Segment Information

12 Months Ended

Dec. 31, 2018

17. Segment Information

Schlumberger’s segments are as follows:

•

Reservoir Characterization – Consists of the principal Technologies involved in finding and defining hydrocarbon resources. These include WesternGeco, Wireline, Testing Services, OneSurface, Software Integrated Solutions and Integrated Services Management.

•

Drilling – Consists of the principal Technologies involved in the drilling and positioning of oil and gas wells. These include Bits & Drilling Tools, M-I SWACO, Drilling & Measurements, Land Rigs and Integrated Drilling Services.

•

Production – Consists of the principal Technologies involved in the lifetime production of oil and gas reservoirs. These include Well Services, OneStim, Completions, Artificial Lift and Schlumberger Production Management.

•

Cameron – Consists of the principal Technologies involved in pressure and flow control for drilling and intervention rigs, oil and gas wells and production facilities. These include OneSubsea, Surface Systems, Drilling Systems and Valves & Measurements.

Financial information for the years ended December 31, 2018, 2017 and 2016, by segment, is as follows:

				(Stated in millions)

	2018
									Depreciation
				Income					and		Capital
	Revenue			Before Taxes			Assets		Amortization		Expenditures
Reservoir Characterization	$	6,526		$	1,392		$	4,477	$	673	$	302
Drilling		9,250			1,239			5,843		597		718
Production		12,394			1,052			12,625		1,417		886
Cameron		5,167			608			3,967		241		146
Eliminations & other		(522	)		(104	)		1,460		189		108
Pretax operating income					4,187
Goodwill and intangible assets								33,658
Cash and short term investments								2,777
All other assets								5,700
Corporate & other ⁽¹⁾					(937	)				439
Interest income ⁽²⁾					52
Interest expense ⁽³⁾					(537	)
Charges & credits ⁽⁴⁾					(141	)
	$	32,815		$	2,624		$	70,507	$	3,556	$	2,160

				(Stated in millions)

	2017
									Depreciation
				Income					and		Capital
	Revenue			Before Taxes			Assets		Amortization		Expenditures
Reservoir Characterization	$	6,795		$	1,244		$	4,892	$	989	$	305
Drilling		8,392			1,151			5,513		697		629
Production		10,630			936			12,450		1,240		889
Cameron		5,205			733			3,978		260		150
Eliminations & other		(582	)		(143	)		1,665		213		134
Pretax operating income					3,921
Goodwill and intangible assets								34,472
Cash and short term investments								5,089
All other assets								3,928
Corporate & other ⁽¹⁾					(934	)				438
Interest income ⁽²⁾					107
Interest expense ⁽³⁾					(513	)
Charges & credits ⁽⁴⁾					(3,764	)
	$	30,440		$	(1,183	)	$	71,987	$	3,837	$	2,107

				(Stated in millions)

	2016
									Depreciation
				Income					and		Capital
	Revenue			Before Taxes			Assets		Amortization		Expenditures
Reservoir Characterization	$	6,660		$	1,244		$	6,890	$	1,156	$	532
Drilling		8,561			994			6,803		881		425
Production		8,792			512			10,497		1,231		655
Cameron		4,211			653			4,246		208		176
Eliminations & other		(414	)		(130	)		1,528		234		267
Pretax operating income					3,273
Goodwill and intangible assets								34,845
Cash, short term investments and fixed income investments								9,495
All other assets								3,652
Corporate & other ⁽¹⁾					(925	)				384
Interest income ⁽²⁾					84
Interest expense ⁽³⁾					(517	)
Charges & credits ⁽⁴⁾					(3,820	)
	$	27,810		$	(1,905	)	$	77,956	$	4,094	$	2,055

⁽¹⁾

Comprised principally of certain corporate expenses not allocated to the segments, stock-based compensation costs, amortization expense associated with certain intangible assets (including intangible asset amortization expense resulting from the 2016 acquisition of Cameron), certain centrally managed initiatives and other nonoperating items.

⁽²⁾	Interest income excludes amounts which are included in the segments’ income (2018: $8 million; 2017: $21 million; 2016: $26 million).

⁽³⁾	Interest expense excludes amounts which are included in the segments’ income (2018: $38 million; 2017: $53 million; 2016: $53 million).

⁽⁴⁾	See Note 3 – Charges and Credits.

Segment assets consist of receivables, inventories, fixed assets, multiclient seismic data and SPM investments.

Depreciation and amortization includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs and SPM investments.

Revenue by geographic area for the years ended December 31, 2018, 2017 and 2016 is as follows:

(Stated in millions)

	2018		2017		2016
North America	$	11,984	$	9,487	$	6,665
Latin America		3,745		3,976		4,230
Europe/CIS/Africa		7,158		7,072		7,373
Middle East & Asia		9,543		9,394		9,264
Eliminations & other		385		511		278
	$	32,815	$	30,440	$	27,810

Revenue is based on the location where services are provided and products are sold.

During each of the three years ended December 31, 2018, 2017 and 2016, no single customer exceeded 10% of consolidated revenue.

Schlumberger did not have revenue from third-party customers in its country of domicile during the last three years. Revenue in the United States in 2018, 2017 and 2016 was $10.1 billion, $8.1 billion and $5.4 billion, respectively.

North America and International revenue disaggregated by segment was as follows:

(Stated in millions)

	2018
	North America		International			Eliminations & other			Total
Reservoir Characterization	$	992	$	5,067		$	467		$	6,526
Drilling		2,332		6,684			234			9,250
Production		6,312		6,077			5			12,394
Cameron		2,316		2,771			80			5,167
Other		32		(153	)		(401	)		(522	)
	$	11,984	$	20,446		$	385		$	32,815

Fixed Assets less accumulated depreciation by geographic area are as follows:

(Stated in millions)

	2018		2017
North America	$	5,715	$	5,121
Latin America		898		1,042
Europe/CIS/Africa		2,364		2,545
Middle East & Asia		2,604		2,762
Unallocated		98		106
	$	11,679	$	11,576