Baker Hughes Company Announces Second-Quarter 2025 Results

Core Insights - Baker Hughes reported strong second-quarter results for 2025, with adjusted EBITDA margins increasing by 170 basis points year-over-year to 17.5%, despite a modest decline in revenue [3][4] - The company achieved IET orders totaling $3.5 billion, contributing to a record backlog, and maintained confidence in meeting full-year order guidance [4][6] - Strategic transactions were announced to optimize the portfolio, including a joint venture, a sale of a product line, and an acquisition, aimed at enhancing earnings durability and shareholder value [4][10][11] Financial Performance - Total revenue for the quarter was $6.91 billion, down 3% year-over-year, with net income attributable to Baker Hughes at $701 million, reflecting a 21% increase year-over-year [6][25] - Adjusted net income was $623 million, up 10% year-over-year, and adjusted EBITDA was $1.21 billion, up 7% year-over-year [26][27] - Cash flow from operating activities was $510 million, with free cash flow of $239 million, indicating a 47% decrease from the previous quarter [30][49] Orders and Backlog - Total orders for the quarter reached $7.03 billion, with a book-to-bill ratio of 1.0, while IET's book-to-bill ratio was 1.1 [24][39] - Remaining Performance Obligations (RPO) stood at $34 billion, with IET RPO at $31.3 billion, reflecting a 3% sequential increase [29] Segment Performance - Oilfield Services & Equipment (OFSE) reported orders of $3.5 billion, with revenue of $3.62 billion, down 10% year-over-year [35][36] - Industrial & Energy Technology (IET) saw orders of $3.53 billion and revenue of $3.29 billion, marking a 5% year-over-year increase [37][40] - IET's segment EBITDA increased by 18% year-over-year to $585 million, driven by positive pricing and productivity [41] Strategic Transactions - The company entered a joint venture with Cactus, Inc. for the OFSE Surface Pressure Control product line, valued at approximately $345 million [9] - Baker Hughes sold the Precision Sensors & Instrumentation product line for approximately $1.15 billion, enhancing reinvestment capabilities [10] - The acquisition of Continental Disc Corporation for approximately $540 million aims to strengthen the IET Industrial Products portfolio [11] Technology and Market Developments - Baker Hughes secured significant awards in data center projects, including a contract for 30 NovaLT™ turbines, which will provide up to 500 MW of power [12][15] - The company is expanding its presence in the New Energy sector, with year-to-date bookings totaling $1.25 billion, including a major CCS order [17][40]