What does gross margin mean?

How much of every sales dollar is left after the direct cost of what was sold.

How do you interpret gross margin?

Higher and stable gross margins indicate pricing power and a durable cost structure. A declining trend signals input-cost pressure, pricing competition, or a shift toward lower-margin products.

How does gross margin compare across companies?

Highly comparable within an industry, less so across industries — software runs 70%+ while distributors run in single digits. Track the trend more than the absolute level across sectors.

Schlumberger SLB Gross margin

Discontinued — last reported Q1 '15

Gross margin at other companies

ConocoPhillipsCOP

61.5%-2.2pp

Cheniere Energy PartnersCQP

45.4%-8.7pp

Lam ResearchLRCX

50%+2.0pp

Energy TransferET

25.2%-0.6pp

ChevronCVX

43.2%+2.8pp

Rockwell AutomationROK

52.5%+1.4pp

Other financials

Income statement

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Revenue$8.7B+2.7%

Net income$752.0M-5.7%

EPS (diluted)$0.50-13.8%

Balance sheet

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Cash & equivalents$2.8B-4.0%

Total debt$9.7B-8.1%

Total equity$26.2B+34.1%

Total assets$54.5B+11.3%

Cash flow

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Operating cash flow$487.0M-26.2%

CapEx$343.0M-13.8%

Free cash flow$144.0M-45.0%

Valuation

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Market cap$75.25B+35.7%

Enterprise value$82.1B+30.4%

P/E22.6×+9.4×

P/S2.1×+0.6×

Profitability

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Operating margin19.4%+2.6pp

Net margin9.3%-2.4pp

Returns & leverage

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Return on equity14.6%-6.2pp

Debt / equity0.4×-0.2×

Current ratio1.3×+0.1×

Where this comes from

Calculated from Schlumberger ’s reported figures.

gross profit/total revenue=22.6%

Based on trailing twelve months.

The official record: Schlumberger ’s 10-Q, filed April 27, 2016, on SEC EDGAR. View the filing →

Questions, answered.

What does gross margin mean?: How much of every sales dollar is left after the direct cost of what was sold.
How do you interpret gross margin?: Higher and stable gross margins indicate pricing power and a durable cost structure. A declining trend signals input-cost pressure, pricing competition, or a shift toward lower-margin products.
How does gross margin compare across companies?: Highly comparable within an industry, less so across industries — software runs 70%+ while distributors run in single digits. Track the trend more than the absolute level across sectors.