SLB N.V. (SLB) Earnings Call Transcript & Summary

Good morning. My name is Sarah, and I will be your conference operator today. I would like to welcome everyone to the third quarter SLB earnings call. [Operator Instructions] As a reminder, this call is being recorded. I will now turn the call over to James R. McDonald, Senior Vice President of Investor Relations and Industry Affairs. Please go ahead.

Thank you, Sarah. Good morning, and welcome to the SLB Third Quarter 2026 Earnings Conference Call. Today's call is being hosted from New York City following our Board meeting held earlier this week. Joining us on the call are Olivier Le Peuch, Chief Executive Officer; and Stephane Biguet, Chief Financial Officer. Before we begin, I would like to remind all participants that some of the statements we will be making today are forward-looking. These matters involve risks and uncertainties that could cause our results to differ materially from those projected in these statements. For more information, please refer to our latest 10-K filing and other SEC filings, which can be found on our website. Our comments today also include non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAAP financial measures can be found in our third quarter earnings press release, which is on our website. With that, I will turn the call over to Olivier.

Thank you, James, and good morning, ladies and gentlemen. Thank you for joining us. Today, I will begin with our third quarter performance. I will then discuss the evolving macro environment and our fundamentals supporting outlook as we approach 2027. And finally, I will share our expectations for the fourth quarter. Stephane will then provide additional details on our financial results. And after that, we'll open the line for your questions. Let's begin. The third quarter was marked by broad-based sequential revenue growth across each of our geographical areas and core divisions, with pretax segment operating margins expanding across all 4 divisions. This was driven by the gradual recovery in the Middle East, solid growth in North America and continued momentum across the international offshore basins, including Latin America, Europe and Africa and Asia. Within the core divisions, Production Systems led the way, supported by higher revenue and strong sales of production chemicals and in North America and the Middle East. Notably, ChampionX delivered its highest quarterly revenue since the acquisition with margins expanding sequentially for the fourth consecutive quarter. While construction growth was driven by double-digit increases across Argentina, Guyana, Brazil and U.S. land along with a seasonal recovery in Canada, complemented by strong offshore drilling in Asia. Sequential growth was also driven by higher drilling activity and fee amounts in the Middle East. While the near-term pace of recovery in the Middle East remains uncertain, the longer-term outlook continues to strengthen. This is reflected by Aramco recent award of 4 integrated well construction contracts to SLB covering more than 450 wells over an initial 3-year term. These multiyear awards significantly improve our revenue visibility and expand our participation in development activity across the Kingdom. We are going together, our digital drilling workflows, automated technologies and integrated well construction portfolio. As our performance also delivered strong sequential growth led by increased stimulation and intervention activity alongside an uptick in evaluation. This demonstrates that customers are investing in both reservation and production optimization of using assets and evaluation of reservoirs to support new development. Our results this quarter continue to demonstrate the benefits of our strategic focus on production and recovery. Our production business, encompassing all production systems and some of the offerings in performance now represents more than 50% of our portfolio with leading position across every major basin and a balanced mix of short and long-cycle activity, including exposure to resilient OpEx spend. This provides a durable foundation with greater revenue visibility and retinal performance across market cycles. Second together, growth across all core divisions reflect the characteristics of an inflecting up cycle, with broad expansion of activity across exploration, development and intervention as operators ramp up efforts to restore production and bring new capacity online. In digital, third quarter revenue was steady sequentially and margins remained strong despite digital exploration sales declining following exceptional sales in the second quarter. Customers continue to recognize the benefit of AI and digital operations, and we delivered more than 750,000 feet of automated drilling this quarter, an increase of nearly 50% year-on-year. Additionally, the predictive analytics, our intelligence, real-time monitoring and advisory system is now monitoring more than 20% of active international rigs, representing year-on-year growth of more than 60%. As you can see, adoption continues to accelerate, and we are very pleased with the progress of our digital business. has grown 11% year-to-date, and we have clear visibility into higher sales in the fourth quarter. As a result, we anticipate fishing the year with double-digit year-on-year growth and adjusted EBITDA margins exceeding 35%. Finally, data center solutions, continued the strong growth trajectory, supported by the progression of existing projects and geographic expansion into Asia. During the quarter, we continued to invest in facilities and talent to expand our execution capacity, including a new manufacturing center in Canada to support the meta data center project that are essential to meet surging customer demand. Upon closing of our announce acquisition of Kelvion, the Kelvion portfolio will also benefit greatly from this momentum and will accelerate our ambition to become a leading industrial partner into the AI infrastructure build-out. In summary, I'm extremely proud of our third quarter performance, and I want to thank the entire SLB team for delivering these results. They are focused on execution, innovation and our customer centricity continues to make the difference. Let me now turn to the macro and the fundamental supporting outlook as we approach 2027. Ongoing disruptions continue to reinforce the importance of energy security and the need of reliable geographically diverse source of supply. At the same time, the nitric continues to face the structural challenge of offsetting natural decline and replacing reserves following several years of limited exploration. Collectively, these conditions are supporting a border and increasingly diversified international opportunity. In the near term, this will support production, intervention and over short cycle activity. Longer term, this is providing a strong foundation for the progression of offshore developments, renewed exploration and new areas of investment emerging across several markets. Let me briefly discuss how this long cycle dynamics are evolving. Deepwater represents one of the industry's most advantaged source of new supply, combining attractive project economics, material resource development and long-duration production. We continue to see this opportunity broaden across Latin America, Africa, the Eastern and Asia, with FIDs expected to increase more than 30% year-on-year in 2026, and many projects advancing from sanctions into execution. For SLB, this momentum is reflected into the continued flow of one subsea award further strengthening our backlog and increasing visibility into 2027 and beyond. One example is our recent award in Mozambique, where OneSubsea was selected to deliver the subsea production systems for the first phase of ExxonMobil deepwater Rovuma LNG development. This project will contribute to an important new source of global supply -- global gas supply and further demonstrates the progression of large long-cycle deepwater development into execution. In addition, fundamentals for exploration are improving as operators seek to reserve -- to replace reserves and diversify supply following several years of restrained investments. We see this materializing through new licensing activity in Brazil, the Eastern -- and West Africa. Growing interest in frontier basins such as Namibia and preparations for future comparing across deporter markets, including Gena and... As exploration assumes a greater role in our customer portfolio, SLB's leading position across exploration data, subsurface modeling and evaluation technologies position us to capture this growing opportunity. So far this year, SLB has participated in the evaluation of approximately 80% of completed high-impact exploration waste globally, many of which are consolidated in frontier and deepwater basins. Beyond deepwater and exploration, international markets are offering a new pathway for growth with opportunities broadening across conventional and noncommercial resource in the Middle East as well as key emerging markets. In this context, Venezuela represent a particularly significant growth driver for SLB, following more than a detail of limited investment activity in the country is accelerating, led by international oil companies. For SLB, these already translated into revenue growth. Our revenue in Venezuela is on track to more than double this year with strong momentum among U.S. and European E&Ps supporting the potential for multi-fold growth in 2027. At the same time, major U.S. shale operators are expanding internationally, entering new countries and partnering with This trend further broaden our addressable market partly in exploration deepwater developments across Africa, Latin America and Asia, as well as and commercial resources in the Middle east. Looking across these dynamics, long-cycle offshore development, renewed exploration, digital adoption and U.S. operators expanding globally, all confirm durable tire international investment cycle with clear visibility in 2027. With market-leading position across our core divisions, recently established leadership position in global production, differentiated digital capabilities and an unmatched global footprint, SLB is uniquely positioned to capture this upside. Now let me conclude with our expectations for the fourth quarter and our first view of the 2027 market outlook. Over the past several weeks, the Middle East has continued to experience heightened tensions. Given the ongoing uncertainty, our fourth quarter outlook assumes Middle East revenue remains flat sequentially at approximately $1.9 billion, representing about 83% of revenue generated in the fourth quarter of 2025. Based on this assumption and supported by continued deepwater momentum as well as the typical year-end strength in digital and product sales, we expect overall fourth quarter revenue to reach approximately $10 billion, representing an increase of 5% to 7% sequentially. As a result, when excluding the Middle East, global fourth quarter revenue is expected to grow in the high single digits year-on-year. We also expect adjusted EBITDA margins to expand 100 to 150 bps. At the division level, we anticipate combined revenue from the core division to sequentially increase by low single digits, led by high single-digit growth in production systems, and with well construction, a performance essentially flat. In Digital, revenue is expected to increase in line with the fourth quarter historical trends, led by a significant uptake in typical year-end digital exploration sets. This outlook provides clear finance that the next phase of that cycle is underway. Well, near-term outlook, I mean, step the geopolitical developments, intendant resolution or regional disruption in the Middle East unlock deferred activity and serve as a powerful catalyst for accelerated growth in 2027. Looking ahead to 2027. Assuming Middle East activity remains at second half 2026 levels and that the cost doesn't naturally escalate, we expect global OFC market activity to grow in the mid-single digits, the normalization of activity in the Middle East, providing further upside. Against this backdrop, we expect our core divisions to visibly outperform the market, reflecting our differentiated exposure to the strongest our of activities, including long cycle offshore developments, renewed exploration activity production recovery investments and the activation of Venezuela. Beyond the core, we expect digital to continue established growth trajectory, while our Data Center Solutions business will continue to accelerate as a meaningful growth engine for the company. I will now turn the call over to Stephane to discuss our financial results in more detail.

Thank you, Olivier, and good morning, ladies and gentlemen. Third quarter earnings per share, excluding charges and credits, was $0.64. This represents an increase of $0.09 sequentially and a decrease of $0.5 when compared to the third quarter of last year. During the quarter, we recorded $0.03 of merger and integration charges related to the ChampionX transaction as well as a $0.12 or $187 million noncash pension settlement charge. This was the result of offering a lump-sum payment to certain former employees in one of our pension plans. This transaction, which was funded directly by assets of the plan allowed us to derisk our largest pension plan by reducing both our pension obligations and client assets by almost EUR 900 million. This will help us lower potential volatility as well as manage future pension costs. Importantly, the plan remains very well funded. Overall, our third quarter revenue of $9.45 million increased 5% sequentially. This performance was driven by the Middle East, growth in North America land and strong international deepwater activity, including upside in OneSubsea. In the Middle East, we experienced a gradual recovery as third quarter revenue of $1.9 billion, increased 13% from the previous quarter. Sequentially, our pretax segment operating margin increased 104 basis points with margin expansion across all 4 divisions. Company-wide adjusted EBITDA margin for the third quarter was 21.9%, representing a sequential increase of 71 basis points. Let me now go through the third quarter results for each division. Fourth quarter digital revenue of $693 million was essentially flat sequentially, as strong platforms and application sales and higher revenue from digital operations and professional services was offset by lower digital exploration revenue following a very strong second quarter. Digital pretax operating margin of 28% increased 27 basis points as improved profitability in digital operations and platforms and applications more than offset the effects of lower sales of exploration data licenses and transfer fees. We expect digital exploration revenue to increase significantly in the fourth quarter, which will result in strong year-on-year growth for the Digital division and adjusted EBITDA margin exceeding 35% for the full year. Reservoir Performance revenue of $1.6 billion increased 5% sequentially, while pretax operating margin of 16.3% increased 140 basis points. These increases were primarily driven by the gradual recovery in the Middle East. While construction revenue of $2.9 billion increased 5% sequentially, primarily driven by higher drilling activity in the Middle East. Pretax operating margin of 16.4%, improved 122 basis points, mostly due to the Middle East activity report. Production Systems revenue of $4 billion increased 6% sequentially, driven by the recovery of Middle East activity, increased sales in North America and strong OneSubsea activity. OneSubsea also recorded a steady flow of new contract awards, increasing backlog and further enhancing subsea revenue visibility into 2027. Production Systems pretax operating margin of 16.1% increased 60 basis points, with broad-based growth in OneSubsea, artificial lift, completions and production chemicals. Notably, the acquired ChampionX businesses delivered the highest quarterly revenue and margin since joining SLB. Finally, in the all other category, revenue increased 8% sequentially, driven by strong growth in Data Center Solutions, while pretax operating income decreased slightly as a result of ramp-up costs associated with new data center projects. With regard to our previously announced agreement to acquire Kelvion, things are progressing quite well. A dedicated integration team has been put in place but has kicked off its various work streams, and we are in the process of making all necessary filings in the relevant jurisdictions. We are very excited about the opportunities that this transaction will bring. And we remain on track for closing in the first half of 2027. Now turning to our liquidity. We ended the quarter with net debt of $9.2 billion, the same level as the first quarter of last year. We generated $1.5 billion of cash flow from operations and $828 million of free cash flow. Looking ahead, consistent with our historical pattern, we expect a meaningful step-up in free cash flow in the fourth quarter, supported by lower inventory following year-end product sales and higher customer collections. The magnitude of the sequential increase in free cash flow will largely depend on the timing of collections in certain countries. Capital investments inclusive of CapEx and investments in APS projects and exploration data were $682 million in the third quarter. For the full year, we still expect capital investments to be approximately $2.5 billion. During the quarter, we repurchased $656 million of our stock and are on track to repurchase approximately $2.4 billion for the full year, in line with 2025 levels. This will bring our total returns to shareholders for 2026, slightly above $4 billion, in line with the commitment we made earlier this year. I will now turn the call back to Olivier.

Thank you, Stephane. I believe Sarah, that you are ready for taking questions. .

[Operator Instructions] Your first question comes from the line of James West with Melius Research.

So Olivier, I think in your prepared remarks, I mean, it seems like almost every part of your business, whether product line or region -- ex the Middle East, of course, which is -- still has uncertainty is inflecting higher. And I'm curious if you could parse that out a little bit further and let us know kind of which areas or maybe which products -- product lines or service lines you think will grow faster than others?

No. Thank you, James. We believe indeed that the cycle has started, and I think it has the characteristics of a very favorable to our footprint and to the composition of our business line. Indeed, I think we are seeing that the combination of deepwater exploration rebound for a long cycle. We see the investment flowing into production recovery to improve the production of our improved recoating assets. And we see the development of new areas -- geographical areas that are attracting investments such as Venezuela, Argentina. And all this without the catalyst of resolution in the Middle East that will add growth. So I believe that, indeed, we are set for all divisions and all basin to benefit for growth in 2027 and beyond. And we believe that, again, it goes from digital to operation recovery from deepwater to unconventional and with exploration being certainly an uptick that will match very well our footprint and match by what portfolio of technology. So yes, it is, I would say, broadly an inflection that is characteristic of an upcycle with long duration.

Great. That's very helpful. And then -- on the exploration side, I'm happy to speak to a group of explorations recently and spent some time with the heads at many of the major oil companies and then, of course, one of your senior people as well. Capital is definitely flowing there for the first time in maybe a decade. They were happy about capital. Where are you seeing the most exciting expiration at this point?

I think we see several -- what is very good in this exploration Second, I think it's a mix of infrastructure-led exploration in very well, no mature basins that still have pocket of all our gas to be unlocked and to be connected to and with opportunity for sizable development in those. And I think that relates to the West Africa Macro Basin as well as North Sea on both sides of the sector and then obviously, Gulf of America. Now there is a lot of frontier basins and a lot of areas that are expanding. And I think this is partly true in Americas. And Brazil, I think the Polycast basin is attracting a lot of attention as well as the Atlantic margin or the margin on the north, I think, which is along with continued investment into Surinam and Vienna. I think are clearly a spotlight for this, the same as in Namibia, in further the basin in Angola as of a part of precast -- And then I could keep going east to East India, Indonesia that has attracted a lot of investment due to gas reserves and potential there. And two large discovery has been made and after entering subsidy development going forward. So it all combined, it's an exciting cycle for exploration. I think the combination of energy security heightened priority as well as depleting reserves and the pressure of declining production, adding and fueling this investment in exploration.

Your next question comes from Scott Gruber with Citigroup.

So a number of growth drivers into '27 as you outlined. But I'm curious because this is a question we often get from investors. Should we see resolution in the Middle East in the not-too-distant future. And crude moderates back to $65 or $70, similar to what we saw back in June. How resilient do you think the growth drivers would prove to be -- obviously, the Middle East would improve. But do you see much risk to the mid-single-digit growth outlook, excluding the Middle East that have more mid-cycle crude prices? Or would the secular elements at play here sustain a healthy growth rate?

No, Scott, I believe that we should keep in mind that a lot of bills have been lost to this crisis. A lot of pull on the strategic reserves and commercial inventory as EBITDA inventory, to the point that I think it is clear that seeing additional investment needs to be throwing through activity into supply in the future. Additionally, I think the realization of Energy Securities is vital to the future of economic growth is also adding a diversity of supply. So this will -- is getting the condition at the comment I made earlier on exploration to create the conditions that are not here for 1 year or 6 months. But the up cycle is adding strong legs, both on long cycle, including exploration deepwater; on short cycle, including production recovery activity that is materializing cost and that is very well registered into the growth that we are enjoying and that -- that will be the base for the 2027 outlook. So we believe that we have set -- the market is set for mid-single-digit global activity growth, assuming Middle East being flat on 2026. But this means that we will visibly perform this and the Middle East catalyst will become a catalyst on the peace deal going forward.

I appreciate that. And I wanted to turn to Venezuela. Opportunity here certainly appears to be materializing more quickly than you anticipated initially. Can you provide some more color on what you're seeing in the market? And you mentioned that Venezuela could double this year with multiple growth in '27. How large could Venezuela become for SLB in 2 to 3 years' time? I know you guys said $1 billion back at peak, I'm curious kind of in the ballpark where you think the market could grow to here in the next 2 to 3 years?

No, we remain very excited about Venezuela. Every time we look into it. I think we realizing that the activity is set to increase further. And I think we are getting several catalysts for this. We are getting first and foremost, in lockstep with our customer that we have been working on it for the last 2 years. We are seeing activity increase currently. And in the near future, and they have made an announcement for further increment of CapEx into the region. So it will be fully participating to this subside. But additionally, several of our international operators have committed have come to agreements in country, and we have benefited from this and by selling contracts, and we have already started with another large contract execution this quarter. So we expect this to only continue going forward. So how big it can become? I think we have mentioned that the potential is for multiple food next year. And I think we see this trajectory to continue going forward. And I think we have mentioned before the historical level of $1 billion of growth in the long term. So we don't see why not this as a ceiling or there is no ceiling, why not as a target as an ambition going forward. So we are well prepared. We're adding resource, adding equipment and getting the trust because we have a unique capacity on the ground and ability to deliver.

Your next question comes from Saurabh Pant with Bank of America.

Olivier, maybe I want to dig in on the Middle East to a little bit more because we saw you delivered strong 13% increase in the Middle East revenue, and that was despite some late quarter disruption, right? So that kind of tells me you were running ahead of expectations perhaps before the disruption Can you maybe share some more color on the disruption? And if these disruptions are continuing right now? And then what was driving this, I guess, stronger than maybe anticipated recovery before these disruptions I know you talked about already some contracts including those integrated drilling contracts, maybe some color on all of that?

Yes. First, I think, indeed, several countries did participate a cliff of activity in the third quarter as the situation started to ease off in several countries. And I think this included the UAE, Kuwait, to a lesser extent -- and to a lesser extent, Saudi that at the beginning of the quarter, clearly, has an increase of activity, and this was consolidated on the -- on some intervention activity stimulation and drilling activity across the region. Iraq by Compass was on the study getting the same uplift of activity but Oman was steady. And that's the situation that turned out to be slightly ahead of our expectation, indeed, at the run rate as well mid-quarter. Now at the end of the quarter, some adjustment of activity were done. And I think this has been fairly publicized. I don't want to come back on this. We see things stabilizing, though. Hence, our expectation is that the fourth quarter will be at current level of disruption, I would say, and without further escalation conflict going into worst-case scenario. We are seeing that the fourth quarter will be in line with the third quarter, and that's our assumption. And this is the appetites we have made on our guidance for 2027 market outlook as well. So that's in a sense where we stand. Now we've related into relation with the integrated contract. We're very pleased with this award that touch both gas and oil assets. And this is an activity that is definitively going forward and for which we are mobilizing in the fourth quarter and then will come to full good capacity in 2027 going forward. And I think that's not -- that's untouched and certainly a committed contract for which we are dedicating resource and gaining increased activity going forward.

Got it. No. That's very useful color, Olivier. And then for my follow-up, maybe I'll stick to the Middle East and focus on the margin side of things a little bit. I know there are lots of crosscurrents -- lots of uncertainty. But just given everything that we have heard about disruptions and cost inflation and then some pricing pressure on larger tenders. How should we think about where margins can go in maybe 27%, but I'm just thinking more broadly, if revenues normalize in the Middle East to, let's say, the pre-conflict level, can margins normalize to that level immediately? Or would it take more time because of everything that's going on the pricing and cost sales thing?

Saurabh, Stephane here. Yes. I mean you are using the Middle East as a swing factor to margins, and it's clearly a significant negative effect this year, if you look at the year-on-year performance. As we have indicated earlier, we have actually decided intentionally to adjust only partially the resources in the Middle East not to hamper our capacity to address the activity rebound. So we are keeping some resources in place. when the conflict is resolved and activity rebounds, as a result, we'll have very strong operating leverage, very few additional costs to bring in. So that will increase margin. Now the overall level of margins of the company, it's not just the Middle East. That will be a booster. We will have likely less inflation effects going into '27 because this is already kind of baked in, if you want. We also hope that pricing pressure we have experienced in some of our core divisions will also abate and are also baked into the current margins. But then you have all the mix of the divisions. Digital is a booster, obviously, on margins, data center on its own as it grows very fast -- is, as you know, not accretive to the overall SLB margin. So it's a big equation, which we are not going to give you the answer today, we will provide more color on our '27 margins in January. But overall, yes, the Middle East will be a catalyst for margin expansion for sure.

Your next question comes from Arun Jayaram with JPMorgan.

Olivier, I was wondering if you could comment on some of the trends you're seeing at ChampionX. On a year-over-year basis, obviously, a partial quarter data from last year, but it looks like revenues were up in the mid-teens and margins are now pushing in the mid-20s. So I just wanted to talk a little bit about some of the trends here? And how is the ability of SLB to scale that business internationally versus when you bought it?

No, as we have seen, we are very, very pleased with the performance of ChampionX. I think the result of the success of the integration team having landed this business to be having very resilient and as well as very successful in innovation and customer centricity, which we attribute to ChampionX in North America. So you have seen that the quarter was remarkable in terms of top line growth and further margin expansion for the fourth consecutive quarter based on both Production Chemical success and growth. And also the actual lift both in North America and with more potential internationally. So I think internationally, as we mentioned in the prepared remarks, I think it would have been even better without the contract in Middle East as we have optionality for expanding the ChampionX portfolio internationally, particularly in the Middle East and across several offshore basins. So this is progressing. And I think this will be certainly an upside into the ChampionX growth trajectory in 2027, both international and offshore. And as the conflict is getting to an end, we'll have a further catalyst for the ChampionX success. But yes, we are very pleased. The thing it reflects again the ability we have to integrate and to leverage their technology and to leverage our global footprint and our customer engagements to make it successful. I think very pleased with the performance. Congratulations to all the ChampionX employees and to the integration team into the production system portfolio. I think the combination is attracting -- attractive for our customers and all the feedback we're receiving from customers, both in North America and abroad is that they like the combination. They like the power of production recovery. They like the potential of unlocking further recovery and production performance to both pollution chemicals and lift technology, including digital. So very, very, very pleased with the performance so far.

And as to the margin level, Arun, yes, you are right. We are ChampionX touched now the mid-20s on EBITDA, which is clearly accretive to the overall company. And this is despite inflation pressures, particularly on chemicals, so the synergies, including in G&A have been higher than we expected and have mostly offset was inflationary pressure to the point where margin continues to expand quarter-after-quarter. So clearly, we are going to achieve our interim synergy target of about $200 million after 18 months post acquisition, which is basically the end of this year, and we are not going to stop there, and we are quite happy with the margins the businesses are generating.

Okay. And then my follow-up, I was wondering if you could just elaborate on OneSubsea visibility as we think about 2027, obviously, you announced the Exxon Rovuma LNG award in Mozambique. But are you seeing 2027 as a year where there's going to be a lot of greenfield activity in terms of larger awards? And maybe just speak to the visibility you're seeing as we extend into this deepwater cycle.

No. Thank you, Arun. I think I will not restrict this to '27. OneSubsea awards typically are multiple -- multiyear revenue generation. So I mean whatever is earned in bookings in '25 and '26 reach out to '27 to '29 typically. So I think -- directionally, I think the success we have had in recent months and the booking projection that we are anticipating. I think we believe that we will surpass the $9 billion target booking that we have set across the 2 years. I believe this will translate into a visible growth on revenue in '27 and '28 and beyond. And as we believe that the technology portfolio we have, the deliverability of our capacity to the market, the multiple alliance we have created with joint FEED study with customers to secure FID and to participate the best economics and best recovery solution for the customer, are combining to make it very attractive, including the processing -- subsea processing technology, we are uniquely positioned to recovery solution for metro basin. So all in, we are quite confident into the outlook for subsea that is aligned with the deepwater cycle that has started. And we believe that we'll benefit from it. And OneSubsea will be a growth driver for the company going forward.