Schlumberger Ltd. (NYSE: SLB) reported third-quarter 2016 results after markets closed on Thursday. The oil field services firm reported adjusted diluted quarterly earnings per share (EPS) of $0.25 on revenues of $7.02 billion. In the same period a year ago, Schlumberger reported adjusted EPS of $0.78 on revenues of $8.47 billion. Third-quarter results compare to the consensus estimates for EPS of $0.22 on revenues of $7.08 billion.

CEO Paal Kibsgaard said that Schlumberger has reduced its headcount by more than 16,000 in the first half of 2016 and taken a $646 million restructuring charge in the second quarter as a result. The company also took a $1.9 billion, non-cash impairment charge and recognized $335 million in merger and integration charges related to its acquisition of Cameron.

Revenue dropped 17% year-over-year in the third quarter and 2% sequentially reflecting the expected reduction in activity at Cameron as the order backlog of products declined. Excluding Cameron, revenue increased 1% sequentially. Including Cameron, margins slipped to 19%; excluding Cameron incremental margins rose above 65%, excluding the second-quarter impairment charge:

The CEO sees some light at the end of the tunnel:

In the global oil market, the supply and demand of crude is now more or less balanced as evidenced by flattening petroleum inventory levels and the start of consistent draws toward the end of the quarter—particularly in North America. At the same time, oil demand for 2017 was again revised upward in October and if combined with OPEC’s announced intention to cut production, this suggests further inventory draws in the coming quarters that should lead to upward movement in prices.

In terms of 2017 E&P investment, visibility remains limited as our customers are still in the planning process. We maintain that a broad-based V-shaped recovery is unlikely given the fragile financial state of the industry, although we do see activity upside in 2017 in North America land, the Middle East and Russia markets. We are therefore ensuring that we are optimally positioned to capture a large share of this upside that we can subsequently turn it into positive earnings contributions.

With the unparalleled cost and cash discipline we have established, we are confident in our capability to deliver incremental margins north of 65% and a free cash conversion rate above 75%. Going forward, this will give us significant flexibility to both re-invest in our business and steadily return cash to our shareholders. This capability, together with our unmatched scale and our unique ability to drive change throughout our company, clearly sets us apart from other industry players.

During the second quarter Schlumberger repurchased 2 million shares of stock at an average price of $77.02 per share for a total cost of $156 million.

The company did not provide additional guidance in its press release, saying it would provide information in a conference call Friday morning. The consensus estimates for the fourth fiscal quarter call for EPS of $0.26 on revenues of $7.22 billion. For the full year, EPS is pegged at $1.12 on revenues of $28.16 billion.

Shares traded up 0.7% in after-hours trading at $83.60 after closing at $82.99. The stock’s 52-week range is $59.60 to $84.30. The 12-month consensus price target was $92.34 before results were announced.

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