Schlumberger Financial Model
Oil and Gas Company Financials Example (Free Excel Download)
SLB (formerly Schlumberger) is the world's largest oilfield services and technology company, providing digital solutions, technology, and equipment to the global energy industry.
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About this model
This model provides a comprehensive equity valuation and scenario planning tool for an analyst covering SLB, specifically designed to forecast the consolidated earnings power and cash flow generation following the recent integration of the ChampionX acquisition and the Aker subsea joint venture.
SLB (formerly Schlumberger) is the world's largest oilfield services and technology company, providing digital solutions, technology, and equipment to the global energy industry. The company helps exploration and production (E&P) customers drill, complete, and produce oil and gas, while increasingly focusing on digital transformation and lower-carbon energy systems.
Business segments (approximate 2025 revenue contribution):
- Production Systems (~40%): Subsea and surface equipment, artificial lift, and production chemicals (bolstered by the 2025 ChampionX acquisition).
- Well Construction (~33%): Drilling fluids, drill bits, and directional drilling services.
- Reservoir Performance (~19%): Wireline, testing, and stimulation services.
- Digital (~8%): Software, cloud infrastructure, and AI solutions for E&P operators.
Key geographies:
- International: ~75% to 80% of revenue (Middle East & Asia, Europe & Africa, Latin America).
- North America: ~20% to 25% of revenue.
Business model type: Historically asset-heavy, SLB is actively transitioning to a more "asset-light" and technology-driven model, focusing on high-margin digital software (SaaS) and capital-efficient partnerships.
Competitive position: SLB is the undisputed market leader in global oilfield services, competing primarily with Baker Hughes and Halliburton, but holding a distinct advantage in international markets, subsea equipment, and digital software.
Recent major events:
- Closed the $5.0 billion all-stock acquisition of ChampionX on July 16, 2025, issuing approximately 141 million new shares.
- Formed the OneSubsea joint venture with Aker Solutions in late 2023, significantly expanding its subsea production capabilities.
- Realigned its reporting segments in 2025, breaking out "Digital" as a standalone division from the former "Digital & Integration" segment.
The downloadable Schlumberger financial model includes SEC-sourced historical financials, forecast assumptions, core operating schedules, and valuation outputs in an Excel workbook built for review and scenario analysis.
A turnkey financial model
Live formulas, no hardcoded values
Outputs are driven by live formulas, so the workbook updates from its assumptions instead of relying on hardcoded results.
All assumptions in one tab
Inputs are clearly marked in the Assumptions tab and separated from calculations, making it clear what to change and what to leave intact.
Statements always balancing
For integrated-statement models, the balance sheet, cash flow, and supporting schedules tie through properly.
Distinct schedules for clarity
Debt, working capital, taxes, and cash flow can get messy quickly. We group calculations in clear schedules, not across disconnected tabs.
No hidden macros or external links
There are no unexplained external workbook links or macros to undermine auditability or portability.
Changes flow through the model
Update a key driver and see the impact carry through the forecast, financing, and return outputs. We never use hardcoded numbers in formulas.
Historicals & AssumptionsSchlumberger financial modelCompany, Historicals & Assumptions used
Source: SEC EDGAR · values in USD
| Line item | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Revenue | $22.93B | $28.09B | $33.13B | $36.29B | $35.71B |
| Income before taxes | $2.37B | $4.27B | $5.28B | $5.67B | $4.29B |
| General & administrative | $339.0M | $376.0M | $364.0M | $385.0M | $340.0M |
| Net income | $1.88B | $3.44B | $4.20B | $4.46B | $3.37B |
Forecast assumptions
Defaults used in the downloadable model. Forecast horizon: FY2026–FY2030.
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How to build a detailed financial model for Schlumberger
A complete walkthrough of every driver, margin, working-capital input, and capital-allocation assumption used in the downloadable model.
Revenue Deep Dive
Production Systems
- Segment name: Production Systems
- Revenue driver formula: (Global E&P Production Capex x SLB Market Share) + ChampionX Run-Rate Contribution
- Historical growth rate: 10% to 24% over the last 3 years (heavily boosted by Aker JV and ChampionX).
- Key growth levers and headwinds: Driven by offshore deepwater project sanctions, subsea tree awards, and the integration of ChampionX artificial lift and production chemicals. Headwinds include supply chain bottlenecks for subsea equipment.
- Pricing dynamics: Long-term contractual for subsea equipment; spot and short-term contractual for artificial lift and chemicals.
- Revenue recognition notes: Percentage-of-completion accounting is heavily used for long-lead subsea equipment manufacturing.
- Seasonality: Q4 is typically the strongest quarter due to year-end customer budget flushes and equipment deliveries.
Well Construction
- Segment name: Well Construction
- Revenue driver formula: Global Active Rig Count x Average Revenue per Rig
- Historical growth rate: Low single digits to slight declines recently (-10% YoY in Q4 2025).
- Key growth levers and headwinds: Highly sensitive to active drilling rig counts, particularly in the Middle East and North America. Recent headwinds include lower drilling activity in Mexico and Saudi Arabia.
- Pricing dynamics: Highly competitive, spot-market pricing for drilling fluids and services, though international contracts tend to be longer-term than North American contracts.
- Revenue recognition notes: Recognised over time as services are rendered at the wellsite.
- Seasonality: Q2 and Q3 are typically stronger in the Northern Hemisphere; Q2 faces the Canadian spring break-up.
Reservoir Performance
- Segment name: Reservoir Performance
- Revenue driver formula: Global Well Completions x SLB Intervention/Evaluation Market Share
- Historical growth rate: Flat to low single digits (-3% YoY in Q4 2025).
- Key growth levers and headwinds: Driven by the intensity of well completions, wireline evaluation, and intervention activity.
- Pricing dynamics: Premium pricing power due to SLB's technological edge in wireline logging and reservoir characterisation.
- Revenue recognition notes: Recognised upon completion of the specific logging or stimulation job.
- Seasonality: Generally tracks broader E&P activity, with Q4 being the strongest.
Digital
- Segment name: Digital
- Revenue driver formula: E&P Software Spend x SaaS Conversion Rate
- Historical growth rate: 15% to 20% CAGR.
- Key growth levers and headwinds: Transitioning customers from perpetual licenses to cloud-based SaaS models (DELFI environment). Growth is driven by AI adoption and data centre infrastructure solutions.
- Pricing dynamics: Subscription-based pricing with high contractual visibility and strong pricing power.
- Revenue recognition notes: Shift from upfront perpetual license recognition to ratable recognition over the subscription period.
- Seasonality: Q4 is massively dominant due to annual software license renewals and enterprise IT budget cycles.
Cost Structure
Variable Costs / COGS
- Line-by-line breakdown: Direct field labour, raw materials (chemicals, drilling fluids), manufacturing costs for equipment, and depreciation of field equipment.
- Gross margin range: 18% to 22% historically, trending upward due to the digital mix.
- Key input costs and commodity exposures: Steel, specialty chemicals, and electronic components for manufacturing.
- How COGS scales with revenue: Well Construction and Reservoir Performance scale linearly with field activity; Digital has massive operating leverage with near-zero marginal cost for new software users.
Operating Expenses
- R&D: Typically 2.5% to 3.0% of revenue. SLB capitalises significant software development costs for its digital platforms.
- SG&A: Includes corporate overhead, global sales force, and facility costs. Runs at approximately 10% to 12% of revenue.
- Depreciation & Amortisation: Approximately 8% to 10% of revenue. The ChampionX acquisition added significant intangible amortisation ($2.26 billion of identifiable intangibles).
- Stock-Based Compensation: Approximately 1% of revenue.
- Restructuring / one-time charges: Frequent due to M&A. SLB recorded $318 million of pretax merger and integration charges in Q3 2025 related to ChampionX.
Margin Profile
- Gross margin: 18% to 22%.
- EBITDA margin: 23% to 25.7% (reached a cycle high of 25.7% in Q4 2024 and maintained strong levels through 2025).
- Operating margin: 15% to 18%.
- Net margin: 10% to 12%.
- Margin trend: Expanding. The addition of high-margin Digital revenue and ChampionX synergies ($400 million target) is structurally lifting consolidated margins.
Balance Sheet Structure
- Total assets: Approximately $45 billion to $50 billion.
- Key asset categories: PP&E (field equipment, manufacturing facilities), Goodwill, Intangible Assets, and Receivables.
- Goodwill & intangibles as % of total assets: High (over 30%). The ChampionX deal alone added $2.28 billion in goodwill and $2.26 billion in intangibles in 2025.
- Working capital profile:
- Days Sales Outstanding (DSO): 70 to 80 days (international national oil companies often have longer payment terms).
- Days Inventory Outstanding (DIO): 60 to 70 days.
- Days Payable Outstanding (DPO): 55 to 65 days.
- Net working capital as % of revenue: 15% to 20%.
- Is working capital positive or negative? Positive. SLB requires working capital to fund international growth and equipment manufacturing.
- PP&E: Consists of wireline trucks, drilling tools, subsea manufacturing plants, and IT infrastructure. Useful lives range from 3 to 15 years.
- Right-of-use assets / operating leases: Material, typically $1.5 billion to $2.0 billion, representing leased facilities and vehicles.
Capital Expenditure & Investment
- Capex as % of revenue: 5.5% to 7.0% (Targeting ~$2.3 billion annually).
- Maintenance capex vs. growth capex: Approximately 60% maintenance (replacing worn field tools) and 40% growth (subsea manufacturing expansion, digital infrastructure).
- Major capex programmes underway: Expanding subsea equipment manufacturing capacity and data centre infrastructure for AI solutions.
- Capitalised software / development costs: Material. SLB capitalises a portion of its DELFI platform development, which sits in investing cash flows.
- M&A pattern: Transformational and bolt-on. Recently executed the $5.0 billion ChampionX acquisition (2025) and the Aker OneSubsea JV (2023).
Debt & Capital Structure
- Total debt: Approximately $10.8 billion as of late 2025.
- Debt/EBITDA ratio: Approximately 1.0x to 1.2x (very strong balance sheet).
- Credit rating: A (S&P) / A2 (Moody's).
- Key debt instruments: Senior unsecured notes with staggered maturities.
- Interest rate profile: Predominantly fixed-rate bonds.
- Share repurchase programme: Highly active. SLB initiated $2.3 billion in accelerated share repurchases in early 2025 and committed to returning more than $4.0 billion to shareholders in 2026.
- Dividend policy: $0.285 per share quarterly ($1.14 annualised), representing a yield of approximately 2.5% to 3.0% depending on share price.
Cash Flow Characteristics
- Operating cash flow conversion: Strong, typically 1.2x to 1.5x of Net Income.
- Free cash flow margin: 10% to 12% of revenue (generated ~$4.0 billion FCF in 2024).
- Major non-cash items: Depreciation, amortisation of acquired intangibles, and stock-based compensation.
- Working capital cash flow impact: Typically a use of cash during periods of high international growth, but SLB actively manages receivables to mitigate this.
- Capex intensity: Moderate (6% of revenue), significantly lower than the 10%+ levels seen prior to 2015 due to the asset-light strategy.
- Cash tax rate vs. GAAP effective tax rate: Cash taxes are generally slightly lower than the GAAP effective tax rate (18% to 20%) due to accelerated depreciation and international tax structures.
Sheet Structure
- Assumptions: Hardcoded drivers for macroeconomic inputs (rig count, E&P capex), segment growth rates, margin targets, and capital allocation policies.
- Income Statement: Consolidated view. Revenue broken down by the four new segments (Digital, Reservoir Performance, Well Construction, Production Systems).
- Revenue & Margin Build: Detailed build for each of the four segments, calculating revenue from drivers and applying segment-level EBITDA margins.
- M&A & Pro-Forma Adjustments: Specific schedule handling the July 2025 ChampionX acquisition, calculating the stub period revenue, shares issued (141 million), and intangible amortisation.
- Balance Sheet: Standard assets, liabilities, and equity. Must include specific lines for Goodwill and Intangible Assets to capture recent M&A.
- Cash Flow Statement: Operating, Investing, and Financing sections. Must explicitly break out capitalised software costs and dividend payments.
- Debt Schedule: Tranche-by-tranche bond maturity profile, calculating interest expense and tracking the $10.8 billion debt balance.
- Working Capital: Schedules for Accounts Receivable, Inventory, and Accounts Payable driven by DSO, DIO, and DPO.
- Depreciation & Amortisation: Waterfall schedule separating tangible PP&E depreciation from acquired intangible amortisation.
- Shareholders Equity: Tracks retained earnings, dividend payouts, and the aggressive share repurchase programme.
- DCF Valuation: Unlevered free cash flow build, WACC calculation, and terminal value using the perpetuity growth method.
Key Financial Relationships
- Well Construction Revenue = Global Active Rig Count x SLB Revenue per Rig.
- Production Systems Revenue = Base Subsea Revenue + (ChampionX Annual Revenue x Stub Period Fraction).
- Digital Revenue = Prior Year Digital Revenue x (1 + Digital Growth Rate assumed at 15-20%).
- Consolidated Revenue = Digital + Reservoir Performance + Well Construction + Production Systems.
- Segment EBITDA = Segment Revenue x Segment Adjusted EBITDA Margin.
- Consolidated Adjusted EBITDA = Sum of Segment EBITDAs - Corporate Overhead.
- Depreciation Expense = Beginning PP&E x Blended Depreciation Rate.
- Intangible Amortisation = Beginning Intangibles x Amortisation Rate (elevated post-ChampionX).
- Interest Expense = Average Debt Balance x Weighted Average Interest Rate.
- Share Count = Prior Period Shares + Shares Issued for M&A (141 million in Q3 2025) - (Share Repurchase Spend / Average Share Price).
- Dividends Paid = Share Count x Annualised Dividend per Share ($1.14).
- Free Cash Flow = Cash Flow from Operations - Capital Expenditures - Capitalised Software Costs.
Cross-Sheet Dependencies
- The Assumptions sheet dictates the growth rates in the Revenue & Margin Build.
- The Revenue & Margin Build feeds the top line and operating profit of the Income Statement.
- The M&A & Pro-Forma Adjustments sheet is critical: it feeds the Income Statement (adding ChampionX revenue from Q3 2025 onwards), the Balance Sheet (adding $4.5 billion in goodwill/intangibles), and the Shareholders Equity sheet (adding 141 million shares).
- The Income Statement generates Net Income, which starts the Cash Flow Statement.
- The Cash Flow Statement determines the ending cash balance and debt paydown capacity, feeding the Balance Sheet and Debt Schedule.
- Circularity risk: Interest expense on the Income Statement depends on the debt balance in the Debt Schedule, which depends on the cash flow sweep from the Cash Flow Statement, which requires Net Income. A toggle switch must be built to break this circularity.
Sign Convention
- Revenues and asset balances are positive.
- Expenses (COGS, SG&A, Interest, Taxes) are entered as positive numbers in their specific schedules but subtracted in the Income Statement totals.
- Cash flow sources (e.g., Net Income, Depreciation, increases in liabilities) are positive.
- Cash flow uses (e.g., Capex, increases in assets, dividends, share repurchases) are negative.
- Debt paydown is negative; debt issuance is positive.
Things Most Likely to Go Wrong
- Segment Restructuring: SLB recently separated "Digital" from "Digital & Integration". Historical data prior to 2025 must be restated or mapped correctly to avoid broken trendlines.
- ChampionX Stub Period: The acquisition closed on July 16, 2025. The model must account for only ~2.5 months of ChampionX revenue in Q3 2025 and a full quarter in Q4 2025.
- Share Count Inflation: The model must explicitly add the 141 million shares issued for ChampionX in Q3 2025 before calculating per-share metrics, otherwise EPS will be artificially inflated.
- Intangible Amortisation: Excluding the new $2.26 billion in identifiable intangibles from the D&A schedule will result in understated expenses and overstated GAAP net income.
- Capitalised Software: SLB capitalises significant R&D for its digital platforms. Failing to deduct this from Operating Cash Flow will overstate true Free Cash Flow.
- Non-Controlling Interests: The OneSubsea JV with Aker includes minority interests. The model must deduct non-controlling interest income from consolidated net income to find Net Income Attributable to SLB.
- One-Time Charges: SLB frequently reports "charges and credits" (e.g., $318 million in Q3 2025). These must be excluded from Adjusted EBITDA but included in GAAP Net Income.
- Geographic Mix Shift: North American margins differ from International margins. If the model assumes uniform margins across all geographies, profitability forecasts will be inaccurate.
Validation Checks
- "Consolidated Adjusted EBITDA margin should be in the 24% to 26% range; flag if outside this band."
- "Capex as a % of revenue should remain between 5.5% and 7.0% based on management guidance."
- "Free Cash Flow should be approximately 10% to 12% of total revenue."
- "Digital segment revenue growth should outpace Well Construction growth (reflecting the company's strategic shift)."
- "Total share count in Q4 2025 must be at least 1.49 billion to account for the ChampionX equity issuance."
- "Balance sheet must balance: Total Assets = Total Liabilities + Equity in every forecasted period."
- "Dividend payout should equal exactly $0.285 per share per quarter unless a hike is explicitly forecasted."
- "Goodwill and Intangibles should account for at least 30% of Total Assets post-2025."
Key Assumptions (Default Values)
| Assumption | Default Value | Unit | Rationale |
|---|---|---|---|
| Digital Revenue Growth | 15.0 | % | Reflects strong SaaS adoption and AI infrastructure demand. |
| Production Systems Growth | 8.0 | % | Organic growth plus full-year ChampionX integration. |
| Well Construction Growth | -2.0 | % | Reflects recent softness in North American and specific international rig counts. |
| Reservoir Performance Growth | 2.0 | % | Stable, low-growth mature business segment. |
| Consolidated EBITDA Margin | 25.0 | % | Cycle-high margins achieved in 2024/2025. |
| Capex as % of Revenue | 6.5 | % | Aligns with management's capital-light strategy and ~$2.3B target. |
| Effective Tax Rate | 19.0 | % | Historical average GAAP tax rate for SLB's global operations. |
| DSO (Days Sales Outstanding) | 75 | Days | Standard collection period for international NOCs. |
| DIO (Days Inventory Outstanding) | 65 | Days | Required inventory for subsea manufacturing and chemical blending. |
| DPO (Days Payable Outstanding) | 60 | Days | Standard supplier payment terms. |
| Annual Dividend per Share | 1.14 | $ | Based on the $0.285 quarterly dividend approved in 2025. |
| Annual Share Repurchases | 4,000 | $ Millions | Management's stated target for shareholder returns in 2026. |
| ChampionX Shares Issued | 141 | Millions | Actual shares issued for the July 2025 acquisition. |
| WACC | 9.5 | % | Standard discount rate for a large-cap oilfield services company. |
| Terminal Growth Rate | 2.0 | % | Long-term global GDP and energy demand growth. |
Data Sources & Benchmarks
- SEC Filings: SLB Investor Relations page and SEC EDGAR (10-K, 10-Q, 8-K).
- Key Peers: Baker Hughes (BKR), Halliburton (HAL), Weatherford (WFRD), TechnipFMC (FTI).
- Industry Data: Baker Hughes Global Rig Count (for Well Construction drivers), Spears & Associates Oilfield Market Report.
- Consensus Estimates: Bloomberg or FactSet for forward EBITDA and EPS estimates.
- Proprietary Data: Rystad Energy for global E&P capex and subsea tree award tracking.
Sources
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Frequently asked
What does Schlumberger (SLB) do?+
Schlumberger (SLB) is the world's largest oilfield services and technology company, providing digital solutions, technology, and equipment to the global energy industry. It helps exploration and production customers drill, complete, and produce oil and gas, with an increasing focus on digital transformation and lower-carbon energy systems.
What are Schlumberger's main revenue streams?+
Schlumberger generates revenue primarily from its Production Systems, Well Construction, Reservoir Performance, and Digital segments. The company's international operations, particularly in the Middle East & Asia, Europe & Africa, and Latin America, contribute approximately 75% to 80% of its total revenue.
What are the key assumptions in a financial model for Schlumberger (SLB)?+
Key assumptions in a financial model for Schlumberger (SLB) include a revenue growth rate of approximately 0.17% and a COGS as a percentage of revenue at 55%. Other important assumptions cover R&D, SGA, and D&A as percentages of revenue, along with a tax rate of about 13.25%.
How does Schlumberger's capital expenditure strategy impact its financial model?+
Schlumberger targets annual capital expenditure at 5.5% to 7.0% of revenue, aiming for approximately $2.3 billion annually. This capex is split between 60% for maintenance, replacing field tools, and 40% for growth, such as expanding subsea manufacturing and digital infrastructure. The company also capitalizes a material portion of its DELFI platform development costs.
Can I download an Excel financial model for Schlumberger (SLB)?+
Yes, an Excel financial model for Schlumberger (SLB) is available for download. This model is designed to provide comprehensive equity valuation and scenario planning, forecasting consolidated earnings power and cash flow generation following recent acquisitions and joint ventures.
How does Schlumberger's working capital profile affect its cash flow generation?+
Schlumberger maintains a positive net working capital, typically 15% to 20% of revenue, which is required to fund international growth and equipment manufacturing. The company experiences longer Days Sales Outstanding (70-80 days) due to international national oil companies, alongside Days Inventory Outstanding of 60-70 days and Days Payable Outstanding of 55-65 days.
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