Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis contains forward-looking statements, including, without limitation, statements relating to our plans, strategies, objectives, expectations, intentions, and resources. Such forward-looking statements should be read in conjunction with our disclosures under “Item 1A. Risk Factors” of this Annual Report on Form 10-K.
SLB previously reported its results on the basis of four Divisions: Digital & Integration, Reservoir Performance, Well Construction, and Production Systems. Commencing the third quarter of 2025, SLB's Digital business is reported as a separate Division. Additionally, SLB's Asset Performance Solutions ("APS"), Data Center Solutions, and SLB Capturi businesses are now reported in the All Other category. The acquired ChampionX businesses are predominantly reported in SLB's Production Systems Division, with the exception of its digital business, which is reported in SLB's Digital Division. Prior periods have been recast to conform to the current presentation.
2025 Executive Overview
Although 2025 presented a challenging backdrop for the industry—with lower commodity prices, geopolitical uncertainty and an oversupplied oil market—we continued to build resilience across our portfolio by accelerating our strategy. We completed the acquisition of ChampionX during the third quarter in an all-stock transaction valued at $4.9 billion. The combined portfolio, technology capabilities and digital leadership positions SLB to create value for its customers and stakeholders by increasing its exposure to the growing production and recovery market while delivering best-in-class workflow integration across production chemicals and artificial lift. In addition to growing our emphasis on production and recovery, we also increased deployment of AI solutions and the rapid expansion of our Data Center Solutions business.
Amidst lower upstream spending, global revenue of $35.7 billion declined 2% year on year, while we generated $6.5 billion of cash flow from operations and $4.1 billion of free cash flow, enabling us to return $4.0 billion to shareholders.
Excluding the $1.5 billion of revenue from the acquisition of ChampionX, revenue declined 6% year on year as growth in our Digital and Data Center Solutions businesses were more than offset by declines in Saudi Arabia, Mexico and offshore Sub-Saharan Africa.
International revenue declined 5% year on year due to the lower activity in Saudi Arabia, Mexico and Sub-Saharan Africa while North America revenue grew 12% driven by the ChampionX acquisition. Excluding the impact of this transaction, North American revenue declined 2% despite a 5% drop in upstream spending, supported by growth in Data Center Solutions which grew 121% year on year. This business is expanding rapidly as we strengthen strategic partnerships with hyperscalers to leverage our modular data center manufacturing capabilities.
Digital revenue increased 9% on a full-year basis driven by significant uptake in Digital Operations as well as steady growth in Platforms & Applications as customers continued to invest in automated solutions to improve performance and efficiency.
SLB concluded the year with a very strong fourth quarter driven by Production Systems, Digital and Reservoir Performance. Notably, fourth quarter revenue increased sequentially across each of our four geographies for the first time since the second quarter of 2024, reflecting stabilized global upstream activity. We experienced sequential organic revenue growth both in North America and in the international markets, driven by higher offshore activity and strong year-end product and digital sales in Latin America, the Middle East and Asia, across Sub-Saharan Africa and in North America Offshore.
As we move into 2026, we believe the headwinds we experienced in key regions in 2025 are behind us. In particular, we expect rig activity in the Middle East, to increase compared to today’s level, and our footprint in the region puts us in a strong position to benefit from this recovery.
As economics remain challenged, production and recovery activity is becoming a strategic priority for our customers to unlock incremental barrels at the lowest cost. This is translating into higher demand particularly for intervention services, artificial lift, production chemicals and SLB OneSubsea.
We expect that Data Center Solutions will be our fastest growing business for years to come, and Digital will continue to grow at highly accretive margins. Both present differentiated growth opportunities for SLB in 2026 and beyond.
SLB has consistently proven that the unique strengths of our portfolio enable us to create differentiated value and generate significant cash flows in varied market conditions.
As we move through the year, we anticipate that activity will gradually improve in the key markets where we operate, giving us the confidence that we will generate strong cash flows, once again, in 2026.
Aligned with our clear priority to create value for investors, we are committed to returning more than $4 billion to shareholders in 2026 through dividends and share repurchases.
Fourth Quarter 2025 Results
(Stated in millions)
Fourth Quarter 2025
Third Quarter 2025
Pretax
Pretax
Revenue
Income
Revenue
Income
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
Corporate & other (1)
Interest income (2)
Interest expense (3)
Charges & credits (4)
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.
Excludes interest income included in the segments’ income (fourth quarter 2025: $- million; third quarter 2025: $- million).
Excludes interest expense included in the segments’ income (fourth quarter 2025: $- million; third quarter 2025: $- million).
Charges and credits are described in detail in Note 3 to the Consolidated Financial Statements .
Fourth-quarter revenue of $9.7 billion increased 9% sequentially with international revenue increasing 8% and North America revenue increasing 15%. These results reflect a full quarter of activity from the acquired ChampionX businesses which contributed $879 million of revenue, consisting of $583 million in North America and $266 million in the international markets. Third-quarter 2025 revenue reflected two months of activity from ChampionX, which contributed revenue of $579 million, consisting of $387 million in North America and $171 million in the international markets.
Excluding the impact of the acquisition, international fourth-quarter 2025 revenue increased 7% and North America fourth-quarter 2025 revenue increased 6% sequentially. Fourth quarter revenue increased sequentially across all the four geographic areas for the first time since the second quarter of 2024 as global upstream markets have stabilized. The organic sequential revenue growth both in the international markets and North America was driven by higher offshore activity and strong year-end product and digital sales, most notably in Latin America, the Middle East and Asia, across Sub-Saharan Africa and Gulf of America.
Digital
Digital revenue reached $825 million, up 25% sequentially, driven by a $104 million increase in Digital Exploration as a result of year-end sales in the Gulf of America, Brazil and Angola, as well as robust increases in Digital Operations and Platforms & Applications.
Digital pretax operating margin expanded 557 basis points sequentially to 34%, reflecting improved profitability from strong Digital Exploration activity, robust growth in Digital Operations, and higher Platforms & Applications revenue.
Reservoir Performance
Reservoir Performance revenue of $1.7 billion increased 4% sequentially, primarily driven by higher stimulation activity in the Middle East & Asia and higher intervention activity in Europe & Africa.
Reservoir Performance pretax operating margin of 20% increased 105 basis points sequentially, reflecting improved profitability in evaluation and intervention services due to the higher uptake of premium technologies.
Well Construction
Well Construction revenue of $2.9 billion decreased 1% sequentially as higher offshore drilling activity in North America and Europe & Africa was more than offset by declines in certain land markets.
Well Construction pretax operating margin of 19% was essentially flat sequentially.
Production Systems
Production Systems revenue of $4.1 billion increased 17% sequentially, reflecting a full quarter of activity from the acquired ChampionX production chemicals and artificial lift businesses. Excluding the impact of the acquisition, Production Systems revenue increased 11% sequentially driven by strong sales of completions, artificial lift, and production chemicals.
Production Systems pretax operating margin of 16% increased 20 basis points sequentially mainly driven by stronger profitability in completions and production chemicals.
All Other
Revenue of $445 million increased $48 million sequentially largely due to higher APS revenue in Ecuador as a result of the resumption of production following the pipeline disruption during the third quarter.
Pretax operating income declined $11 million sequentially as improved profitability from the higher revenue in APS in Ecuador was more than offset by a significant loss on one particular project in SLB Capturi.
Full-Year 2025 Results
(Stated in millions)
Pretax
Pretax
Revenue
Income
Revenue
Income
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
Corporate & other (1)
Interest income (2)
Interest expense (3)
Charges & credits (4)
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.
Excludes interest income included in the segments’ income (2025: $2 million; 2024: $40 million).
Excludes interest expense included in the segments’ income (2025: $7 million; 2024: $14 million).
Charges and credits are described in detail in Note 3 to the Consolidated Financial Statements .
Full-year 2025 revenue of $35.7 billion decreased 2%, or $580 million year on year. Excluding the $1.5 billion of revenue from the acquired ChampionX businesses, revenue declined 6% year on year as growth in the Digital and Data Center Solutions businesses were more than offset by activity reductions in Saudi Arabia, Mexico and offshore Sub-Saharan Africa.
International revenue declined 5% year on year due to the lower activity in Saudi Arabia, Mexico and Sub-Saharan Africa. North America revenue grew 12% year on year primarily driven by the acquisition of ChampionX. Excluding the impact of this transaction, North America revenue declined 2% despite a 5% drop in upstream spending supported by growth in Data Center Solutions, which grew 121% year on year.
Digital
Digital revenue of $2.7 billion grew 9% year on year due to strong growth from both Digital Operations and Platforms & Applications. The acquisition of ChampionX also accounted for $48 million of the increase.
Digital pretax operating margin of 28% expanded 291 bps year on year primarily driven by the higher revenue and efficiency gains.
Reservoir Performance
Reservoir Performance revenue of $6.8 billion decreased 5% year on year primarily due to a slowdown in evaluation and stimulation activity in the international markets.
Reservoir Performance pretax operating margin of 18% contracted 191 bps year on year due to the lower evaluation and stimulation activity.
Well Construction
Well Construction revenue of $11.9 billion decreased 11% year on year driven by a broad reduction in drilling activity both internationally, mainly in Mexico, Saudi Arabia, and offshore Africa, and in North America.
Well Construction pretax operating margin of 19% declined 220 bps year on year driven by the widespread activity reductions.
Production Systems
Production Systems revenue of $13.3 billion increased 12% year on year reflecting five months of activity from the acquired ChampionX production chemicals and artificial lift businesses, which contributed $1.45 billion of revenue. Excluding the impact of this acquisition, Production Systems revenue was essentially flat year on year.
Production Systems pretax operating margin of 16% was essentially flat year on year.
All Other
Revenue of $2.0 billion decreased 6% year on year largely due to the absence of approximately $290 million of revenue following the divestiture of SLB’s interest in the Palliser APS project in Canada at the end of the second quarter of 2025 and the loss of approximately $100 million of APS revenue due to production interruption arising from a pipeline disruption in Ecuador during the third quarter of 2025. These decreases were partially offset by a $251 million, or 121%, increase in Data Center Solutions revenue.
Pretax operating income decreased $277 million year on year primarily due to the effects of the divestiture of the Palliser asset, the pipeline disruption in Ecuador and a significant loss on one particular project in SLB Capturi.
Full-Year 2024 Results
(Stated in millions)
Pretax
Pretax
Revenue
Income
Revenue
Income
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
Corporate & other (1)
Interest income (2)
Interest expense (3)
Charges & credits (4)
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.
Excludes interest income included in the segments’ income (2024: $40 million; 2023: $13 million).
Excludes interest expense included in the segments’ income (2024: $14 million; 2023: $14 million).
Charges and credits are described in detail in Note 3 to the Consolidated Financial Statements .
2024 was a strong year for SLB as it successfully navigated evolving market conditions as full year revenue of $36.3 billion increased 10% year on year. Approximately 46% of this increase came from the acquisition of the Aker Solutions subsea business (“Aker”) in the fourth quarter of 2023.
Full-year results were highlighted by 12% international revenue growth. This performance was led by the Middle East & Asia and Europe & Africa, which grew 18% and 13%, respectively. The Middle East & Asia achieved record revenues, while growth in Europe & Africa was bolstered by the acquisition of the Aker subsea business. Excluding this acquired business, international revenue increased 7% year over
year, outperforming the rate of upstream investment and rig activity over the same period. North America revenue decreased 1% due to lower drilling in US land.
SLB’s Core divisions — Reservoir Performance, Well Construction and Production Systems — delivered 9% revenue growth compared to the prior year, led by 21% growth in Production Systems, largely due to the subsea acquisition. Production Systems grew 9% organically due to double-digit increases in surface systems, completions and artificial lift. Reservoir Performance also delivered 9% growth, underpinned by strong stimulation and intervention activity in the production space.
Digital revenue, which reached $2.44 billion for the year, increased 20% year on year. Accelerated adoption of digital technologies marked a milestone year, highlighted by strategic collaborations with cross-industry leaders, the launch of the Lumi data and AI platform, new Performance Live centers to enable remote operations, and the achievement of fully autonomous drilling operations.
Digital
Digital revenue of $2.4 billion increased 20% year on year driven by the accelerated adoption of digital technologies and higher sales of exploration data.
Digital & Integration pretax operating margin of 25% increased 710 bps year on year primarily as a result of the revenue growth.
Reservoir Performance
Reservoir Performance revenue of $7.2 billion increased 9% year on year due to increased stimulation and intervention activity, with approximately 75% of the revenue growth coming from the Middle East & Asia.
Reservoir Performance pretax operating margin of 20% expanded 99 bps year on year due to improved profitability in the international markets driven by higher activity and improved pricing from increased technology intensity.
Well Construction
Well Construction revenue of $13.4 billion decreased 1% year on year. North America revenue declined 13% due to lower drilling activity in US land largely offset by a 2% increase in international revenue, primarily in the Middle East & Asia.
Well Construction pretax operating margin of 21% decreased 59 bps year on year driven by the reduced activity in North America.
Production Systems
Production Systems revenue of $11.9 billion increased 21% year on year mainly due to the acquisition of the Aker subsea business. Excluding the effects of the Aker subsea acquisition, revenue grew by 9% year on year driven by strong international sales across the portfolio.
Production Systems pretax operating margin of 16% expanded 325 bps year on year driven by a favorable activity mix, execution efficiency, and conversion of improved-price backlog.
All Other
Revenue of $2.1 billion increased 15% year on year with approximately 75% of the increase attributable to the Data Center Solutions business. APS revenue was essentially flat. The remaining increase was driven by the SLB Capturi joint venture which was formed in the second quarter of 2024.
Pretax operating income decreased $117 million year on year primarily due to the effects of high APS amortization expense and lower gas prices.
Interest & Other Income
Interest & other income consisted of the following:
(Stated in millions)
Earnings of equity method investments
Gain on sale of Palliser APS project *
Interest income
Gain on sale of investment *
Gain on sale of Liberty shares
* See Note 3 to the Consolidated Financial Statements.
Interest income decreased $39 million in 2025 as compared to 2024 primarily due to lower average cash and short-term investment balances and increased $74 million in 2024 as compared to 2023 primarily due to higher average cash and short-term investment balances.
Other
Research & engineering and General & administrative expenses, as a percentage of Revenue , were as follows:
Research & engineering
General & administrative
Charges and Credits
SLB recorded charges and credits during 2025, 2024 and 2023. These charges and credits, which are summarized below, are more fully described in Note 3 to the Consolidated Financial Statements .
The following is a summary of the 2025 charges and credits:
(Stated in millions)
Pretax Charge (Credit)
Tax Benefit (Expense)
Noncontrolling Interest
Net
First quarter:
Workforce reductions
Other merger and integration
Second quarter:
Impairment of equity method investment
Workforce reductions
Other merger and integration
Gain on sale of Palliser APS project
Third quarter:
Amortization of inventory purchase accounting adjustment
Acquisition-related professional fees
Workforce reductions
Acquisition-related employee benefits
Impairment of equity-method investment
Other merger and integration
Fourth quarter:
Goodwill impairment
Workforce reductions
Amortization of inventory purchase accounting adjustment
Other merger and integration
Reversal of valuation allowance relating to deferred tax assets
The following is a summary of the 2024 charges and credits:
(Stated in millions)
Pretax Charge (Credit)
Tax Benefit (Expense)
Noncontrolling Interest
Net
First quarter:
Amortization of inventory purchase accounting adjustment
Merger and integration
Second quarter:
Workforce reductions
Merger and integration
Amortization of inventory purchase accounting adjustment
Third quarter
Workforce reductions
Merger and integration
Amortization of inventory purchase accounting adjustment
Fourth quarter
Asset impairments
Merger and integration
Workforce reductions
Gain on sale of investment
The 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
Fourth quarter:
Currency devaluation loss in Argentina
Merger and integration
Amortization of inventory purchase accounting adjustment
Liquidity and Capital Resources
Details of the components of liquidity as well as changes in liquidity follow:
(Stated in millions)
Dec. 31,
Dec. 31,
Dec. 31,
Components of Liquidity:
Cash
Short-term investments
Short-term borrowings and current portion of long-term debt
Long-term debt
Net debt (1)
Changes in Liquidity:
Net income
Depreciation and amortization (2)
Impairments
Amortization of inventory purchase accounting adjustment
Gains on sales of investments
Gain on sale of Palliser APS project
Stock-based compensation expense
Deferred taxes
Earnings of equity method investments, less dividends received
Increase in working capital
US federal tax refund
Other
Cash flow from operations
Capital expenditures
APS investments
Exploration data capitalized
Free cash flow (3)
Dividends paid
Stock repurchase program
Proceeds from employee stock purchase plan and exercise of stock options
Net debt assumed in connection with ChampionX acquisition
Proceeds from sale of Palliser APS project
Proceeds from sale of ChampionX Drilling Technologies business
Other business acquisitions and investments, net of cash acquired plus debt assumed
Proceeds from sale of Liberty shares
Purchases of Blue Chip Swap securities
Proceeds from sales of Blue Chip Swap securities
Taxes paid on net-settled stock-based compensation awards
Other
Change in net debt before impact of changes in foreign exchange rates
Impact of changes in foreign exchange rates
Decrease in Net Debt
Net Debt, Beginning of period
Net Debt, End of period
“Net debt” represents gross debt less cash and short-term investments. 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.
Includes depreciation of fixed assets and amortization of intangible assets, exploration data costs and APS investments.
“Free cash flow” represents cash flow from operations less capital expenditures, APS investments and exploration data costs capitalized. Management believes that free cash flow is an important liquidity measure for the company and that it is useful to investors and management as a measure of our ability to generate cash. Once business needs and obligations are met, this cash can be used to reinvest in the company for future growth or to return to shareholders through dividend payments or share repurchases. Free cash flow does not represent the residual cash flow available for discretionary expenditures. 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 2025, 2024 and 2023 included:
In January 2026, SLB announced a 3.5% increase to its quarterly cash dividend from $0.285 per share of outstanding common stock to $0.295 per share, beginning with the dividend payable in April 2026. In January 2025, SLB announced a 3.6% increase to its quarterly cash dividend from $0.275 per share of outstanding common stock to $0.285 per share, beginning with the dividend payable in April 2025. 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 paid in April 2024. Dividends paid during 2025, 2024 and 2023 were $1.6 billion, $1.5 billion and $1.3 billion, respectively.
Capital investments (consisting of capital expenditures, APS investments, and exploration data capitalized) were $2.4 billion in 2025, and $2.6 billion in both 2024 and 2023. Capital investments during 2026 are expected to be approximately $2.5 billion.
During the fourth quarter of 2025, SLB repaid its $0.5 billion 4.00% Senior Notes due 2025.
During the third quarter of 2025, SLB repaid its $0.5 billion 1.40% Senior Notes due 2025.
During the third quarter of 2025, SLB fully repaid all the $0.6 billion of debt assumed in connection with the acquisition of ChampionX.
During the third quarter of 2025 and concurrent with the close of the ChampionX acquisition, the ChampionX Drilling Technologies business was disposed of and SLB received $286 million of proceeds.
As of December 31, 2025, SLB cumulatively repurchased $5.9 billion of its common stock under its $10 billion share repurchase program.
The following table summarizes the activity under the share repurchase program:
(Stated in millions, except per share amounts)
Total Cost
Total Number
Average Price
of Shares
of Shares
Paid per
Purchased
Purchased
Share
During the second quarter of 2025, SLB completed the sale of its interest in the Palliser APS project in Canada in exchange for net cash proceeds of $338 million. SLB recorded revenue of approximately $0.2 billion relating to this project during the six months ended June 30, 2025 and approximately $0.5 billion during 2024.
During the fourth quarter of 2024, SLB repaid its €0.6 billion of 0.00% Notes that were outstanding.
During the second quarter of 2024, SLB issued $500 million of 5.00% Senior Notes due 2027, $500 million of 5.00% Senior Notes due 2029, and $500 million of 5.00% Senior Notes due 2034.
During the second quarter of 2024, SLB and Aker Carbon Capture ASA (“ACC”) announced the closing of their previously announced joint venture. The new company, SLB Capturi, combines technology portfolios, expertise, and operation platforms to support accelerated carbon capture adoption for industrial decarbonization at scale. At closing, SLB paid NOK 4.1 billion ($0.4 billion) in cash to ACC for the purchase of 80% of the shares in Aker Carbon Capture Holdings AS (“ACCH”), which held the business of ACC.
After a lock-up period of three years, ACC is entitled to sell its 20% interest in ACCH to SLB during a period of six months for a price based on the fair market value of the combined business subject to a floor of NOK 1.0 billion and a ceiling of NOK 2.1 billion (the “put option”). Additionally, after the expiration of the put option, SLB has the right to purchase ACC’s 20% interest in the combined business during the following six months for a price based on the fair market value of the combined business subject to a floor of NOK 1.5 billion and a ceiling of NOK 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.
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.
As of December 31, 2025, SLB had $4.2 billion of cash and short-term investments and committed credit facility agreements with commercial banks aggregating $5.0 billion, all of which was available. 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.
The following table reflects the carrying amounts of SLB’s debt at December 31, 2025 by year of maturity:
(Stated in millions)
After
Total
Fixed rate debt
1.375% Guaranteed Notes
1.00% Guaranteed Notes
0.25% Notes
5.00% Senior Notes
3.90% Senior Notes
4.50% Senior Notes
4.30% Senior Notes
5.00% Senior Notes
2.65% Senior Notes
0.50% Notes
2.00% Guaranteed Notes
4.85% Senior Notes
5.00% Senior Notes
7.00% Notes
5.95% Notes
5.13% Notes
Total fixed rate debt
Variable rate debt
Total
Interest payments on fixed rate debt obligations by year are as follows:
(Stated in millions)
Thereafter
See Note 14, Leases of the Consolidated Financial Statements for details regarding SLB’s lease obligations.
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.
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. The following accounting policies involve “critical accounting estimates” because they are particularly dependent on estimates and assumptions made by SLB about matters that are inherently uncertain.
SLB bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Allowance for Doubtful Accounts
SLB maintains an allowance for doubtful accounts in order to record accounts receivable at their net realizable value. Judgment is involved in recording and making adjustments to this reserve. Allowances have been recorded for receivables believed to be uncollectible, including amounts for the resolution of potential credit and other collection issues such as disputed invoices. Adjustments 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.
As a large multinational company with a long history of operating in a cyclical industry, SLB has extensive experience in working with its customers during difficult times to manage its accounts receivable. During weak economic environments or when there is an extended period of weakness in oil and gas prices, SLB typically experiences delays in the payment of its receivables. However, SLB has not historically had material write-offs due to uncollectible accounts receivables in its recent past. SLB has a global footprint in more than 100 countries. As of December 31, 2025, three of those countries individually accounted for greater than 5% of SLB’s net accounts receivable balance, of which only one (the United States) accounted for greater than 10% of such receivables.
As of December 31, 2025, the United States represented 13% of SLB’s net accounts receivable balance. As of December 31, 2025, Mexico represented approximately 6% of SLB's net accounts receivable balance. 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. 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.
Under generally accepted accounting principles, SLB has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of one or more of its reporting units is greater than its carrying amount. If, after assessing the totality of events or circumstances, SLB determines it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, there is no need to perform any further testing. However, if SLB concludes otherwise, then it is required to perform a quantitative impairment test by calculating the fair value of the reporting unit and comparing the fair value with the carrying amount of the reporting unit. If the fair value of the reporting unit is less than its carrying value, an impairment loss is recorded based on that difference.
SLB has the option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to perform the quantitative goodwill impairment test.
SLB elected to perform the qualitative assessment described above for purposes of its annual goodwill impairment test for each of its Digital, Reservoir Performance, Well Construction and Production Systems reporting units in 2025. Based on this assessment, SLB concluded it was more likely than not that the fair value of each of its reporting units was significantly greater than its carrying amount. Accordingly, no further testing was required.
SLB performed a quantitative goodwill impairment test for SLB Capturi, its remaining reporting unit, using the income approach to estimate its fair value. Based on the results of this test, SLB recorded a $210 million goodwill impairment charge during 2025 relating to this reporting unit.
The income approach estimates the fair value by discounting the reporting unit’s estimated future cash flows using SLB’s estimate of the discount rate, or expected return, that a marketplace participant would have required as of the valuation date. The more significant assumptions inherent in the income approach include the estimated future net annual cash flows for the reporting unit and the discount rate. SLB selected the assumptions used in the discounted cash flow projections using current and anticipated market conditions and estimated growth rates. SLB’s estimates are based upon assumptions believed to be reasonable.
The discount rate utilized to value the reporting unit was 14.75%. Assuming all other assumptions and inputs used in the discounted cash flow analysis were held constant, a 50-basis point increase in the discount rate assumption would have increased the goodwill impairment charge by approximately $32 million. Conversely, assuming all other assumptions and inputs used in the respective discounted cash flow analysis were held constant, a 50-basis point decrease in the discount rate assumption would have decreased the goodwill impairment charge by approximately $36 million.
Long-lived assets, including fixed assets, intangible assets, and investments in APS projects, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. In reviewing for impairment, the carrying value of such assets is compared to the estimated undiscounted future cash flows expected from the use of the assets and their eventual disposition. If such cash flows are not sufficient to support the asset’s recorded value, an impairment charge is recognized to reduce the carrying value of the long-lived asset to its estimated fair value. The determination of future cash flows as well as the estimated fair value of long-lived assets involves significant estimates on the part of management. If there is a material change in economic conditions or other circumstances influencing the estimate of future cash flows or fair value, SLB could be required to recognize impairment charges in the future.
Income Taxes
SLB conducts business in more than 100 tax jurisdictions, a number of which have tax laws that are not fully defined and are evolving. SLB’s tax filings are subject to regular audits by the tax authorities. These audits may result in assessments for additional taxes that are resolved with the authorities or, potentially, through the courts. SLB recognizes the impact of a tax position in its financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. Tax liabilities are recorded based on estimates of additional taxes that will be due upon the conclusion of these audits. Estimates of these tax liabilities are judgmental and are made based upon prior experience and are updated in light of changes in facts and circumstances. However, due to the uncertain
and complex application of tax regulations, the ultimate resolution of audits may result in liabilities that could be materially different from these estimates. In such an event, SLB will record additional tax expense or tax benefit in the period in which such resolution occurs.
Revenue Recognition for Certain Long-term Construction-type Contracts
SLB recognizes revenue for certain long-term construction-type contracts over time. These contracts involve significant design and engineering efforts in order to satisfy custom designs for customer-specific applications. 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 11% of SLB’s revenue in 2025, 9% in 2024, and 6% in 2023, was recognized under this method.
The estimate of total project costs has a significant impact on both the amount of revenue recognized as well as the related profit on a project. Revenue and profits on contracts can also be significantly affected by change orders and claims. Profits are recognized based on the estimated project profit multiplied by the percentage complete. Due to the nature of these projects, adjustments to estimates of contract revenue and total contract costs are often required as work progresses. Any expected losses on a project are recorded in full in the period in which they become probable.
Pension and Postretirement Benefits
SLB’s pension and postretirement benefit obligations are described in detail in Note 17 to the Consolidated Financial Statements . The obligations and related costs are calculated using actuarial concepts, which include critical assumptions related to the discount rate and the expected rate of return on plan assets. These assumptions are important elements of expense and/or liability measurement and are updated on an annual basis, or upon the occurrence of significant events.
The discount rate that SLB uses reflects the prevailing market rate of a portfolio of high-quality debt instruments with maturities matching the expected timing of payment of the related benefit obligations. 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 5.55% at December 31, 2025 and 5.70% at December 31, 2024.
The weighted-average discount rate utilized to determine the liability for SLB’s international pension plans was 5.56% at December 31, 2025 and 5.67% at December 31, 2024.
The discount rate utilized to determine expense for SLB’s United States pension plans and postretirement medical plan was 5.70% in 2025 and 5.25% in 2024.
The weighted-average discount rate utilized to determine expense for SLB’s international pension plans was 5.67% in 2025 and 5.14% in 2024.
The expected rate of return for SLB’s retirement benefit plans represents the long-term average rate of return expected to be earned on plan assets based on expectations regarding future rates of return for the portfolio considering the asset allocation and related historical rate of return. The average expected rate of return on plan assets for the United States pension plans was 6.30% in 2025 and 6.00% in 2024. The weighted average expected rate of return on plan assets for the international pension plans was 6.57% in 2025 and 5.91% in 2024. A higher expected rate of return decreases pension expense.
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 2025
Dec. 31, 2025
Change in Assumption
Pretax Expense
Obligation
25 basis point decrease in discount rate
25 basis point increase in discount rate
25 basis point decrease in expected return on plan assets
25 basis point increase in expected return on plan assets
The following illustrates the sensitivity to changes in certain assumptions, holding all other assumptions constant, for SLB’s United States postretirement medical plan:
(Stated in millions)
Effect on
Effect on 2025
Dec. 31, 2025
Change in Assumption
Pretax Expense
Obligation
25 basis point decrease in discount rate
25 basis point increase in discount rate
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 70% of SLB’s revenue in 2025 was denominated in US dollars. 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.
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.
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 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, 2025 market rates would decrease the unrealized value of SLB’s forward contracts by $154 million. Conversely, a 10% depreciation in the US dollar from the December 31, 2025 market rates would increase the unrealized value of SLB’s forward contracts by $166 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.
At December 31, 2025, forward contracts for the US dollar equivalent of $10.8 billion in various foreign currencies were outstanding, of which $4.5 billion related to hedges of debt balances denominated in currencies other than the functional currency.
Forward-Looking Statements
This Form 10-K, as well as other statements we make, contain “forward-looking statements” within the meaning of the federal securities laws, which include any statements that are not historical facts. Such statements often contain words such as “expect,” “may,” “can,” “believe,” “predict,” “plan,” “potential,” “projected,” “projections,” “precursor,” “forecast,” “outlook,” “expectations,” “estimate,” “intend,” “anticipate,” “ambition,” “goal,” “target,” “scheduled,” “think,” “should,” “could,” “would,” “will,” “see,” “likely,” and other similar words. 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); the benefits of the ChampionX acquisition, including the ability of SLB to integrate the ChampionX business successfully and to achieve anticipated synergies and value creation from the acquisition; 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 ; the impact of ongoing or 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. These statements are subject to risks and uncertainties, including, but not limited to, changing global economic and geopolitical conditions; changes in exploration and production spending by SLB’s customers, and changes in the level of oil and natural gas exploration and development; the results of operations and financial condition of SLB’s customers and suppliers; SLB’s to its financial and performance targets and other forecasts and expectations; SLB’s to net-zero carbon emissions goals or interim emissions reduction goals; general economic, geopolitical and business conditions in key regions of the world; foreign currency risk; inflation; changes in monetary policy by governments; tariffs; pricing pressure; weather and seasonal factors; effects of health pandemics; availability and cost of raw materials; operational modifications, or ; in SLB’s supply chain; production ; the extent of future charges; SLB’s to recognize and other intended benefits from its business strategies and initiatives, such as digital or new energy, as well as its cost reduction strategies; changes in government regulations and regulatory requirements, including those related to offshore oil and gas exploration, radioactive sources, explosives, chemicals, and climate-related initiatives; the of technology to meet new in exploration; the competitiveness of alternative energy sources or product substitutes; and other risks and uncertainties detailed in this Form 10-K and other filings that we make with the SEC.
If one or more of these or other risks or uncertainties materialize (or the consequences of any such development changes), or should our underlying assumptions prove incorrect, actual results or outcomes may vary materially from those reflected in our forward-looking statements. Forward-looking and other statements in this Form 10-K regarding our environmental, social, and other sustainability plans and goals are not an indication that these statements are necessarily material to investors or required to be disclosed in our filings with the SEC. In addition, historical, current, and forward-looking environmental, social, and sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future. Statements in this Form 10-K are made as of January 23, 2026, 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.
Item 8. Financial Statement s and Supplementary Data.
SLB LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEME NT OF INCOME
(Stated in millions, except per share amounts )
Year Ended December 31,
Revenue
Services
Product sales
Total Revenue
Interest & other income
Expenses
Cost of services
Cost of sales
Research & engineering
General & administrative
Restructuring & other
Impairments
Merger & integration
Interest
Income before taxes
Tax expense
Net income
Net income attributable to noncontrolling interests
Net income attributable to SLB
Basic earnings per share of SLB
Diluted earnings per share of SLB
Average shares outstanding:
Basic
Assuming dilution
See the Notes to Consolidated Financial Statements
SLB LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF C OMPREHENSIVE INCOME
(Stated in millions)
Year Ended December 31,
Net income
Currency translation adjustments:
Net change arising during the period
Cash flow hedges:
Net (loss) gain on cash flow hedges
Reclassification to net income of net realized loss
Pension and other postretirement benefit plans:
Actuarial loss arising during the period
Amortization to net income of net actuarial losses
Amortization to net income of net prior service credit
Income taxes on pension and other postretirement benefit plans
Other
Comprehensive income
Comprehensive income attributable to noncontrolling interests
Comprehensive income attributable to SLB
See the Notes to Consolidated Financial Statements
SLB LIMITED AND SUBSIDIARIES
CONSOLIDATED B ALANCE SHEET
(Stated in millions)
December 31,
ASSETS
Current Assets
Cash
Short-term investments
Receivables less allowance for doubtful accounts (2025 - $ 335 ; 2024 - $ 325 )
Inventories
Other current assets
Investments in Affiliated Companies
Fixed Assets less accumulated depreciation
Goodwill
Intangible Assets
Other Assets
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable and accrued liabilities
Estimated liability for taxes on income
Short-term borrowings and current portion of long-term debt
Dividends payable
Long-term Debt
Postretirement Benefits
Deferred Taxes
Other Liabilities
Equity
Common stock
Treasury stock
Retained earnings
Accumulated other comprehensive loss
SLB stockholders' equity
Noncontrolling interests
See the Notes to Consolidated Financial Statements
SLB LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEM ENT OF CASH FLOWS
(Stated in millions)
Year Ended December 31,
Cash flows from operating activities:
Net income
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization (1)
Impairments
Amortization of inventory purchase accounting adjustment
Gains on sales of investments
Gain on sale of APS project
Deferred taxes
Stock-based compensation expense
Earnings of equity method investments, less dividends received
Change in assets and liabilities: (2)
Increase in receivables
Increase in inventories
Decrease in other current assets
Decrease (increase) in other assets
Increase (decrease) in accounts payable and accrued liabilities
Decrease in estimated liability for taxes on income
Increase (decrease) in other liabilities
Other
NET CASH PROVIDED BY OPERATING ACTIVITIES
Cash flows from investing activities:
Capital expenditures
APS investments
Exploration data capitalized
Cash acquired in ChampionX Corporation acquisition
Proceeds from sale of APS project
Proceeds from sale of ChampionX Drilling Technologies business
Other business acquisitions and investments, net of cash acquired
(Purchase) sale of short-term investments, net
Purchases of Blue Chip Swap securities
Proceeds from sales of Blue Chip Swap securities
Proceeds from sale of Liberty shares
Other
NET CASH USED IN INVESTING ACTIVITIES
Cash flows from financing activities:
Dividends paid
Stock repurchase program
Proceeds from employee stock purchase plan
Proceeds from exercise of stock options
Taxes paid on net-settled stock-based compensation awards
Proceeds from issuance of long-term debt
Repayment of long-term debt
Net (decrease) increase in short-term borrowings
Other
NET CASH USED IN FINANCING ACTIVITIES
Net (decrease) increase in cash before translation effect
Impact of changes in exchange rates on cash
Cash, beginning of period
Cash, end of period
Includes depreciation of fixed assets and amortization of intangible assets, exploration data costs and APS investments.
Net of the effect of business acquisitions and divestitures.
See the Notes to Consolidated Financial Statements
SLB LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENT O F STOCKHOLDERS’ EQUITY
(Stated in millions)
Accumulated
Other
Common Stock
Retained
Comprehensive
Noncontrolling
Issued
In Treasury
Earnings
Loss
Interests
Total
Balance, January 1, 2023
Net income
Currency translation adjustments
Changes in fair value of cash flow hedges
Pension and other postretirement benefit plans
Vesting of restricted stock, net of taxes withheld
Employee stock purchase plan
Stock repurchase program
Stock-based compensation expense
Shares sold to optionees, less shares exchanged
Dividends declared ($ 1.00 per share)
Acquisition of Aker Subsea
Other
Balance, December 31, 2023
Net income
Currency translation adjustments
Changes in fair value of cash flow hedges
Pension and other postretirement benefit plans
Vesting of restricted stock, net of taxes withheld
Employee stock purchase plan
Stock repurchase program
Stock-based compensation expense
Shares sold to optionees, less shares exchanged
Dividends declared ($ 1.10 per share)
Other
Balance, December 31, 2024
Net income
Currency translation adjustments
Changes in fair value of cash flow hedges
Pension and other postretirement benefit plans
Vesting of restricted stock, net of taxes withheld
Employee stock purchase plan
Stock repurchase program
Stock-based compensation expense
Shares sold to optionees, less shares exchanged
Dividends declared ($ 1.14 per share)
Dividends paid to noncontrolling interest
Acquisition of ChampionX Corporation
Other
Balance, December 31, 2025
See the Notes to Consolidated Financial Statements
SLB LIMITED AND SUBSIDIARIES
SHARES OF CO MMON STOCK
(Stated in millions)
Shares
Issued
In Treasury
Outstanding
Balance, January 1, 2023
Employee stock purchase plan
Vesting of restricted stock, net of taxes withheld
Shares sold to optionees, less shares exchanged
Stock repurchase program
Acquisition of Aker Subsea
Balance, December 31, 2023
Employee stock purchase plan
Vesting of restricted stock, net of taxes withheld
Shares sold to optionees, less shares exchanged
Stock repurchase program
Balance, December 31, 2024
Vesting of restricted stock, net of taxes withheld
Share issued under employee stock purchase plan
Shares sold to optionees, less shares exchanged
Stock repurchase program
Acquisition of ChampionX Corporation
Balance, December 31, 2025
See the Notes to Consolidated Financial Statements
Notes to Consolidated Financial Statements
1. Business Description
SLB Limited (SLB N.V., incorporated in Curaçao) and its consolidated subsidiaries (collectively, “SLB”) form a global technology company that drives energy innovation for a balanced planet. With a global footprint in more than 100 countries and employees representing almost twice as many nationalities, SLB works each day on innovating energy technology, delivering digital at scale, decarbonizing industries, and developing and scaling new energy systems that accelerate the energy transition.
2. Summary of Accounting Policies
The Consolidated Financial Statements of SLB have been prepared in accordance with accounting principles generally accepted in the United States of America.
Use of Estimates
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. On an ongoing basis, SLB evaluates its estimates, including those related to collectibility of accounts receivable; revenue recognized for certain long-term construction-type contracts over time; recoverability of fixed assets, goodwill, intangible assets, Asset Performance Solutions investments, and investments in affiliates; income taxes; exploration data; contingencies and actuarial assumptions for employee benefit plans. SLB bases its estimates on historical experience and other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Revenue Recognition
SLB recognizes revenue upon the transfer of control of promised products or services to customers at an amount that reflects the consideration it expects to receive in exchange for these products or services. The vast majority of SLB’s services and product offerings are short-term in nature. The time between invoicing and when payment is due under these arrangements is generally between 30 to 60 days .
Revenue is recognized for certain long-term construction-type contracts over time. These contracts involve significant design and engineering efforts in order to satisfy custom designs for customer-specific applications. 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. The estimate of total project costs has a significant impact on both the amount of revenue recognized as well as the related profit on a project. Revenue and profits on contracts can also be significantly affected by change orders and claims. Due to the nature of these projects, adjustments to estimates of contract revenue and total contract costs may be required as work progresses. Progress billings are generally issued upon completion of certain phases of work as stipulated in the contract. Any expected losses on a project are recorded in full in the period in which they become probable.
Total backlog was $ 5.6 billion at December 31, 2025, of which approximately 65 % is expected to be recognized as revenue during 2026.
Short-term Investments
Short-term investments are comprised primarily of money market funds, time deposits, certificates of deposit, commercial paper, bonds, and notes, substantially all of which are denominated in US dollars and are stated at cost plus accrued interest, which approximates fair value.
For purposes of the Consolidated Statement of Cash Flows , SLB does not consider Short-term investments to be cash equivalents.
Investments in Affiliated Companies
Investments in companies in which SLB does not have a controlling financial interest, but over which it has significant influence, are accounted for using the equity method. SLB’s share of the after-tax earnings of equity method investees is included in Interest & other income . Investments in privately held companies in which SLB does not have the ability to exercise significant influence are accounted for using the cost method. Investments in publicly traded companies in which SLB does not have the ability to exercise significant influence are reported at fair value, with unrealized gains and losses reported as a component of Interest & other income .
Exploration Data
SLB’s exploration data library consists of completed and in-process seismic surveys that are licensed on a nonexclusive basis. SLB capitalizes costs directly incurred in acquiring and processing the exploration data. Such costs are charged to Cost of services based on the percentage of the total costs to the estimated total revenue that SLB expects to receive from the sales of such data. However, an individual survey generally will not carry a net book value greater than a 4-year, straight-line amortized value.
The carrying value of the exploration data library is reviewed for impairment annually as well as when an event or change in circumstance indicating impairment may have occurred. Adjustments to the carrying value are recorded when it is determined that estimated future cash flows, which involve significant judgment on the part of SLB, would not be sufficient to recover the carrying value of the surveys. Significant adverse changes in SLB’s estimated future cash flows could result in impairment charges in a future period.
Asset Performance Solutions
Asset Performance Solutions (“APS”) projects are generally focused on developing and co-managing production of customers’ assets under long-term agreements. SLB invests its own services and products into the field development activities and operations and is compensated on a fee-per-barrel basis or based on cash flow generated. This includes certain arrangements whereby SLB is only compensated based on incremental production that it helps deliver above a mutually agreed baseline.
SLB capitalizes its investments in a project including the direct costs associated with providing its services or products. These capitalized investments are amortized to the Consolidated Statement of Income as the related production is achieved based on the units of production method, whereby each unit produced is assigned a pro-rata portion of the unamortized costs based on estimated total production, resulting in a matching of revenue with the applicable costs.
Concentration of Credit Risk
SLB is exposed to concentrations of credit risk primarily relating to cash, short-term investments, receivables from clients, and derivative financial instruments. SLB places its cash and short-term investments with financial institutions and corporations and limits the amount of credit exposure with any one of them. SLB regularly evaluates the creditworthiness of the issuers in which it invests. By using derivative financial instruments to hedge certain exposures, SLB exposes itself to some credit risk. SLB minimizes this credit risk by entering into transactions with high-quality counterparties, limiting the exposure to each counterparty and monitoring the financial condition of its counterparties.
As a large multinational company, SLB’s accounts receivable are spread over many countries and customers. The United States represented 13 % of SLB’s net accounts receivable balance at December 31, 2025. No other country accounted for greater than 10% of SLB’s accounts receivable balance. SLB maintains an allowance for uncollectible accounts receivable based on ex pected collectibility and performs ongoing credit evaluations of its customers’ financial condition. 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 may be required.
Earnings per Share
The following is a reconciliation from basic to diluted earnings per share of SLB:
(Stated in millions, except per share amounts)
Net Income Attributable to SLB
Average
Shares
Outstanding
Earnings per Share
Basic
Dilutive impact of stock options and restricted stock
Diluted
Basic
Dilutive impact of stock options and restricted stock
Diluted
Basic
Dilutive impact of stock options and restricted stock
Diluted
The number of outstanding employee stock options to purchase shares of SLB common stock that were not included in the computation of diluted earnings per share, because to do so would have had an anti-dilutive effect, were as follows:
(Stated in millions)
Employee stock options
3. Charges and Credits
SLB recorded the following charges and credits during 2025:
(Stated in millions)
Pretax Charge (Credit)
Tax Benefit (Expense)
Noncontrolling Interest
Net
First quarter:
Workforce reductions
Other merger and integration
Second quarter:
Impairment of equity method investment
Workforce reductions
Other merger and integration
Gain on sale of Palliser APS project
Third quarter:
Amortization of inventory purchase accounting adjustment
Acquisition-related professional fees
Workforce reductions
Acquisition-related employee benefits
Impairment of equity-method investment
Other merger and integration
Fourth quarter:
Goodwill impairment
Workforce reductions
Amortization of inventory purchase accounting adjustment
Other merger and integration
Reversal of valuation allowance relating to deferred tax assets
In connection with the July 2025 acquisition of ChampionX Corporation (“ChampionX”) (see Note 6 – Acquisitions ), SLB recorded $ 367 million of merger and integration charges during 2025. These charges consisted of $ 166 million relating to the amortization of purchase accounting adjustments associated with the write-up of acquired inventory to its estimated fair value; $ 80 million of transaction costs, including advisory and legal fees; $ 59 million relating to employee benefits for change-in-control arrangements, accelerated stock-based compensation and retention; and $ 62 million of other merger and integration cost. $ 201 million of these costs are classified in Merger & integration with the remaining $ 166 million classified in Cost of sales in the Consolidated Statement of Income .
In connection with the October 2023 acquisition of the Aker Solutions (“Aker”) subsea business (see Note 6 – Acquisitions ), SLB recorded $ 101 million of charges during 2025, consisting primarily of costs associated with information technology, and severance costs associated with the integration. These costs are classified in Merger & integration in the Consolidated Statement of Income .
SLB recorded $ 407 million of charges relating to workforce reductions to align its resources with activity levels and to realign and optimize its support and service delivery structure. These charges are classified in Restructuring & other in the Consolidated Statement of Income .
SLB recorded a $ 121 million of impairment charges relating to an equity method investment that was determined to be other-than-temporarily impaired. These charges are classified in Impairments in the Consolidated Statement of Income .
During the second quarter of 2025, SLB completed the sale of its interest in the Palliser APS project in Canada in exchange for net cash proceeds of $ 338 million. SLB recorded a gain of $ 149 million as a result of this transaction. This gain is classified in Interest & other income in the Consolidated Statement of Income .
During the fourth quarter of 2025, SLB recorded $ 50 million of other restructuring charges primarily relating to the closure of certain facilities and certain activities. These charges are classified in Restructuring & other in the Consolidated Statement of Income .
SLB recorded a $ 210 million goodwill impairment charge relating to its SLB Capturi reporting unit during the fourth quarter of 2025. This charge is classified in Impairments in the Consolidated Statement of Income .
During the fourth quarter of 2025, SLB reversed $ 92 million of a valuation allowance relating to deferred tax assets associated with certain foreign tax credits in the US. This credit is reflected in Tax expense in the Consolidated Statement of Income .
SLB recorded the following charges and credits during 2024:
(Stated in millions)
Pretax Charge (Credit)
Tax Benefit (Expense)
Noncontrolling Interest
Net
First quarter:
Amortization of inventory purchase accounting adjustment
Merger and integration
Second quarter:
Workforce reductions
Merger and integration
Amortization of inventory purchase accounting adjustment
Third quarter
Workforce reductions
Merger and integration
Amortization of inventory purchase accounting adjustment
Fourth quarter
Asset impairments
Merger and integration
Workforce reductions
Gain on sale of investment
During the second quarter of 2024, SLB commenced a program to realign and optimize its support and service delivery structure in certain parts of its organization. As a result, SLB recorded severance charges of $ 111 million during the second quarter, $ 65 million during the third quarter, and $ 61 million during the fourth quarter which are classified in Restructuring & other in the Consolidated Statement of Income .
In connection with the October 2023 acquisition of the Aker subsea business (see Note 6 - Acquisitions ) and the ChampionX transaction, SLB recorded $ 166 million of charges during 2024, consisting of: $ 43 million relating to the amortization of purchase accounting adjustments associated with the write-up of acquired inventories to its estimated fair value (classified in Cost of sales in the Consolidated Statement of Income) and $ 123 million of other merger and integration-related costs which are classified in Merger & integration .
During the fourth quarter of 2024, SLB recorded impairment charges consisting of $ 93 million relating to equity investments and $ 69 million relating to fixed asset impairments. These charges are classified in Impairments in the Consolidated Statement of Income .
During the fourth quarter of 2024, SLB sold an investment accounted for under the equity method. SLB received proceeds of $ 51 million and recognized a gain of $ 24 million, which is classified in Interest & other, net in the Consolidated Statement of Income .
SLB recorded the following charges and credits during 2023:
(Stated in millions)
Pretax Charge (Credit)
Tax Benefit (Expense)
Noncontrolling Interests
Net
First quarter:
Gain on sale of Liberty shares
Fourth quarter:
Currency devaluation loss in Argentina
Merger and integration
Amortization of inventory purchase accounting adjustment
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. (“Liberty”) in exchange for an equity interest in Liberty. 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 which is classified in Interest & other income in the Consolidated Statement of Income.
Although SLB’ s functional currency in Argentina is the US dollar, a portion of its transactions are denominated in pesos. During the fourth quarter of 2023, Argentina devalued its peso relative to the US dollar by approximately 55 %. As a result, SLB recorded a $ 90 million devaluation charge. $ 61 million of this charge is classified in Cost of services in the Consolidated Statement of Income , with the remaining $ 29 million classified in Cost of sales .
In connection with SLB’ s acquisition of the Aker subsea business, SLB recorded the following charges: $ 23 million of acquisition-related transaction costs, including advisory and legal fees; $ 11 million relating to the amortization of purchase accounting adjustments associated with the write-up of acquired inventories to its estimated fair value; and $ 22 million of other merger and integration-related costs. $ 45 million of these costs are classified in Merger & integration in the Consolidated Statement of Income with the remaining $ 11 million classified in Cost of sales .
4. Inventories
Inventories, which are stated at the lower of average cost or net realizable value, consist of the following:
(Stated in millions)
Raw materials & field materials
Work in progress
Finished goods
5. Fixed Assets
Fixed assets consist of the following:
(Stated in millions)
Land
Buildings & improvements
Machinery & equipment
Less: Accumulated depreciation
The estimated useful lives of Buildings & improvements are primarily 25 to 30 years . The estimated useful lives of Machinery & equipment are primarily 5 to 10 years .
Depreciation expense, which is recorded on a straight-line basis, was $ 1.7 billion in 2025, $ 1.6 billion in 2024, and $ 1.4 billion in 2023.
6. Acquisitions
ChampionX
On July 16, 2025, SLB acquired all of the outstanding shares of ChampionX in an all-stock transaction. ChampionX is a global leader in chemistry solutions, artificial lift systems, and highly engineered equipment and technologies that help companies drill for and produce oil and gas safely, efficiently, and sustainably across the world. The acquisition strengthens SLB's leadership in the production and recovery space. Under the terms of the agreement, ChampionX shareholders received 0.735 shares of SLB common stock in exchange for each ChampionX share.
Calculation of Consideration Transferred
The following details the fair value of the consideration transferred to effect the acquisition of ChampionX:
(stated in millions, except exchange ratio and per share amounts)
Equity consideration:
Number of shares of ChampionX stock outstanding
Exchange ratio
SLB shares of common stock issued
SLB closing stock share price on July 15, 2025
Equity consideration
Fair value of replacement equity awards
Total fair value of the consideration transferred
Preliminary Allocation of Consideration Transferred to Net Assets Acquired
The following amounts represent the preliminary estimates of the fair value of assets acquired and liabilities assumed in the acquisition. The final determination of fair value for certain assets and liabilities will be completed as soon as the information necessary to complete the analysis is obtained. These amounts, which are not expected to differ materially from current estimates, will be finalized no later than one year from the acquisition date.
(Stated in millions)
Cash
Accounts receivable
Inventories (1)
Net assets held for sale (2)
Fixed assets
Intangible assets (weighted average life of 18 years)
Customer relationships (weighted-average life of 25 years)
Technology/Technical know-how (weighted-average life of 16 years)
Tradenames (weighted-average life of 20 years)
Other assets
Accounts payable and accrued liabilities
Long-term debt
Deferred taxes
Other liabilities
Noncontrolling interests
Total identifiable net assets
Goodwill (3)
Total consideration transferred
SLB recorded an adjustment of $ 166 million to write-up the acquired inventory to its estimated fair value. SLB's Cost of sales reflected this increased valuation as the acquired inventory was sold. See Note 3 - Charges and Credits .
Concurrent with the closing of the acquisition, SLB completed the sale of ChampionX's Drilling Technologies business for net cash proceeds of $ 286 million.
The goodwill recognized is primarily attributable to expected synergies that will result from combining the operations of SLB and ChampionX, as well as intangible assets which do not qualify for separate recognition. The amount of goodwill that is deductible for income tax purposes is not significant.
Businesses acquired from ChampionX contributed revenue of approximately $ 1.5 billion and pretax operating income of approximately $ 0.3 billion to SLB for the period from August 1, 2025 through December 31, 2025.
Excluding its Drilling Technologies business, which was disposed of concurrently with the closing of the acquisition, ChampionX recorded revenue of approximately $ 3.4 billion in 2024 and $ 2.0 billion during the period from January 1, 2025 to July 31, 2025. The pro forma impact of this acquisition on net income attributable to SLB and diluted earnings per share was not material.
Aker Subsea
On October 2, 2023, SLB, Aker, and Subsea7 closed their previously announced joint venture, SLB OneSubsea. SLB OneSubsea drives innovation and efficiency in subsea production by helping customers unlock reserves and reduce cycle time. SLB OneSubsea 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.
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. Concurrently, Subsea7 purchased a 10 % interest in exchange for $ 306.5 million in cash to Aker. The joint venture also issued a promissory note valued at $ 87.5 million to Aker. SLB owns 70 % of the joint venture, while Aker owns 20 % and Subsea7 owns 10 %.
The formation of the joint venture was accounted for as a business combination. As the majority owner and controlling entity, SLB is considered the acquirer and reflects OneSubsea as a consolidated subsidiary in its Consolidated Financial Statements . The transfer of the SLB subsea business to the joint venture was accounted for at historical cost, while the Aker subsea business was recorded based on the fair value of the assets acquired and liabilities assumed of approximately $ 1.3 billion.
The combination of the historical cost and fair value, discussed above, resulted in net assets of the joint venture of approximately $ 2.8 billion upon formation. Aker and Subsea7’s combined 30 % interest in the initial net assets of OneSubsea of $ 0.8 billion was recognized in Noncontrolling interests in the Consolidated Balance Sheet . The $ 0.1 billion difference between the noncontrolling interest recognized and the fair value of Aker’s net assets acquired less the fair value of the SLB shares of common stock issued to Aker was recorded as an increase to Common stock in the Consolidated Balance Sheet .
The following amounts represent the estimated fair value of assets acquired and liabilities assumed in connection with the formation of the joint venture.
(Stated in millions)
Cash
Accounts receivable
Inventories (1)
Other current assets
Fixed assets
Intangible assets (weighted average life of 18 years)
Accounts payable and accrued liabilities
Deferred taxes
Other liabilities
Total identifiable net assets
Goodwill (2)
Total consideration transferred
SLB recorded an adjustment of $ 54 million to write-up the acquired inventory to its estimated fair value. SLB’s Cost of sales reflected this increased valuation as the acquired inventory was sold. See Note 3 – Charges and Credits.
The goodwill recognized is primarily attributable to intangible assets that do not qualify for separate recognition as well as expected synergies from combining the subsea operations of SLB and Aker. None of the goodwill is deductible for income tax purposes.
For the period from October 2, 2023 to December 31, 2023, the subsea business acquired from Aker contributed revenue of approximately $ 0.5 billion. The acquired Aker subsea business’ contribution to Net income attributable to SLB for the same period was not material.
Aker reported revenue for its subsea business of approximately $ 1.4 billion for the nine months ended September 30, 2023.
7. Goodwill
The changes in the carrying amount of goodwill by segment were as follows:
(Stated in millions)
Reservoir
Well
Production
Digital
Performance
Construction
Systems
All Other
Total
Balance, December 31, 2023
Acquisitions
Balance, December 31, 2024
Acquisition of ChampionX
Other acquisitions
Impairment (see Note 3)
Impact of changes in exchange rate and other
Balance, December 31, 2025
8. Intangible Assets
Intangible assets consist of the following:
(Stated in millions)
Gross
Accumulated
Net Book
Gross
Accumulated
Net Book
Book Value
Amortization
Value
Book Value
Amortization
Value
Customer relationships
Technology/technical know-how
Trade names
Other
Customer relationships are generally amortized over periods ranging from 18 to 28 years , technology/technical know-how are generally amortized over periods ranging from 10 to 18 years , and trade names are generally amortized over periods ranging from 15 to 30 years .
Amortization expense was $ 376 million in 2025, $ 334 million in 2024, and $ 314 million in 2023.
Based on the carrying value of intangible assets at December 31, 2025, amortization expense for the subsequent five years is estimated to be as follows: 2026: $ 437 million, 2027: $ 433 million, 2028: $ 423 million, 2029: $ 410 million and 2030: $ 404 million.
9. Long-term Debt and Debt Facility Agreements
Long-term Debt consists of the following:
(Stated in millions)
3.90 % Senior Notes due 2028
2.65 % Senior Notes due 2030
2.00 % Guaranteed Notes due 2032
0.25 % Notes due 2027
0.50 % Notes due 2031
4.30 % Senior Notes due 2029
4.50 % Senior Notes due 2028
5.00 % Senior Notes due 2027
4.85 % Senior Notes due 2033
5.00 % Senior Notes due 2029
5.00 % Senior Notes due 2034
7.00 % Notes due 2038
5.95 % Notes due 2041
5.13 % Notes due 2043
1.375 % Guaranteed Notes due 2026
1.00 % Guaranteed Notes due 2026
Long-term Debt as of December 31, 2025 is due as follows: $ 1.6 billion in 2027, $ 2.0 billion in 2028, $ 1.3 billion in 2029, $ 1.2 billion in 2030, $ 1.1 billion in 2031, and $ 2.6 billion thereafter.
The estimated fair value of SLB’s Long-term Debt at December 31, 2025 and December 31, 2024 was $ 9.4 billion and $ 10.4 billion, respectively, and was estimated based on quoted market prices.
At December 31, 2025, SLB had committed credit facility agreements with commercial banks aggregating $ 5.0 billion, of which $ 2.0 billion matures in February 2029 and $ 3.0 billion matures in December 2030. These committed facilities support commercial paper programs in the United States and Europe. There were no borrowings under these facilities at December 31, 2025 and 2024.
Commercial paper borrowings are classified as long-term debt to the extent they are backed up by available and unused committed credit facilities maturing in more than one year and to the extent it is SLB’s intent to maintain these obligations for longer than one year. There wer e no borrowings un der the commercial paper programs at December 31, 2025 and 2024.
SLB Limited fully and unconditionally guarantees the publicly-held securities issued by Schlumberger Investment SA, an indirect wholly-owned subsidiary of SLB Limited.
10. Derivative Instruments and Hedging Activities
SLB’s functional currency is primarily the US dollar. Approximately 70 % of SLB’s revenues in 2025 were denominated in US dollars. However, outside the United States, a significant portion of SLB’s expenses is incurred in foreign currencies. Therefore, when the US dollar weakens (strengthens) in relation to the foreign currencies of the countries in which SLB conducts business, the US dollar-reported expenses will increase (decrease).
Changes in foreign currency exchange rates expose SLB 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 risks. These contracts are accounted for as cash flow hedges, with the fair value of the derivative recorded on the Consolidated Balance Sheet and in Accumulated other comprehensive loss. Amounts recorded in Accumulated other comprehensive loss are reclassified into earnings in the same period or periods that the hedged item is recognized in earnings.
Details regarding SLB’s outstanding cross-currency interest rate swaps as of December 31, 2025, were as follows:
During 2019, SLB entered into cross-currency interest rate swaps in order to hedge changes in the fair value of its € 0.5 billion 0.25 % Notes due 2027 and € 0.5 billion 0.50 % Notes due 2031 that were issued by a US-dollar functional currency subsidiary. These cross-currency interest rate swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 2.51 % and 2.76 %, respectively.
During 2020, a US-dollar functional currency subsidiary of SLB issued € 0.8 billion of Euro-denominated debt. SLB entered into cross-currency interest rate swaps to hedge changes in the fair value of its € 0.4 billion of 0.25 % Notes due 2027 and € 0.4 billion of 0.50 % Notes due 2031. These cross-currency interest rate swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 1.87 % and 2.20 %, respectively.
During 2020, a US-dollar functional currency subsidiary of SLB issued € 2.0 billion of Euro-denominated debt. SLB entered into cross-currency interest rate swaps to hedge changes in the fair value of its € 1.0 billion of 1.375 % Guaranteed Notes due 2026 and € 1.0 billion of 2.00 % Guaranteed Notes due 2032. These cross-currency interest rate swaps effectively convert the Euro-denominated notes to US-dollar denominated debt with fixed annual interest rates of 2.77 % and 3.49 %, respectively.
A summary of the amounts included in the Consolidated Balance Sheet relating to cross currency interest rate swaps follows:
(Stated in millions)
Dec. 31, 2025
Dec. 31, 2024
Other current assets
Other Assets
Other Liabilities
The fair values were determined using a model with inputs that are observable in the market or can be derived or corroborated by observable data.
SLB is exposed to risks on future cash flows to the extent that the local currency is not the functional currency and expenses denominated in local currency are not equal to revenues denominated in local currency. SLB uses foreign currency forward contracts to provide a hedge against a portion of these cash flow risks. These contracts are accounted for as cash flow hedges.
SLB is also exposed to changes in the fair value of assets and liabilities denominated in currencies other than the functional currency. While SLB uses foreign currency forward contracts to economically hedge this exposure as it relates to certain currencies, these contracts are not designated as hedges for accounting purposes. Instead, the fair value of the derivative is recorded on the Consolidated Balance Sheet and changes in the fair value are recognized in the Consolidated Statement of Income, as are changes in the fair value of the hedged item. Transaction losses of $ 118 million in 2025, $ 139 million in 2024, $ 154 million (including $ 90 million related to the Argentina devaluation; see Note 3 – Charges and credits for further details) in 2023 were recognized in the Consolidated Statement of Income net of related hedging activities.
Foreign currency forward contracts were outstanding for the US dollar equivalent of $ 6.3 billion and $ 5.5 billion in various foreign currencies as of December 31, 2025 and 2024, respectively.
Other than the previously mentioned cross-currency interest rate swaps, the fair value of the other outstanding derivatives was no t material as of December 31, 2025 and 2024.
The effect of derivative instruments designated as hedges and those not designated as hedges on the Consolidated Statement of Income was as follows:
(Stated in millions)
Gain (Loss) Recognized in Income
Consolidated Statement
of Income Classification
Derivatives designated as cash flow hedges:
Cross-currency interest rate swaps
Cost of services/sales
Cross-currency interest rate swaps
Interest expense
Commodity contracts
Revenue
Foreign currency forward contracts
Cost of services/sales
Foreign exchange contract
Revenue
Derivatives not designated as hedges:
Foreign currency forward contracts
Cost of services/sales
SLB has issued credit default swaps (“CDSs”) to certain third-party financial institutions that have an aggregate notional amount outstanding of approximately $ 0.6 billion as of December 31, 2025 ($ 1.15 billion as of December 31, 2024). The CDSs relate to borrowings provided by the financial institutions to SLB’s primary customer in Mexico. The borrowings were used by this customer to pay certain of SLB’s outstanding receivables. Approximately $ 0.1 billion of the outstanding CDSs will reduce on a monthly basis over its remaining 2 -month term while the remaining $ 0.5 billion will reduce on a monthly basis over its remaining 6 -month te rm. The fair value of these derivative liabilities was not material at December 31, 2025 or December 31, 2024.
11. Stockholders’ Equity
SLB is authorized to issue 4,500,000,000 shares of common stock, par value $ 0.01 per share, of which 1,495,331,485 and 1,400,850,420 shares were outstanding on December 31, 2025 and 2024, respectively. Holders of common stock are entitled to one vote for each share of stock held. SLB is also authorized to issue 200,000,000 shares of preferred stock, par value $ 0.01 per share, which may be issued in series with terms and conditions determined by the SLB Board of Directors. No shares of preferred stock have been issued.
Accumulated Other Comprehensive Loss consists of the following:
(Stated in millions)
Currency translation adjustments
Pension and other postretirement benefit plans
Cash flow hedges
Other
12. Stock-based Compensation Plans
SLB has three types of stock-based compensation programs: (i) a restricted stock unit and performance share unit program (collectively referred to as “restricted stock”), (ii) a discounted stock purchase plan (“DSPP”), and (iii) stock options.
Restricted Stock
SLB grants performance share units to certain key employees. The number of shares earned is determined at the end of each performance period based on SLB’s achievement of certain predefined targets as described in the underlying performance share unit agreement. In the event SLB exceeds the predefined target, shares for up to a maximum of 250 % of the target award may be awarded. In the event SLB falls below the predefined target, a reduced number of shares may be awarded. If SLB falls below the threshold award performance level, no shares will be awarded. As of December 31, 2025, 2.4 million performance share units were outstanding assuming the achievement of 100% of target.
Restricted stock awards do not pay dividends or have voting rights prior to vesting and generally vest at the end of three years or ratably in equal tranches over a three-year period. The fair value of a restricted stock award is generally the quoted market price of SLB’s stock on the date of grant less the present value of the expected dividends not received prior to vesting.
The following table summarizes information related to restricted stock activity:
(Shares stated in millions)
Weighted-
Weighted-
Weighted-
Average
Average
Average
Restricted
Grant Date
Restricted
Grant Date
Restricted
Grant Date
Stock
Fair Value
Stock
Fair Value
Stock
Fair Value
Unvested at beginning of year
Granted
Assumed in ChampionX transaction
Adjustments for performance achieved
Vested
Forfeited
Unvested at year-end
Discounted Stock Purchase Plan
Under the terms of the DSPP, employees can choose to have a portion of their earnings withheld, subject to certain restrictions, to purchase SLB common stock. The purchase price of the stock is 85 % of the lower of the stock price at the beginning or end of the plan period at six-month intervals.
The fair value of the employees’ purchase rights under the DSPP was estimated using the Black-Scholes model with the following assumptions and resulting weighted-average fair value per share:
Dividend yield
Expected volatility
Risk-free interest rate
Weighted-average fair value per share
Stock Options
Key employees may be granted stock options under SLB stock option plans. The exercise price equals the average of the high and low sales prices of SLB stock on the date of grant. The maximum term is 10 years, and the options generally vest in increments over five years .
The following table summarizes stock option activity:
(Shares stated in millions)
Weighted-
Weighted-
Weighted-
Average
Average
Average
Exercise
Exercise
Exercise
Shares
Price
Shares
Price
Shares
Price
Outstanding at beginning of year
Exercised
Forfeited / expired
Assumed in ChampionX acquisition
Outstanding at year-end
The following table summarizes information related to options outstanding as of December 31, 2025, all of which are exercisable:
(Shares stated in millions)
Weighted-
Average
Weighted-
Options
Remaining Life
Average
Exercise prices range
Outstanding
(in years)
Exercise Price
Stock options outstanding as of December 31, 2025 had an intrinsic value of $ 22 million.
Total Stock-based Compensation Expense
The following summarizes stock-based compensation expense recognized in income:
(Stated in millions)
Restricted stock
DSPP
Stock options
At December 31, 2025, there was $ 307 million of total unrecognized compensation cost related to nonvested stock-based compensation arrangements, of which $ 190 million is expected to be recognized in 2026, $ 96 million in 2027, $ 18 million in 2028, and $ 3 million in 2029.
As of December 31, 2025, approximately 10 million shares of SLB common stock were available for future grants under SLB’s stock-based compensation programs.
13. Income Taxes
Income before taxes subject to United States and non-United States income taxes was as follows:
(Stated in millions)
United States
Outside United States
SLB recorded net pretax charges o f $ 1.107 billion in 2025 ($ 565 million of charges in the US and $ 542 million of net charges outside the US); $ 540 million in 2024 ($ 188 million of charges in the US and $ 352 million of net charges outside the US); and $ 110 million in 2023 ($ 2 million of net credits in the US and $ 112 million of charges outside the US) . These charges and credits are included in the table above and are more fully described in Note 3 – Charges and Credits .
The components of net deferred tax liabilities were as follows:
(Stated in millions)
Intangible assets
Net operating losses
Fixed assets, net
Research and development credits
Capitalized research and development costs
Pension and other postretirement benefits
Investments in non-US subsidiaries
Foreign tax credits
Other, net
Approximately $ 105 million of the $ 153 million deferred tax asset relating to net operating losses at December 31, 2025 can be carried forward indefinitely.
The deferred tax balance at December 31, 2025 and 2024 was net of valuation allowances relating to the following:
(Stated in millions)
Foreign tax credits
Net operating losses
The components of Tax expense were as follows:
(Stated in millions)
Current:
United States-Federal
United States-State
Outside United States
Deferred:
United States-Federal
United States-State
Outside United States
United States - Valuation allowance
Outside United States - Valuation allowance
A reconciliation of the United States statutory federal tax rate to the consolidated effective tax rate follows:
Amount
Percentage
Amount
Percentage
Amount
Percentage
US federal income tax
Non-US tax effects
United Arab Emirates
Saudi Arabia
Norway
Ecuador:
Dividend withholding tax
Other
British Virgin Island
Russia
Other jurisdictions
Tax credits
Changes in valuation allowance
Nontaxable or nondeductible items
Changes in unrecognized tax benefits
Other adjustments
A number of the jurisdictions in which SLB operates have tax laws that are not fully defined and are evolving. SLB’s tax filings are subject to regular audit by the tax authorities. These audits may result in assessments for additional taxes that are resolved with the tax authorities or, potentially, through the courts. Tax liabilities are recorded based on estimates of additional taxes that will be due upon the conclusion of these audits. Due to the uncertain and complex application of tax regulations, the ultimate resolution of audits may result in liabilities which could be materially different from these estimates.
A reconciliation of the beginning and ending amount of liabilities associated with uncertain tax positions is as follows:
(Stated in millions)
Balance at beginning of year
Additions based on tax positions related to the current year
Additions for tax positions of prior years
Additions related to acquisitions
Impact of changes in exchange rates
Settlements with tax authorities
Reductions for tax positions of prior years
Reductions due to the lapse of statute of limitations
The amounts above exclude accrued interest and penalties of $ 132 million at December 31, 2025 and $ 116 million at December 31, 2024. SLB classifies interest and penalties relating to uncertain tax positions within Tax expense in the Consolidated Statement of Income .
The following table summarizes the tax years that are either currently under audit or remain open and subject to examination by the tax authorities in the most significant jurisdictions in which SLB operates:
Ecuador
Mexico
Norway
Russia
Saudi Arabia
United Kingdom
United States
Cash paid for income taxes was as follows:
(Stated in millions)
US Federal
US State
Ecuador
Saudi Arabia
Mexico
Other
* Amount of income taxes paid during the year did not meet the 5 % disaggregation threshold.
14. Leases
SLB’s leasing activities primarily consist of operating leases for administrative offices, manufacturing facilities, research centers, service centers, sales offices, and certain equipment. Total operating lease expense, which approximates cash paid and includes short-term leases, was $ 1.5 billion in 2025, and $ 1.4 billion in each of 2024 and 2023.
Maturities of operating lease liabilities as of December 31, 2025 were as follows:
(Stated in millions)
Thereafter
Total lease payments
Less: Interest
Amounts recognized in balance sheet:
Accounts payable and accrued liabilities
Other Liabilities
The weighted-average remaining lease term as of December 31, 2025 was 8 years . The weighted-average discount rate used to determine the operating lease liability as of December 31, 2025 was 4 %.
15. Contingencies
SLB is party to various legal proceedings from time to time. A liability is accrued when a loss is both probable and can be reasonably estimated. Management believes that the probability of a material loss with respect to any currently pending legal proceeding is remote. However, litigation is inherently uncertain, and it is not possible to predict the ultimate disposition of any of these proceedings.
16. Segment Information
SLB is primarily organized under four Divisions that combine and integrate SLB’s technologies, enhancing the Company’s ability to support the emerging long-term growth opportunities in each of these market segments.
SLB previously reported its results on the basis of four Divisions: Digital & Integration, Reservoir Performance, Well Construction, and Production Systems. Commencing the third quarter of 2025, SLB's Digital business is reported as a separate Division. Additionally, SLB's Asset Performance Solutions ("APS"), Data Center Solutions and SLB Capturi businesses are now reported in the All Other category. The acquired ChampionX businesses are predominantly reported in SLB's Production Systems Division, with the exception of its digital business, which is reported in SLB's Digital Division. Prior periods have been recast to conform to the current presentation.
SLB’s segments, are:
Digital – Comprised of SLB's industry-leading digital solutions and data products.
Reservoir Performance – Consists of reservoir-centric technologies and services that are critical to optimizing reservoir productivity and performance.
Well Construction – Combines the full portfolio of products and services to optimize well placement and performance, maximize drilling efficiency, and improve wellbore assurance.
Production Systems – Develops technologies and provides expertise that enhances production and recovery of oil and gas assets from subsurface reservoirs to the surface, into pipelines, and to refineries.
All Other – Consists of Asset Performance Solutions, Data Center Solutions, and SLB Capturi.
Financial information by segment is as follows:
(Stated in millions)
Depreciation
Pretax
and
Capital
Revenue
Income
Assets
Amortization
Investments
Digital
Reservoir Performance
Well Construction
Production Systems
All other
Eliminations & other
Goodwill and intangible assets
Cash and short-term investments
All other assets
Corporate & other (1)
Interest income (2)
Interest expense (3)
Charges & credits (4)
(Stated in millions)
Depreciation
Pretax
and
Capital
Revenue
Income
Assets
Amortization
Investments
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
Goodwill and intangible assets
Cash and short-term investments
All other assets
Corporate & other (1)
Interest income (2)
Interest expense (3)
Charges & credits (4)
(Stated in millions)
Depreciation
Pretax
and
Capital
Revenue
Income
Assets
Amortization
Investments
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
Goodwill and intangible assets
Cash and short-term investments
All other assets
Corporate & other (1)
Interest income (2)
Interest expense (3)
Charges & credits (4)
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.
Interest income excludes amounts which are included in the segments’ income (2025: $ 2 million; 2024: $ 40 million; 2023: $ 13 million).
Interest expense excludes amounts which are included in the segments’ income (2025: $ 7 million; 2024: $ 14 million; 2023: $ 14 million).
See Note 3 – Charges and Credits .
Segment assets consist of receivables, inventories, fixed assets, exploration data, and APS investments.
Capital investments includes capital expenditures, APS investments, and exploration data cost capitalized.
Depreciation and amortization includes depreciation of fixed assets and amortization of intangible assets, exploration data costs, and APS investments.
Revenue from Digital Operations of $ 464 million, $ 290 million, and $ 186 million in 2025, 2024 and 2023, respectively, is reflected in the Digital Division. Revenue from this solution is generated from the same customer base as SLB's Core divisions of Well Construction, Reservoir Performance and Production Systems. In order to incentivize the Core divisions and Digital to develop and promote digital operations, the resulting revenue and profitability is recognized in both the respective Core division as well as in the Digital Division. This effect is eliminated in consolidation.
Revenue by geographic area for the years ended December 31, 2025, 2024, and 2023 was as follows:
(Stated in millions)
North America
Latin America
Europe & Africa *
Middle East & Asia
Eliminations & other
* Includes Russia and the Caspian region
Revenue is based on the location where services are provided and products are sold.
SLB did not have revenue from third-party customers in its country of domicile during the last three years. Revenue in the United States in 2025, 2024, and 2023 was $ 6.3 billion, $ 5.3 billion, and $ 5.4 billion, respectively.
North America and International revenue disaggregated by segment was as follows:
(Stated in millions)
North America
International
Other
Total
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
(Stated in millions)
North America
International
Other
Total
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
(Stated in millions)
North America
International
Other
Total
Digital
Reservoir Performance
Well Construction
Production Systems
All Other
Eliminations & other
Fixed Assets less accumulated depreciation by geographic area was as follows:
(Stated in millions)
North America
Latin America
Europe & Africa
Middle East & Asia
Significant segment expenses, which represents the difference between segment revenue and pretax segment income, consist of the following:
(Stated in millions)
Reservoir
Well
Production
Digital
Performance
Construction
Systems
Compensation
Cost of products, materials, and supplies
Depreciation and amortization
Allocations
Other
(Stated in millions)
Reservoir
Well
Production
Digital
Performance
Construction
Systems
Compensation
Cost of products, materials, and supplies
Depreciation and amortization
Allocations
Other
(Stated in millions)
Reservoir
Well
Production
Digital
Performance
Construction
Systems
Compensation
Cost of products, materials, and supplies
Depreciation and amortization
Allocations
Other
Other segment expenses include transportation, mobilization, lease, occupancy, professional, and other costs.
SLB's chief operating decision maker is its Chief Executive Officer who uses pretax segment income to assess the performance of each segment.
17. Pension and Other Postretirement Benefit Plans
Pension Plans
SLB sponsors several defined benefit pension plans that cover substantially all US employees hired prior to October 1, 2004. The benefits are based on years of service and compensation, on a career-average pay basis.
In addition to the US defined benefit pension plans, SLB sponsors several other international defined benefit pension plans. The most significant of these international plans are the International Staff Pension Plan and the UK pension plan (collectively, the “International plans”). The International Staff Pension Plan covers certain international employees hired prior to July 1, 2014 and is based on years of service and compensation on a career-average pay basis. The UK plan covers employees hired prior to April 1, 1999, and is based on years of service and compensation, on a final salary basis.
The weighted-average assumed discount rate, compensation increases and expected long-term rate of return on plan assets used to determine the net pension cost for the US and International plans were as follows:
International
Discount rate
Compensation increases
Return on plan assets
Net pension cost (credit) included the following components:
(Stated in millions)
International
Service cost
Interest cost
Expected return on plan assets
Amortization of net loss
The weighted-average assumed discount rate and compensation increases used to determine the projected benefit obligations for the US and International plans were as follows:
International
Discount rate
Compensation increases
The changes in the projected benefit obligation, plan assets and funded status of the plans were as follows:
(Stated in millions)
International
Change in Projected Benefit Obligations:
Projected benefit obligation at beginning of year
Service cost
Interest cost
Contribution by plan participants
Actuarial losses (gains)
Currency effect
Benefits paid
Projected benefit obligation at end of year
Change in Plan Assets:
Plan assets at fair value at beginning of year
Actual return on plan assets
Currency effect
Company contributions
Contributions by plan participants
Benefits paid
Plan assets at fair value at end of year
Unfunded Liability
Amounts Recognized in Balance Sheet:
Postretirement Benefits
Other Assets
Amounts Recognized in Accumulated Other Comprehensive Loss:
Actuarial losses
Accumulated benefit obligation
The asset represents the difference between the plan assets and the projected benefit obligation (“PBO”). The PBO represents the actuarial present value of benefits based on employee service and compensation and includes an assumption about future compensation levels. The accumulated benefit obligation represents the actuarial present value of benefits based on employee service and compensation but does not include an assumption about future compensation levels.
Actuarial gains and losses arising during 2025 and 2024 were primarily attributable to changes in the discount rate used to determine the PBO.
The weighted-average allocation of plan assets as of December 31, 2025 and 2024 and the target allocations by asset category as of December 31, 2025 were as follows:
International
Target
Target
Cash and cash equivalents
Equity securities
Debt securities
Private equity and real estate
Private debt
The expected rate of return on assets assumptions reflect the long-term average rate of return expected to be earned on plan assets. The assumptions have been determined based on expectations regarding future rates of return for the portfolio considering the asset allocation and related historical rates of return. The appropriateness of the assumptions is reviewed annually.
The fair value of SLB’s pension plan assets at December 31, 2025 and 2024, by asset category, is presented below and was determined based on valuation techniques categorized as follows:
Level One: The use of quoted prices in active markets for identical instruments.
Level Two: The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data.
Level Three: The use of significant unobservable inputs that typically require the use of management’s estimates of assumptions that market participants would use in pricing.
(Stated in millions)
US Plan Assets
Level
Level
Level
Level
Level
Level
Total
One
Two
Three
Total
One
Two
Three
Asset Category:
Cash and Cash Equivalents
Equity Securities
Debt Securities:
Corporate bonds
Government and related debt securities
Other
Alternative Investments:
Private equity
Private debt
Real estate
Total
(Stated in millions)
International Plan Assets
Level
Level
Level
Level
Level
Level
Total
One
Two
Three
Total
One
Two
Three
Asset Category:
Cash and Cash Equivalents
Equity Securities
Debt Securities:
Corporate bonds
Government and related debt securities
Other
Alternative Investments:
Private equity
Private debt
Real estate
Total
SLB’s funding policy is to contribute amounts that are based upon a number of factors including the funded status of the plans, amounts that are deductible for income tax purposes, legal funding requirements, and available cash flow. SLB does not expect to make any material contributions to its postretirement benefit plans in 2026.
Postretirement Benefits Other Than Pensions
SLB provides healthcare benefits to certain former US employees who have retired.
The actuarial assumptions used to determine the accumulated postretirement benefit obligation and net periodic benefit cost for the US postretirement medical plan were as follows:
Benefit Obligation
Net Periodic Benefit
At December 31,
Cost for the Year
Discount rate
Return on plan assets
Current medical cost trend rate
Ultimate medical cost trend rate
Year that the rate reaches the ultimate trend rate
The net credit for the US postretirement medical plan included the following components:
(Stated in millions)
Service cost
Interest cost
Expected return on plan assets
Amortization of prior service credit
Amortization of net gain
The changes in the accumulated postretirement benefit obligation, plan assets and funded status were as follows:
(Stated in millions)
Change in Accumulated Postretirement Benefit Obligation:
Benefit obligation at beginning of year
Service cost
Interest cost
Contribution by plan participants
Actuarial loss (gain)
Benefits paid
Benefit obligation at end of year
Change in Plan Assets:
Plan assets at fair value at beginning of year
Actual return on plan assets
Contributions by plan participants
Benefits paid
Plan assets at fair value at end of year
Asset
Amounts Recognized in Accumulated Other Comprehensive Loss:
Actuarial gains
Prior service credit
The asset balance relating to this plan was included in Other Assets in the Consolidated Balance Sheet .
The assets of the US postretirement medical plan are invested 84 % in debt securities and 16 % in equity securities at December 31, 2025. The fair value of these assets was primarily determined based on Level Two valuation techniques.
Other Information
The expected benefits to be paid under the US and International pension plans as well as the postretirement medical plan are as follows:
(Stated in millions)
Pension Plans
Postretirement
International
Medical Plan
18. Supplementary Information
Cash paid for interest was $ 560 million in 2025, $ 510 million in 2024, and $ 503 million in 2023.
Interest and other income includes the following:
(Stated in millions)
Earnings of equity method investments
Gain on sale of Palliser APS project *
Interest income
Gain on sale of investment *
Gain on sale of Liberty shares *
* See Note 3 – Charges and Credits
The components of depreciation and amortization expense were as follows:
(Stated in millions)
Depreciation of fixed assets
Amortization of intangible assets
Amortization of APS investments
Amortization of exploration data costs
The change in Allowance for doubtful accounts was as follows:
(Stated in millions)
Balance at beginning of year
Additions
Amounts written off
Balance at end of year
Revenue in excess of billings related to contracts where revenue is recognized over time was $ 0.4 billion at December 31, 2025 and $ 0.5 billion at December 31, 2024. Such amounts are included within Receivables less allowance for doubtful accounts in the Consolidated Balance Sheet .
Other Assets consist of the following:
(Stated in millions)
Investments in APS projects
Pension and other postretirement plan assets
Operating lease assets
Exploration data costs capitalized
Other
Accounts payable and accrued liabilities consist of the following:
(Stated in millions)
Trade payables
Payroll, vacation, and employee benefits
Billings and cash collections in excess of revenue
Other
Management’s Report on Internal Control Over Financial Reporting
SLB management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). SLB’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
SLB management assessed the effectiveness of its internal control over financial reporting as of December 31, 2025. In making this assessment, it used the criteria set forth in 2013 by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework. Based on this assessment SLB’s management has concluded that, as of December 31, 2025, its internal control over financial reporting is effective based on those criteria.
The effectiveness of SLB’s internal control over financial reporting as of December 31, 2025 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.
Report of Independent Regist ered Public Accounting Firm
To the Board of Directors and Stockholders
of SLB Limited
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheet of SLB Limited and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of income, comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2025, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024 and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Uncertain Tax Positions
As described in Note 13 to the consolidated financial statements, the Company’s tax filings are subject to regular audit by the tax authorities, and those audits may result in assessments for additional taxes that are resolved with the tax authorities or, potentially, through the courts. Tax liabilities are recorded based on estimates of additional taxes that will be due upon the conclusion of these audits.
The principal considerations for our determination that performing procedures relating to uncertain tax positions is a critical audit matter are the significant judgment applied by management in determining these liabilities including a high degree of estimation uncertainty due to the uncertain and complex application of tax regulations, which in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures to evaluate management’s estimates.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the identification and recognition of uncertain tax positions. These procedures also included, among others (i) evaluating management’s process for determining the estimated liabilities for uncertain tax positions, (ii) testing the completeness and reasonableness of uncertain tax positions recorded in the consolidated financial statements, and (iii) evaluating assessments received from the relevant tax authorities. Professionals with specialized skill and knowledge were used to assist in evaluating the reasonableness of assumptions used by management, including management's assessment of whether tax positions are more likely than not of being sustained.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
January 23, 2026
We have served as the Company’s auditor since 1952.
