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How the US Rig Count Affected SLB, HAL, and BHI in 1Q17

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Revenues from North America

In the past year, Schlumberger’s (SLB) North America revenues declined 14%. In 1Q17, SLB’s revenues from North America totaled 28% of its total revenues. In comparison, Halliburton’s (HAL) 1Q17 revenues from North America increased 24% from 1Q16. Baker Hughes’ (BHI) revenues from North America fell 13% in 1Q17 over 1Q16.

HAL’s North America revenue share increased significantly in 1Q17 over 1Q16. HAL generated ~52% of its total revenues from North America in 1Q17. National Oilwell Varco’s (NOV) geographic revenue breakdown is not available. HAL comprises 0.18 of the iShares S&P 500 Value ETF (IVE). The energy sector makes up 11.1% of IVE. 

Please read Market Realist’s Why Baker Hughes Missed 1Q17 Earnings Estimates to see what’s happening with BHI.

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US rig count

On March 31, 2017, the US rig count increased 83% over the previous year. Since July 2016, the US rig count has moved upward. From March 31, 2017, until April 28, 2017, the US rig count trend has strengthened, increasing 6%. A higher rig count can increase OFS companies’ revenues and earnings going forward.

Next, we’ll discuss how the international rig count affected these companies’ revenues from international geographies.

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