Schlumberger Ltd. (NYSE: SLB – $84.30) the world’s No.1 oilfield services provider, reported a bigger-than-expected quarterly profit as its cost-cutting efforts helped soften the impact of reduced global drilling activity. Schlumberger, which provides drilling technology and equipment to oil and gas companies, now expects exploration and production investment in North America to fall by more than 35%, vs. its prediction of 30% in March. In the international market, Schlumberger expects investment to decline more than 15%, compared with its earlier view for a decline of “roughly” 15%. For the quarter, the company reported a profit of $1.12 billion, or $0.88 a share, down from $1.6 billion, or $1.21 a share, a year earlier. Revenue dropped 25% to $9.01 billion. Analysts, however, had expected per-share profit of $0.79 and revenue of $8.97 billion. Second-quarter revenue in North America declined 39%. For its operations outside North America, Schlumberger reported revenue fell 19%. For the full-year, Street estimates for SLB are $3.46 vs. $5.51 for 2014 and the shares will continue to trade in line with oil prices. The industry remains in flux and near-term visibility is poor. Displaying its strength, the company is generating free cash flow in spite of the drilling slump. In all, the good-quality stock offers sizable recovery potential to decade’s end and the shares are a good way for conservative investors to participate in the industry’s gradual projected comeback.