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What changed in Schlumberger's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Schlumberger's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+207 added−222 removedSource: 10-K (2024-01-24) vs 10-K (2023-01-25)

Top changes in Schlumberger's 2023 10-K

207 paragraphs added · 222 removed · 155 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

51 edited+13 added−21 removed16 unchanged
Biggest changeReservoir Performance develops and deploys innovative technologies and services to evaluate, intervene, and stimulate reservoirs that help customers understand subsurface assets and maximize their value. 3 The primary offerings comprising this Division are: • Wireline: Provides the information necessary to evaluate subsurface geology and fluids to plan and monitor well construction and to monitor and evaluate well production through both openhole and cased hole services, including wireline logging and perforating. • Testing: Provides exploration and production pressure and flow-rate measurement services both at the surface and downhole supported by a network of laboratories that facilitate rock and fluid characterization. • Stimulation and Intervention : Provides services used during well completions, as well as those used to maintain optimal production throughout the life of a well, including pressure pumping, well stimulation, and coiled tubing equipment for downhole mechanical well intervention, reservoir monitoring, and downhole data acquisition.
Biggest changeThe primary offerings comprising this Division are: • Wireline: Provides the information necessary to evaluate subsurface geology and fluids to plan and monitor well construction and to monitor and evaluate well production through both openhole and cased hole services, including wireline logging and perforating. • Testing: Provides exploration and production pressure and flow-rate measurement services both at the surface and downhole supported by a network of laboratories that facilitate rock and fluid characterization. • Stimulation and Intervention : Provides services used during well completions, as well as those used to maintain optimal production throughout the life of a well, including pressure pumping, well stimulation, and coiled tubing equipment for downhole mechanical well intervention and coiled-tubing drilling, reservoir monitoring, and downhole data acquisition. 3 Well Construction – Combines the full portfolio of products and services to optimize well placement and performance, maximize drilling efficiency, and improve wellbore assurance.
Furthermore, customer spending patterns for exploration data, software, and other products may result in higher activity in the fourth quarter of the year as clients seek to fully utilize their annual budgets. Conversely, customer budget constraints in North America may lead to lower demand for our services and products in the fourth quarter of the year.
Furthermore, customer spending patterns for exploration 7 data, software, and other products may result in higher activity in the fourth quarter of the year as clients seek to fully utilize their annual budgets. Conversely, customer budget constraints in North America may lead to lower demand for our services and products in the fourth quarter of the year.
Building on decades of technology advancement, we will continue innovating new products, services and technologies that make the exploration, development and production of oil and gas assets cleaner, more resilient, and more efficient, with lower carbon and less impact on the environment.
Building on decades of technology advancement, we will continue innovating new products, services and technologies that make the exploration, development and production of oil and gas assets cleaner, more resilient, and more efficient, with lower carbon emissions and less impact on the environment.
We are building a broad, diverse portfolio across New Energy sectors, selected for their materiality and adjacency to existing SLB market strengths and our ability to offer differentiated technology.
We are building a broad, diverse portfolio across New Energy sectors, selected for their materiality and adjacency to existing SLB strengths and our ability to offer differentiated technology.
One such investment is Genvia, a unique private-public partnership that combines SLB’s expertise and experience with that of the French Alternative Energies and Atomic Energy Commission (“CEA”) and partners.
One such investment is Genvia, a unique private-public partnership that combines SLB’s expertise and experience with that of the French Atomic Energy and Alternative Energies Commission and partners.
Customers SLB’s primary customers are national oil companies, large integrated oil companies and independent operators. No single customer exceeded 10% of SLB’s consolidated revenue during each of 2022, 2021 and 2020. Governmental Regulations SLB is subject to numerous environmental and other governmental and regulatory requirements related to its operations worldwide. For additional details, see “Item 1(a).
Customers SLB’s primary customers are national oil companies, large integrated oil companies, and independent operators. No single customer exceeded 10% of SLB’s consolidated revenue during each of 2023, 2022 and 2021. Governmental Regulations SLB is subject to numerous environmental and other governmental and regulatory requirements related to its operations worldwide. For additional details, see “Item 1(a).
The primary offerings comprising this Division are: • Drilling & Measurements: Provides mud logging services for geological and drilling surveillance, directional drilling, measurement-while-drilling, and logging-while-drilling services for all well profiles as well as engineering support. • Drilling Fluids: Supplies individually engineered drilling fluid systems that improve drilling performance and maintain well control and wellbore stability throughout drilling operations. • Drill Bits: Designs, manufactures, and markets roller cone and fixed cutter drill bits for all drilling environments. • Drilling Tools : Includes a wide variety of bottom-hole-assembly and borehole enlargement technologies for drilling operations. • Well Cementing : Provides products and services that secure and protect well casings while isolating fluid zones and maximizing wellbore activity. • Integrated Well Construction: Provides integrated solutions to construct or change the architecture (re-entry) of wells, including well planning, well drilling, engineering, supervision, logistics, procurement and contracting of third parties, and drilling rig management. • Rigs and Equipment : Provides drilling equipment and services for shipyards, drilling contractors, operators, and rental tool companies, as well as land drilling rigs and related services.
The primary offerings comprising this Division are: • Drilling & Measurements: Provides mud logging services for geological and drilling surveillance, directional drilling, measurement-while-drilling, and logging-while-drilling services for all well profiles as well as engineering support. • Drilling Fluids: Supplies individually engineered drilling fluid systems that improve drilling performance and maintain well control and wellbore stability throughout drilling operations. • Drill Bits: Designs, manufactures, and markets roller cone and fixed cutter drill bits for all drilling environments. • Drilling Tools : Includes a wide variety of bottomhole assembly and borehole enlargement technologies for drilling operations. • Well Cementing : Provides products and services that secure and protect well casings while isolating fluid zones and maximizing wellbore activity. • Integrated Well Construction: Provides integrated solutions to construct or change the architecture (re-entry) of wells, including well planning, well drilling, engineering, supervision, logistics, procurement and contracting of third parties, and drilling rig management. • Rigs and Equipment : Provides drilling equipment, including pressure control equipment and rotary drilling equipment, and services for shipyards, drilling contractors, operators, and rental tool companies, as well as land drilling rigs and related services.
Katharina Beumelburg 46 Chief Strategy and Sustainability Officer, since May 2021; Senior Vice President, Transmission Service, Siemens Energy, Siemens AG (a multinational industrial manufacturing company), April 2020 to May 2021; and Executive Vice President, Strategy, Siemens Gas and Power, Siemens AG, November 2016 to April 2020.
Katharina Beumelburg 47 Chief Strategy and Sustainability Officer, since May 2021; Senior Vice President, Transmission Service, Siemens Energy, Siemens AG (a multinational industrial manufacturing company), April 2020 to May 2021; and Executive Vice President, Strategy, Siemens Gas and Power, Siemens AG, November 2016 to April 2020.
We will continue to build on our fit-for-basin approach and technology access initiatives, developing bespoke and custom technology tailored to the regions and environments in which we operate. This strategy will allow us to address the rapid evolution of our industry into more regional markets, each with distinct resource plays and economics.
We continue to build on our fit-for-basin approach and technology access initiatives, developing bespoke and custom technology tailored to the regions and environments in which we operate. This strategy allows us to address the rapid evolution of our industry into more regional markets, each with distinct resource plays and economics.
Risk Factors – Legal and Regulatory Risks”, which is incorporated by reference in this Item 1. Corporate Information SLB was founded in 1926. Schlumberger Limited, the NYSE-listed parent of the SLB family of companies, is incorporated under the laws of Curaçao and has executive offices in Paris, Houston, London, and The Hague.
Risk Factors – Legal and Regulatory Risks,” which is incorporated by reference in this Item 1. Corporate Information SLB was founded in 1926. Schlumberger Limited, the NYSE-listed parent of the SLB family of companies, is incorporated under the laws of Curaçao and has executive offices in Paris, Houston, London, and The Hague.
SLB’s customers have access to leading digital products and services that help to meet their sustainability goals by driving transparency, better measurement, more effective planning and more impactful and reliable outcomes. To continue elevating customer offerings, we will accelerate the adoption of our proprietary cloud offering DELFI, enabling enterprise data management, delivering autonomous operations, and innovating through domain-driven artificial intelligence.
SLB’s customers have access to leading digital products and services that help to meet their sustainability goals by driving transparency, better measurement, more effective planning, and more impactful and reliable outcomes. To continue elevating customer offerings, we are accelerating the adoption of our proprietary cloud offering Delfi™, enabling enterprise data management, delivering autonomous operations, and innovating through domain-driven artificial intelligence.
With a global presence in more than 100 countries and employees representing almost twice as many nationalities, we work each day on innovating oil and gas, delivering digital at scale, decarbonizing industries, and developing and scaling new energy systems that accelerate the energy transition.
With a global presence in more than 100 countries and employees representing almost twice as many nationalities, we work each day on innovating energy technology, delivering digital at scale, decarbonizing industries, and developing and scaling new energy systems that accelerate the energy transition.
Khaled Al Mogharbel 52 Executive Vice President, Geographies, since July 2020; Executive Vice President, Operations, April 2019 to June 2020; Executive Vice President, Eastern Hemisphere, February 2019 to March 2019; and President, Eastern Hemisphere, May 2017 to January 2019.
Khaled Al Mogharbel 53 Executive Vice President, Geographies, since July 2020; Executive Vice President, Operations, April 2019 to June 2020; Executive Vice President, Eastern Hemisphere, February 2019 to March 2019; and President, Eastern Hemisphere, May 2017 to January 2019.
While SLB seeks and holds numerous patents covering various products and processes, no particular patent or group of patents is material to SLB’s business. Seasonality Seasonal changes in weather and significant weather events can temporarily affect the delivery of SLB’s products and services.
While SLB seeks and holds a significant number of patents covering various products and processes, no particular patent or group of patents is material to SLB’s business. Seasonality Seasonal changes in weather and significant weather events can temporarily affect the delivery of SLB’s products and services.
Our ambition is to seed technology capabilities in each of these domains and grow throughout the decade, ultimately scaling our New Energy offering into the Company’s fastest growing and largest division. • Carbon Solutions : Carbon capture, utilization, and sequestration (“CCUS”) is critical to advancing decarbonization and achieving the goals of the Paris Agreement on climate change.
Our ambition is to seed technology capabilities in each of these domains, and then grow throughout the decade, ultimately scaling our New Energy offering into the Company’s fastest growing and largest division. • Carbon Solutions : Carbon capture, and sequestration (“CCS”) is critical to advancing decarbonization and achieving the goals of the Paris Agreement on climate change.
Alternatively, you may access these reports at the SEC’s website at www.sec.gov . Copies are also available, without charge, from SLB Investor Relations, 5599 San Felipe, 17 th Floor, Houston, Texas 77056.
Alternatively, you may access these reports at the SEC’s website at www.sec.gov . Copies are also available, without charge, from SLB Investor Relations, 5599 San Felipe, Houston, Texas 77056.
Today, the world faces the trilemma of providing secure and affordable energy to meet growing demand, while rapidly decarbonizing for a sustainable future. With nearly a century of market and technology leadership, SLB is well positioned to be a leader in providing solutions to address this trilemma.
Today, the world faces the challenge of providing secure and affordable energy to meet growing demand, while rapidly decarbonizing for a sustainable future. With nearly a century of market and technology leadership, SLB is well positioned and committed to being a leader in providing solutions to address this trilemma.
Digital Digital capabilities continue to grow throughout the energy industry as a key enabler to manage the complex systems required to meet current energy demands and to harness the promise of a lower carbon future. SLB is uniquely positioned to support customers on their digital journeys by managing data migration, workflow redesign and transition to the cloud.
Digital Digital capabilities continue to grow throughout the energy industry as a key element of the complex systems required to meet current energy demand and to harness the promise of a lower-carbon future. SLB is uniquely positioned to support customers on their digital journeys by managing data migration, workflow redesign, and transition to the cloud.
Stephane Biguet 54 Executive Vice President and Chief Financial Officer, since January 2020; and Vice President, Finance, December 2017 to January 2020. Abdellah Merad 49 Executive Vice President, Core Services and Equipment, since April 2022; Executive Vice President, Performance Management, May 2019 to March 2022; and President, Production Group, October 2017 to April 2019.
Stephane Biguet 55 Executive Vice President and Chief Financial Officer, since January 2020; and Vice President, Finance, December 2017 to January 2020. Abdellah Merad 50 Executive Vice President, Core Services and Equipment, since April 2022; Executive Vice President, Performance Management, May 2019 to March 2022; and President, Production Group, October 2017 to April 2019.
Ugo Prechner 45 Vice President and Controller, since August 2022; Well Construction Controller, July 2020 to July 2022; Controller Operations, August 2019 to June 2020; and M-I Swaco Controller, October 2017 to August 2019. Vijay Kasibhatla 59 Director, Mergers and Acquisitions, since January 2013. 9
Ugo Prechner 46 Vice President and Controller, since August 2022; Well Construction Controller, July 2020 to July 2022; Controller Operations, August 2019 to June 2020; and M-I SWACO Controller, October 2017 to August 2019. Vijay Kasibhatla 60 Director, Mergers and Acquisitions, since January 2013. 9
By setting targets based on SLB’s total 2019 baseline GHG footprint—inclusive of Scope 3 emissions (which accounted for approximately 95% of SLB’s baseline)—and not just its Scope 1 and 2 footprint, SLB’s comprehensive emissions reduction roadmap addressees the entire oil and gas value chain.
By setting targets based on SLB’s total 2019 baseline GHG footprint—inclusive of Scope 3 emissions (which accounted for approximately 95% of SLB’s baseline)—and not just its Scope 1 and 2 footprint, SLB’s comprehensive emissions reduction roadmap addresses the entire energy value chain.
The Basins are configured around common regional characteristics that enable us to deploy fit-for-purpose technologies, operating models and skills to meet the specific customer needs in each Basin and are focused on agility, responsiveness, and competitiveness. The Basins are organized into GeoUnits, which can be a single country or made up of several countries.
The Basins are configured around common regional characteristics that enable us to deploy fit-for-purpose technologies, operating models, and skills to meet the specific customer needs in each Basin. The Basins are further organized into GeoUnits, which can be a region, a single country, or made up of several countries.
Name Age Current Position and Five-Year Business Experience Olivier Le Peuch 59 Chief Executive Officer and Director, since August 2019; Chief Operating Officer, February 2019 to July 2019; Executive Vice President, Reservoir and Infrastructure, May 2018 to February 2019; and President, Cameron Group, February 2017 to May 2018.
Name Age Current Position and Five-Year Business Experience Olivier Le Peuch 60 Chief Executive Officer and Director, since August 2019; Chief Operating Officer, February 2019 to July 2019; and Executive Vice President, Reservoir and Infrastructure, May 2018 to February 2019.
Kevin Fyfe 49 Vice President and Treasurer, since July 2022; and Vice President and Controller, October 2017 to June 2022. Howard Guild 51 Chief Accounting Officer, since July 2005.
Kevin Fyfe 50 Vice President and Treasurer, since July 2022; and Vice President and Controller, October 2017 to June 2022. Howard Guild 52 Chief Accounting Officer, since July 2005.
SLB will continue forging partnerships across various industries to focus on five emerging technologies: carbon solutions, hydrogen, geothermal and geoenergy, stationary energy storage, and critical minerals.
SLB will continue building businesses and forging partnerships across various industries to focus on five key areas: carbon solutions, hydrogen, geothermal and geoenergy, stationary energy storage, and critical minerals.
With the continued growth of digitally enabled technologies that improve efficiency and performance, including our Transition Technologies™ portfolio (which is further described below) and our SLB End-to-End Emissions Solution (SEES) methane elimination business, the Company will provide solutions that enable customers to increase production from their reserves at a competitive cost and low carbon intensity per barrel equivalent.
With the continued growth of digitally enabled technologies that improve efficiency and performance, including our Transition Technologies™ portfolio and our SLB End-to-end Emissions Solutions (SEES) methane elimination business, SLB provides solutions that enable customers to increase production from their reserves at a competitive cost and at a lower carbon intensity per barrel equivalent.
As customers transition from our established software applications to our DELFI digital platform, they will shift from a user-based license model to software-as-a-service (SaaS) subscriptions.
Our cloud-based solutions allow our customers to transition from our established software applications to our Delfi digital platform, and shift from a user-based license model to software-as-a-service (SaaS) subscriptions.
Our New Energy portfolio builds on three fundamental SLB strengths: our unique subsurface domain expertise, applicable beyond oil and gas; our differentiated track record for innovation and industrialization; and our ability to deploy at scale in any region of the world with local knowledge and talent.
Our New Energy portfolio builds on several fundamental SLB strengths: our unique subsurface domain expertise, applicable beyond oil and gas; our ability to design and deploy complex processing and production systems as an original equipment manufacturer; our differentiated track record for innovation and industrialization; and our ability to deploy at scale in any region of the world with local knowledge and talent.
Solutions are deployable on traditional on-premise IT infrastructures, the cloud, and the edge, allowing for full market coverage irrespective of customer constraints. • Exploration data and data processing: Provides comprehensive worldwide reservoir interpretation and data processing services, enabled by a scientifically advanced platform and innovative subsurface imaging techniques for exploration data, also referred to as “multiclient surveys.” Offers one of the industry’s most extensive multiclient libraries. • Asset Performance Solutions: Offers an integrated business model for field production projects, by combining SLB’s services and products with drilling rig management and specialized engineering and project management expertise, to provide a complete solution to well construction and production improvement.
Solutions are deployable on traditional on-premise IT infrastructures, the cloud, and the edge, allowing for full market coverage irrespective of customer constraints. • Exploration data and data processing: Provides comprehensive worldwide reservoir interpretation and data processing services, enabled by a scientifically advanced platform and innovative subsurface imaging techniques for exploration data, and includes one of the industry’s most extensive exploration data libraries. • Asset Performance Solutions: Offers an integrated business model for field production projects.
Genvia aims to deliver the most efficient and cost-effective technology for producing clean hydrogen — a versatile source of energy and key component of the energy transition. • Geothermal and Geoenergy: Geothermal power leverages the heat of the earth to generate electricity by tapping into hot water and steam zones that are continuously recharged, both naturally and by heat injection from sources such as power plant by-products.
Genvia aims to deliver the most efficient and cost-effective solid oxide electrolyzer technology for producing clean hydrogen in hard-to-abate industrial settings—a key component of the energy transition. 5 • Geothermal and Geoenergy: Geothermal power leverages the heat of the earth to generate electricity or provide heat directly, by tapping into subsurface hot water and steam zones that are continuously recharged, both naturally and by injection.
SLB’s Scope 1 and 2 emissions primarily come from fuel use and 6 electricity consumption : Scope 3 emissions are indirect, such as emissions from customers’ use of SLB technology and emissions from our use of third - party goods and services. In tandem with our 2050 net-zero commitment, SLB introduced a portfolio of Transition Technologies in 2021.
SLB’s Scope 1 and 2 emissions primarily come from fuel use and electricity consumption. SLB’s Scope 3 emissions are indirect, such as emissions from customers’ use of SLB technology and emissions from our use of third-party goods and services.
Gavin Rennick 48 President, New Energy, since April 2022; Vice President, Human Resources, February 2019 to March 2022; and President, Software Integrated Solutions, January 2017 to February 2019.
Rakesh Jaggi 54 President, Digital and Integration, since April 2023; Senior Vice President, Sales & Commercial, May 2019 to March 2023; and President, Completions, March 2017 to May 2019. Gavin Rennick 49 President, New Energy, since April 2022; Vice President, Human Resources, February 2019 to March 2022; and President, Software Integrated Solutions, January 2017 to February 2019.
With a strong focus on customers, the Basins identify opportunities for growth. Supporting the Divisions is a global network of research and development centers. Through these centers we advance SLB’s technology programs to enhance industry efficiency, lower finding and producing costs, improve productivity, maximize reserve recovery, and increase asset value safely, securely, and sustainably.
Through these centers we advance SLB’s technology programs to enhance industry efficiency, lower finding and producing costs, improve productivity, maximize reserve recovery, and increase asset value safely, securely, and sustainably.
Demosthenis Pafitis 55 Chief Technology Officer, since February 2020; and Senior Vice President, SLB 4.0 Platforms, from December 2017 to January 2020. Dianne Ralston 56 Chief Legal Officer, since December 2020, and Secretary, since April 2021; and Executive Vice President, Chief Legal Officer, and Secretary, TechnipFMC plc (a global oilfield services company), January 2017 to September 2020.
Demosthenis Pafitis 56 Chief Technology Officer, since February 2020; and Senior Vice President, SLB 4.0 Platforms, from December 2017 to January 2020.
This recognition confirms the strategy we have in place and our commitment to leading change in the industry. Human Capital As a leading global technology company, with a workforce consisting of approximately 99,000 people in more than 100 countries, one of SLB’s greatest strengths is the diversity of our people.
Human Capital As a leading global technology company that operates in more than 100 countries with a workforce of approximately 111,000 people from diverse backgrounds, cultures, and nationalities, one of SLB’s greatest strengths is the diversity of our people.
Carmen Rando Bejar 45 Chief People Officer, since April 2022; Vice President, Global Business Services, September 2019 to March 2022; Operational Planning and Resource Manager, Drilling and Measurements, April 2018 to August 2019; and Operations Systems Manager, Drilling and Measurements, August 2016 to March 2018.
Dianne Ralston 57 Chief Legal Officer, since December 2020, and Secretary, since April 2021; and Executive Vice President, Chief Legal Officer, and Secretary, TechnipFMC plc (a global oilfield services company), January 2017 to September 2020. 8 Carmen Rando Bejar 46 Chief People Officer, since April 2022; Vice President, Global Business Services, September 2019 to March 2022; and Operational Planning and Resource Manager, Drilling and Measurements, April 2018 to August 2019.
This will enable them to evolve from legacy infrastructure and deliver new levels of value creation, with access to key resources such as storage and computing from our cloud partners and access to our industry-leading simulators. 5 New Energy New Energy offers a significant opportunity to use our experience and scale to drive innovation for a low-carbon economy spanning many industries.
This enables customers to evolve from legacy infrastructure and deliver new levels of value creation, with access to key resources such as storage and computing from our cloud partners and access to our industry-leading simulators.
Unless expressly noted, the information on its website or any other website is not incorporated by reference in this Form 10-K and should not be considered part of this Form 10-K or any other filing SLB makes with the SEC. 8 Information A bout Our Executive Officers The following table sets forth, as of January 25, 2023 , the names and ages of SLB’s executive officers, including all offices and positions held by each executive officer during the past five years.
Unless expressly noted, the information on its website or any other website is not incorporated by reference in this Form 10-K and should not be considered part of this Form 10-K or any other filing SLB makes with the SEC.
Item 1. Business. All references in this report to “Registrant,” “Company,” “SLB,” “we” or “our” are to Schlumberger Limited (Schlumberger N.V.) and its consolidated subsidiaries. We are SLB. In October 2022, we announced our brand which is built around a new name—SLB—and a logo that underscores our vision for a decarbonized energy future.
Item 1. B usiness. All references in this report to “Registrant,” “Company,” “SLB,” “we” or “our” are to Schlumberger Limited (Schlumberger N.V.) and its consolidated subsidiaries. We are SLB, a global technology company driving energy innovation for a balanced planet.
The evolving marketplace will require bold new technologies and ideas, digital transformation and a deep commitment to sustainability. With a balanced transition in mind, we are focused on three engines of growth: Core, Digital and New Energy. Core Consisting of Reservoir Performance, WeIl Construction and Production Systems, Core remains the Company’s largest engine of growth.
These centers also support SLB's New Energy investments in lower carbon energy sources and carbon capture technologies. 4 Corporate Strategy The evolving marketplace will require bold new technologies and ideas, digital transformation and a deep commitment to sustainability. With a balanced energy transition in mind, our strategy is focused on three engines of growth: Core, Digital and New Energy.
This portfolio includes a select group of products and services that quantifiably reduce our customers’ GHG emissions footprint, while continuing to drive high performance, reliability and efficiency. This portfolio will be supported by an industry-leading impact quantification framework and is set to grow as sustainability is further embedded in the Company’s research and development process.
This portfolio is supported by an industry-leading impact quantification framework and will continue to grow as sustainability is further embedded in the Company’s research and development process.
During the third quarter of 2022, SLB, Aker Solutions, and Subsea 7 announced an agreement to form a joint venture to drive innovation and efficiency in subsea production by helping customers unlock reserves and reduce cycle time.
On October 2, 2023, SLB, Aker Solutions (“Aker”), and Subsea7 closed their previously announced joint venture. The new business, OneSubsea, will drive innovation and efficiency in subsea production by helping customers unlock reserves and reduce cycle time.
The Company is actively progressing CCUS technologies and business models to enable widespread adoption and is exploring collaborations in facility design, building, and operations and going beyond subsurface characterization and well construction to include capture technology, project economics, technology selection, and permitting. • Hydrogen as an Energy Carrier: SLB is investing in hydrogen generation technologies.
With industry-leading reservoir modeling capabilities, SLB has been in the CCS business for more than three decades. The Company is actively progressing CCS technologies to enable widespread adoption of CCS and is going beyond subsurface characterization and well construction to include capture technology, project economics, technology selection, and permitting.
Our new identity symbolizes SLB's commitment to moving farther and faster in facilitating the world's energy needs today and forging the road ahead for a sustainable future. SLB is a global technology company driving energy innovation for a balanced planet.
Our identity symbolizes SLB's commitment to moving farther and faster in facilitating the world's energy needs today and forging the road ahead for a sustainable future. SLB is organized under four Divisions that combine and integrate SLB’s technologies, enhancing our ability to support the emerging long-term growth opportunities in each of these market segments.
SLB is organized under four Divisions that combine and integrate SLB’s technologies, enhancing our ability to support the emerging long-term growth opportunities in each of these market segments. The Divisions operate through the geographical structure of four Basins that are aligned with critical concentrations of activity: Americas Land, Offshore Atlantic, Middle East & North Africa, and Asia.
As the majority owner and controlling entity, SLB is considered the acquirer and reflects OneSubsea as a consolidated subsidiary in its Consolidated Financial Statements . SLB's four Divisions operate through a geographical structure of four Basins that are aligned with critical concentrations of activity: Americas Land, Offshore Atlantic, Middle East & North Africa, and Asia.
Celsius Energy is a New Energy venture that uses shallow geoenergy to provide heating and cooling solutions for new or existing construction and leverages SLB’s extensive knowledge of subsurface behavior, operational automation technology, and science expertise. • Stationary Energy Storage: Stationary energy storage is a key enabler to make variable renewable energy sources (solar or wind) a larger component of the world’s electricity systems, via energy shifting —enabling power to be delivered in the right place, at the right time, to meet demand.
Geoenergy uses the ambient temperatures beneath the earth's surface to act as a thermal battery and dramatically reduce energy consumption from heating and cooling buildings, electrify and, therefore, drive both efficiency and decarbonization. • Stationary Energy Storage: Stationary energy storage is a key enabler to make variable renewable energy sources (such as solar or wind) a larger component of the world’s electricity systems enabling power to be delivered in the right place, at the right time, to meet demand.
SLB strives to identify talent early and to provide opportunities for those employees who demonstrate exceptional performance and the ability to progress to higher levels within the organization. These opportunities accelerate career development while fostering an agile workforce and the next generation of business leaders.
Learning and Development SLB invests significantly in the learning and development of our people. We strive to identify talent early, and to provide employees who demonstrate exceptional performance with opportunities to progress to higher levels within the organization.
As of December 31, 2022, SLB’s APS portfolio primarily consisted of three field production projects in Ecuador and one in Canada. Reservoir Performance – Consists of reservoir-centric technologies and services that are critical to optimizing reservoir productivity and performance.
Combines SLB’s services and products with drilling rig management and specialized engineering and project management expertise, to provide a complete solution from well construction to production improvement. As of December 31, 2023, SLB’s APS portfolio primarily consisted of three field production projects in Ecuador and one in Canada.
We are committed to leading our industry in gender diversity, and we are on track to reach our interim milestone of having women represent 25% of our salaried employees by 2025. Our next milestone is for women to comprise 30% of our salaried employees by 2030.
We are committed to leading our industry in this area and, in this regard, a number of years ago we established goals of having women represent 25% of our salaried workforce by 2025 and 30% by 2030. As of December 31, 2023, women represented just under 25% of our salaried workforce.
As renewables penetration increases, so does the need for additional storage to ensure the efficiency of the renewable assets and reliability of electricity systems. Large-scale, long-duration energy storage is key, and this market is growing rapidly.
As renewables become a greater percentage of the energy mix, the need increases for additional long-duration energy storage to ensure the efficiency of renewable assets and the reliability of electricity systems. • Critical Minerals: SLB is applying its knowledge of extraction technologies and processing to the location and sources of critical minerals, such as lithium from brine deposits, that will be required to support the energy transition.
Our national and cultural diversity is based in our philosophy to recruit and develop people from the communities where we work. As a result, we maintain a workforce nationality mix aligned to the revenue derived from the countries in which we work, as reflected in the charts below.
Our workforce nationality mix generally aligns with the revenue derived from the countries in which we work, as reflected in the charts below. This fosters a culture that is global in outlook, yet local in practice. 6 SLB also recognizes the importance of gender diversity as a source of creativity, innovation, and competitive advantage.
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This move affirmed our transformation from the world’s largest oilfield services company to a global technology company focused on driving energy innovation.
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In October 2022, we changed our brand name to SLB and unveiled a new logo that underscores our vision for a decarbonized energy future. This bold change highlighted our leadership as a global technology company focused on driving energy innovation within traditional energy sources and beyond. The SLB brand builds on nearly a century of technology innovation and industrialization.
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The SLB brand builds on nearly a century of technology innovation and industrialization expertise in the energy services industry—continuing to drive innovation, decarbonization and performance for the oil and gas industry while increasing our focus on low- and zero-carbon energy technology solutions.
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Reservoir Performance – Consists of reservoir-centric technologies and services that are critical to optimizing reservoir productivity and performance. Reservoir Performance develops and deploys innovative technologies and services to evaluate, intervene, and stimulate reservoirs providing customers with greater insights into their assets and maximizing their return on investment.
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On December 31, 2020, SLB contributed its onshore hydraulic fracturing business in the United States and Canada (“OneStim ® ”), including its pressure pumping, pumpdown perforating, and Permian frac sand businesses, to Liberty Energy Inc. (“Liberty”), in exchange for a 37% equity interest in Liberty.
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OneSubsea now comprises SLB’s and Aker’s subsea businesses, which include an extensive complementary subsea production and processing technology portfolio, world-class manufacturing scale and capacity, access to industry-leading reservoir and digital domain expertise, unique pore-to-process integration capabilities, and strengthened research and development capabilities. SLB owns 70% of the joint venture, while Aker owns 20% and Subsea7 owns 10%.
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OneStim’s historical results were reported as part of the Reservoir Performance Division through the closing of the transaction. As of December 31, 2022, SLB had a 5% equity interest in Liberty. Well Construction – Combines the full portfolio of products and services to optimize well placement and performance, maximize drilling efficiency, and improve wellbore assurance.
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With a strong focus on customers, the Basins identify opportunities for growth, and are focused on agility, responsiveness, and competitiveness. Supporting the Divisions is a global network of research and development centers.
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Drilling equipment falls into two broad categories: pressure control equipment and rotary drilling equipment. These products are designed for either onshore or offshore applications and include drilling equipment packages, blowout preventers, blowout preventer control systems, connectors, riser systems, valves and choke manifold systems, top drives, mud pumps, pipe handling equipment, rig designs and rig kits.
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Core Consisting of our Reservoir Performance, WeIl Construction and Production Systems Divisions, Core remains SLB’s largest engine of growth.
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The agreement 4 will bring together a portfolio of innovative technologies such as subsea gas compression, all-electric subsea production systems and other electrification capabilities that help customers meet their decarbonization goals. The proposed joint venture will combine SLB’s and Aker Solutions’ subsea businesses. Subsea 7 will be an equity partner in the new joint venture.
Added
Our evolving offering of on-premises solutions allows us to support the digital transition journey of customers that prefer or are required to maintain data solutions locally. New Energy New Energy offers a significant opportunity to use SLB’s experience and scale to drive innovation for a low-carbon economy spanning industries beyond oil and gas.
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In addition to contributing its subsea business to the joint venture, at closing SLB will issue to Aker Solutions shares of SLB common stock valued at $306.5 million. Concurrently, Subsea 7 will purchase its 10% interest in exchange for $306.5 million in cash to Aker Solutions.
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In addition, SLB is developing digital platforms to support emissions management for carbon and methane that will allow clients to measure, monitor, and plan abatement strategies. • Hydrogen: SLB is investing in low-carbon hydrogen generation technologies.
Removed
The joint venture also will issue a promissory note to Aker Solutions for $87.5 million. At closing of the joint venture, SLB will own 70%, with Aker Solutions owning 20% and Subsea 7 owning 10%. The transaction is subject to regulatory approvals and other customary closing conditions and is expected to close in the second half of 2023.
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In tandem with our 2050 net-zero commitment, SLB introduced a portfolio of Transition Technologies™ in 2021. This portfolio includes a select group of products and services that quantifiably reduce our customers’ GHG emissions footprint, while continuing to drive high performance, reliability, and efficiency.
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Corporate Strategy SLB is committed to addressing the most difficult challenges in the energy industry by pushing the limits of innovation while remaining the performance partner of choice for our customers across the globe. This commitment is underscored by a bold corporate vision: to drive energy innovation for a balanced planet.
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We believe our strong culture focused on workforce diversity, inclusivity, and learning and development results in the best possible working environment for all our people. Workforce Diversity SLB's long-standing commitment to national and cultural diversity is reflected in our workforce composition and our philosophy to recruit and develop people from the communities in which we operate.
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At the core of our vision is a returns-focused strategy designed to meet the current and future needs of customers while returning value to shareholders.
Added
Inclusivity We are building on our diversity to foster a strong culture of inclusion, in which each person can feel accepted, respected, and empowered to perform at their best.
Removed
Since launching the strategy in 2019, it has delivered impressive results, which include: • Strengthening our core business by high-grading the Company’s portfolio, choosing to exit certain margin-dilutive, commoditized and capital-intensive businesses and projects. • Optimizing operations by executing the largest restructuring in the Company’s history, creating a more agile, leaner organization that is better aligned with customer workflows. • Enhancing the go-to-market approach through our Basin organization and the launch of fit-for-basin and technology access initiatives. • Investing in long-term, resilient growth opportunities in gas, offshore, digital and decarbonization resulting in a stronger footing in gas and offshore development projects. • Developing an industry-leading digital platform and launching SLB’s New Energy business to grow lower-carbon or carbon-neutral technologies beyond oil and gas.
Added
SLB has numerous policies and programs to support our inclusive culture, including: • a global Code of Conduct that outlines the standards of behavior and ethics that all employees are expected to follow, and that prohibits any form of discrimination, harassment, or retaliation; • a global diversity, equity, and inclusion (“DEI”) strategy with a network of diversity and inclusion champions that promote DEI awareness and best practices; and • a global mobility program that enables employees to gain international exposure and experience and develop cross-cultural competencies.
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With industry-leading reservoir modeling capabilities, SLB has been in the CCUS business for more than three decades.
Added
This allows us to accelerate personal development while maximizing performance, fostering an agile workforce with the skills necessary to lead SLB today and into the future. SLB believes that through diversity, inclusivity, and learning and development, we can support our people to reach their full potential which unlocks value for all of our stakeholders.
Removed
With decades of expertise in the sector, Geothermex, an SLB company, provides the full spectrum of deep geothermal resource development services —from exploration and drilling to analysis, resource modeling and management, financial modeling, and operational support.
Added
Information About Our Executive Officers The following table sets forth, as of January 24, 2024, the names and ages of SLB’s executive officers, including all offices and positions held by each executive officer during the past five years.
Removed
SLB is investing in storage technologies including EnerVenue, a start-up that delivers nickel-hydrogen, non-lithium based, economic, safe battery technology that targets the 10-hour storage market. • Critical Minerals: SLB is applying its knowledge of extraction technologies and processing to the location and sources of critical minerals that will be required to support alternative energy sources.
Removed
An example of this is our NeoLith Energy technology venture, which uses a differentiated direct lithium extraction process to produce high-purity, battery-grade lithium material while reducing the production time from over a year to just weeks. This unique process is in sharp contrast to conventional evaporative methods of extracting lithium, with significantly reduced water consumption and physical footprint.
Removed
While there is an ambitious path ahead, we are cementing our position as a sustainability leader today. SLB continues to be one of the highest-ranked companies in the energy industry across key environmental, social, and governance ratings agencies as of December 31, 2022.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe have developed, and will continue to develop and set, goals, targets, and other objectives related to sustainability matters, including our net-zero target and our energy transition strategy. Statements related to these goals, targets and objectives reflect our current plans and aspirations and do not constitute a guarantee that they will be achieved.
Biggest changeGeneral Risk Factors Our aspirations, goals, and initiatives related to sustainability and emissions reduction, and our public statements and disclosures regarding them, expose us to numerous risks. We have developed, and will continue to develop and set, goals, targets, and other objectives related to sustainability matters, including our net-zero emissions target and our energy transition strategy.
Item 1A. Risk Factors. The following discussion of risk factors known to us contains important information for the understanding of our “forward-looking statements,” which are discussed immediately following Item 7A. of this Form 10-K and elsewhere. These risk factors should also be read in conjunction with Item 7.
Item 1A. Ris k Factors. The following discussion of risk factors known to us contains important information for the understanding of our “forward-looking statements,” which are discussed immediately following Item 7A. of this Form 10-K and elsewhere. These risk factors should also be read in conjunction with Item 7.
Recent oil and gas industry downturns have resulted in reduced demand for oilfield products and services and lower expenditures by our customers, which has in the past had, and may in the future have, a material adverse effect on our financial condition, results of operations and cash flows.
Oil and gas industry downturns have resulted in reduced demand for oilfield products and services and lower expenditures by our customers, which has in the past had, and may in the future have, a material adverse effect on our financial condition, results of operations and cash flows.
Our operations are subject to anti-corruption and anti-bribery laws and regulations, such as the Foreign Corrupt Practices Act, the UK Bribery Act, and other similar laws. We are also subject to trade control regulations and trade sanctions laws that restrict the movement of certain goods and services to, and certain operations in, various countries or with certain persons.
Our operations are subject to anti-corruption and anti-bribery laws and regulations, such as the Foreign Corrupt Practices Act, the UK Bribery Act, and other similar laws. We are also subject to trade control regulations and trade sanctions laws that restrict the movement of certain goods to, and certain operations in, various countries or with certain persons.
Violations of international and US laws and regulations or the loss of any required licenses may result in fines and penalties, criminal sanctions, administrative remedies, or restrictions on business conduct, and could have a material 12 adverse effect on our business, operations, and financial condition.
Violations of international and US laws and regulations or the loss of any required licenses may result in fines and penalties, criminal sanctions, administrative remedies, or restrictions on business conduct, and could have a material adverse effect on our business, operations, and financial condition.
Extreme weather conditions such as hurricanes, flooding, landslides, and heat waves have in the past resulted in, and may in the future result in, the evacuation of personnel, stoppage of services and activity disruptions at our facilities, in our supply chain, or at well-sites, or result in disruptions of our customers’ operations.
Extreme weather conditions such as hurricanes, flooding, landslides, and heat waves have in the past resulted in, and may in the future result in, the evacuation of personnel, stoppage of services and activity disruptions at our facilities, in our supply chain, or at well-sites, or result in disruptions to our customers’ operations.
Instability and unforeseen changes in any of the markets in which we operate could result in business disruptions or operational challenges that may adversely affect the demand for our products and services, or our reputation, financial condition, results of operations or cash flows.
Geopolitical instability and unforeseen changes in any of the markets in which we operate could result in business disruptions or operational challenges that may adversely affect the demand for our products and services, or our reputation, our financial condition, and our results of operations and cash flows.
The extent to which our operations and financial results may be affected by the ongoing conflict in Ukraine will depend on various factors, including the extent and duration of the conflict; the effects of the conflict on regional and global economic and geopolitical conditions; the effect of further laws, sanctions and trade control restrictions on our business, the global economy and global supply chains; and the impact of fluctuations in the exchange rate of the ruble.
The extent to which our operations, financial results and cash flows may be affected by the ongoing conflict in Ukraine will depend on various factors, including the extent and duration of the conflict; the effects of the conflict on regional and global economic and geopolitical conditions; the effect of further laws, sanctions and trade control restrictions on our business, the global economy and global supply chains; and the impact of fluctuations in the exchange rate of the ruble.
Continuation or escalation of the conflict may also aggravate this and other risk factors identified in this Form 10-K, including cybersecurity, regulatory, and reputational risks. Failure to effectively and timely address the energy transition could adversely affect our business, results of operations and cash flows.
Continuation or escalation of the conflict may also exacerbate this and other risk factors identified in this Form 10-K, including cybersecurity, regulatory, and reputational risks. Failure to effectively and timely address the energy transition could adversely affect our business, results of operations, and cash flows.
Disruptions in the political, regulatory, economic, and social environments of the countries in which we operate could adversely affect our reputation, financial condition, results of operations and cash flows. We are a global technology company, and our non-US operations accounted for approximately 84% of our consolidated revenue in 2022, 85% in 2021 and 81% in 2020.
Disruptions in the political, regulatory, economic, and social environments of the countries in which we operate could adversely affect our reputation, financial condition, results of operations and cash flows. We are a global technology company, and our non-US operations accounted for approximately 84% of our consolidated revenue in 2023 and 2022, and 85% in 2021.
These factors include, but are not limited to, the following: • uncertain or volatile political, social, and economic conditions; • exposure to expropriation, nationalization, deprivation or confiscation of our assets or the assets of our customers, or other governmental actions; • social unrest, acts of terrorism, war, or other armed conflict; • public health crises and other catastrophic events, such as the COVID-19 pandemic; • confiscatory taxation or other adverse tax policies; • theft of, or lack of sufficient legal protection for, proprietary technology and other intellectual property; • deprivation of contract rights; • trade and economic sanctions or other restrictions imposed by the European Union, the United States, the United Kingdom, China, or other regions or countries that could restrict or curtail our ability to operate in certain markets; • unexpected changes in legal and regulatory requirements, including changes in interpretation or enforcement of existing laws; • restrictions on the repatriation of income or capital; • currency exchange controls; • inflation; and • currency exchange, rate fluctuations and devaluations.
These factors include, but are not limited to, the following: • uncertain or volatile political, social, and economic conditions; • exposure to expropriation, nationalization, deprivation or confiscation of our assets or the assets of our customers, or other governmental actions; 10 • social unrest, acts of terrorism, war, or other armed conflict; • confiscatory taxation or other adverse tax policies; • theft of, or lack of sufficient legal protection for, proprietary technology and other intellectual property; • deprivation of contract rights; • trade and economic sanctions or other restrictions imposed by the European Union, the United States, the United Kingdom, China, or other regions or countries that could restrict or curtail our ability to operate in certain markets; • public health crises; • unexpected changes in legal and regulatory requirements, including changes in interpretation or enforcement of existing laws; • restrictions on the repatriation of income or capital; • currency exchange controls; • inflation; and • currency exchange rate fluctuations and devaluations.
Environmental compliance costs and liabilities arising as a result of environmental laws and regulations could have a material adverse effect on our business, financial condition and results of operations.
Environmental compliance costs and liabilities arising as a result of environmental laws and regulations could have a material adverse effect on our business, financial condition, results of operations, and cash flows.
Particularly severe weather events affecting platforms or structures may result in a suspension of activities. In addition, acute or chronic physical impacts of climate change, such as sea level rise, coastal storm surge, inland flooding from intense rainfall, and hurricane-strength winds may damage our facilities.
Particularly severe weather events affecting platforms or structures may result in a suspension of activities. Climate change may impact the frequency and/or intensity of such events. In addition, acute or chronic physical impacts of climate change, such as sea level rise, coastal storm surge, inland flooding from intense rainfall, and hurricane-strength winds may damage our facilities.
Other effects of the pandemic included, and may continue to include, significant volatility and disruption of the global financial markets; adverse revenue and net 13 income effects; disruptions to our operations, including suspension or deferral of drilling activities ; customer shutdowns of oil and gas exploration and production; downward revisions to customer budgets; limitations on access to sources of liquidity; supply chain disruptions; limitations on access to raw materials; employee impacts from illness; and local and regional closures or lockdowns, including temporary closures of our facilities and the facilities of our customers and suppliers.
Other effects of public health emergencies have included, and may continue to include, significant volatility and disruption of the global financial markets; adverse revenue and net income effects; disruptions to our operations, including suspension or deferral of drilling activities; customer shutdowns of oil and gas exploration and production; downward revisions to customer budgets; limitations on access to sources of liquidity; supply chain disruptions; limitations on access to raw materials; employee impacts from illness; and local and regional closures or lockdowns, including temporary closures of our facilities and the facilities of our customers and suppliers.
Any determination that we have violated or are responsible for violations of applicable laws, including anti-bribery, trade control, trade sanctions or anti-corruption laws, could have a material adverse effect on our financial condition.
Any determination that we have violated or are responsible for violations of applicable laws, including securities, environmental, trade control, trade sanctions, or anti-corruption laws, could have a material adverse effect on our financial condition.
These laws and regulations are complex, frequently change, and have tended to become more stringent over time. In the event the scope of these laws and regulations expands in the future, the incremental cost of compliance could adversely affect our financial condition, results of operations, or cash flows.
These laws and regulations are complex, frequently change, have tended to become more stringent over time, and could conflict among one another. In the event the scope of these laws and regulations expands in the future, the incremental cost of compliance could adversely affect our financial condition, results of operations, or cash flows.
Sustained market uncertainty can also result in lower demand and pricing for our products and services. A significant industry downturn, sustained market uncertainty, or increased availability of economical alternative energy sources could result in a reduction in demand for our products and services, which could adversely affect our business, financial condition, results of operations, cash flows and prospects.
A significant industry downturn, sustained market uncertainty, or increased availability of economical alternative energy sources could result in a reduction in demand for our products and services, which could adversely affect our business, financial condition, results of operations, cash flows and prospects.
In addition, allegations, reports, or concerns regarding vulnerabilities affecting our digital products or services could damage our reputation. This could lead to fewer customers using our digital products and services, which could have a material adverse impact on our financial condition, results of operations or prospects.
In addition, allegations, reports, or concerns regarding vulnerabilities affecting our digital products or services could damage our reputation. This could lead to fewer customers using our digital products and services, which 11 could have a material adverse impact on our financial condition, results of operations, cash flows, and future prospects.
In addition, the transition of the global energy sector from primarily a fossil fuel-based system to renewable energy sources could affect our customers’ levels of expenditures.
In addition, the transition of the global energy sector from a primarily fossil fuel-based system to a diverse system which includes renewable energy sources could affect our customers’ levels of expenditures.
In addition, if our systems, or our third-party business associates’ systems, for protecting against cybersecurity risks prove to be insufficient, we could be adversely affected by, among other things, loss of or damage to intellectual property, proprietary or confidential information, or customer, supplier, or employee data; breach of personal data; interruption of our business operations; increased legal and regulatory exposure, including fines and remediation costs; and increased costs required to prevent, respond to, or mitigate cybersecurity attacks.
In addition, if our systems or third-party products, services, and network systems for protecting against cybersecurity risks prove to be insufficient, we could be adversely affected by, among other things, loss of or damage to our intellectual property, proprietary or confidential information; loss of customer, supplier, or our employee data; breach of personal data; interruption of our business operations; disruption of our customers’ businesses; increased legal and regulatory exposure, including fines and remediation costs; and increased costs required to prevent, respond to, or mitigate cybersecurity attacks.
Unauthorized access to or modification of, or actions disabling our ability to obtain authorized access to, our customers’ data, other external data, personal data, or our own data, as a result of a cyber incident, attack or exploitation of a security vulnerability, could result in significant damage to our reputation or disruption of the services we provide to our customers.
Unauthorized access to or modification of, or actions disabling our ability to obtain authorized access to, our customers’ data, other external data, personal data, or our own data, as a result of a cyber incident, attack or exploitation of a security vulnerability, or loss of control of our clients’ operations could result in significant damage to our reputation or disruption of the services we provide to our customers or of our customers’ businesses.
Our business may be adversely affected if we fail to continue developing and producing innovative technologies in response to changes in the market, including customer and government requirements, or if we fail to deliver such technologies to our customers in a timely and cost-competitive manner.
The energy industry is highly competitive and rapidly evolving. Our business may be adversely affected if we fail to continue developing and producing innovative technologies in response to changes in the market, including customer and government requirements, or if we fail to deliver such technologies to our customers in a timely and cost-competitive manner.
Historically, oil and gas prices have experienced significant volatility and can be affected by a variety of factors, including: • changes in the supply of and demand for hydrocarbons, which are affected by general economic and business conditions; • the costs of exploring for, producing, and delivering oil and gas; • the ability or willingness of the Organization of Petroleum Exporting Countries and the expanded alliance known as OPEC+ to set and maintain production levels for oil; • the level of oil and gas exploration and production activity; • the level of excess production capacity; • the level of refining capacity; • the level of oil and gas inventories; • access to potential resources; • political and economic uncertainty and geopolitical unrest; • governmental laws, policies, regulations, subsidies, and other actions, including initiatives to promote the use of renewable energy sources; • speculation as to the future price of oil and the speculative trading of oil and gas futures contracts; • technological advances affecting energy consumption; and • extreme weather conditions, natural disasters, and public health or similar issues, such as pandemics and epidemics. 10 The oil and gas industry has historically experienced periodic downturns, which have been characterized by diminished demand for our products and services and downward pressure on the prices that we are able to charge.
Historically, oil and gas prices have experienced significant volatility and can be affected by a variety of factors, including: • changes in the supply of and demand for hydrocarbons, which are affected by general economic and business conditions; • the costs of exploring for, producing, and delivering oil and gas; • the ability or willingness of the Organization of Petroleum Exporting Countries and the expanded alliance known as OPEC+ to set and maintain production levels for oil; • the level of oil and gas exploration and production activity; • the level of excess production capacity; • the level of refining and storage capacity; • the level of oil and gas inventories; • access to potential resources; • political and economic uncertainty and geopolitical unrest; • governmental laws, policies, regulations, subsidies, and other actions, including initiatives to promote the use of renewable energy sources; • speculation as to the future price of oil and the speculative trading of oil and gas futures contracts; • technological advances affecting energy consumption; and • extreme weather conditions, natural disasters, and public health or similar issues, such as pandemics and epidemics.
We have experienced and will continue to experience varying degrees of cyber incidents in the normal conduct of our business, including attacks resulting from phishing emails and ransomware infections.
We have experienced and will continue to experience varying degrees of cyber incidents in the normal conduct of our business, including attacks resulting from social engineering such as phishing and ransomware infections.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated Financial Statements and related notes included in this Form 10-K.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated Financial Statements and related notes included in Item 8. Financial Statements and Supplementary Data of this Form 10-K.
Our operations are subject to cyber incidents that could have a material adverse effect on our business, financial condition, and results of operations. Our success depends in part on our ability to provide effective data security protection in connection with our digital technologies and services.
Our operations are subject to cyber incidents that could have a material adverse effect on our business, financial condition, results of operations, and cash flows. Our success depends in part on our ability to provide effective cyber security protection in connection with our digital technologies and services as well as our internal digital infrastructure.
Our operations involve production-related activities, radioactive materials, chemicals, explosives and other equipment and services that are deployed in challenging exploration, development, and production environments.
Our operations involve the use of radioactive materials, chemicals, explosives and other equipment and services that are deployed in challenging exploration, development, and production environments.
If our sustainability practices do not meet investor or other stakeholder expectations and standards, which continue to evolve, our reputation, our ability to attract or retain employees, and our attractiveness as an investment or business partner could be negatively affected.
If our sustainability practices do not meet investor or other stakeholder expectations and standards, including any third-party ratings used by stakeholders, which continue to evolve, our reputation, our ability to attract or retain employees, our ability to access capital, and our attractiveness as an investment or business partner could be negatively affected.
The COVID-19 pandemic caused, and any resurgence of the pandemic could again cause, a significant reduction in global economic activity, significantly weakening demand for oil and gas, and in turn, for our products and services.
Public health emergencies, including the COVID-19 pandemic, have caused, and could again cause, a significant reduction in global economic activity, significantly weakening demand for oil and gas, and in turn, demand for our products and services.
These risks could harm our reputation and our relationships with our employees, business associates and other third parties, and may result in claims against us. We operate in a highly competitive environment. If we are unable to maintain technology leadership, this could adversely affect any competitive advantage we hold. The energy industry is highly competitive and rapidly evolving.
These risks could harm our reputation and our relationships with our employees, our customers, our suppliers, our alliance partners and other third parties, and may result in claims against us. We operate in a highly competitive environment. If we are unable to maintain technology leadership, this could adversely affect any competitive advantage we hold.
The extent to which our operating and financial results will continue to be affected by the pandemic will depend on various factors beyond our control, such as the continued severity of the pandemic, including any sustained geographic resurgence; the emergence of new variants and strains of the COVID-19 virus; and the success of actions to contain or treat the virus.
The extent to which our operating and financial results will be and may continue to be affected by public health emergencies will depend on various factors beyond our control, such as the continued severity and duration of the public health emergencies, including any sustained geographic resurgence; the emergence of new variants and strains of a contagious disease or virus; and the success of actions to contain or mitigate the effects of the public health emergency.
Even if we successfully defend our own digital technologies and services, we 11 also rely on third-party business associates, with whom we may share data and services, to defend their digital technologies and services against attack.
Even if we successfully defend our own digital technologies and services, we also rely on providers of third-party products, services, and networks, with whom we may share data and services, and who may be unable to effectively defend their digital technologies and services against attack.
Our digital technologies and services, and those of our business associates, are subject to the risk of cyberattacks and, given the nature of such attacks, some incidents can remain undetected for a period of time despite efforts to detect and respond to them in a timely manner.
Our digital technologies and services, as well as third-party products, services and technologies that we rely on (including emerging technologies, such as artificial intelligence programs), are subject to the risk of cyberattacks and, given the nature of such attacks, some incidents can remain undetected for a period of time despite efforts to detect and respond to them in a timely manner.
We urge you to consider carefully the risks described below, which discuss the material factors that make an investment in our securities speculative or risky, as well as in other reports and materials that we file with the SEC and the other information included or incorporated by reference in this Form 10-K, any of which could materially adversely affect our financial condition, results of operations and cash flows.
Please carefully consider the risks described below, which discuss the material factors that make an investment in our securities speculative or risky, other material included or incorporated by reference in this Form 10-K, and other reports and materials that we file with the SEC.
Our targets are based on empirical data and estimates that reflect the current best practices for measuring or estimating emissions, but we anticipate that future innovations in both measurement technologies and estimation methodologies could cause us to revise our baseline as well as re-calculate progress toward our targets.
Our targets are based on empirical data and estimates that reflect our understanding of current best practices for measuring or estimating emissions or other metrics, but we anticipate that future innovations in both measurement technologies and estimation methodologies could cause us to revise our baseline as well as re-calculate progress toward our targets. 13 Our business faces increased scrutiny from certain investors and other stakeholders related to our sustainability activities, including the goals, targets, and objectives that we announce, and our methodologies and timelines for pursuing them.
Additional risks and uncertainties not currently known to us or that we currently deem immaterial may also materially adversely affect our business, reputation, financial condition, results of operations, cash flows and prospects. Business and Operational Risks Demand for our products and services is substantially dependent on the levels of expenditures by our customers.
Additional risks and uncertainties not currently known to us or that we currently deem immaterial could also materially adversely affect our business, reputation, financial condition, results of operations, cash flows and prospects.
This consisted of $0.3 billion of receivables, $0.3 billion of fixed assets, $0.5 billion of current assets, and $0.4 billion of current liabilities. We continue to actively monitor the dynamic situation in Ukraine and applicable laws, sanctions and trade control restrictions resulting from the conflict.
We continue to actively monitor the dynamic situation in Ukraine and applicable laws, sanctions and trade control restrictions resulting from the conflict.
Our efforts to research, establish, accomplish, and accurately report on these goals, targets, and objectives expose us to numerous operational, reputational, financial, legal, and other risks. Our ability to achieve any stated goal, target, or objective, including with respect to emissions reduction, is subject to numerous factors and conditions, some of which are outside of our contro l.
Our ability to achieve any stated goal, target, or objective, including with respect to emissions reduction, is subject to numerous factors and conditions, some of which are outside of our contro l.
General Risk Factors The COVID-19 pandemic and resulting adverse economic conditions have had, and may continue to have, a material adverse effect on our financial condition, results of operations and cash flows.
Any such extreme weather events may result in increased operating costs or decreases in revenue. Public health emergencies, such as the COVID-19 pandemic, and resulting adverse economic conditions have had, and may continue to have, a material adverse effect on our financial condition, results of operations, and cash flows.
Continuing political and social attention to the issue of climate change has resulted in both existing and proposed international agreements and national, regional, and local legislation and regulatory measures to limit GHG emissions.
Existing or future laws, regulations, court orders or other public- or private-sector initiatives to limit greenhouse gas emissions or relating to climate change may reduce demand for our products and services. 12 Continuing political and social attention to the issue of climate change has resulted in both existing and proposed international agreements and national, regional, and local legislation and regulatory measures to limit GHG emissions and mitigate the effects of climate change.
In addition, any major violations could have a significant effect on our reputation and consequently on our ability to win future business and maintain existing customer and supplier relationships. Existing or future laws, regulations, court orders or other public- or private-sector initiatives to limit greenhouse gas emissions or relating to climate change may reduce demand for our products and services.
In addition, any major violations could have a significant effect on our reputation and consequently on our ability to win future business and maintain existing customer and supplier relationships.
COVID-19, and volatile regional and global economic conditions stemming from the pandemic, could also aggravate our other risk factors described in this Form 10-K. Our aspirations, goals, and initiatives related to sustainability and emissions reduction, and our public statements and disclosures regarding them, expose us to numerous risks.
A public health emergency, and volatile regional and global economic conditions stemming from a public health emergency, could also aggravate our other risk factors described in this Form 10-K.
As an example of a risk resulting from our global operations, in March 2022 we decided to immediately suspend new investment and technology deployment to our Russia operations. Russia represented approximately 6% of our worldwide revenue during 2022. The carrying value of our net assets in Russia was approximately $0.7 billion as of December 31, 2022.
As an example of a risk resulting from our global operations, in March 2022 we decided to immediately suspend new investment and technology deployment to our Russia operations. In July 2023, we announced that we were halting shipments of products into Russia from all our facilities worldwide in response to the continued expansion of international sanctions.
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We rely on information technology networks and systems for internal purposes, including secure data storage, processing, and transmission, as well as in our interactions with our business associates, such as customers and suppliers.
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Business and Operational Risks Demand for our products and services is substantially dependent on the levels of expenditures by our customers, which can change based on many factors, including fluctuations in oil and gas prices.
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Our business faces increased scrutiny from certain investors and other stakeholders related to our sustainability activities, including the goals, targets, and objectives that we announce, and our methodologies and timelines for pursuing them.
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The oil and gas industry has historically experienced periodic downturns, which have been characterized by diminished demand for our products and services and downward pressure on the prices that we are able to charge. Sustained market uncertainty can also result in lower demand and pricing for our products and services.
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Any such extreme weather events may result in increased operating costs or decreases in revenue. 14 Item 1B. Unresolve d Staff Comments. None.
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Russia represented approximately 5% of our worldwide revenue during 2023. The carrying value of our net assets in Russia was approximately $0.6 billion as of December 31, 2023. This consisted of $0.2 billion of receivables, $0.3 billion of fixed assets, $0.4 billion of other assets, and $0.3 billion of current liabilities.
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We operate information technology networks and systems for internal purposes that incorporate third-party software and technologies. We also connect to and exchange data with external networks that may be operated by our customers, suppliers, alliance partners, or other third parties. We provide digital technologies that allow us or our customers to remotely perform wellsite and field operations.
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Cyberattacks are expected to accelerate on a global basis in both frequency and magnitude as threat actors are becoming increasingly sophisticated in using techniques and tools (including artificial intelligence) that circumvent controls, evade detection and even remove forensic evidence of the infiltration.
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Statements related to these goals, targets, and objectives reflect our current plans and aspirations and do not constitute a guarantee that they will be achieved. Our efforts to research, establish, accomplish, and accurately report on these goals, targets, and objectives expose us to numerous operational, reputational, financial, legal, and other risks.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for SLB’s Common Stock, Related Stockholder Matters and Issuer Purchases of Equity Securities. As of December 31, 2022, there were 22,341 stockholders of record.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Sto ckholder Matters and Issuer Purchases of Equity Securities. As of December 31, 2023, there were 21,444 stockholders of record.
It assumes $100 was invested on December 31, 2017 in SLB common stock, in the S&P 500 Index and in the Philadelphia Oil Service Index, as well as the reinvestment of dividends on the last day of the month of payment. The stockholder return set forth below is not necessarily indicative of future performance.
It assumes $100 was invested on December 31, 2018 in SLB common stock, in the S&P 500 Index and in the Philadelphia Oil Service Index, as well as the reinvestment of dividends on the last day of the month of payment. The stockholder return set forth below is not necessarily indicative of future performance.
The following graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that SLB specifically incorporates it by reference into such filing.
The following graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that SLB specifically incorporates it by reference into such filing.
Comparison of Five-Year Cumulative Total Return Among SLB Common Stock, the S&P 500 Index and the Philadelphia Oil Service Index Share Repurchases On January 21, 2016, the SLB Board of Directors approved a $10 billion share repurchase program for SLB common stock. SLB had repurchased $1.0 billion of its common stock under this program as of December 31, 2022.
Comparison of Five-Year Cumulative Total Return Among SLB Common Stock, the S&P 500 Index and the Philadelphia Oil Service Index Share Repurchases On January 21, 2016, the SLB Board of Directors approved a $10 billion share repurchase program for SLB common stock. SLB had cumulatively repurchased $1.7 billion of its common stock under this program as of December 31, 2023.
Removed
SLB did not repurchase any of its common stock during 2022. Unregistered Sales of Equity Securities None. Item 6. [Reserved]. 16
Added
SLB's common stock repurchase program activity for the three months ended December 31, 2023 was as follows: 16 (Stated in thousands, except per share amounts) Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum value of shares that may yet be purchased under the plans or programs October 2023 598.9 $ 58.10 598.9 $ 8,343,538 November 2023 618.2 $ 53.96 618.2 $ 8,310,182 December 2023 619.9 $ 51.44 619.9 $ 8,278,295 1,837.0 $ 54.46 1,837.0 Unregistered Sales of Equity Securities On October 2, 2023, SLB, Aker and Subsea7 closed their previously announced joint venture.
Added
In addition to contributing its subsea business to the joint venture, at closing SLB issued 5.1 million shares of its common stock valued at $306.5 million to Aker through a private placement pursuant to Rule 144A. Item 6. [R eserved]. 17

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

49 edited+30 added−42 removed26 unchanged
Biggest changeThe following is a summary of the 2022 charges and credits: (Stated in millions) Pretax Tax Benefit Charge (Credit) (Expense) Net First quarter: Gain on sale of Liberty shares $ (26 ) $ (4 ) $ (22 ) Second quarter: Gain on sale of Liberty shares (215 ) (14 ) (201 ) Gain on sale of real estate (43 ) (2 ) (41 ) Fourth quarter: Gain on sale of Liberty shares (84 ) (19 ) (65 ) Loss on Blue Chip Swap transactions 139 - 139 Gain on ADC equity investment (107 ) (3 ) (104 ) Gain on repurchase of bonds (11 ) (2 ) (9 ) $ (347 ) $ (44 ) $ (303 ) 21 The following is a summary of the 2021 charges and credits: (Stated in millions) Pretax Tax Benefit Charge (Credit) (Expense) Net Third quarter: Unrealized gain on marketable securities $ (47 ) $ (11 ) $ (36 ) Fourth quarter: Gain on sale of Liberty shares (28 ) (4 ) (24 ) Early repayment of bonds 10 - 10 $ (65 ) $ (15 ) $ (50 ) Liquidity and Capital Resources Details of the components of liquidity as well as changes in liquidity follow: (Stated in millions) Dec. 31, Dec. 31, Components of Liquidity: 2022 2021 Cash $ 1,655 $ 1,757 Short-term investments 1,239 1,382 Short-term borrowings and current portion of long-term debt (1,632 ) (909 ) Long-term debt (10,594 ) (13,286 ) Net debt (1) $ (9,332 ) $ (11,056 ) Changes in Liquidity: 2022 2021 Net income $ 3,492 $ 1,928 Charges and credits (347 ) (65 ) Depreciation and amortization (2) 2,147 2,120 Stock-based compensation expense 313 324 Deferred taxes (39 ) (31 ) Earnings of equity method investments, less dividends received (96 ) 10 Increase in working capital (1,709 ) (45 ) US Federal tax refund - 477 Other (41 ) (67 ) Cash flow from operations 3,720 4,651 Capital expenditures (1,618 ) (1,141 ) APS investments (587 ) (474 ) Exploration data capitalized (97 ) (39 ) Free cash flow (3) 1,418 2,997 Dividends paid (848 ) (699 ) Proceeds from employee stock purchase plan 141 137 Proceeds from exercise of stock options 81 - Taxes paid on net-settled stock-based compensation awards (93 ) (24 ) Business acquisitions and investments, net of cash acquired plus debt assumed (58 ) (103 ) Proceeds from sale of Liberty shares 732 109 Proceeds from sale of ADC shares 223 - Proceeds from sale of real estate 120 - Purchases of Blue Chip Swap securities (259 ) - Proceeds from sales of Blue Chip Swap securities 111 - Other (105 ) (81 ) Change in net debt before impact of changes in foreign exchange rates on net debt 1,463 2,336 Impact of changes in foreign exchange rates on net debt 261 488 Decrease in Net Debt 1,724 2,824 Net Debt, Beginning of period (11,056 ) (13,880 ) Net Debt, End of period $ (9,332 ) $ (11,056 ) 22 (1) “ Net debt” represents gross debt less cash and short-term investments.
Biggest changeThe following is a summary of the 2023 charges and credits: (Stated in millions) Pretax Charge (Credit) Tax Benefit (Expense) Noncontrolling Interests Net First quarter: Gain on sale of Liberty shares $ (36 ) $ (8 ) $ - $ (28 ) Fourth quarter: Merger and integration 56 8 8 40 Currency devaluation loss in Argentina 90 - - 90 $ 110 $ - $ 8 $ 102 The following is a summary of the 2022 charges and credits: (Stated in millions) Pretax Charge (Credit) Tax Benefit (Expense) Net First quarter: Gain on sale of Liberty shares $ (26 ) $ (4 ) $ (22 ) Second quarter: Gain on sale of Liberty shares (215 ) (14 ) (201 ) Gain on sale of real estate (43 ) (2 ) (41 ) Fourth quarter: Gain on sale of Liberty shares (84 ) (19 ) (65 ) Loss on Blue Chip Swap transactions 139 - 139 Gain on ADC equity investment (107 ) (3 ) (104 ) Gain on repurchase of bonds (11 ) (2 ) (9 ) $ (347 ) $ (44 ) $ (303 ) 22 Liquidity and Capital Resources Details of the components of liquidity as well as changes in liquidity follow: (Stated in millions) Dec. 31, Dec. 31, Components of Liquidity: 2023 2022 Cash $ 2,900 $ 1,655 Short-term investments 1,089 1,239 Short-term borrowings and current portion of long-term debt (1,123 ) (1,632 ) Long-term debt (10,842 ) (10,594 ) Net debt (1) $ (7,976 ) $ (9,332 ) Changes in Liquidity: 2023 2022 Net income $ 4,275 $ 3,492 Charges and credits 110 (347 ) Depreciation and amortization (2) 2,312 2,147 Stock-based compensation expense 293 313 Deferred taxes 28 (39 ) Earnings of equity method investments, less dividends received (132 ) (96 ) Increase in working capital (215 ) (1,709 ) US federal tax refund 85 - Other (119 ) (41 ) Cash flow from operations 6,637 3,720 Capital expenditures (1,939 ) (1,618 ) APS investments (507 ) (587 ) Exploration data capitalized (153 ) (97 ) Free cash flow (3) 4,038 1,418 Dividends paid (1,317 ) (848 ) Stock repurchase program (694 ) - Proceeds from employee stock purchase plan 191 141 Proceeds from exercise of stock options 90 81 Taxes paid on net-settled stock-based compensation awards (169 ) (93 ) Business acquisitions and investments, net of cash acquired plus debt assumed (330 ) (58 ) Proceeds from sale of Liberty shares 137 732 Proceeds from sale of ADC shares - 223 Proceeds from sale of real estate - 120 Purchases of Blue Chip Swap securities (185 ) (259 ) Proceeds from sales of Blue Chip Swap securities 97 111 Other (195 ) (105 ) Change in net debt before impact of changes in foreign exchange rates on net debt 1,663 1,463 Impact of changes in foreign exchange rates on net debt (307 ) 261 Decrease in Net Debt 1,356 1,724 Net Debt, Beginning of period (9,332 ) (11,056 ) Net Debt, End of period $ (7,976 ) $ (9,332 ) (1) “ Net debt” represents gross debt less cash and short-term investments.
Management believes that Net debt provides useful information regarding the level of SLB’s indebtedness by reflecting cash and investments that could be used to repay debt. Net debt is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, total debt.
Management believes that Net debt provides useful information to investors and management regarding the level of SLB’s indebtedness by reflecting cash and investments that could be used to repay debt. Net debt is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, total debt.
Critical Accounting Policies and Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires SLB to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities and the reported amounts of revenue and expenses.
Critical Accounting Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires SLB to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities and the reported amounts of revenue and expenses.
During the fourth quarter of 2022, SLB repurchased $395 million of its 3.75% Senior Notes due 2024 and $409 million of its 4.00% Senior Notes due 2025 for $790 million, resulting in a gain of $11 million after considering the write-off of the related deferred financing fees and other costs.
During 2022, SLB repurchased $395 million of its 3.75% Senior Notes due 2024 and $409 million of its 4.00% Senior Notes due 2025 for $790 million, resulting in a gain of $11 million after considering the write-off of the related deferred financing fees and other costs.
SLB has outstanding letters of credit/guarantees that relate to business performance bonds, custom/excise tax commitments, facility lease/rental obligations, etc. These were entered into in the ordinary course of business and are customary practices in the various countries where SLB operates.
SLB has outstanding letters of credit/guarantees that relate to business performance bonds, customs/excise tax commitments, facility lease/rental obligations, etc. These were entered into in the ordinary course of business and are customary practices in the various countries where SLB operates.
However, except for a $469 million accounts receivable write-off during 2017 as a result of the political and economic condition in Venezuela, SLB has not historically had material write-offs due to uncollectible accounts receivable. SLB has a global footprint in more than 100 countries.
However, except for a $469 million accounts receivable write-off during 2017 as a result of the political and economic conditions in Venezuela, SLB has not historically had material write-offs due to uncollectible accounts receivable. SLB has a global footprint in more than 100 countries.
Under this method, revenue is recognized as work progresses on each contract. Progress is measured by the ratio of actual costs incurred to date on the project in relation to total estimated project costs. Approximately 5% of SLB’s revenue in 2022, 6% in 2021, and 5% in 2020, was recognized under this method.
Under this method, revenue is recognized as work progresses on each contract. Progress is measured by the ratio of actual costs incurred to date on the project in relation to total estimated project costs. Approximately 6% of SLB’s revenue in 2023, 5% in 2022 and 6% in 2021, was recognized under this method.
SLB has the option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the quantitative goodwill impairment test. SLB elected to perform the qualitative assessment described above for purposes of its annual goodwill impairment test in 2022.
SLB has the option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the quantitative goodwill impairment test. SLB elected to perform the qualitative assessment described above for purposes of its annual goodwill impairment test in 2023.
When the percentage of pretax earnings generated outside of North America increases, the SLB effective tax rate generally decreases. Conversely, when the percentage of pretax earnings generated outside of North America decreases, the SLB effective tax rate generally increases. The effective tax rate was 18% in 2022 as compared to 19% in 2021.
When the percentage of pretax earnings generated outside of North America increases, the SLB effective tax rate generally decreases. Conversely, when the percentage of pretax earnings generated outside of North America decreases, the SLB effective tax rate generally increases. The effective tax rate was 19% in 2023 as compared to 18% in 2022.
This section of the Form 10-K generally discusses 2022 and 2021 items and year-to-year comparisons between 2022 and 2021.
This section of the Form 10-K generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
Any expected losses on a project are recorded in full in the period in which they become probable. 25 Pension and Postretirement Benefits SLB’s pension and postretirement benefit obligations are described in detail in Note 16 to the Consolidated Financial Statements .
Any expected losses on a project are recorded in full in the period in which they become probable. 26 Pension and Postretirement Benefits SLB’s pension and postretirement benefit obligations are described in detail in Note 17 to the Consolidated Financial Statements .
The decrease in the effective tax rate was primarily due to the charges and credits described in Note 3 to the Consolidated Financial Statements . These charges and credits reduced the effective tax rate in 2022 by approximately one percentage point. Charges and Credits SLB recorded charges and credits during 2022 and 2021.
The increase in the effective tax rate was primarily due to the charges and credits described in Note 3 to the Consolidated Financial Statements . These charges and credits reduced the effective tax rate in 2022 by approximately one percentage point. Charges and Credits SLB recorded charges and credits during 2023 and 2022.
The following summarizes the discount rates utilized by SLB for its various pension and postretirement benefit plans: • The discount rate utilized to determine the liability for SLB’s United States pension plans and postretirement medical plan was 5.50% at December 31, 2022 and 3.00% at December 31, 2021. • The weighted-average discount rate utilized to determine the liability for SLB’s international pension plans was 5.41% at December 31, 2022 and 2.83% at December 31, 2021. • The discount rate utilized to determine expense for SLB’s United States pension plans and postretirement medical plan was 3.00% in 2022 and 2.60% in 2021. • The weighted-average discount rate utilized to determine expense for SLB’s international pension plans was 2.83% in 2022 and 2.38% in 2021.
The following summarizes the discount rates utilized by SLB for its various pension and postretirement benefit plans: • The discount rate utilized to determine the liability for SLB’s United States pension plans and postretirement medical plan was 5.25% at December 31, 2023 and 5.50% at December 31, 2022. • The weighted-average discount rate utilized to determine the liability for SLB’s international pension plans was 5.14% at December 31, 2023 and 5.41% at December 31, 2022. • The discount rate utilized to determine expense for SLB’s United States pension plans and postretirement medical plan was 5.50% in 2023 and 3.00% in 2022. • The weighted-average discount rate utilized to determine expense for SLB’s international pension plans was 5.41% in 2023 and 2.83% in 2022.
Adjustments 24 to the allowance may be required in future periods depending on how such potential issues are resolved, or if the financial condition of SLB ’s customers were to deteriorate resulting in an impairment of their ability to make payments.
Adjustments to the allowance 25 may be required in future periods depending on how such potential issues are resolved, or if the financial condition of SLB’s customers were to deteriorate resulting in an impairment of their ability to make payments.
( 2 ) Includes depreciation of property, plant and equipment and amortization of intangible assets, exploration data costs and APS investments. ( 3 ) “Free cash flow” represents cash flow from operations less capital expenditures, APS investments and exploration data costs capitalized.
(2) Includes depreciation of fixed assets and amortization of intangible assets, exploration data costs and APS investments. (3) “Free cash flow” represents cash flow from operations less capital expenditures, APS investments and exploration data costs capitalized.
As of December 31, 2022, three of those countries individually accounted for greater than 5% of SLB’s net accounts receivable balance, of which only two (the United States and Mexico) accounted for greater than 10% of such receivables.
As of December 31, 2023, three of those countries individually accounted for greater than 5% of SLB’s net accounts receivable balance, of which only two (the United States and Mexico) accounted for greater than 10% of such receivables. As of December 31, 2023, Mexico and the United States represented 13% and 11% respectively, of SLB’s net accounts receivable balance.
(2) Excludes interest income included in the segments’ income (fourth quarter 2022: $19 million; third quarter 2022: $25 million). (3) Excludes interest expense included in the segments’ income (fourth quarter 2022: $3 million; third quarter 2022: $3 million). (4) Charges & credits are described in detail in Note 3 to the Consolidated Financial Statements .
(2) Excludes interest income included in the segments’ income (fourth quarter 2023: $11 million; third quarter 2023: $2 million). (3) Excludes interest expense included in the segments’ income (fourth quarter 2023: $4 million; third quarter 2023: $3 million). (4) Charges and credits are described in detail in Note 3 to the Consolidated Financial Statements .
During the fourth quarter of 2022, ADC completed an initial public offering (“IPO”). In connection with the IPO, SLB sold a portion of its interest in a secondary offering that resulted in SLB receiving net proceeds of $223 million. As a result of these transactions, SLB’s ownership interest in ADC decreased from 49% to approximately 34%.
In connection with the IPO, SLB sold a portion of its interest in a secondary offering that resulted in SLB receiving net proceeds of $223 million. As a result of these transactions, SLB’s ownership interest in ADC decreased from 49% to approximately 34%.
The following illustrates the sensitivity to changes in certain assumptions, holding all other assumptions constant, for SLB’s United States and international pension plans: (Stated in millions) Effect on Effect on 2022 Dec. 31, 2022 Change in Assumption Pretax Expense Obligation 25 basis point decrease in discount rate +$31 +$334 25 basis point increase in discount rate -$30 -$321 25 basis point decrease in expected return on plan assets +$38 - 25 basis point increase in expected return on plan assets -$38 - The following illustrates the sensitivity to changes in certain assumptions, holding all other assumptions constant, for SLB’s United States postretirement medical plans: (Stated in millions) Effect on Effect on 2022 Dec. 31, 2022 Change in Assumption Pretax Expense Obligation 25 basis point decrease in discount rate -$3 +$23 25 basis point increase in discount rate +$3 -$22 26
The following illustrates the sensitivity to changes in certain assumptions, holding all other assumptions constant, for SLB’s United States and international pension plans: (Stated in millions) Effect on Effect on 2023 Dec. 31, 2023 Change in Assumption Pretax Expense Obligation 25 basis point decrease in discount rate -$3 +$356 25 basis point increase in discount rate +$15 -$338 25 basis point decrease in expected return on plan assets +$35 - 25 basis point increase in expected return on plan assets -$35 - The following illustrates the sensitivity to changes in certain assumptions, holding all other assumptions constant, for SLB’s United States postretirement medical plans: (Stated in millions) Effect on Effect on 2023 Dec. 31, 2023 Change in Assumption Pretax Expense Obligation 25 basis point decrease in discount rate -$2 +$23 25 basis point increase in discount rate +$2 -$22 27
Free cash flow is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, cash flow from operations. Key liquidity events during 2022 and 2021 included: • Cash flow from operations of $3.7 billion in 2022 decreased approximately $1.0 billion as compared to 2021.
Free cash flow is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, cash flow from operations. Key liquidity events during 2023 and 2022 included: • Cash flow from operations of $6.6 billion in 2023 increased approximately $2.9 billion as compared to 2022.
SLB recognized a gain of $ 107 million, representing the gain on the sale of a portion of its interest as well as the effect of the ownership dilution of its equity investment due to the IPO.
SLB recognized a gain of $107 million, representing the gain on the sale of a portion of its interest as well as the effect of the ownership dilution of its equity investment due to the IPO. During 2022, SLB sold certain real estate and recognized a gain of $43 million.
The average expected rate of return on plan assets for the United States pension plans was 4.40% in 2022 and 6.60% in 2021. The weighted average expected rate of return on plan assets for the international pension plans was 5.05% in 2022 and 6.73% in 2021. A lower expected rate of return increases pension expense.
The average expected rate of return on plan assets for the United States pension plans was 6.00% in 2023 and 4.40% in 2022. The weighted average expected rate of return on plan assets for the international pension plans was 6.00% in 2023 and 5.05% in 2022. A higher expected rate of return decreases pension expense.
As of December 31, 2022, SLB had $2.89 billion of cash and short-term investments and committed credit facility agreements with commercial banks aggregating $6.55 billion, all of which was available and unused.
As of December 31, 2023, SLB had $3.99 billion of cash and short-term investments and committed credit facility agreements with commercial banks aggregating $5.0 billion, all of which was available and unused.
Other Research & engineering and General & administrative expenses, as a percentage of Revenue , were as follows: 2022 2021 Research & engineering 2.3 % 2.4 % General & administrative 1.3 % 1.5 % Income Taxes The SLB effective tax rate is sensitive to the geographic mix of earnings.
Interest Expense Interest expense of $503 million in 2023 increased $13 million compared to 2022. 21 Other Research & engineering and General & administrative expenses, as a percentage of Revenue , were as follows: 2023 2022 Research & engineering 2.1 % 2.3 % General & administrative 1.1 % 1.3 % Income Taxes The SLB effective tax rate is sensitive to the geographic mix of earnings.
Discussions of 2020 items and year-to-year comparison between 2021 and 2020 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of SLB’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021. 2022 Executive Overview We delivered strong fourth quarter results and concluded a remarkable year for SLB with great success.
Discussions of 2021 items and year-to-year comparison between 2022 and 2021 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of SLB’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022. 2023 Executive Overview 2023 was a remarkable year marked by widespread revenue growth, margin expansion, and exceptional cash flow.
Full-Year 2022 Results (Stated in millions) 2022 2021 Pretax Pretax Revenue Income Revenue Income Digital & Integration $ 3,725 $ 1,357 $ 3,290 $ 1,141 Reservoir Performance 5,553 881 4,599 648 Well Construction 11,397 2,202 8,706 1,195 Production Systems 7,862 748 6,710 634 Eliminations & other (446 ) (177 ) (376 ) (253 ) Pretax segment operating income 5,011 3,365 Corporate & other (1) (637 ) (573 ) Interest income (2) 27 31 Interest expense (3) (477 ) (514 ) Charges & credits (4) 347 65 $ 28,091 $ 4,271 $ 22,929 $ 2,374 (1) Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.
Full-Year 2023 Results (Stated in millions) 2023 2022 Pretax Pretax Revenue Income Revenue Income Digital & Integration $ 3,871 $ 1,257 $ 3,725 $ 1,357 Reservoir Performance 6,561 1,263 5,553 881 Well Construction 13,478 2,932 11,397 2,202 Production Systems 9,831 1,245 7,862 748 Eliminations & other (606 ) (174 ) (446 ) (177 ) Pretax segment operating income 6,523 5,011 Corporate & other (1) (729 ) (637 ) Interest income (2) 87 27 Interest expense (3) (489 ) (477 ) Charges & credits (4) (110 ) 347 $ 33,135 $ 5,282 $ 28,091 $ 4,271 (1) Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives, and other nonoperating items.
SLB believes these amounts, along with cash generated by ongoing operations, will be sufficient to meet future business requirements for the next 12 months and beyond. 23 The following table reflects the carrying amounts of SLB ’s debt at December 31, 202 2 by year of maturity: (Stated in millions) After 2023 2024 2025 2026 2027 2028 2029 2030 2031 Total Fixed rate debt 3.65% Senior Notes $ 1,499 1,499 4.00% Notes 79 79 0.00% Notes $ 531 531 3.75% Senior Notes 355 355 3.70% Notes 54 54 4.00% Senior Notes $ 522 522 1.40% Senior Notes 499 499 1.375% Guaranteed Notes $ 1,060 1,060 1.00% Guaranteed Notes 636 636 0.25% Notes $ 955 955 3.90% Senior Notes $ 1,464 1,464 4.30% Senior Notes $ 847 847 2.65% Senior Notes $ 1,250 1,250 2.00% Guaranteed Notes $ 1,055 1,055 0.50% Notes 954 954 7.00% Notes 202 202 5.95% Notes 112 112 5.13% Notes 98 98 Total fixed rate debt $ 1,578 $ 940 $ 1,021 $ 1,696 $ 955 $ 1,464 $ 847 $ 1,250 $ 2,421 $ 12,172 Variable rate debt 54 - - - - - - - - 54 Total $ 1,632 $ 940 $ 1,021 $ 1,696 $ 955 $ 1,464 $ 847 $ 1,250 $ 2,421 $ 12,226 Interest payments on fixed rate debt obligations by year are as follows: (Stated in millions) 2023 $ 386 2024 320 2025 301 2026 265 2027 235 Thereafter 706 $ 2,213 See Note 13, Leases of the Consolidated Financial Statements for details regarding SLB’s lease obligations.
SLB believes these amounts, along with cash generated by ongoing operations, will be sufficient to meet future business requirements for the next 12 months and beyond. 24 The following table reflects the carrying amounts of SLB’s debt at December 31, 2023 by year of maturity: (Stated in millions) After 2024 2025 2026 2027 2028 2029 2030 2031 2032 Total Fixed rate debt 0.00% Notes $553 553 3.75% Senior Notes 355 355 3.70% Notes 54 54 4.00% Senior Notes $523 523 1.40% Senior Notes 499 499 1.375% Guaranteed Notes $1,104 1,104 1.00% Guaranteed Notes 662 662 0.25% Notes $994 994 4.50% Senior Notes $497 497 3.90% Senior Notes 1,471 1,471 4.30% Senior Notes $847 847 2.65% Senior Notes $1,250 1,250 0.50% Notes $992 992 2.00% Guaranteed Notes $1,098 1,098 4.85% Senior Notes 496 496 7.00% Notes 199 199 5.95% Notes 112 112 5.13% Notes 98 98 Total fixed rate debt $962 $1,022 $1,766 $994 $1,968 $847 $1,250 $992 $2,003 $11,804 Variable rate debt 161 - - - - - - - - 161 Total $1,123 $1,022 $1,766 $994 $1,968 $847 $1,250 $992 $2,003 $11,965 Interest payments on fixed rate debt obligations by year are as follows: (Stated in millions) 2024 $ 367 2025 348 2026 312 2027 282 2028 212 Thereafter 631 $ 2,152 See Note 14, Leases of the Consolidated Financial Statements for details regarding SLB’s lease obligations.
This parallel rate, which cannot be used as the basis to remeasure SLB’s net monetary assets in US dollars under US GAAP, was approximately 93% higher than Argentina’s official exchange rate at December 31, 2022. During the fourth quarter of 2022, SLB entered into Blue Chip Swap transactions that resulted in a loss of $139 million.
This parallel rate, which cannot be used as the basis to remeasure SLB’s net monetary assets in US dollars under US GAAP, was approximately 20% higher than Argentina’s official exchange rate at December 31, 2023 and 93% higher at December 31, 2022. During the fourth quarter of 2023, Argentina devalued its peso relative to the US dollar by approximately 55%.
During 2021, SLB sold 9.5 million of its shares of Liberty and recognized a gain of $28 million. SLB’s functional currency in Argentina is the US dollar and it uses Argentina’s official exchange rate to remeasure its Argentine peso-denominated net assets into US dollars.
Although SLB's functional currency in Argentina is the US dollar, a portion of its transactions are denominated in pesos. SLB uses Argentina’s official exchange rate to remeasure its Argentine peso-denominated net assets into US dollars.
Goodwill, Intangible Assets and Long-Lived Assets SLB records the excess of purchase price over the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed as goodwill. The goodwill relating to each of SLB’s reporting units is tested for impairment annually as well as when an event, or change in circumstances, indicates an impairment may have occurred.
The goodwill relating to each of SLB’s reporting units is tested for impairment annually as well as when an event, or change in circumstances, indicates an impairment may have occurred.
In January 2023, SLB announced a further 43% increase to its quarterly cash dividend from $0.175 per share of outstanding common stock to $0.25 per share, beginning with the dividend payable in April 2023. • On January 21, 2016, the SLB Board of Directors approved a $10 billion share repurchase program for SLB common stock.
In January 2024, SLB announced a 10% increase to its quarterly cash dividend from $0.25 per share of outstanding common stock to $0.275 per share, beginning with the dividend payable in April 2024. • As of December 31, 2023, SLB had cumulatively repurchased $1.7 billion of its common stock under its $10 billion share repurchase program.
During 2021, SLB sold 9.5 million of its shares of Liberty and received proceeds of $109 million. • During the fourth quarter of 2022, SLB repurchased $395 million of its 3.75% Senior Notes due 2024 and $409 million of its 4.00% Senior Notes due 2025 for $790 million. • During the fourth quarter of 2022, SLB sold a portion of its equity interest in ADC in a secondary offering that resulted in SLB receiving net proceeds of $223 million. • During the second quarter of 2022, SLB sold certain real estate and received proceeds of $120 million. • During the fourth quarter of 2021, SLB deposited sufficient funds with the trustee for its $1.0 billion of 2.40% Senior Notes due 2022 to satisfy and discharge all of its obligations relating to such notes. • During the second quarter of 2021, SLB repurchased all $665 million of its 3.30% Senior Notes due 2021.
During 2022, SLB sold 47.8 million of its shares of Liberty and received proceeds of $732 million. • During the second quarter of 2023, SLB issued $500 million of 4.50% Senior Notes due 2028 and $500 million of 4.85% Senior Notes due 2033. • During the fourth quarter of 2023, SLB repaid its $1.5 billion of 3.65% Senior Notes that were outstanding. • During the second quarter of 2022, SLB sold certain real estate and received proceeds of $120 million. • During the fourth quarter of 2022, SLB repurchased $395 million of its 3.75% Senior Notes due 2024 and $409 million of its 4.00% Senior Notes due 2025 for $790 million. • During the fourth quarter of 2022, SLB repaid $795 million of Senior Notes that matured. • During the fourth quarter of 2022, SLB sold a portion of its equity interest in ADC in a secondary offering that resulted in SLB receiving net proceeds of $223 million.
(2) Excludes interest income included in the segments’ income (2022: $72 million; 2021: $2 million). (3) Excludes interest expense included in the segments’ income (2022: $13 million; 2021: $15 million) and $10 million interest expense included in Charges & credits in 2021.
(2) Excludes interest income included in the segments’ income (2023: $13 million; 2022: $72 million). (3) Excludes interest expense included in the segments’ income (2023: $14 million; 2022: $13 million) . (4) Charges and credits are described in detail in Note 3 to the Consolidated Financial Statements .
Interest & Other Income, Net Interest & other income, net consisted of the following: (Stated in millions) 2022 2021 Gain on sale of Liberty shares $ 325 $ 28 Loss on Blue Chip Swap transactions (139 ) - Gain on ADC equity investment 107 - Earnings of equity method investments 164 40 Interest income 99 33 Gain on sale of real estate 43 - Gain on repurchase of bonds 11 - Unrealized gain on marketable securities - 47 $ 610 $ 148 During 2022, SLB sold 47.8 million of its shares of Liberty and recognized a gain of $325 million.
Interest & Other Income, Net Interest & other income, net consisted of the following: (Stated in millions) 2023 2022 Earnings of equity method investments $ 206 $ 164 Interest income 100 99 Gain on sale of Liberty shares 36 325 Gain on ADC equity investment - 107 Gain on sale of real estate - 43 Gain on repurchase of bonds - 11 Loss on Blue Chip Swap transactions - (139 ) $ 342 $ 610 On December 31, 2020, SLB contributed its onshore hydraulic fracturing business in the United States and Canada, including its pressure pumping, pumpdown perforating and Permian frac sand business, to Liberty Energy Inc.
Included in Receivables, less allowance for doubtful accounts in the Consolidated Balance Sheet as of December 31, 2022 is approximately $1.0 billion of receivables relating to Mexico. SLB’s receivables from its primary customer in Mexico are not in dispute and SLB has not historically had any material write-offs due to uncollectible accounts receivable relating to this customer.
SLB’s receivables from its primary customer in Mexico are not in dispute and SLB has not historically had any material write-offs due to uncollectible accounts receivable relating to this customer. Goodwill, Intangible Assets and Long-Lived Assets SLB records the excess of purchase price over the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed as goodwill.
Capital investments during 2023 are expected to be approximately $2.5 to $2.6 billion as SLB continues to support the strong revenue growth that is expected to continue in 2023. • During 2022, SLB sold 47.8 million of its shares of Liberty and received proceeds of $732 million.
Capital investments during 2024 are expected to be approximately $2.6 billion. • During the first quarter of 2023, SLB sold all of its remaining approximately 9 million shares of Liberty and received net proceeds of $137 million. As a result, SLB recognized a gain of $36 million.
In addition, cash flow from operations in 2021 benefited from a federal tax refund of $477 million relating to the carryback of US net operating losses pursuant to the Coronavirus Aid, Relief and Economic Security Act. • In April 2022, SLB announced a 40% increase to its quarterly cash dividend from $0.125 per share of outstanding common stock to $0.175 per share, beginning with the dividend payable in July 2022.
Additionally, SLB received a US federal tax refund of $85 million during the fourth quarter of 2023 relating to prior years. • In January 2023, SLB announced a 43% increase to its quarterly cash dividend from $0.175 per share of outstanding common stock to $0.25 per share, beginning with the dividend payable in April 2023.
Well Construction pretax operating margin of 19% expanded 560 bps year on year driven by the higher activity and improved pricing. Production Systems Production Systems full-year revenue of $7.9 billion increased 17% year on year driven by new projects and increased sales activity primarily in Europe, Africa, and North America.
North America revenue decreased 7% on a lower US land rig count. Well Construction pretax operating margin of 22% increased 35 bps sequentially primarily driven by improved profitability from the increased activity in the Middle East & Asia and Africa. 19 Production Systems Production Systems revenue of $2.94 billion increased 24% sequentially.
Digital & Integration pretax operating margin of 38% expanded 386 bps sequentially, due to improved profitability in exploration data licensing and digital solutions. Reservoir Performance Reservoir Performance revenue of $1.6 billion increased 7% sequentially from new projects and activity gains internationally, particularly in the Middle East and Africa. Reservoir Performance pretax operating margin of 18% expanded 146 bps sequentially.
Digital & Integration Digital & Integration revenue of $1.0 billion increased 7% sequentially due to increased digital revenue across all areas led by the Middle East & Asia and Europe & Africa. Digital & Integration pretax operating margin of 34% expanded 197 bps sequentially due to improved profitability in digital.
Full-year pretax operating margin of 18% increased 316 bps due to improved operating leverage from higher activity, a favorable activity mix, and an improving pricing environment.
Full-year 2023 pretax segment operating margin of 20% expanded by 185 bps as compared to 2022 driven by higher activity, improved pricing, and a more favorable activity mix.
Additionally, SLB may enter into further Blue Chip Swap transactions in the future. Argentina represented less than 5% of SLB’s consolidated revenue in 2022. SLB has an investment in the Arabian Drilling Company (“ADC”), an onshore and offshore gas and oil rig drilling company in Saudi Arabia, that it accounts for under the equity method.
SLB accounts for its investment in the Arabian Drilling Company (“ADC”), an onshore and offshore gas and oil rig drilling company in Saudi Arabia, under the equity method. During the fourth quarter of 2022, ADC completed an initial public offering (“IPO”).
SLB’s peso-denominated net assets in Argentina were approximately $40 million at December 31, 2022 (as compared to approximately $270 million at September 30, 2022), primarily consisting of cash. If Argentina’s official exchange rate converges with the parallel rate, SLB would incur a loss on its peso-denominated net assets in Argentina.
SLB’s peso-denominated net assets in Argentina were approximately $75 million at December 31, 2023 ($40 million at December 31, 2022 and $270 million at September 30, 2022), primarily consisting of cash. Argentina represented less than 5% of SLB’s consolidated revenue in each of 2023 and 2022.
SLB resumed repurchases under this program in the first quarter of 2023. • Capital investments (consisting of capital expenditures, APS investments and exploration data capitalized) were $2.3 billion in 2022 and $1.7 billion in 2021.
SLB repurchased approximately 13.3 million shares of its common stock under this program during 2023, for a total purchase price of $694 million. SLB did not repurchase any of its common stock during 2022. • Capital investments (consisting of capital expenditures, APS investments, and exploration data capitalized) were $2.6 billion in 2023 and $2.3 billion in 2022.
Digital & Integration Digital & Integration full-year revenue of $3.7 billion increased 13% year on year, primarily driven by increased APS project activity in Ecuador and Canada and higher exploration data licensing sales in the US Gulf of Mexico.
Digital & Integration Digital & Integration revenue of $3.9 billion increased 4% year on year, as strong growth in digital sales was largely offset by lower APS revenue and decreased exploration data licensing sales.
Fourth Quarter 2022 Results (Stated in millions) Fourth Quarter 2022 Third Quarter 2022 Pretax Pretax Revenue Income Revenue Income Digital & Integration $ 1,012 $ 382 $ 900 $ 305 Reservoir Performance 1,554 282 1,456 244 Well Construction 3,229 679 3,084 664 Production Systems 2,215 238 2,150 224 Eliminations & other (131 ) (24 ) (113 ) (37 ) Pretax segment operating income 1,557 1,400 Corporate & other (1) (169 ) (155 ) Interest income (2) 14 8 Interest expense (3) (118 ) (119 ) Charges & credits (4) 63 - $ 7,879 $ 1,347 $ 7,477 $ 1,134 (1) Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives and other nonoperating items.
Additionally, we plan to increase share repurchases in 2024, visibly enhancing returns to shareholders for the full year. 18 Fourth Quarter 2023 Results (Stated in millions) Fourth Quarter 2023 Third Quarter 2023 Pretax Pretax Revenue Income Revenue Income Digital & Integration $ 1,049 $ 356 $ 982 $ 314 Reservoir Performance 1,735 371 1,680 344 Well Construction 3,426 770 3,430 759 Production Systems 2,944 442 2,367 319 Eliminations & other (164 ) (71 ) (149 ) (53 ) Pretax segment operating income 1,868 1,683 Corporate & other (1) (193 ) (182 ) Interest income (2) 30 20 Interest expense (3) (126 ) (126 ) Charges & credits (4) (146 ) - $ 8,990 $ 1,433 $ 8,310 $ 1,395 (1) Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets, certain centrally managed initiatives, and other nonoperating items.
Reservoir Performance Reservoir Performance full-year revenue of $5.6 billion increased 21% year on year as a result of strong international activity led by the Middle East & Asia and Latin America on higher activity and improved pricing. 19 Reservoir Performance pretax operating margin of 16% increased 177 bps year on year primarily due to improved profitability in intervention activity.
Reservoir Performance Reservoir Performance revenue of $6.6 billion increased 18% year on year due primarily to increased activity internationally. Reservoir Performance pretax operating margin expanded 338 bps to 19% primarily due to higher activity levels and improved pricing. Well Construction Well Construction revenue of $13.5 billion increased 18% year on year with double-digit growth across all areas.
Well Construction Well Construction full-year revenue of $11.4 billion grew 31% year on year with strong growth across all geographical areas led by North America and Latin America, which grew 56% and 53%, respectively. This growth was driven by higher land and offshore activity along with improved pricing.
North America grew 17% while international revenue increased 19%. This growth was driven by drilling fluids and measurements—both on higher land and offshore activity—along with improved pricing. 20 Well Construction pretax operating margin expanded 243 bps to 22% with profitability improving across all geographic areas driven by the higher activity and improved pricing.
The increase in working capital in 2022 was partially offset by the effects of a $1.3 billion increase in net income, excluding the effects of the previously mentioned charges and credits (which had no impact on cash flow from operations), in 2022 as compared to 2021.
This increase was primarily due to a $1.4 billion increase in net income adjusted for the previously mentioned charges and credits and depreciation and amortization expense combined with the effect of working capital only consuming $0.2 billion of liquidity in 2023 as compared to $1.7 billion in 2022.
Well Construction Well Construction revenue of $3.2 billion increased 5% sequentially, outperforming global rig count growth due to strong activity from new projects and solid pricing improvements internationally, particularly in the Middle East & Asia and Latin America. 18 Well Construction pretax operating margin of 21% contracted 50 bps sequentially, as improved profitability from increasing activity in the Middle East & Asia, North America, and Latin America was more than offset by the onset of seasonal effects in the Northern Hemisphere.
This increase was primarily driven by higher activity, pricing, and improved operating leverage. Well Construction Well Construction revenue of $3.4 billion was flat sequentially with international growth being offset by a decline in North America revenue. International revenue increased 2% driven primarily by strong growth in the Middle East & Asia and Africa.
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Full-year 2022 revenue of $28.1 billion increased 23% year on year. All Divisions and geographical areas experienced double digit revenue growth. 2022 was transformative for SLB as we set new safety, operational, and performance benchmarks for our customers and strengthened our market position both internationally and in North America.
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Year on year, revenue grew 18%, pretax segment operating margin increased 185 basis points (“bps”) to 20% and we delivered $6.6 billion of cash flow from operations and $4.0 billion of free cash flow—allowing us to reduce net debt by $1.4 billion and return $2.0 billion to shareholders this year through dividends and stock repurchases.
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We launched our bold new brand identity, reinforcing our leadership position in energy technology, digital, and sustainability, and demonstrated our ability to deliver superior earnings in this early phase of a structural upcycle in energy.
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Our strong full-year performance was fueled by substantial international growth, with approximately 90% of our international GeoUnits posting year-on-year increases, complemented by sustained performance in North America. International revenue grew 20% year on year by more than $4 billion.
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In North America, we seized the growth cycle throughout the year, increased our pretax operating margins close to 600 basis points (“bps”), and almost doubled our pretax operating income. We effectively harnessed our refocused portfolio, fit-for-basin technology, and performance differentiation to gain greater market access and improved pricing, particularly in the drilling markets where we significantly outperformed rig count growth.
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Notably, we achieved our highest-ever revenue in the Middle East, led by impressive growth in Saudi Arabia, the United Arab Emirates, and Egypt & East Mediterranean GeoUnits.
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Today, we have built one of the highest-quality oilfield services and equipment businesses in North America through the implementation of our returns-focused strategy.
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In the offshore basins, we benefited from long-cycle developments, capacity expansions, and exploration and appraisal activities with remarkable growth in Brazil and Angola, and solid increases in the US Gulf of Mexico, Guyana, and Norway. In North America, while activity moderated as expected in the second half of the year, revenue increased 12% year on year, outpacing the rig count.
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In the international markets, after a first half of the year that was impacted by geopolitical conflict and supply chain bottlenecks, activity began to visibly expand in the second half of the year, resulting in full year revenue growth of 20% and margin expansion of more than 150 bps.
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This outperformance was driven by our technology-leveraged portfolio in both US land and the US Gulf of Mexico. On a divisional basis, our Core business—comprising Reservoir Performance, Well Construction, and Production Systems—accelerated, growing revenue 20% year on year and expanding pretax segment operating margin 277 bps. Digital & Integration revenue increased 4% year on year.
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We laid the foundation for further growth and margin expansion through pricing improvements and a solid pipeline of incremental contract awards. In the Middle East, SLB is well positioned to be a key beneficiary of this visible market expansion, and we expect record levels of upstream investment by national oil companies to continue in the next few years.
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This was led by digital, which continued strong growth momentum, delivering more than $2 billion in revenue. Our success in digital was driven by further adoption of Delfi technology and customers embracing our connected and autonomous drilling, data, and AI solutions. We also saw continued adoption of our Transition Technologies portfolio as customers look to enhance efficiency and reduce emissions.
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During the year, we secured a sizeable share of tender awards in the region, driven by our differentiated performance, fit-for-purpose technology, and best-in-class local content. Similarly, across offshore basins, we continue to consolidate our advantaged position with new contract awards, particularly in Latin America and Africa.
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The imperative to operate more sustainably is translating into tangible investments by our customers, resulting in the portfolio generating more than $1 billion of revenue. As global energy demand continues to increase, international production is expected to play a key role in meeting supply through the end of the decade.
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Beyond our financial results, we made significant progress in our sustainability initiatives during the year, including launching several new Transition Technologies to support the decarbonization of oil and gas. Our Transition Technologies portfolio revenue grew more than 30% year-on-year, and we project it will cross the $1 billion revenue mark in 2023.
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Notably, we anticipate record investment levels in the Middle East extending beyond 2025, with significant expansion in Saudi Arabia, the United Arab Emirates, Iraq, and Kuwait.
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Finally, we initiated increased returns to shareholders, demonstrating confidence in our strategy, our financial outperformance, and our commitment to superior returns. We increased our dividend by 40% in April 2022, followed by a further 43% increase in January 2023, and we resumed our share buyback program in the first quarter of 2023.
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Offshore remains another distinct attribute of this durable growth cycle, serving as an important source for production growth and capacity additions, and we expect strong activity to continue in Brazil, West Africa, the Eastern Mediterranean, the Middle East, and Southeast Asia.
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The fourth quarter affirmed a distinctive new phase in the upcycle with the much-anticipated acceleration of activity in the Middle East, as revenue in the region increased by double digits. Offshore activity continued to strengthen, partially offset by seasonality in the Northern Hemisphere.
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In the international environment, despite elevated geopolitical tensions in various regions, we do not anticipate a significant impact on the sector's overall activity, absent any escalation. Furthermore, we expect the long-cycle investments across the Middle East, global offshore, and gas resource plays to be largely decoupled from short-term commodity price fluctuations.
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In North America, the US land rig count remains at robust levels, although the pace of growth is moderating. Additionally, pricing continues to trend favorably, extending beyond North America and into the international regions, supported by new technology and very tight equipment and service capacity in certain markets.
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In 2024, SLB expects to experience another year of strong growth driven by the international markets. Benefiting from these market dynamics, we foresee further growth led by Production Systems, strengthened by the additional subsea opportunities from our OneSubsea joint venture. Sustained momentum is expected in Reservoir Performance, accompanied by increased activity in Well Construction.
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These activity dynamics, improved pricing, and our commercial success—particularly in the Middle East, offshore, and North American markets—combine to set a very strong foundation for outperformance in 2023.
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Additionally, we expect continued customer adoption of our Digital business, particularly in our new technology platforms. Our performance and returns-focused strategy, combined with our differentiated market positioning and digital capabilities, will drive profitable growth and further margin expansion, setting a strong foundation for long-term outperformance.
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We strengthened our balance by reducing our net debt by $1.7 billion to $9.3 billion, its lowest level since the second quarter of 2016, and repaid approximately $1.7 billion of gross debt during the year.
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With confidence in the strength and longevity of the cycle and visibility into sustained strong cash flows, in January 2024, our Board of Directors approved a 10% increase to our quarterly dividend.
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Looking ahead, we believe the macro backdrop and market fundamentals that underpin a strong multi-year upcycle for energy remain very compelling in both oil and gas and in low-carbon energy resources.
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Fourth-quarter revenue of $9.0 billion increased 8% sequentially with the acquired Aker subsea business accounting for approximately 70% of the growth, while the legacy portfolio continued its growth trajectory in the international markets. International revenue of $7.3 billion grew 10% sequentially, driven by Europe & Africa and the Middle East & Asia.
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First, oil and gas demand is forecasted by the International Energy Agency (“IEA”) to grow by 1.7 million barrels per day in 2023 despite concerns for a potential economic slowdown in certain regions. In parallel, markets remain very tightly supplied.
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Europe & Africa increased 16% sequentially driven by the acquired Aker subsea business, which accounted for most of the sequential revenue growth, primarily in Scandinavia. Revenue in the Middle East & Asia increased 11% sequentially driven by higher drilling, intervention, stimulation, and evaluation activity, both on land and offshore.
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Second, energy security is prompting a sense of urgency to make further investments to ensure capacity expansion and diversity of supply. And third, the secular trends of digital and decarbonization are set to accelerate with significant digital technology advancements, favorable government policy support, and increased spending on low-carbon initiatives and resources.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeSLB enters into foreign currency forward contracts to provide a hedge against currency fluctuations on certain monetary assets and liabilities, and certain expenses denominated in currencies other than the functional currency. A 10% appreciation in the US dollar from the December 31, 2022 market rates would increase the unrealized value of SLB’s forward contracts by $28 million.
Biggest changeSLB maintains a foreign currency risk management strategy that uses derivative instruments to manage the impact of changes in foreign exchange rates on its earnings. SLB enters into foreign currency forward contracts to provide a hedge against currency fluctuations on certain monetary assets and liabilities, and certain expenses denominated in currencies other than the functional currency.
Statements in this Form 10-K are made as of January 25, 2023, and SLB disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise. 27
Statements in this Form 10-K are made as of January 24, 2024, and SLB disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise. 28
Forward-looking statements address matters that are, to varying degrees, uncertain, such as statements about SLB’s financial and performance targets and other forecasts or expectations regarding, or dependent on, its business outlook; growth for SLB as a whole and for each of its Divisions (and for specified business lines, geographic areas or technologies within each Division); oil and natural gas demand and production growth; oil and natural gas prices; forecasts or expectations regarding energy transition and global climate change; improvements in operating procedures and technology; capital expenditures by SLB and the oil and gas industry; the business strategies of SLB, including digital and “fit for basin,” as well as the strategies of SLB’s customers; SLB’s effective tax rate; SLB’s APS projects, joint ventures, and other alliances; SLB’s response to the COVID-19 pandemic and its preparedness for other widespread health emergencies; the impact of the ongoing conflict in Ukraine on global energy supply; access to raw materials; future global economic and geopolitical conditions; future liquidity; and future results of operations, such as margin levels.
Forward-looking statements address matters that are, to varying degrees, uncertain, such as statements about SLB’s financial and performance targets and other forecasts or expectations regarding, or dependent on, its business outlook; growth for SLB as a whole and for each of its Divisions (and for specified business lines, geographic areas or technologies within each Division); oil and natural gas demand and production growth; oil and natural gas prices; forecasts or expectations regarding energy transition and global climate change; improvements in operating procedures and technology; capital expenditures by SLB and the oil and gas industry; the business strategies of SLB, including digital and “fit for basin,” as well as the strategies of SLB’s customers; SLB’s capital allocation plans, including dividend plans and share repurchase programs; SLB’s APS projects, joint ventures, and other alliances; the impact of the ongoing conflict in Ukraine on global energy supply; access to raw materials; future global economic and geopolitical conditions; future liquidity, including free cash flow; and future results of operations, such as margin levels.
At December 31, 2022, contracts were outstanding for the US dollar equivalent of $7.2 billion in various foreign currencies, of which $5.1 billion related to hedges of debt balances denominated in currencies other than the functional currency.
At December 31, 2023, contracts were outstanding for the US dollar equivalent of $10.6 billion in various foreign currencies, of which $5.3 billion related to hedges of debt balances denominated in currencies other than the functional currency.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. SLB is subject to market risks primarily associated with changes in foreign currency exchange rates. SLB’s functional currency is primarily the US dollar. Approximately 72% of SLB’s revenue in 2022 was denominated in US dollars. However, outside the United States, a significant portion of SLB’s expenses is incurred in foreign currencies.
Item 7A. Quantitative and Qualitat ive Disclosures About Market Risk. SLB is subject to market risks primarily associated with changes in foreign currency exchange rates. SLB’s functional currency is primarily the US dollar. Approximately 72% of SLB’s revenue in 2023 was denominated in US dollars.
SLB uses cross-currency interest rate swaps to provide a hedge against these cash flow risks and effectively convert the debt to US-dollar denominated fixed rate debt. SLB maintains a foreign-currency risk management strategy that uses derivative instruments to manage the impact of changes in foreign exchange rates on its earnings.
SLB is exposed to risks on future cash flows relating to its fixed rate debt denominated in currencies other than the functional currency. SLB uses cross-currency interest rate swaps to provide a hedge against these cash flow risks and effectively convert the debt to US-dollar denominated fixed rate debt.
Conversely, a 10% depreciation in the US dollar from the December 31, 2022 market rates would decrease the unrealized value of SLB’s forward contracts by $36 million. In either scenario, the gain or loss on the forward contract would be offset by the gain or loss on the underlying transaction, and therefore, would have no impact on future earnings.
In either scenario, the gain or loss on the forward contract would be offset by the gain or loss on the underlying transaction, and therefore, would have no impact on future earnings.
Therefore, when the US dollar weakens in relation to the foreign currencies of the countries in which SLB conducts business, the US dollar-reported expenses will increase. SLB is exposed to risks on future cash flows relating to its fixed rate debt denominated in currencies other than the functional currency.
However, outside the United States, a significant portion of SLB’s expenses is incurred in foreign currencies. Therefore, when the US dollar weakens in relation to the foreign currencies of the countries in which SLB conducts business, the US dollar-reported expenses will increase.
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A 10% appreciation in the US dollar from the December 31, 2023 market rates would decrease the unrealized value of SLB’s forward contracts by $103 million. Conversely, a 10% depreciation in the US dollar from the December 31, 2023 market rates would increase the unrealized value of SLB’s forward contracts by $113 million.

Other SLB 10-K year-over-year comparisons