(Reuters) - Oil field service companies Halliburton Co (>> Halliburton Company) and smaller rival Baker Hughes Inc (>> Baker Hughes Incorporated) reported quarterly earnings above market estimates due to strong activity outside North America, particularly in the Middle East and Africa.

Both companies have been expanding outside North America as excess capacity and a drop in the number of rigs drilling for gas have depressed margins in their traditional strongholds.

Halliburton and Baker Hughes, No. 2 and No. 3 in the industry, received nearly half of their revenue from outside North America in the fourth quarter.

Market leader Schlumberger Ltd (>> Schlumberger Limited.), which gets almost 70 percent of its revenue from outside North America, reported a better-than-expected profit on Friday thanks to robust drilling activity in Saudi Arabia and the United Arab Emirates.

Halliburton, whose shares were up 1.3 percent before the bell, said on Tuesday its revenue from Middle East and Asia climbed 13 percent in the fourth quarter.

Baker Hughes said its revenue from Middle East and Asia Pacific jumped 27 percent despite a temporary shutdown of operations in southern Iraq in November that cost it $80 million, or 18 cents per share.

Baker Hughes, whose shares were also up 1.3 percent premarket, has the second-largest presence in Iraq after Schlumberger, whose operations were also disrupted by protests by Shi'ites over allegations that a foreign security adviser had insulted their religion.

Baker Hughes said revenue from its operations in Europe, Africa, Russia and the Caspian region combined rose 10 percent. Halliburton's revenue from the same areas rose 15 percent.

Halliburton's income from continuing operations rose 31 percent to $770 million, or 90 cents per share, in the fourth quarter. Revenue rose 5 percent to $7.64 billion.

Adjusted income from continuing operations was 93 cents per share. On that basis, analysts on average had expected earnings of 89 cents on revenue of $7.55 billion, according to Thomson Reuters I/B/E/S.

Net income attributable to Baker Hughes rose 16 percent to $248 million, or 56 cents per share, in the quarter. Revenue rose 10 percent to $5.86 billion.

Excluding one-time items, Baker Hughes earned 62 cents per share. Analysts on average had expected earnings of 61 cents on revenue of $5.67 billion.

Halliburton shares have risen 35 percent in the past year, while Baker Hughes shares have risen 27 percent. The broader Philadelphia oil service index <.OSX> has risen 17 percent.

Halliburton shares were trading at $51.36 before the opening bell, while Baker Hughes stock was trading at $54.82.

(Reporting by Garima Goel and Swetha Gopinath in Bangalore; Editing by Don Sebastian)