 (going from -$53M to +$7M), while Sclumbeger's profit went down 82% (from +$989M to +$176M). Hence the headlines in the financial press are trumpeting Schlumberger's 82% decrease. The further good news for Schlumberger is that they maintained their workforce at around 100,000 employees--after having previously axed 50,000 jobs over the past couple of years. CEO Paal Kibsgaard said the o&g industry hit the bottom of the cycle in 2Q16 and Schlumberger (and by extension the industry) "stabilized" in 3Q16...

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