Ladies and gentlemen, thank you for standing by, and welcome to the SLB Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, there will be an opportunity for your questions. You may press one then zero to place your line into the question queue. You may remove yourself from the queue by repeating the same one-zero command. As a reminder, this conference is being recorded. I would now like to turn the conference over to the Vice President of Investor Relations, ND Maduemezia. Please go ahead. Thank you, Leah. Good morning, everyone, and welcome to the Schlumberger Limited Q2 2022 earnings conference call. Today's call is being hosted from Paris, following the Schlumberger Limited board meeting held earlier this week. Joining us on the call are Olivier Le Peuch, Chief Executive Officer, and Stéphane Biguet, Chief Financial Officer. Before we begin, I would like to remind all participants that some of the statements we'll 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. I therefore refer you to our latest 10-K filing and our other SEC filings. Our comments today may also include non-GAAP financial measures. Additional details and reconciliation to the most directly comparable GAAP financial measures can be found in our Q2 press release, which is on our website. With that, I will turn the call over to Olivier. Thank you, ND. Good day, ladies and gentlemen. Thank you for joining us on the call. In my prepared remarks today, I will cover three topics, starting with our Q2 results and our latest view of the macro environment. Thereafter, I will conclude with our outlook for the H2 of the year and its competing attributes, which are very supportive of our raised guidance for the full year. The Q2 was a defining moment in the overall trajectory of the year, with significant growth in revenue, margin expansion and earnings per share. Our execution was solid and directionally all trends were positively in our favor. Strong international activity growth and steady drilling momentum in North America, sustained offshore recovery and the broadening impact of improved pricing. We leveraged the power of our core, our global footprint and differentiated technology to seize widening industry activity, demonstrating our ability to capture growth in every land and offshore basin from North America to most remote international basin. This was reflected in the broad dimension of growth in our Q2 results as customers stepped up activity with a focus on increased performance and production. Above all, we effectively harnessed these positive dynamics and delivered very strong sequential quarterly revenue and earnings growth. In addition to the details provided in our earnings press release this morning, let me reiterate some performance highlights from the quarter. We recorded a 14% revenue increase, the largest sequential revenue increase in more than a decade, as revenue growth exceeded rig count increase both internationally and in North America. Year-on-year revenue growth accelerated to 20%, further sustaining robust growth momentum with a visible inflection in international markets at 50% growth over the same period last year. Growth was very broad across all dimensions, area, divisions, land and offshore, with spending visibly higher across all customer types. Internationally, sequential growth was recorded in all of our Middle East and Asia geo-units and all of Latin America. In ECA, growth was pervasive across Europe, Scandinavia and West Africa. In North America, we continue to post very solid growth offshore and onshore and on increased drilling and completions activity. The rise of offshore activity, particularly deepwater, was a key driver for our Q2 sequential growth in most regions and in support of all divisions. Globally, all four divisions posted double-digit revenue growth and expanded margins sequentially, resulting in the highest quarterly operating margins level since 2015. In addition, another feature of the quarter was broadening pricing improvement, impacting all divisions, geographies and operating environments. Finally, the quarter also marked a number of new contract wins and an increase in backlog for Production Systems and our rig equipment business, another leading indicator of the strength of the activity pipeline ahead of us. Notably, price improvement is also being reflected in Production Systems backlog, which is significant for its later cycle implication for sustained margins expansion on an overall portfolio basis. To sum up, the Q2 emphasizes our clearly differentiated operational performance, strategic execution and financial results, both in North America and internationally. We have very strong momentum and have secured a solid pipeline of activity ahead of us. I'm very proud of the entire Schlumberger team for delivering these exceptional results and demonstrating our unique value proposition for both our customers and our shareholders. Turning now to the macro. First, energy security and urgency to establish more diverse and reliable source of oil and gas supply has become increasingly apparent through the year, exacerbated by the effect of ongoing conflict in Ukraine and a notable increase in periodic supply disruptions in certain regions. Second, supply and excess spare capacity remained very tight as recent OPEC and IEA demand outlooks for 2022 and 2023 remain constructive, continuing to suggest a call on supply from North America and a more significant call on supply from the international basins. Third, despite near-term concern of a global economic slowdown, the combination of energy security, favorable breakeven price, and the urgency to grow long-term oil and gas production capacity will continue to support strong upstream E&P spending growth. Consequently, we are witnessing a decoupling of upstream spending from potential near-term demand volatility, resulting in resilient global oil and gas activity growth in 2022 and beyond. Additionally, the factors supporting persistent tailwinds, more specifically the tightening service supply capacity both in NAM and increasingly in international markets, will continue to represent the defining characteristics of this upcycle and will support both revenue growth and margin expansion more than offsetting inflation. Looking more specifically at the H2 of the year, we see very robust activity dynamics characterized by distinct acceleration of investment in the international basins and a continued strengthening of offshore activity as oil operators, including IOCs, step up spending. The energy security situation continues to drive structural activity increase resulting from the increased focus on short-term production and the need for long-term capacity expansion across oil and gas plays. In addition, we also expect further exploration appraisal activity and the pricing dynamics expansion so far to add further support to both the growth trajectory and the margins performance during the H2. These positive undercurrents will lead to an attractive mix and an increase in short- and long-cycle international projects complementing already robust short-cycle activity in North America. Directionally, during the H2 of the year, we expect a strong continuation of growth in the core, led by Production Systems for the rest of the year, with Digital & Integration benefiting from typically seasonally strong year-end sales. As a result of the rotation of investment towards international basins, we anticipate the highest growth rate during the H2 to occur internationally, setting up a very nice backdrop for 2023 outlook. Based on this, we expect our H2 revenue this year to grow by at least high teens compared to the same period last year. Full year revenue growth will therefore be in the high teens, resulting revenue of at least $27 billion for 2022. Furthermore, our adjusted EBITDA in absolute dollar terms will increase by at least 25% for the full year of 2022 when compared to 2021. Indeed, 2022 is shaping up to be an outstanding year for Schlumberger. The power of our core, our digital and decarbonization leadership, and the expansive attribute of this upcycle enable us to leverage a focused North America business with an unparalleled international breadth. The combination of which favorably exposed Schlumberger to durable top-line growth, earnings, and further margin expansion potential that is unmatched in the sector. Beyond this, the momentum we are building through the H2 of the year and the execution rates that we'll have achieved bode very well for our 2023 outlook and financial ambition, off of which we will share in more details at our investor conference in November. I look forward to seeing many of you in person at this event. I will now turn the call over to Stéphane. Thank you, Olivier, and good morning, ladies and gentlemen. Q2 earnings per share, excluding charges and credits, was $0.50. This represents an increase of $0.16 sequentially and $0.20 when compared to the Q2 of last year. This also represented the highest quarterly earnings per share since the Q4 of 2015. In addition, during the Q1, we recorded a $0.14 gain relating to the further sale of a portion of our shares in Liberty Energy and a $0.03 gain relating to the sale of certain real estate which brought our GAAP EPS to $0.67. Overall, our Q2 revenue of $6.8 billion increased 14% sequentially. This represented the strongest sequential quarterly growth since 2010. All four divisions experienced double-digit increases. Changes in foreign currency exchange rates had virtually no impact on the sequential revenue increase. Pre-tax operating margins expanded 212 basis points sequentially to 17.1%, and EBITDA margins increased 157 basis points to 22.6%. These increases largely reflect the seasonal rebound in activity, a favorable technology mix, particularly on higher offshore activities, and strong exploration data licensing sales in our Digital & Integration division. Margins also increased significantly as compared to the Q2 of last year. Pre-tax segment operating margins increased 279 basis points year-on-year, while adjusted EBITDA margins increased 133 basis points year-on-year. This margin performance is even more notable considering the inflationary headwinds we continue to face. This demonstrates our ability to manage inflation through our supply chain organization as well as through pricing adjustments from our customers. Let me now go through the Q2 results for each division. Q2 Digital & Integration revenue of $955 million increased 11% sequentially, with margins increasing 570 basis points to 39.7%. These increases were primarily due to higher exploration data licensing sales, including $95 million of transfer fees. Reservoir Performance revenue of $1.3 billion increased 10% sequentially beyond the impact of the seasonal rebound in activity, driven by growth both on land and offshore. Margins improved 143 basis points to 14.6%, primarily as a result of the seasonal recovery and higher offshore and exploration activity. Well Construction revenue of $2.7 billion increased 12%, driven by strong growth and improved pricing, both internationally and in North America. Margins increased 134 basis points to 17.5% due to the higher activity, combined with a favorable technology mix and improved pricing. Finally, Production Systems revenue of $1.9 billion increased 18% sequentially, and margins increased 190 basis points to 9%. Global supply chain and logistics constraints started to abate, resulting in higher product deliveries and backlog conversion. International growth outpaced North America growth and was particularly strong in the Europe, CIS, Africa area. Now turning to our liquidity. During the quarter, we generated $408 million of cash flow from operations and negative free cash flow of $119 million. Working capital consumed $936 million of cash during the quarter, largely driven by higher receivables due to the significant revenue growth. However, our DSO improved sequentially. Inventory also increased as we continue to manage lead times in anticipation of continuous growth in the H2 of the year, particularly in our Production Systems division. Consistent with our historical trends, we expect our working capital and cash flow generation to significantly improve over the H2 of the year. During the quarter, we made capital investments of $527 million. This amount includes CapEx and investments in APS projects and seismic exploration data. Although it is reflected outside the free cash flow, our overall cash position was enhanced by the further sale of a portion of our shares in Liberty, which generated $430 million of net proceeds. We currently hold a 12% interest in Liberty. During the quarter, we also sold certain real estate, which resulted in proceeds of $120 million. As a result, our net debt improved by $406 million during the quarter to $11 billion. This level of net debt represented a $2 billion improvement compared to the same period last year. Furthermore, we have now achieved our previously stated leverage target of 2x net debt to EBITDA. We expect our leverage to continue decreasing throughout the rest of the year on a combination of higher earnings and improved free cash flow, allowing us to further strengthen our balance sheet. This will provide us with the financial flexibility required to continue funding growth and increase returns to shareholders throughout the cycle. I will now turn the conference call back to Olivier. Thank you, Stéphane. Ladies and gentlemen, I believe we are opening the floor to the questions. Very good. Ladies and gentlemen, once again, if you have a question, please press one zero on your telephone keypad. Our first question goes to the line of James West with Evercore ISI. Please go ahead. Hey, good morning, Olivier and Stéphane. Morning. Good morning. Morning, James. Olivier, curious how you're thinking about the evolution of the, specifically international cycle, as we go through the next several quarters and really into next year. I mean, we're clearly, you know, OFS or energy is decoupling from the global economy. You're gonna see some changes in probably activity levels, the mix, the pricing. It seems to me that kind of the best is still to come, I think, for the cycle. Just kind of curious your broad outlook for international. No, first, I want to reinforce that the macro environment we are facing is quite unique. It's a confluence of unprecedented low spare capacity, eight years of under-investment in international basins, and a call for energy security that is creating a double sourcing of both oil and gas, particularly international basins. When you put that together, it creates not only a short cycle impulse on production enhancements to respond to that energy security but also reinforce the need for expanding oil capacity, accelerating gas development, and the entire set of international basins, both offshore and onshore, benefit from it. Right. As we see. We have seen an inflection in the sentiment of our customers, both national company, international oil company, and international independents to respond to that call. Turning and accelerating their investment and rotating their investment internationally, visibly. This is certainly a multi-legs, I will call it multi-phase, both oil and gas, positive environment forward. We have seen that Latin America has been the first to benefit from that inflection, and we see that continuing going forward as from Guyana to Brazil to Colombia and as a short cycle or to Argentina as a shale exposed environment. We foresee this to be continuing, including exploration offshore Colombia or Atlantic margin Brazil. This is set to continue going forward. We are seeing this to rotate in ECA, as you may have seen. More than offsetting the constraints we have in Russia, Ukraine region. Creating a superb undercurrent, as I call it, on all offshore basins in this region. We have seen it very strong in Europe, West Africa and Scandinavia with the unique tax incentive set that will start to be kicking in. Next year will only accelerate that trend. East Mediterranean or Black Sea will also see continuous growth going forward. You turn to Middle East and Asia. I think you have a combination of oil capacity commitment increase by both UAE, Saudi, and to an extent, Kuwait that will play out and will, in the case of KSA, create an uptick in offshore activity partly from next year. You see that the gas that is being developed at large scale in Middle East, both for domestic and for fuel substitution. That will continue to play to our strength in Qatar and conventional in both UAE and Saudi if not Oman. You have the Asia market that is also not shy of investment. You see that long-term into the South China Sea, South China Sea as well. I think it's multi-pronged, multi-color, I would say. It has started strong in LATAM, and it will turn to further ECA, further Middle East, which inflection will materialize as the quarter executed going forward. Okay. Got it. Thanks. That's very helpful. Olivier, maybe a quick follow-up from me. You have your digital event coming up here in September. I've been following kind of the list of speakers. Very impressive group that you're assembling. I'm curious where you see the industry now, where you see Schlumberger in the industry in the digitalization or the digital journey of the industry. It seems to be that we're, you know, we've been inflecting, but we seem to be inflecting even further in digital and certainly the results are proving that out in your income statement as well. Curious about digital. No, I think you are correct. I think the number and the rich panels that we are assembling into this digital forum in September is there for two reason. First and foremost is because the industry believes in digital. That digital can add a significant step up in efficiency that will continue to impact positively cost, cash generation and will contribute to decarbonization of operations. That's the reason why we are seeing customer coming in high number and record number to our digital forum. The second reason we have this success is on our thought leadership and platform strategy that has been adopted, and that has been the cornerstone of our success in digital. We are using it to continue to transition all of our customer base towards this cloud platform. This is a long tail, and this will certainly last all this decade and beyond. We are looking forward to success, long success here. Also, we are using this platform and this digital capability to continue to enhance our operation, to continue to transform our digital operation, to impact our customers and our own operation for efficiency and for performance. Lifting up through efficiency, lifting up the performance, and hence getting a premium or getting an increment of market position. It has a dual effect, but the success of digital forum is certainly the credit to our team, but also, the proof that digital is now mainstream into this industry. Got it. Thanks, Olivier. You're welcome. Our next question is from David Anderson with Barclays. Please go ahead. Hey, good morning, Olivier. Going to crush your numbers. You grew in every region and every segment. The one I thought was really interesting was MENA. You grew 7% this quarter, but it didn't even, I mean, the Middle East hasn't even started yet. I was wondering if you could just kind of start there and just help us, give us a sense of kind of where you stand today in terms of project mobilization and how that region is building out. I'm just kinda curious, when do you fully expect to be up and running on the contracts you have in hand? I guess related to that, it's been a while since we've seen a ramp-up in activity over there, but we've often seen startup delays and higher costs that lead up to the work. Aside from just pure execution, are there ways that you can navigate some of these risks? Are there lessons learned from past cycles? Or is it different because this is much more integrated drilling work that didn't exist in prior cycles? No, I think I believe that our team has improved its execution track record. We have, as you may remember, three years ago, we took some action onto our underperforming contract. We learned and applied some best practice, best lessons and project management to technology deployment and to the discipline in our competency management deployment and use of digital to help us execute this contract in a better way. From the way we manage the maintenance cycle of our equipment to the way we deploy and do remote operation to control and help and support our people on the ground, I think we have progressed a lot in the last few years. As such, the major contract we are starting always has a learning period, but I think we are accelerating this learning period by contrast to previous cycle. I think we are set for success on all these projects very soon. But we always have somewhere somehow in international space in a major project startup. But we expect this to be, I would say, the background that we'll have going forward. Our execution track record, lessons learned, use of digital, best practices, and disciplined organization, including our competency that we deploy, has helped us to accelerate the lessons learned and to reach a maturity in terms of performance margins on those projects faster than in previous cycle. I'm positive. As I said, there's an inflection building up in Middle East activity that will materialize in two or three countries visibly into the H2. It will accelerate next year as we see more offshore shallow activity, particularly into the GCC environment in Middle East led by the Saudi oil major development that they're accelerating for oil capacity increase towards their 2027 one million barrel. This will translate into activity, so further activity increase will materialize. We will benefit from it. The industry will certainly have a large ramp up going forward. It's the early cycle of growth in Middle East. The offshore market was actually what my second question there. The offshore markets are really tailor-made for your technology profile, exploration, drilling, subsea boosting. Recognizing that there's a ramp up on the shallow water side and the jackups in the Middle East, is it too soon to say an overall kinda offshore inflection is here? We noticed a lot of your. It's not too soon. Yeah. We saw a lot of your awards. It's not too soon. We were offshore, Gulf of Mexico. It's not too soon. Okay. No, it's not too soon. In the Q2, international deep offshore was accretive to our growth, international visibly. You can see it in the ECA growth. I think if you read some of the reports published by IEA and others, you see that the outlook for 2022-2025 on offshore investments and FID activity will outpace visibly the 2016 through 2019 cycle. We are at early innings of this offshore cycle, but it's quite interesting. It includes more exploration or more appraisal activity than we could have anticipated considering some of the macro. We are seeing it from Namibia to Colombia to Asia. We are seeing interesting exploration happening to the north of Brazil in the Atlantic margin. We are seeing acceleration of appraisal and exploration that combine and increase the beneficiary mix, I would say, that we are seeing in offshore environment. Yes, we are very well exposed. As we recently commented during a conference in June, we believe that the average revenue intensity that we collect from an offshore environment is, can be up to 5 x or more what we collect in the land environment. The scope that we have is quite unique from, as you said, from subsea to exploration, from data licensing to integrated rig well construction. It's quite unique and will benefit increasingly on that offshore outlook. Excellent. Thank you very much. Thank you, Dave. Our next question is from Chase Mulvehill with Bank of America. Please go ahead. Hey, good morning, or I guess good afternoon over in Europe. I guess yeah, I want to come back to the topic on international and maybe follow up a little bit on James' question. You know, obviously you know, we've now seen kind of three of the diversified service companies' international results. I mean, they've all surprised to the upside, so it feels like that activity may be a little bit higher than kind of what we all thought you know, kinda heading into 2Q. But could you talk about the fundamental tightness that you're seeing you know, across the international market, and whether you're seeing kinda broad-based pricing at this point, or is it just kinda more pockets of pricing increases? Just a little bit on pricing across the international side. No, it's definitively broadening. Activity continues to ramp up and includes an offshore mix that typically has more pull on equipment considering the backup and considering the length of assignment of this equipment on the offshore rigs. This is creating a pinch on the supply capacity that results in a rolling pricing pressure and pricing uplift that we are seeing in all environments, I would say, both from existing contracts where we have the opportunity to negotiate and offset more than offset inflation, as in new tenders and or in direct award, where a customer wants to secure future capacity, they want to secure technology, they want to secure performance, and as such are accepting and are directly negotiating pricing increment on existing scope. We are benefiting from this. The pricing environment is definitely broadening and improving. We believe that going forward, as we see the inflection of international investment that has started to accelerate in the H2, as we anticipate H2 international rate of growth will outpace the North America rate of growth. We see that to generate more flow and uplift for the pricing environment going forward. Yep. All makes sense, and we agree with you there. You know, can we, as a kind of a related follow-up, can you expand on kind of, you know, I guess maybe your ultimate earnings power, you know, of the company? Obviously, you know, you gave us some EBITDA guidance here and, you know, when we think about the earnings, you know, for this year, you'll surpass last cycle's peak. You know, how should we be framing kind of the earnings power of Schlumberger this cycle? I mean, and maybe just kind of weave in the discussion around EBITDA margins and your confidence in maybe hitting the 25% mid-cycle margins, that you had kind of guided, as a target for kind of year-end 2023. Do you think you can kind of hit that a little bit earlier now, given that you're outperforming on the margin side? No, I think as we have said before, there are two, three reasons why we are confident about our margin trajectory earnings power going forward. First is that we had a high level of portfolio in North America that has lifted our margin in North America to a level that we are comfortable now that we are competing and are creative. Secondly, we have created a significant reset in our operating leverage less than two years ago that is paying off at the time we are expanding and growing. Third, we believe that a combination of tight supply already very visible in North America and broadening, as I said, in international, combined with performance technology, performance integration, performance differentiation, is creating a further premium that will fall through to our earnings. We have a favorable mixed outlook that includes offshore. We have a differentiating technology and integration performance, and we have the foundation, the operating reset that we have done and the high grading we did for work. You combine this with the upside that digital brings to this, and you get all in a significant upside that we have in our margin. We have the anticipated 25% EBITDA margin sometime next year, and I think we are still very confident about that target. Okay. Perfect. I'll turn it back over. Thanks, Olivier. Thank you. Next, we have a question from Arun Jayaram with JP Morgan. Please go ahead. Yeah. Good morning, Olivier. You know, obviously some concerns around Russia kind of heading into the print. But I was wondering if you could provide more color on the drivers of the 20% sequential type one growth that you saw in Europe, CIS, Africa, that manifested despite, you know, a decline in Russian revenue. I think it's built on multiple geo units in West Africa and Europe and Scandinavia to a lesser extent that has been benefiting from project timing, particularly in the Production Systems that you have seen has benefited from a significant sequential growth. A large portion of that was in Europe. The same in offshore environment. I think an offshore environment is picking up in that region, and this has been very beneficial to us, including some exploration into the Reservoir Performance. You combine all of this, and we have had a fairly substantial growth, and we don't see this necessarily abating a lot in the coming quarters. I think we see a lot of further offshore activity both in Africa, Europe, Scandinavia accelerating, as I said, next year. That will more than offset the risk we are facing in the Russia outlook. Great. Just my follow-up, Olivier. You mentioned how Schlumberger is hosting an investor day in November. I was wondering if you could talk about some of the objectives of that upcoming event, and what do you hope to showcase and highlight to investors at that time? I think we commented on this during the last call, and I think it is an event where we invite investors and analysts to update them on our view, first on the cycle, our strategy to execute on this cycle, and our long-term ambition we have for the company, building on our core and our digital and our new energy investment that will go forward. That's where, and you will see technology, you will see, I think, element of our strategy, and we will expose all of you to the view we have on the macro and the long-term ambition for the company. Great. Thank you. Welcome. Our next question is from Neil Mehta with Goldman Sachs. Please go ahead. Yeah. Good morning, team. The first question was just around. Morning, Neil. Good morning, Olivier. Just around your Canada APS assets and how are you thinking about that? Are you still considering the sale, or has the thought process changed given the macro environment? Alongside that, you know, the monetization of the Liberty position as well, should we be thinking that Schlumberger will look to continue to exit? Arun, Stéphane here. Look on Palliser in Canada, our asset for APS. We are quite happy with the performance of this asset. Actually, it's generating very strong cash flows. It's a great asset, and we are making the most of it at the moment. As it relates to Liberty Energy, you have seen that we decided to monetize a large part of our investment in the Q2 when the market conditions were favorable. We now hold only 12% of the equity. We will continue to monitor our investment going forward, and we'll decide on further monetization based on market conditions like we did earlier. Okay. That's good. That's helpful color in it. The second is a philosophical question, as Schlumberger now getting to the point where the business is generating a decent amount of free cash flow and visibility for that free cash flow to grow, how do you think about return of capital? As you think about the preferred methodology to return that capital, do you think a buyback or a dividend is the most effective way to get that cash back to shareholders? Sure. Look, first, as you know, we increased our dividend by 40%, starting with the July payment. This was the first step in increasing returns to shareholders in this growth cycle. Now, as earnings and cash flows indeed continue to grow over the cycle, we will review opportunities constantly to increase returns to shareholders. It will be either in the form of increased dividends or share repurchases. We, you know, will also see exceptional cash proceeds from our continuous portfolio high grading program. This will give us further optionality. But we will decide between dividends and share repurchases in due time. Dividend, of course, has to be sustainable, affordable for the long term, but share repurchases will be part of the equation as well. Thank you, sir. Thank you. Thank you. Our next question comes from Scott Gruber with Citigroup. Please go ahead. Yes. Hello, Scott. Good afternoon. You know, as you mentioned, there's growing recession fears in the broader market, and that's weighed on oil and it's weighed on your stock. Olivier, as you mentioned, there seems to be great resiliency here to the growth outlook. I am curious, you know, roughly at what oil price do you think the multi-year double-digit recovery could be imperiled? You know, it just seems like there's a pretty big buffer between the current price and where that price could be. I'm wondering your thoughts on, I think it's important to- No, there is indeed that. I think, first, I think we are living through a supply lead on that. I think it's quite unique, and it would take time before the amount recovers towards demand supply balance. I think the quarters to come will be definitely quarters to be replenishing and securing enough spare capacity to avoid the overexposure to risk on the energy supply. But you have the undercurrent that is on energy security that is creating a double sourcing that is a new attribute of demand and supply that is doubling down. I think the buffer is pretty wide, in my opinion. Hence, the short term and some of the risk on slowing and or inflection into the demand growth going forward. There is a decoupling and there is resilience into the investment cycle that we are seeing as we speak. Whether this last, it's very difficult to say how long it will last, but I think we see that this cycle is stronger, longer and pricier than we had anticipated because of those unique condition that the security supply has just added a new dimension to it. I think there is a lot of space, in my opinion. Yeah, we agree. A follow-up on exploration. I know you touched on it, how it's benefiting mix. I'm curious, you know, just how you see the recovery here on the exploration side this cycle. You know, the general assumption coming in was that exploration would lag, but just given a deep downturn in exploration activity and given renewed focus on energy security, should we now be assuming that exploration activity will actually rise in excess of the general recovery as it usually does? Is that possible here? What we are witnessing actually is that below the screen, if I may use that expression, we are seeing a lot of exploration and appraisal programs that are being initiated with some good surprises that we are seeing in the new frontier, call it in Namibia, call it in Colombia or the place. We are seeing a program and support for new exploration in Asia as well. Yes, we are cautiously optimistic that indeed the exploration cycle is back to a scale that I think will be accretive to our mix, and will give us the unique exposure from our exploration data licensing and/or from our Reservoir Performance portfolio and Digital also as we typically have a lot of licensing and Digital solutions that address the exploration geoscience workflows. We see this as a mix that is accretive to our future and that is coming a little bit ahead of what we could have anticipated in this cycle. I appreciate that color. Thank you. Thank you. Our next question is from Roger Read with Wells Fargo, please go ahead. Yeah, thank you. Good morning and good afternoon. Morning, Roger. I guess what I would like to maybe understand, in focusing on kind of the back half and the exit this year on the EBITDA guidance. Didn't really raise that despite the stronger Q2, obviously some positives on pricing. I was just wondering what you see to keep you, I don't know if cautious is the right term, but let's just say, conservative in terms of, EBITDA guidance relative to revenue guidance. Is that Russia or something else that's flowing through? I think first let me reiterate the guidance we provided. We provided the guidance that revenue will be full year $27 billion at least. We provided the guidance that EBITDA in dollar terms will grow by at least 25% year-on-year from 2021. If you use this, you see that it goes up above the current consensus haven't adjusted for the actual beat that we had in the Q2. We foresee a raise in EBITDA dollar for the full year with this guidance that I just shared. Yeah, I understand that. I guess I was just really coming at the sort of 24% up 200 basis points from Q2. Yeah. Q4 of 2021 to Q4 of 2022. No, this is still. I mean, given the seasonality and other things should help. Yes, this is still our ambition. I think this ambition is based on the seasonal impact that we anticipate through a particular digital year-end sales that will follow our digital form. The mix that we believe will be favorable, including international and offshore that are accelerating in the H2. This is still the ambition we have set for the team and this is the reason why we have guided to the 25% full-year EBITDA growth in dollar terms or higher. Okay. This is a little more of a, especially given the commentary earlier about, you know, best quarter since back in 2015. This is a cycle where a lot of the E&P companies integrated are being conservative in terms of their pace of spending increase relative to what we've seen in the commodity prices. I was just wondering, as you look at this cycle, this part of the recovery so far, what you can see in the back half this year, thinking about next. What looks the same? What looks different? I mean, obviously you expect the exploration recovery to continue. If we just look at the, you know, call it development side, are we leaning more heavily into that? Is the mix more positive than in some other cycles? Or should it ultimately look a lot like any other cycle? Just, you know, it's gonna be stronger in one place, weaker in another. No, I think what is quite characteristic of this cycle is the broad nature of this cycle. We see it. We are growing across the four divisions. We are growing across the four areas. We are seeing this set to continue. We see, as I said, a strong inflection in international that will outpace in terms of rate of growth North America from the H2. We see also offshore, the return of offshore being a characteristic that will only expand going forward. If you were to just look at the in terms of numbers, the number of jack-up operating in shallow waters is actually on par higher than it has been for the previous cycle at more than 300. The deep water is starting to catch up. I think we have a mix of signals that are clearly broadening the activity outlook. Hence, if I want to differentiate, it's more the supply lead and tightness to the market creating pricing conditions that are unique in this cycle, in addition to the broad nature of growth across almost all countries in the coming quarters. Great. Appreciate it. Thank you. Yeah, it's positive in all. Yeah, yeah. It's positive in all dimensions, I would say. Customers, geographies, and divisional business lines. That's what we foresee is unique. Hence, it's both. It's production enhancement, it's some appraisal acceleration, and it's a development program, both oil and gas. Thank you. Next, we move on to Connor Lynagh with Morgan Stanley. Please go ahead. Yeah, thanks. We've been talking a lot about pricing, but I wanted to maybe just put a finer point on something. One of the big investor concerns on both Schlumberger and the broader oil services industry is the degree to which you'll be able to extract pricing or improve margins, not just, you know, in some of the less core geographies, but also with some of your big national oil company customers. I'm curious, based on how broad-based your comments have suggested pricing is, are you already seeing pricing or margins improve in some of your biggest regions with some of your biggest customers? Are your conversations indicating that more is to come? Just curious if you could address that? No, it, as I commented before, it's broad, it's happening today, and it's expanding. Now, is it in for every contract, for every customer? That's what we're working on. The customer care for performance. The customer wants to secure capacity for their future plan. Hence, we are seeing success in our engagement with all of our customers, positive response and adjustment of our price in the existing contract or in new contract, in, as I said, a contract extension that are negotiated one-on-one and with pricing increments or in tender environment where the pricing is seen being lifted. It's broad, and it will continue to happen. I think while a year ago it was mostly in North America with wins short internationally, I would say it's very established in North America and it's broad now in international across all customers. Yes, some will take more time to materialize and some will phase at a later date. We are confident that the momentum has started and the market will support it going forward. Got it. Thank you. Maybe pivoting a little bit here, we've talked tangentially about Russia, but I was wondering if you could just clarify what your expectations are for the country, for your operations there, and effectively what the wind down might look like relative to your plans to cease investment and new contracts there. No, I think I would just reiterate what we said earlier and bring a bit of clarity. Our position is unchanged since we communicated earlier this year at the onset of this crisis. We have suspended new investment and technology deployment into Russia. However, our structure gives us the flexibility to have operations in the country in full compliance with international sanctions. At the same time, we continue to monitor the situation very, very closely, very carefully, and we'll always put the safety of our people and assets as a first priority. We cannot and will not comment on the future, but we have taken a position to support. All right. Thank you very much. Thank you. Ladies and gentlemen, we have time for one last question. That is from Keith Mackey with RBC Capital Markets. Please go ahead. Hi. Good day, everyone. Hey, good morning. Good morning, Keith. I just would like to dig into a little bit more on the cash flow and free cash flow expectations for the H2 of the year. Stéphane, you mentioned that you expect that to improve. Just curious if you can put some you know color or magnitude around that, and is a double digit free cash flow margin for the H2 of the year in the cards? Sure. Look, first let me come back to the Q2 to put some color. Our free cash flow was indeed slightly negative, even though the cash flow from operations improved sequentially. As you have seen, it's all in the working capital. To give a bit more details, two-thirds of the sequential working capital increase was due to an increase in receivables. As I mentioned earlier, our DSO improved sequentially. Really the increase in receivables is due to the significantly higher activity we experienced in the quarter. Also, the inventory is increased. As I mentioned, we are preparing to fulfill our growing backlog, particularly in our Production Systems division. We mentioned this is the fastest growing division, so we want to seize all the opportunities there. Really the working capital buildup we saw this quarter is to support the accelerated growth we are experiencing. As it relates to the rest of the year, we do expect the same pattern we see every year in the H2, where working capital gradually improves on higher customer collections, then we have lower inventories due to higher product sales towards the H2. We fully expect our free cash flow to significantly improve in the H2, as per historical trends. Clearly we maintain our ambition to generate double digit free cash flow margin over the cycle, for sure. Got it. Okay. Thanks for that. Maybe just to follow up on capital, looks like you moved to the top end of your $1.9-$2 billion range. Can you talk about where this was? Is it activity driven versus inflation driven? If it's ultimately where you think you'll land for the year, under your $27 billion revenue guidance. Just to confirm, we are expecting our total capital investments, which include the CapEx, exploration data cost, and APS investments for the full year, approximately $2 billion. As Olivier highlighted, clearly we are seeing higher demand for technology and equipment, mostly in our core service divisions. This is where most of the CapEx goes, Well Construction and Reservoir Performance. We are recording very strong year-on-year growth, so this is expected to continue. We will continue, of course, to maintain discipline in the way we deploy any additional resource, allocating those to the countries and contracts with the best returns in accordance with our capital stewardship framework. Just one note, the CapEx portion of our total capital investment remains at the low end of our target range of 5%-7% of revenue, and we fully intend to maintain that commitment throughout the growth cycle. Perfect. Thank you very much for the color. Thank you. I do understand we have time for one more. That is Marc Bianchi with Cowen. Please go ahead. Hello. Thank you. I wanted to ask first on Russia, just to follow up. I think last you updated, Russia was about 5% of total company revenue, but at the time, the ruble had significantly devalued. We've seen an appreciation in the ruble since. Can you comment on where that revenue mix is today? Yeah. Marc, sorry. Russia throughout the first six months of 2022 is actually about 5% of our total worldwide revenue. Got it. Okay. Thank you, Stéphane. As we look at the back half of the year, perhaps you could provide a little more color on the segments. I understand you mentioned D&I and Production Systems driving the improvement, but the D&I benefit would be largely Q4, which is typical with seasonality. There was an exceptional Q2. Maybe you could just provide a little more color on the progression as we move through Q3 for the business. Yes, we had indeed a very strong quarter on D&I due to some very strong data exploration sales. At the same time, I think we will see indeed the D&I coming back to restoring its usual margin to low- to mid-30s%. To progress through the H2 to finish on a strong end of the year through the effect of digital year-on-year sales as we experienced in previous years. While it was very strong, I think it's still in the 30s%, and we expect to keep in the 30s%, if not in the mid-30s% going forward. We will see the uptick in the end of the year. Very good. Thank you so much. Thank you, Marc. I believe. [crosstalk] I believe it's time to close indeed. Thank you. Ladies and gentlemen, to conclude, let me share with you three key takeaways. Firstly, as our Q2 results demonstrate, our differentiated global market position, our industry leading performance and our technology portfolio are uniquely matched to the market dynamics of this cycle. Secondly, the market fundamentals continue to support significant investment growth in our sector with an anticipated decoupling and resilience against the uncertainty of the pace of future demand growth. At the same time, the market conditions are increasingly supportive of net pricing impact onto current and future contracts, both in North America and internationally. Finally, our confidence in the activity mix outlook for the H2, particularly the rotation of investment internationally, combined with pricing tailwinds, has led us to revise our full year expectation for both the revenue and earnings growth. This bodes extremely well for our future beyond year-end as we continue to secure significant service and equipment backlog to support our ambition in this upcycle. Ladies and gentlemen, I believe there is no better time for Schlumberger as we continue to execute with much success our returns-focused strategy and are set to continue to outperform in a market increasingly aligned with our strength. Thank you very much. Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation. You may now disconnect.