Oil and gas services provider Schlumberger (NYSE:SLB) recently wrapped up a very successful quarter. In fact, its third quarter performance set a company record, which it owes to its industry-leading technology and solutions. It's seeing higher demand for its services and, going forward, there are several catalysts that could generate strong returns. Oil and gas production from its customers remains robust, which means good things are likely in store for Schlumberger.

Here are a few key reasons why the stock has room to climb.

North American onshore development

The main reason why Schlumberger produced such strong earnings results is it resumed on-land activity in both the United States and Canada. North American well activity firmed last quarter, despite the potential headwind posed by falling oil prices. The company's best-performing operating segment was reservoir production. This segment includes well services.. In this group, pumping activity and the company's artificial lift services saw strong demand. Because of this, the production group produced 17% revenue growth year over year. Among geographic markets, North America is very strong. Revenue grew 9% just since the last quarter in North America.

There's ample room for this trend to continue over the long-term. Schlumberger management expects GDP growth in the U.S. to continue, which is a tailwind for energy production. Schlumberger also sees room for more energy exporting, resulting from the potential for supply outside North America coming from sources other than OPEC.

Margins are expanding across markets

In addition to solid top-line growth, Schlumberger's profitability is improving because its margins are expanding. In North America, pre-tax operating margin increased 137 basis points to 19.4%. This was due to increased efficiency on-land in the United States. Schlumberger's customers are making significant efficiency gains thanks to increased penetration of Schlumberger's technological solutions. This is helping customers improve their logistical cost structures. One such service is Schlumberger's BroadBand Sequence fracturing technique that is being utilized by clients to improve hydraulic fracturing effectiveness in the Eagle Ford shale in South Texas.

Margins expanded across Schlumberger's other businesses as well. Its international operations saw pre-tax operating margin expand 55 basis points to 24%. Schlumberger saw improved conditions in certain geographies such as Russia and Central Asia, where seasonal activity rebounded.

Ultimately, margin expansion is a great sign for long-term investors. Schlumberger is maintaining its best-in-class status with high and widening margins that retain strong demand from customers

Huge buybacks will help boost earnings growth

Schlumberger has been very aggressive in buying back its own stock throughout 2014. Over the first nine months, the company has spent $3.5 billion on share repurchases, which is more than double the $1.5 billion utilized for share repurchases through the same period last year. This is particularly advantageous for shareholders, since Schlumberger's stock price has declined recently. After trading as high as $118 per share earlier this year, shares of Schlumberger have fallen to its current level around $97. This allows Schlumberger's share repurchases to create more value than usual, because the money spent on buybacks purchases additional shares when the stock decline.

In addition, another reason why these buybacks are beneficial is that each remaining share will capture a higher portion of profits. Since Schlumberger is buying back more shares thanks to the dip in the stock price, there are more profits to go around. That means future earnings growth will likely accelerate, which could be a future catalyst.

Schlumberger's share buybacks demonstrate the cash-generating power of the business. It's also a great sign that management is so shareholder-friendly by rewarding investors with billions of dollars allocated to share repurchases.The deeper point here for the long term investor, which you mention in the conclusion, is that SLB generates loads of cash, which allows them to do these massive stock buybacks. Use that stock buyback as an example of its cash generating power and managements propensity to reward shareholders.

The Foolish conclusion
The bottom line is that Schlumberger is producing strong growth so far this year, and the future remains equally bright. That's because demand for the company's solutions is growing thanks to the ongoing domestic oil and gas production boom. Schlumberger should see growth in its international business as well, due to the gradual improvement in the global economy.. Schlumberger generates a lot of cash, which it returns to shareholders through a nice dividend and billions of dollars in share buybacks. Because of all these factors, Schlumberger's stock price could go higher in the future.

Bob Ciura has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.