Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
SLB N.V., profitability ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The profitability metrics demonstrate a generally positive trend from 2021 to 2023, followed by a moderation in 2024 and a decline in 2025. Throughout the period, the company exhibits consistent profitability, though performance fluctuates. A notable improvement is observed across all measured ratios between 2021 and 2023, indicating increasing efficiency and returns. However, 2025 shows a reversal of this trend, with most ratios decreasing from their 2023 and 2024 levels.
- Gross Profit Margin
- The gross profit margin increased steadily from 15.95% in 2021 to 20.56% in 2024, suggesting improved cost management or pricing strategies. A decrease to 18.22% in 2025 indicates potential pressures on cost of goods sold or pricing.
- Operating Profit Margin
- Similar to the gross profit margin, the operating profit margin shows improvement from 12.06% in 2021 to 16.43% in 2023, reflecting enhanced operational efficiency. The margin then slightly decreased to 15.99% in 2024 and experienced a more substantial decline to 12.23% in 2025, potentially due to increased operating expenses.
- Net Profit Margin
- The net profit margin followed the same pattern as the gross and operating margins, rising from 8.20% in 2021 to 12.68% in 2023, and then decreasing to 12.29% in 2024 before falling to 9.45% in 2025. This suggests that factors beyond core operations, such as financing costs or taxes, may be contributing to the 2025 decline.
- Return on Equity (ROE)
- ROE demonstrated significant growth, increasing from 12.54% in 2021 to a peak of 21.11% in 2024. This indicates an increasing ability to generate profits from shareholder investments. The substantial decrease to 12.92% in 2025 suggests a decline in equity utilization efficiency or profitability.
- Return on Assets (ROA)
- ROA also exhibited an upward trend from 4.53% in 2021 to 9.12% in 2024, signifying improved asset utilization in generating profits. The decline to 6.15% in 2025 mirrors the trends observed in other profitability ratios, indicating a reduced ability to generate earnings from its asset base.
In summary, the period between 2021 and 2023 was characterized by improving profitability across all measured ratios. However, the year 2025 presents a concerning shift, with a decline in all ratios, suggesting potential challenges to maintaining profitability levels achieved in prior years. Further investigation into the factors driving the 2025 performance is warranted.
Return on Sales
Return on Investment
Gross Profit Margin
SLB N.V., gross profit margin calculation
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Gross profit margin = 100 × Gross margin ÷ Revenue
= 100 × 6,507 ÷ 35,708 = 18.22%
The gross profit margin exhibited a generally positive trend from 2021 to 2024, followed by a decline in the most recent year presented. Simultaneously, both gross margin in US dollars and revenue demonstrated overall growth throughout the period, though revenue experienced a slight decrease in 2025.
- Gross Profit Margin Trend
- The gross profit margin increased steadily from 15.95% in 2021 to 20.56% in 2024. This indicates improving efficiency in managing production costs relative to revenue. However, the margin decreased to 18.22% in 2025, suggesting potential pressures on cost of goods sold or pricing strategies in that year.
- Revenue and Gross Margin (US$)
- Revenue increased from US$22,929 million in 2021 to US$36,289 million in 2024, representing substantial growth over the period. The gross margin in US dollar terms mirrored this upward trend, rising from US$3,658 million to US$7,460 million during the same timeframe. The decrease in revenue to US$35,708 million in 2025, coupled with a corresponding decrease in gross margin to US$6,507 million, suggests a potential slowdown in growth or increased cost pressures.
- Relationship between Revenue Growth and Margin
- From 2021 to 2024, the company successfully expanded its revenue while simultaneously improving its gross profit margin. This suggests effective scaling of operations and cost management. The 2025 results, however, indicate that revenue growth and margin expansion are not necessarily correlated and can diverge. The slight revenue decline alongside a more pronounced margin decrease warrants further investigation into the underlying factors affecting profitability.
Overall, the period demonstrates a positive trajectory in profitability up to 2024, but the 2025 results introduce a note of caution, indicating potential challenges to maintaining previous levels of performance.
Operating Profit Margin
SLB N.V., operating profit margin calculation, comparison to benchmarks
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Operating profit margin = 100 × Operating income ÷ Revenue
= 100 × 4,368 ÷ 35,708 = 12.23%
The operating profit margin exhibited a clear upward trend from 2021 to 2023, followed by a moderation in subsequent years. Operating income and revenue both increased consistently throughout the period, but the rate of increase varied. This analysis details these observations.
- Operating Profit Margin Trend
- The operating profit margin increased from 12.06% in 2021 to a peak of 16.43% in 2023. This indicates improving operational efficiency and/or pricing power during this timeframe. A slight decrease to 15.99% occurred in 2024, and a more pronounced decline to 12.23% was observed in 2025. This recent decline suggests potential pressures on profitability, possibly from increased costs or competitive pricing.
- Revenue Growth
- Revenue demonstrated consistent growth over the five-year period, increasing from US$22,929 million in 2021 to US$36,289 million in 2024. While revenue continued to be reported in 2025, it experienced a slight decrease to US$35,708 million. This suggests a potential slowing of revenue expansion.
- Operating Income Growth
- Operating income increased from US$2,765 million in 2021 to US$5,804 million in 2024, mirroring the revenue trend. However, operating income decreased to US$4,368 million in 2025. The decrease in operating income in 2025 was proportionally larger than the decrease in revenue, contributing to the decline in the operating profit margin.
The period between 2021 and 2023 was characterized by strong growth in both revenue and operating income, resulting in a significant improvement in the operating profit margin. The subsequent two years show a stabilization and then a decline, indicating a shift in the company’s operational or market conditions. Further investigation would be required to determine the underlying causes of the 2024 and 2025 performance.
Net Profit Margin
SLB N.V., net profit margin calculation, comparison to benchmarks
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Net profit margin = 100 × Net income attributable to SLB ÷ Revenue
= 100 × 3,374 ÷ 35,708 = 9.45%
The net profit margin exhibited a generally positive trend from 2021 to 2023, followed by a decline in the most recent two years presented. This indicates fluctuating profitability relative to revenue over the analyzed period.
- Overall Trend
- The net profit margin increased from 8.20% in 2021 to 12.68% in 2023, representing a substantial improvement in profitability. However, this was followed by a decrease to 12.29% in 2024 and a more pronounced drop to 9.45% in 2025.
- Growth Phase (2021-2023)
- Between 2021 and 2023, the net profit margin demonstrated consistent growth. This coincided with increases in both net income attributable to SLB and revenue. The growth rate slowed between 2022 and 2023, suggesting diminishing returns on revenue growth in terms of profitability.
- Decline Phase (2023-2025)
- From 2023 to 2025, the net profit margin experienced a decline despite a continued increase in revenue from 2023 to 2024. The decrease in 2025, occurring alongside a slight decrease in revenue, suggests potential pressures on profitability, possibly stemming from increased costs or pricing pressures. The decline in net income was more significant than the decline in revenue, amplifying the reduction in the net profit margin.
- Revenue and Net Income Relationship
- While revenue generally increased throughout the period, the relationship between revenue growth and net income growth was not consistently proportional. The largest increase in revenue occurred between 2022 and 2023, but the corresponding increase in net income was less substantial than the increase observed between 2021 and 2022. This suggests that cost of goods sold and/or operating expenses may have increased at a faster rate than revenue during certain periods.
The observed fluctuations in net profit margin warrant further investigation to determine the underlying drivers of these changes, including a detailed analysis of cost structures and revenue streams.
Return on Equity (ROE)
SLB N.V., ROE calculation, comparison to benchmarks
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
ROE = 100 × Net income attributable to SLB ÷ Total SLB stockholders’ equity
= 100 × 3,374 ÷ 26,109 = 12.92%
The return on equity (ROE) exhibited a clear upward trend from 2021 through 2023, followed by a decline in the most recent year presented. Net income attributable to SLB and total stockholders’ equity both increased consistently over the period, contributing to the observed ROE movement.
- ROE Trend
- ROE increased from 12.54% in 2021 to a peak of 21.11% in 2024. This indicates improving profitability relative to shareholder investment over these years. However, ROE decreased to 12.92% in 2025, suggesting a reduction in profitability relative to equity in the latest period.
- Net Income
- Net income attributable to SLB demonstrated substantial growth, increasing from US$1,881 million in 2021 to US$4,461 million in 2024. A decrease to US$3,374 million was observed in 2025. This fluctuation in net income directly influences the ROE calculation.
- Stockholders’ Equity
- Total stockholders’ equity consistently increased throughout the analyzed period, rising from US$15,004 million in 2021 to US$26,109 million in 2025. While generally positive for financial stability, the growth in equity, coupled with the decline in net income in 2025, contributed to the decrease in ROE during that year.
The period between 2021 and 2024 shows a strong positive correlation between increasing net income and ROE. The 2025 results indicate that while equity continues to grow, a decline in net income can significantly impact the return generated for shareholders.
Return on Assets (ROA)
SLB N.V., ROA calculation, comparison to benchmarks
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
ROA = 100 × Net income attributable to SLB ÷ Total assets
= 100 × 3,374 ÷ 54,868 = 6.15%
The Return on Assets (ROA) exhibited a clear upward trend from 2021 through 2024, followed by a decline in 2025. This indicates increasing efficiency in utilizing assets to generate profit during the initial period, with a subsequent reduction in that efficiency. Net income attributable to SLB also generally increased over the same period, though with a decrease in the final year.
- Overall Trend
- ROA increased consistently from 4.53% in 2021 to 9.12% in 2024, representing a substantial improvement in profitability relative to asset base. However, in 2025, ROA decreased to 6.15%, signaling a potential shift in operational efficiency or asset utilization.
- Year-over-Year Changes
- The largest year-over-year increase in ROA occurred between 2021 and 2022, rising 3.45 percentage points. Subsequent increases were more moderate, at 0.78 percentage points between 2022 and 2023, and 0.36 percentage points between 2023 and 2024. The decrease in 2025 was significant, falling 2.97 percentage points from the 2024 peak.
- Relationship to Net Income and Total Assets
- The increase in ROA from 2021 to 2024 aligns with increases in net income attributable to SLB. Total assets also increased throughout this period, but the growth in net income outpaced the growth in assets, driving the ROA higher. The decline in ROA in 2025 coincides with a decrease in net income, while total assets continued to increase, suggesting that the reduction in profitability was not offset by efficient asset management.
The observed trend suggests a period of improving financial performance followed by a potential weakening. Further investigation into the factors driving the 2025 decline in both net income and ROA would be warranted.