SLB N.V. (NYSE:SLB)

The long-term activity ratios demonstrate generally positive trends over the observed period, with some moderation in the most recent quarters. Efficiency in asset utilization appears to be improving, though the rate of improvement has fluctuated. A closer examination of individual ratios reveals nuanced patterns.

Net Fixed Asset Turnover

The net fixed asset turnover ratio exhibits a consistent upward trend from 3.72 in the first quarter of 2022 to a peak of 4.93 in the fourth quarter of 2024. This indicates increasing efficiency in generating revenue from fixed assets. However, the ratio experienced a slight decline to 4.88 in the first quarter of 2025 and remained relatively stable at 4.41 and 4.52 in subsequent quarters, suggesting a potential plateauing of improvements or the impact of external factors. The overall increase suggests effective management of fixed asset investments.

Total Asset Turnover

The total asset turnover ratio also shows an improving trend, rising from 0.56 in the first quarter of 2022 to 0.74 in the fourth quarter of 2024. This signifies enhanced efficiency in utilizing all assets to generate sales. Similar to the net fixed asset turnover, the ratio decreased to 0.64 in the first quarter of 2025 and remained at 0.65 in the second quarter of 2025, indicating a possible stabilization or slight decrease in overall asset utilization efficiency. The initial upward trajectory suggests effective asset management strategies.

Equity Turnover

The equity turnover ratio demonstrates a more pronounced increase than the asset turnover ratios. Starting at 1.54 in the first quarter of 2022, it rose to 1.85 in the first quarter of 2025, indicating a greater ability to generate revenue from shareholder equity. However, the ratio then decreased to 1.75 in the second quarter of 2025 and further declined to 1.37 in both the third and fourth quarters of 2025. This recent decline warrants further investigation, as it suggests a reduced efficiency in generating revenue relative to equity investment. The earlier increase suggests effective utilization of equity financing.

In summary, the observed ratios generally indicate improving efficiency in asset utilization from 2022 through 2024. However, the most recent quarters of 2025 show signs of stabilization or slight declines in these ratios, particularly in equity turnover, which may warrant further scrutiny to understand the underlying causes and potential implications.

The net fixed asset turnover ratio demonstrates a generally increasing trend over the observed period, with some fluctuations. This ratio, which measures the efficiency with which a company utilizes its fixed assets to generate revenue, has shown improvement from early 2022 through late 2024, followed by a slight decline in the most recent quarters.

Overall Trend

From March 31, 2022, to December 31, 2024, the net fixed asset turnover ratio increased from 3.72 to 4.93. This indicates a growing ability to generate sales from the company’s fixed asset base. The rate of increase was most pronounced between March 2022 and December 2023.

Short-Term Fluctuations

While the overall trend is positive, there are quarterly variations. A slight decrease is observed from the peak of 4.93 in December 2024 to 4.88 in March 2025. This is followed by a further decrease to 4.41 in September 2025, before a modest recovery to 4.52 in December 2025. These fluctuations suggest potential short-term impacts from factors affecting revenue or asset utilization.

Recent Performance

The most recent two quarters (September 30, 2025, and December 31, 2025) show a leveling off and slight decline from the high values achieved in 2024. While still above the levels seen in 2022 and early 2023, this warrants monitoring to determine if it represents a sustained shift or a temporary dip.

Revenue and Fixed Asset Relationship

The consistent increase in revenue, coupled with a moderate increase in fixed assets less accumulated depreciation, supports the observed rise in the net fixed asset turnover ratio. The ratio’s performance suggests that revenue growth has outpaced the growth in fixed assets, indicating improved efficiency. However, the recent stabilization of revenue growth and a slight decrease in fixed assets may be contributing to the recent ratio decline.

In conclusion, the net fixed asset turnover ratio generally reflects improving efficiency in asset utilization. However, the recent fluctuations and slight decline necessitate continued observation to assess the sustainability of this performance.

The total asset turnover ratio exhibits an overall increasing trend from March 31, 2022, through December 31, 2024, followed by a decline in the most recent periods analyzed. This indicates a changing pattern in how efficiently assets are being utilized to generate revenue.

Initial Increase (Mar 31, 2022 – Dec 31, 2024)

The ratio began at 0.56 in March 2022 and steadily increased, reaching 0.74 in both December 2024 and March 2025. This suggests improving efficiency in asset utilization during this period. Revenue growth appears to have outpaced the growth in total assets, contributing to this increase. The ratio’s climb from 0.56 to 0.74 represents a 32.14% improvement in asset turnover.

Subsequent Decline (Mar 31, 2025 – Dec 31, 2025)

Following the peak in March 2025, the total asset turnover ratio experienced a decrease, falling to 0.64 in September 2025 and remaining at 0.65 in December 2025. This suggests a potential slowdown in revenue generation relative to the asset base. The increase in total assets from 49.002 to 54.868, coupled with a smaller increase in revenue from 8,490 to 9,744, likely contributed to this decline.

Quarterly Fluctuations

While the overall trend is upward initially and then downward, there are quarterly variations. For example, the ratio increased from 0.58 in June 2022 to 0.60 in September 2022, but then rose more significantly to 0.65 in December 2022. Similarly, the ratio remained stable at 0.70 in both June and September 2023. These fluctuations suggest that seasonal factors or short-term operational changes may influence asset utilization.

Revenue and Asset Relationship

The observed trends indicate a strong relationship between revenue and total assets. The period of increasing asset turnover coincided with consistent revenue growth. The subsequent decline in the ratio suggests that asset growth is no longer being effectively translated into proportional revenue increases. Further investigation into the composition of assets and revenue streams may be warranted to understand the drivers behind these changes.

In summary, the total asset turnover ratio demonstrates a period of improving efficiency followed by a recent decline. Monitoring this ratio closely will be important to assess whether the downward trend continues and to identify potential areas for operational improvement.

The equity turnover ratio for the analyzed period demonstrates a generally increasing trend, punctuated by some fluctuations. Initially, the ratio exhibited relative stability before experiencing a more pronounced shift in later periods. This analysis details the observed patterns and potential implications.

Overall Trend

From March 31, 2022, through December 31, 2023, the equity turnover ratio remained relatively consistent, fluctuating between 1.52 and 1.68. A noticeable upward trend began in March 2024, peaking at 1.85 in December 2024. Subsequently, the ratio decreased significantly in the first half of 2025, settling at 1.37 by December 31, 2025.

Initial Period (Mar 31, 2022 – Dec 31, 2023)

The ratio began at 1.54 in March 2022 and showed minor variations over the subsequent eight quarters. The highest value within this period was 1.68 in June 2023, while the lowest was 1.52 in June 2022. These fluctuations suggest a stable, but not dramatically efficient, utilization of equity to generate revenue during this timeframe.

Accelerated Increase (Mar 31, 2024 – Dec 31, 2024)

Starting in March 2024, the equity turnover ratio began to increase more rapidly. It rose from 1.64 to 1.72 by September 2024, and then to 1.85 by December 2024. This indicates a substantial improvement in the company’s ability to generate revenue from each dollar of equity during this period. This could be attributed to increased sales, improved asset utilization, or a reduction in equity.

Subsequent Decline (Mar 31, 2025 – Dec 31, 2025)

The ratio experienced a sharp decline in 2025, falling from 1.85 in December 2024 to 1.37 in December 2025. This decrease suggests a reduced efficiency in revenue generation relative to equity. Potential causes include a decrease in revenue, an increase in equity, or a combination of both. The consistency of the ratio at 1.37 in both September and December 2025 suggests this lower level of efficiency may be stabilizing.

Revenue and Equity Relationship

The observed fluctuations in the equity turnover ratio correlate with changes in both revenue and total stockholders’ equity. The increase in the ratio during 2024 coincided with rising revenue, while the decrease in 2025 occurred alongside a decrease in revenue and a significant increase in equity. This suggests that both factors play a role in determining the ratio’s value.