The shares were off 3.2% in morning trading after the company posted revenues of US$6.89bn, which were up 5.7% from a year earlier but about US$100mln shy of what the market had been expecting.
Adjusted earnings per share of 25 cents were down from 40 cents a year earlier but in line with market expectations.
First-quarter revenue declines were led by the Cameron Group, which fell 9% quarter-on-quarter (QoQ), driven by lower project volumes in OneSubsea and reduced product sales in Surface Systems.
Reservoir Characterization Group revenue decreased 3% QoQ, sequentially due to the seasonal reduction in revenue for its Software Integrated Solutions (SIS) and WesternGeco product lines.
Drilling Group and Production Group revenues were each down 1% on the preceding quarter as continued strong growth in hydraulic fracturing and directional drilling activity in North America land was offset by seasonal revenue reductions in the international markets.
“As we begin the recovery from one of the deepest downturns on record, we see four areas as critical for the industry to restore its strength and advance its capabilities. They are: the need for higher E&P spending to meet growing hydrocarbon demand over the coming years; the need to protect and encourage investments in R&E throughout the entire oil and gas value chain; the need for new business models that foster closer technical collaboration and commercial alignment between operators and suppliers; and the need for broader and more integrated technology platforms that combine hardware, software, data, and expertise,” said Paal Kibsgaard, who is both chairman and chief executive of Schlumberger.
“While our view of the fundamentals of supply and demand in the oil markets remains constructive, the continuing under-investment in new supply is increasing the likelihood of a medium-term supply deficit as reservoirs are produced but reserves are not replaced in sufficient volume. In particular, the market continues to focus on headline decline numbers, suggesting that production is holding up well; however, a closer examination of the underlying data clearly shows that the rate of depletion of proven developed reserves is rapidly accelerating in several key non-OPEC countries,” he added.
Net income before taxes for the Reservoir Characterization division fell to US$281mln from US$334mln the year before.
The Drilling unit's income before tax declined to US$229mln from US$379mln while the Production unit's pre-tax contribution almost halved to US$110mln from US$206mln a year earlier.
Cameron Group's income before tax was US$162mln (2016:nil).
Post-tax income for the group in the first quarter tumbled to US$279mln from US$501mln the year before.