Schlumberger (SLB) To Slash Workforce
The world’s largest oilfield services company that employs roughly 120,000 people announced Thursday it would be cutting 11,000 jobs. The news didn’t come as much of a surprise with Schlumberger reporting awful Q1 earnings and the recent weakness in the crude oil market.
Schlumberger CEO, Paal Kibsgaard said:
“In spite of the detailed preparations we made in the fourth quarter, the abruptness of the fall in activity, particularly in North America, required us to take additional actions during the quarter. These included the difficult decision to make a further reduction in our workforce of 11,000 employees, leading to a total reduction of about 15% compared to the peak of the third quarter of 2014.”
You can read more about Schlumberger’s Q1 earnings report here.
The recent layoff of 11,000 added to the 9,000 it had just announced 3 months ago. A total of 20,000 jobs slashed amounts to an elimination of 15% of the SLB workforce.
Along with the negative news and carnage of the job cuts came comments regarding Schlumberger’s positioning in relation to competitors from Stewart Glickman, analyst at S&P Capital IQ who stated “Their geographic footprint is more internationally focused, with about a third of revenues from North America, whereas a competitor like Halliburton gets more than half of its revenue from North America.”
In 2015, shares of Schlumberger have tacked on 7% but down year over year by 8%. Shares of SLB opened higher Friday and are now trading off their premarket highs by $3. Traders used the volatility in today’s session to rack up profits on Schlumberger’s decline. Learn how to capitalize on these opportunities at WarriorTrading.com