Baker Hughes Co

Previous wording

Baker Hughes Company ("Baker Hughes," "the Company," "we," "us," or "our") is an energy technology company with a broad and diversified portfolio of technologies and services that span the energy and industrial value chain. We conduct business in more than 120 countries and employ approximately 53,000 employees. We operate through our two business segments: Oilfield Services & Equipment ("OFSE") and Industrial & Energy Technology ("IET"). We sell products and services primarily in the global oil and gas markets, within the upstream, midstream and downstream segments, as well as broader industrial and new energy markets.

Current wording

Baker Hughes Company ("Baker Hughes," "the Company," "we," "us," or "our") is an energy technology company with a broad and diversified portfolio of technologies and services that span the energy and industrial value chain. We conduct business in more than 120 countries and employ approximately 54,000 employees. We operate through our two business segments: Oilfield Services & Equipment ("OFSE") and Industrial & Energy Technology ("IET"). We sell products and services primarily in the global oil and gas markets, within the upstream, midstream and downstream segments, as well as broader industrial and new energy markets.

Previous wording

During the first quarter of 2026, disruptions in the Middle East contributed to tighter oil and liquefied natural gas (“LNG”) market balances and higher commodity prices.

Current wording

During the second quarter of 2026, continued disruptions in the Middle East contributed to tighter oil and liquefied natural gas (“LNG”) market balances and higher inflationary costs.

Previous wording

Looking ahead, oil market fundamentals are likely to be supported by expectations of an undersupplied market and the need to replenish depleted strategic inventories. As the evolving geopolitical environment continues to create uncertainty, we expect to see a significant decline in upstream spending in the Middle East. North American and other international markets are expected to be broadly flat year-over-year. Over the longer term, heightened geopolitical risk may contribute to higher mid‑cycle oil prices necessary to incentivize incremental global supply. As a result, we see continued upstream investment as necessary to sustain production growth and meet rising global demand. We also expect a continued increase in operating expenditure driven investment as operators focus on optimizing recovery and extending the life of producing assets.

Current wording

Looking ahead, oil market fundamentals are likely to be supported by a supply-constrained market and the need to replenish depleted strategic inventories. As the dynamic geopolitical environment continues to create uncertainty, we expect to see a decline in upstream spending in the Middle East this year, while spending in North American and other international markets is expected to remain broadly unchanged compared to 2025, absent further downside pressure in oil prices. Additionally, ongoing supply constraints through the Strait of Hormuz and broader disruptions across the Middle East are expected to create incremental risk across the business, with potential impacts on customer spending patterns, project timing, and supply chain visibility. Over the longer term, heightened geopolitical risk may contribute to higher mid-cycle oil prices necessary to incentivize incremental global supply. As a result, we see continued upstream investment as necessary to sustain production growth and meet rising global demand. We also expect a continued increase in operating expenditure-driven investment as operators focus on optimizing recovery and extending the life of producing assets.

Previous wording

In the first quarter of 2026, the Company generated revenues of $6.6 billion, an increase of $0.2 billion, or 2%, compared to the first quarter of 2025. IET revenue increased $0.4 billion, or 14%, driven by an increase of $199 million or 34% in Gas Technology Services ("GTS"), and increase of $210 million or 14% in Gas Technology Equipment ("GTE"), partially offset by a decline of $73 million or 28% in Industrial Solutions reflective of the Precision Sensors & Instrumentation ("PSI") disposition. OFSE revenue decreased $0.3 billion, or 7%, led by the Surface Pressure Control ("SPC") disposition and a decline in international revenue. Net income was $0.9 billion, an increase of $0.5 billion, compared to the first quarter of 2025, with net gains on sale from the PSI and SPC dispositions, improved performance in Segment EBITDA, and the change in fair value of equity securities, partially offset by depreciation.

Current wording

In the second quarter of 2026, the Company generated revenues of $6.7 billion, a decrease of $0.2 billion, or 2%, compared to the second quarter of 2025. IET revenue remained flat year-over-year, driven by an increase of $79 million or 11% in Gas Technology Services ("GTS"), an increase of $61 million or 13% in Industrial Products ("IP"), and an increase in Climate Technology Solutions ("CTS") of $49 million or 31%, offset by a decrease of $100 million or 6% in Gas Technology Equipment ("GTE"), and a decrease of $91 million or 33% in Industrial Solutions ("IS") reflective of the Precision Sensors & Instrumentation ("PSI") disposition. OFSE revenue decreased $0.2 billion, or 5% year-over-year led by the Surface Pressure Control ("SPC") disposition and a decline in international revenue. Net income was $0.7 billion, which remained flat compared to the second quarter of 2025, driven by reduced income tax expense, improved performance in Segment EBITDA, and the change in fair value of equity securities, offset by increases in depreciation and amortization, transaction related costs, working capital adjustments related to business dispositions, interest expense, and restructuring.

Previous wording

As a part of our anticipated acquisition of Chart Industries, Inc. ("Chart"), Chart shareholders approved the acquisition of Chart by the Company (the "Chart acquisition") on October 6, 2025. With regulatory reviews still underway in certain jurisdictions, we presently expect closing in the second quarter of 2026, understanding that the timing may evolve as those processes progress. On March 11, 2026, we completed an offering of $6.5 billion of USD-denominated notes, along with €3.0 billion of Euro-denominated notes. As a result of the completed offering, the Company terminated the Bridge Facility entered on July 28, 2025.

Current wording

On July 16, 2026, we completed our previously announced acquisition of Chart Industries, Inc. ("Chart"), for

Previous wording

In the first quarter of 2026, we returned $228 million to shareholders through dividends.

Current wording

In the second quarter of 2026, we returned $228 million to shareholders through dividends.

Previous wording

•OFSE outlook: We expect to see an improvement in global upstream spending, outside of the Middle East, through the remainder of the year due to current constraints on supply, partially offset by near-term weakness in Middle East activity.

Current wording

•OFSE outlook: We expect to see an improvement in global upstream spending through the remainder of the year across both international and North American markets, absent further downside pressure in oil prices.

Previous wording

We believe we have an important role to play in society as an industry leader and partner. We view the area of sustainability as a lever to transform the performance of our Company. In 2019, we made a commitment to reduce Scope 1 and 2 carbon dioxide equivalent emissions from our operations by 50% by 2030 and achieve net-zero emissions by 2050. We continue to make progress on emissions reductions and reported in our 2024 Corporate Sustainability Report a 29.3% reduction in our Scope 1 and 2 carbon dioxide equivalent emissions as compared to our 2019 base year, alongside a 39.5% intensity reduction. Key initiatives supporting these results include facility consolidation, increased use of renewable electricity, infrastructure upgrades, and electrification of our vehicle fleet.

Current wording

We believe we have an important role to play in society as an industry leader and partner. We view the area of sustainability as a lever to transform the performance of our Company. In 2019, we made a commitment to reduce Scope 1 and 2 carbon dioxide equivalent emissions from our operations by 50% by 2030 and achieve net-zero emissions by 2050. We continue to make progress on emissions reductions and reported in our 2025 Corporate Sustainability Report a 36.9% reduction in our Scope 1 and 2 carbon dioxide equivalent emissions as compared to our 2019 base year, alongside a 45.8% intensity reduction. Key initiatives supporting these results include facility consolidation, increased use of renewable electricity, infrastructure upgrades, and electrification of our vehicle fleet.

Previous wording

The following discussion and analysis summarizes the significant factors affecting our results of operations, financial condition, and liquidity position as of and for the three months ended March 31, 2026 and 2025, and should be read in conjunction with our condensed consolidated financial statements and related notes.

Current wording

The following discussion and analysis summarizes the significant factors affecting our results of operations, financial condition, and liquidity position as of and for the three and six months ended June 30, 2026 and 2025, and should be read in conjunction with our condensed consolidated financial statements and related notes.

Previous wording

Outside North America, customer spending is influenced by Brent oil prices. In North America, customer spending is influenced by WTI oil prices and natural gas prices are measured by the Henry Hub Natural Gas Spot Price.

Current wording

In North America, customer spending is influenced by the price of oil and gas as indicated by the Cushing, OK West Texas Intermediate ("WTI") crude oil spot price and the Henry Hub natural gas spot price. Outside of North America, customer spending is influenced by Brent crude oil prices.

Previous wording

(2)EIA Cushing, OK West Texas Intermediate ("WTI") Spot Price per Barrel

Current wording

(2)EIA WTI Spot Price per Barrel

Previous wording

Our condensed consolidated statements of income display sales and costs of sales in accordance with the Securities and Exchange Commission ("SEC") regulations under which "goods" is required to include all sales of tangible products and "services" must include all other sales, including other service activities. For the amounts shown below, we distinguish between "equipment" and "product services," where product services refer to sales under product services agreements, including sales of both goods (such as spare parts and equipment upgrades) and related services (such as monitoring, maintenance and repairs), which is an important part of our operations. We refer to "product services" simply as "services" within Management's Discussion and Analysis of Financial Condition and Results of Operations.

Current wording

Our condensed consolidated statements of income display sales and costs of sales in accordance with the Securities and Exchange Commission ("SEC") regulations under which "goods" are required to include all sales of tangible products and "services" must include all other sales, including other service activities. For the amounts shown below, we distinguish between "equipment" and "product services," where product services refer to sales under product services agreements, including sales of both goods (such as spare parts and equipment upgrades) and related services (such as monitoring, maintenance, and repairs), which are an important part of our operations. We refer to "product services" simply as "services" within Management's Discussion and Analysis of Financial Condition and Results of Operations.

Previous wording

The Remaining Performance Obligations ("RPO") relate to the aggregate amount of the transaction price allocated to the unsatisfied (or partially unsatisfied) performance obligations. As of March 31, 2026, RPO totaled $36.1 billion, of which OFSE totaled $3.0 billion, and IET totaled $33.1 billion.

Current wording

Remaining Performance Obligations ("RPO") relate to the aggregate amount of the transaction prices allocated to the unsatisfied (or partially unsatisfied) performance obligations. As of June 30, 2026, RPO totaled $40.1 billion, of which OFSE totaled $3.0 billion and IET totaled $37.1 billion.

Previous wording

Selling, general and administrative costs decreased $15 million, or 3%, to $562 million.

Current wording

Selling, general and administrative costs increased $2 million to $569 million.

Previous wording

Research and development costs decreased $13 million, or 9%, to $133 million due to timing of project spend.

Current wording

Research and development costs decreased $18 million, or 11%, to $143 million.

Previous wording

We recorded income taxes in the first quarter of 2026 and 2025 of $336 million and $152 million, respectively. The difference between the U.S. statutory tax rate of 21% and the effective tax rate in both periods is primarily related to income generated in jurisdictions with tax rates higher than in the U.S. and losses with no tax benefit due to valuation allowances.

Current wording

We recorded income tax expense in the second quarter of 2026 and 2025 of $210 million and $256 million, respectively. The difference between the U.S. statutory tax rate of 21% and the effective tax rate in both periods is primarily related to income generated in jurisdictions with tax rates higher than in the U.S. and losses with no tax benefit due to valuation allowances.

Previous wording

OFSE revenue of $3,237 million decreased $262 million, or 7%, in the first quarter of 2026 compared to the first quarter of 2025, driven mainly by the SPC disposition and disruptions in the Middle East. From a geographical perspective, international revenue was $2,310 million, a decrease of $267 million, or 10%, from the first quarter of 2025, driven by Middle East/Asia, Europe/CIS/Sub-Saharan Africa, partially offset by an increase in Latin America. North America revenue was $927 million in the first quarter of 2026, an increase of $5 million from the first quarter of 2025.

Current wording

OFSE revenue of $3,451 million decreased $166 million, or 5%, in the second quarter of 2026 compared to the second quarter of 2025, driven mainly by the impact of the SPC disposition and disruptions in the Middle East, offset by the benefit of FX in Latin America. From a geographical perspective, international revenue was $2,518 million, a decrease of $171 million, or 6%, from the second quarter of 2025, driven by Middle East/Asia and Europe/CIS/Sub-Saharan Africa, partially offset by an increase in Latin America. North America revenue was $933 million in the second quarter of 2026, an increase of $5 million, or 1%, from the second quarter of 2025.

Previous wording

OFSE segment EBITDA of $565 million decreased $58 million, or 9%, in the first quarter of 2026 compared to the first quarter of 2025. The reduction of EBITDA in the first quarter of 2026 was a result of lower volume, change in business mix, inflation, and the SPC disposition, partially offset by overall productivity and cost out initiatives.

Current wording

OFSE segment EBITDA of $605 million decreased $72 million, or 11%, in the second quarter of 2026 compared to the second quarter of 2025. The reduction of EBITDA in the second quarter of 2026, after taking into consideration the impact of the SPC disposition, was the result of inflation, change in business mix, and lower volume, partially offset by cost-out initiatives, overall productivity, and FX.

Previous wording

IET segment EBITDA of $678 million increased $177 million, or 35%, in the first quarter of 2026 compared to the first quarter of 2025. The improved performance in the first quarter of 2026 was driven by FX, price, higher volume, and productivity, partially offset by inflation.

Current wording

IET segment EBITDA of $678 million increased $93 million, or 16%, in the second quarter of 2026 compared to the second quarter of 2025. The improved performance in the second quarter of 2026 was driven by price, productivity, cost-out initiatives, and FX, partially offset by lower volume and inflation.

Previous wording

Revenue increased $0.2 billion, or 2%, to $6.6 billion. OFSE decreased $0.3 billion, or 7%, and IET increased $0.4 billion, or 14%.

Current wording

Revenue was flat at $13.3 billion. OFSE decreased $0.4 billion, or 6%, and IET increased $0.4 billion, or 7%.

Previous wording

Other income increased $728 million, primarily related to gains of $721 million on business dispositions.

Current wording

Other income increased $697 million, primarily related to gains of $697 million on business dispositions.

Previous wording

Net interest expense incurred in the first quarter of 2026 was $86 million, which includes interest income of $59 million offset by interest expense of $145 million. Net interest expense increased $35 million compared to the first quarter of 2025, primarily driven by previously unamortized lending fees of $43 million recognized as a result of the termination of the Bridge Facility during the first quarter of 2026.

Current wording

Net interest expense incurred in the first six months of 2026 was $151 million, which includes interest income of $189 million offset by interest expense of $340 million. Net interest expense increased $46 million compared to the first six months of 2025, as a result of the recognition of previously unamortized lending fees related to the Bridge Facility terminated in the first quarter of 2026.

Previous wording

Net income increased $0.5 billion to $0.9 billion compared to the first quarter of 2025.

Current wording

Net income increased $0.5 billion, or 46%, to $1.6 billion compared to the first six months of 2025.

Previous wording

IET revenue of $3,350 million increased $422 million, or 14%, in the first quarter of 2026 compared to the first quarter of 2025, with increases in GTE and GTS, partially offset by a decline in Industrial Solutions driven by the PSI disposition.

Current wording

IET revenue of $6,641 million increased $420 million, or 7%, in the first six months of 2026 compared to the first six months of 2025, with increases in GTE, GTS, IP, and CTS, partially offset by a decline in IS driven by the PSI disposition.

Previous wording

Our objective in financing our business is to maintain sufficient liquidity, adequate financial resources, and financial flexibility in order to fund the requirements of our business and pending acquisitions. We continue to maintain solid financial strength and sufficient liquidity. At March 31, 2026, we had cash and cash equivalents of $14.8 billion compared to $3.7 billion at December 31, 2025.

Current wording

Our objective in financing our business is to maintain sufficient liquidity, adequate financial resources, and financial flexibility in order to fund the requirements of our business and pending acquisitions. We continue to maintain solid financial strength and sufficient liquidity. At June 30, 2026, we had cash and cash equivalents of $15.7 billion compared to $3.7 billion at December 31, 2025.

Previous wording

As of March 31, 2026, we held approximately $12.5 billion of cash and cash equivalents in the U.S. and approximately $2.3 billion outside the U.S., including $1.1 billion held in Europe and the United Kingdom. As of December 31, 2025, cash and cash equivalents totaled approximately $0.7 billion in the U.S. and approximately $3.0 billion outside the U.S., including $1.5 billion held in Europe and the United Kingdom. A substantial portion of the cash held outside the U.S. at March 31, 2026 has either been reinvested in active non-U.S. business operations or is being held for the pending Chart acquisition. If we decide at a later date to repatriate certain cash to the U.S., we may incur other additional taxes that would not be significant to the total tax provision.

Current wording

As of June 30, 2026, we held approximately $13.5 billion of cash and cash equivalents in the U.S. and approximately $2.3 billion outside the U.S., including $0.9 billion held in Europe and the United Kingdom. As of December 31, 2025, cash and cash equivalents totaled approximately $0.7 billion in the U.S. and approximately $3.0 billion outside the U.S., including $1.5 billion held in Europe and the United Kingdom. A substantial portion of the cash held outside the U.S. at June 30, 2026 has either been reinvested in active non-U.S. business operations or was being held for the Chart acquisition, which was completed on July 16, 2026. If we decide at a later date to repatriate certain cash to the U.S., we may incur other additional taxes that would not be significant to the total tax provision.

Previous wording

During the three months ended March 31, 2026, we disbursed cash to fund a variety of activities including certain working capital needs, capital expenditures, and the payment of dividends.

Current wording

During the six months ended June 30, 2026, we disbursed cash to fund a variety of activities including certain working capital needs, capital expenditures, and the payment of dividends.

Previous wording

Cash flows provided by (used in) each type of activity were as follows for the three months ended March 31:

Current wording

Cash flows provided by (used in) each type of activity were as follows for the six months ended June 30:

Previous wording

Cash flows provided by operating activities were $500 million and $709 million for the three months ended March 31, 2026 and 2025, respectively.

Current wording

Cash flows provided by operating activities were $1,845 million and $1,219 million for the six months ended June 30, 2026 and 2025, respectively.

Previous wording

For the three months ended March 31, 2026, net working capital cash usage was $173 million, mainly due to accounts payable payments and contract assets build up partially offset by progress collections, accounts receivable collections, and inventory reduction.

Current wording

For the six months ended June 30, 2026, net working capital cash generation was $350 million, mainly due to progress collections, partially offset by contract assets build up and inventory increase.

Previous wording

For the three months ended March 31, 2025, net working capital cash generation was $218 million, mainly due to accounts receivable collections and contract assets partially offset by progress collections, accounts payable, and inventory increase.

Current wording

For the six months ended June 30, 2025, net working capital cash generation was $98 million, mainly due to accounts receivable collections and contract asset buildup, partially offset by progress collections, accounts payable, and inventory increases.

Previous wording

Included in the cash flows from operating activities for the three months ended March 31, 2026 and 2025 were payments of $55 million and $32 million, respectively, made primarily for employee severance as a result of our restructuring activities.

Current wording

Included in the cash flows from operating activities for the six months ended June 30, 2026 and 2025 were payments of $86 million and $67 million, respectively, made primarily for employee severance as a result of our restructuring activities.

Previous wording

Cash flows provided by investing activities were $1,038 million for the three months ended March 31, 2026 and cash flows used in investing activities were $310 million for the three months ended March 31, 2025.

Current wording

Cash flows provided by investing activities were $874 million for the six months ended June 30, 2026 and cash flows used in investing activities were $596 million for the six months ended June 30, 2025.

Previous wording

Our principal recurring investing activity is the funding of capital expenditures including property, plant and equipment ("PP&E") and software, to support and generate revenue from operations. Expenditures for capital assets were $336 million and $300 million for the three months ended March 31, 2026 and 2025, respectively, partially offset by cash flows from the disposal of PP&E of $46 million and $45 million for the three months ended March 31, 2026 and 2025, respectively. Proceeds from the disposal of assets were primarily related to OFSE equipment that was lost-in-hole, and PP&E no longer used in operations that was sold throughout the period.

Current wording

Our principal recurring investing activity is the funding of capital expenditures including property, plant and equipment ("PP&E") and software, to support and generate revenue from operations. Expenditures for capital assets were $636 million and $601 million for the six months ended June 30, 2026 and 2025, respectively, partially offset by cash flows from the disposal of PP&E of $110 million and $74 million for the six months ended June 30, 2026 and 2025, respectively. Proceeds from the disposal of assets were primarily related to OFSE equipment that was lost-in-hole, and PP&E no longer used in operations that was sold throughout the period.

Previous wording

Cash flows provided by financing activities were $9,523 million for the three months ended March 31, 2026 and cash flows used in financing activities were $502 million for the three months ended March 31, 2025.

Current wording

Cash flows provided by financing activities were $9,287 million for the six months ended June 30, 2026 and cash flows used in financing activities were $945 million for the six months ended June 30, 2025.

Previous wording

We increased our quarterly dividend during the three months ended March 31, 2026 and 2025 by zero cents to $0.23 and two cents to $0.23 per share, respectively. We paid dividends of $228 million and $229 million to our Class A shareholders during the three months ended March 31, 2026 and 2025, respectively.

Current wording

We maintained a quarterly dividend during the six months ended June 30, 2026 and 2025 of $0.23 per share. We paid dividends of $456 million and $456 million to our Class A shareholders during the six months ended June 30, 2026 and 2025, respectively.

Previous wording

We did not repurchase shares of Class A common stock during the three months ended March 31, 2026. During the three months ended March 31, 2025, we repurchased and canceled 4.4 million shares of Class A common stock for a total of $188 million.

Current wording

We did not repurchase any shares of Class A common stock during the six months ended June 30, 2026. During the six months ended June 30, 2025, we repurchased and canceled 9.8 million shares of Class A common stock for a total of $384 million.

Previous wording

On March 11, 2026, we completed an offering of $6.5 billion of USD-denominated notes, along with €3.0 billion of Euro-denominated notes. As a result of the completed offering, the Company terminated the Bridge Facility entered on July 28, 2025. We intend to use the net proceeds of the notes to fund a portion of the cash consideration for the proposed Chart acquisition. Any future acquisition funding requirements will be determined closer to the acquisition close.

Current wording

On March 11, 2026, we completed an offering of $6.5 billion of U.S. dollar-denominated notes, along with €3.0 billion of Euro-denominated notes. As a result of the completed offering, we terminated the Bridge Facility entered into on July 28, 2025.

Previous wording

We believe cash on hand, cash flows from operating activities, the available revolving credit facility, access to our uncommitted lines of credit, the DDTL, and availability under our existing shelf registrations of debt will provide us with sufficient capital resources and liquidity in the short-term and long-term to manage our working capital needs; meet contractual obligations; fund strategic growth initiatives, capital expenditures, and dividends; repay debt; repurchase our common stock; and support the development of our short-term and long-term operating strategies.

Current wording

We believe cash on hand, cash flows from operating activities, the available revolving credit facility, access to our uncommitted lines of credit, and availability under our existing shelf registrations of debt will provide us with sufficient capital resources and liquidity in the short-term and long-term to manage our working capital needs; meet contractual obligations; fund strategic growth initiatives, capital expenditures, and dividends; repay debt; repurchase our Class A common stock; and support the development of our short-term and long-term operating strategies.

Previous wording

Based on our current outlook, we anticipate making income tax payments in the range of $1.1 billion in 2026.

Current wording

Based on our current outlook, we anticipate making income tax payments in the range of $0.9 to $1.0 billion in 2026.