BKR earnings analysis
What we found in BKR's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Baker Hughes delivered a $0.64 EPS result above the $0.48 consensus estimate and sequential revenue improvement to $6.742 billion, but revenue remained 2% below the prior-year quarter as OFSE declined 5%. IET earnings momentum, a $10.501 billion order intake and $40.1 billion RPO support the medium-term growth case, while Middle East disruption and the post-quarter Chart acquisition increase execution and balance-sheet considerations. The filing does not provide numeric revenue or EPS guidance; management maintains a constructive LNG and gas-infrastructure outlook but flags geopolitical and oil-price uncertainty.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue recovered sequentially and EPS beat
- Q2 revenue was $6.742 billion, up $152 million from $6.590 billion in Q1 2026, though down $168 million from $6.910 billion in Q2 2025. Diluted EPS of $0.64 exceeded the $0.48 consensus estimate by 33.3%.
- Gross margin improved sequentially
- Implied gross margin was 23.5%, calculated from $6.742 billion of revenue and $5.160 billion of segment cost of goods and services. This improved from 22.8% in Q1 2026, while remaining slightly below the 23.6% implied in Q2 2025; consolidated operating margin was not separately disclosed in the supplied filing text.
- IET EBITDA expanded 16%
- IET revenue held essentially flat at $3.291 billion, but segment EBITDA increased $93 million, or 16%, to $678 million. Management attributed the improvement to price, productivity, cost-out actions and FX, partly offset by volume and inflation.
- IET orders and backlog accelerated
- Total orders rose to $10.501 billion from $7.032 billion, led by Gas Technology Equipment orders of $4.913 billion versus $781 million. IET remaining performance obligations reached $37.1 billion of total RPO of $40.1 billion.
- Cash conversion strengthened
- Six-month operating cash flow increased $626 million to $1.845 billion, while net working-capital cash generation rose to $350 million from $98 million. Capital expenditures were $636 million, equal to about 4.8% of $13.329 billion of first-half revenue.
- Liquidity increased ahead of Chart closing
- Cash and equivalents were $15.7 billion at June 30 versus $3.7 billion at December 31, 2025, following $9.5 billion of note offerings in March. The company paid $456 million of dividends in the first half while making no share repurchases.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Middle East disruption weighs on OFSE
- OFSE revenue fell $166 million, or 5%, to $3.451 billion and segment EBITDA fell $72 million, or 11%, to $605 million. Management cited the Surface Pressure Control disposition and Middle East disruptions; international OFSE revenue declined $171 million, or 6%, to $2.518 billion.
- Geopolitical volatility clouds demand
- Management expects upstream spending in the Middle East to decline during 2026 and warns that Strait of Hormuz constraints could affect customer spending, project timing and supply-chain visibility. Brent averaged $102.63 per barrel in Q2 2026, versus $68.07 in Q2 2025, underscoring the volatile backdrop.
- Chart transaction raises funding burden
- Debt securities outstanding had $15.7 billion of aggregate principal at June 30, with maturities from 2026 to 2056. The company subsequently completed the approximately $13.6 billion Chart acquisition on July 16, funded partly with March note issuance, other borrowings and cash.
- No formal risk-factor update disclosed
- Item 1A states that the company remains subject to the risk factors in its 2025 Annual Report; the filing does not identify a newly added or revised risk factor. Inventory increased during the first half even as net working-capital cash generation was $350 million.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.64
- Gross margin
- 23.5%
- Segment
- Oilfield Services & Equipment (OFSE): $3.451 billion, down $166 million or 5% year over year
- Segment
- Industrial & Energy Technology (IET): $3.291 billion, down $2 million (approximately flat) year over year
- Segment
- Gas Technology Equipment: $1.524 billion, down $100 million year over year
- Segment
- Gas Technology Services: $831 million, up $79 million year over year
- Segment
- Industrial Products: $549 million, up $61 million year over year
- Segment
- Industrial Solutions: $182 million, down $91 million year over year
- Segment
- Climate Technology Solutions: $205 million, up $49 million year over year
What they said about what is next.
The 10-Q provides no consolidated revenue or EPS range. Management expects improved global upstream spending through the rest of 2026 absent further oil-price downside, sustained LNG and gas-infrastructure strength, and 2026 capex of up to 5% of annual revenue; it anticipates $0.9 billion to $1.0 billion of 2026 income-tax payments.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 24, 2026
- Baker Hughes reported Q1 2026 revenue of $6,587 million, up $200 million or 2% year-over-year, driven by a 14% increase in Industrial & Energy Technology (IET) that offset a 7% decline in Oilfield Services & Equipment…
- 10-Q · October 24, 2025
- Baker Hughes reported Q3 revenue of $7,010 million, up $102 million versus the prior-year quarter (Q3 2024: $6,908 million), with gross margin roughly stable at ~24.3% and operating margin about 13.5%. Diluted EPS was…
- 10-K · February 4, 2025
- Baker Hughes positions itself as a diversified energy-technology company pursuing a three‑pillar strategy: transform the core, drive profitable growth, and deliver new‑energy solutions. The 2024 Form 10‑K highlights…
- 10-Q · October 23, 2024
- Baker Hughes reported Q3 revenue of $6,908 million, up $267 million (+4.0%) versus Q3 2023 ($6,641 million). Gross margin expanded to ~22.3% and operating margin to ~13.5%, driven by higher operating income of $930…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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