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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file No.: 1-4601

SCHLUMBERGER N.V.

(SCHLUMBERGER LIMITED)

(Exact name of registrant as specified in its charter)

Curaçao		52-0684746
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

42 rue Saint-Dominique
Paris, France		75007

5599 San Felipe
Houston, Texas, United States of America		77056

62 Buckingham Gate
London, United Kingdom		SW1E 6AJ

Parkstraat 83, The Hague,
The Netherlands		2514 JG
(Addresses of principal executive offices)		(Zip Codes)

Registrant’s telephone number in the United States, including area code, is: (713) 513-2000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
common stock, par value $0.01 per share	SLB	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class

Outstanding at March 31, 2022

COMMON STOCK, $0.01 PAR VALUE PER SHARE

1,413,460,705

SCHLUMBERGER LIMITED

First Quarter 2022 Form 10-Q

Table of Contents

		Page
PART I	Financial Information

Item 1.	Financial Statements	3

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	20

Item 4.	Controls and Procedures	20

PART II	Other Information

Item 1.	Legal Proceedings	21

Item 1A.	Risk Factors	21

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	21

Item 3.	Defaults Upon Senior Securities	21

Item 4.	Mine Safety Disclosures	21

Item 5.	Other Information	21

Item 6.	Exhibits	22

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME

(Unaudited)

(Stated in millions, except per share amounts)

	Three Months Ended March 31,
	2022		2021
Revenue
Services	$	4,222	$	3,482
Product sales		1,740		1,741
Total Revenue		5,962		5,223
Interest & other income		50		19
Expenses
Cost of services		3,387		3,031
Cost of sales		1,626		1,473
Research & engineering		141		135
General & administrative		97		81
Interest		123		136
Income before taxes		638		386
Tax expense		118		74
Net income		520		312
Net income attributable to noncontrolling interests		10		13
Net income attributable to Schlumberger	$	510	$	299

Basic income per share of Schlumberger	$	0.36	$	0.21

Diluted income per share of Schlumberger	$	0.36	$	0.21

Average shares outstanding:
Basic		1,412		1,398
Assuming dilution		1,434		1,419

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Unaudited)

(Stated in millions)

	Three Months Ended March 31,
	2022			2021
Net income	$	520		$	312
Currency translation adjustments
Unrealized net change arising during the period		(106	)		14
Cash flow hedges
Net gain on cash flow hedges		9			150
Reclassification to net income of net realized loss (income)		17			(2	)
Pension and other postretirement benefit plans
Amortization to net income of net actuarial loss		16			63
Amortization to net income of net prior service credit		(5	)		(5	)
Comprehensive income		451			532
Comprehensive income attributable to noncontrolling interests		10			13
Comprehensive income attributable to Schlumberger	$	441		$	519

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(Stated in millions)

	Mar. 31,
	2022			Dec. 31,
	(Unaudited)			2021
ASSETS
Current Assets
Cash	$	1,600		$	1,757
Short-term investments		1,049			1,382
Receivables less allowance for doubtful accounts (2022 - $319; 2021 - $319)		5,713			5,315
Inventories		3,719			3,272
Other current assets		1,172			928
		13,253			12,654
Investments in Affiliated Companies		1,955			2,044
Fixed Assets less accumulated depreciation		6,354			6,429
Goodwill		12,978			12,990
Intangible Assets		3,158			3,211
Other Assets		4,269			4,183
	$	41,967		$	41,511
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable and accrued liabilities	$	8,638		$	8,382
Estimated liability for taxes on income		940			879
Short-term borrowings and current portion of long-term debt		923			909
Dividends payable		195			189
		10,696			10,359
Long-term Debt		13,163			13,286
Postretirement Benefits		232			231
Deferred Taxes		77			94
Other Liabilities		2,160			2,255
		26,328			26,225
Equity
Common stock		11,957			12,608
Treasury stock		(1,503	)		(2,233	)
Retained earnings		8,532			8,199
Accumulated other comprehensive loss		(3,639	)		(3,570	)
Schlumberger stockholders’ equity		15,347			15,004
Noncontrolling interests		292			282
		15,639			15,286
	$	41,967		$	41,511

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

(Stated in millions)

	Three Months Ended March 31,
	2022			2021
Cash flows from operating activities:
Net income	$	520		$	312
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization ⁽¹⁾		533			532
Deferred taxes		(14	)		(29	)
Stock-based compensation expense		89			84
Earnings of equity method investments, less dividends received		6			(13	)
Change in assets and liabilities: ⁽²⁾
Increase in receivables		(404	)		(16	)
(Increase) decrease in inventories		(464	)		49
Increase in other current assets		(177	)		(17	)
(Increase) decrease in other assets		(25	)		11
Increase (decrease) in accounts payable and accrued liabilities		89			(438	)
Increase (decrease) in estimated liability for taxes on income		8			(33	)
Decrease in other liabilities		(5	)		(18	)
Other		(25	)		5
NET CASH PROVIDED BY OPERATING ACTIVITIES		131			429
Cash flows from investing activities:
Capital expenditures		(304	)		(178	)
APS investments		(168	)		(85	)
Multiclient seismic data costs capitalized		(40	)		(7	)
Business acquisitions and investments, net of cash acquired		-			(13	)
Proceeds from sale of Liberty shares		84			-
Sale of investments, net		336			520
Other		(23	)		(26	)
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES		(115	)		211
Cash flows from financing activities:
Dividends paid		(175	)		(174	)
Taxes paid on net settled stock-based compensation awards		(81	)		(18	)
Proceeds from employee stock purchase plan		64			62
Proceeds from exercise of stock options		7			-
Proceeds from issuance of long-term debt		-			134
Repayment of long-term debt		-			(98	)
Net increase (decrease) in short-term borrowings		16			(101	)
Other		(1	)		(17	)
NET CASH USED IN FINANCING ACTIVITIES		(170	)		(212	)
Net (decrease) increase in cash before translation effect		(154	)		428
Translation effect on cash		(3	)		(4	)
Cash, beginning of period		1,757			844
Cash, end of period	$	1,600		$	1,268

⁽¹⁾	Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs, and APS investments.

⁽²⁾	Net of the effect of business acquisitions and divestitures.

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(Unaudited)

	(Stated in millions, except per share amounts)

										Accumulated
										Other
	Common Stock						Retained			Comprehensive			Noncontrolling
January 1, 2022 – March 31, 2022	Issued			In Treasury			Earnings			Loss			Interests		Total
Balance, January 1, 2022	$	12,608		$	(2,233	)	$	8,199		$	(3,570	)	$	282	$	15,286
Net income								510						10		520
Currency translation adjustments											(106	)				(106	)
Changes in fair value of cash flow hedges											26					26
Pension and other postretirement benefit plans											11					11
Shares sold to optionees, less shares exchanged		(6	)		12											6
Vesting of restricted stock, net of taxes withheld		(631	)		550											(81	)
Shares issued under employee stock purchase plan		(104	)		168											64
Stock-based compensation expense		89														89
Dividends declared ($0.125 per share)								(177	)							(177	)
Other		1														1
Balance, March 31, 2022	$	11,957		$	(1,503	)	$	8,532		$	(3,639	)	$	292	$	15,639

	(Stated in millions, except per share amounts)

										Accumulated
										Other
	Common Stock						Retained			Comprehensive			Noncontrolling
January 1, 2021 – March 31, 2021	Issued			In Treasury			Earnings			Loss			Interests			Total
Balance, January 1, 2021	$	12,970		$	(3,033	)	$	7,018		$	(4,884	)	$	418		$	12,489
Net income								299						13			312
Currency translation adjustments											14			(2	)		12
Changes in fair value of cash flow hedges											148						148
Pension and other postretirement benefit plans											58						58
Vesting of restricted stock, net of taxes withheld		(189	)		171												(18	)
Shares issued under employee stock purchase plan		(202	)		264												62
Stock-based compensation expense		84															84
Dividends declared ($0.125 per share)								(175	)								(175	)
Balance, March 31, 2021	$	12,663		$	(2,598	)	$	7,142		$	(4,664	)	$	429		$	12,972

SHARES OF COMMON STOCK

(Unaudited)

			(Stated in millions)

						Shares
	Issued		In Treasury			Outstanding
Balance, January 1, 2022		1,434		(31	)		1,403
Vesting of restricted stock		-		8			8
Shares issued under employee stock purchase plan		-		2			2
Balance, March 31, 2022		1,434		(21	)		1,413

See Notes to Consolidated Financial Statements

SCHLUMBERGER LIMITED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation

The accompanying unaudited consolidated financial statements of Schlumberger Limited and its subsidiaries (“Schlumberger”) have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of Schlumberger management, all adjustments considered necessary for a fair statement have been included in the accompanying unaudited financial statements. All intercompany transactions and balances have been eliminated in consolidation. Operating results for the three-month period ended March 31, 2022 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2022. The December 31, 2021 balance sheet information has been derived from the Schlumberger 2021 audited financial statements. For further information, refer to the Consolidated Financial Statements and notes thereto included in the Schlumberger Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission on January 26, 2022.

2. Charges and Credits

On December 31, 2020, Schlumberger 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 2022, Schlumberger sold 7.2 million of its shares of Liberty and received proceeds of $84 million. As a result of this transaction Schlumberger recognized a gain of $26 million. This gain is classified in Interest & other income in the Consolidated Statement of Income. As of March 31, 2022, Schlumberger had a 27% equity interest in Liberty.

Schlumberger did not record any charges or credits during the first quarter of 2021.