Baker Hughes Company

Overview

Baker Hughes is one of the world's three major oilfield services companies, providing drilling, completion, production, and industrial technology across more than 120 countries. The company traces its roots to 1907, when Hughes Tool Company, founded by Howard Hughes Sr., pioneered the roller cone drill bit, and it has grown through a century of acquisitions and mergers. Its current form was created in 2017, when the legacy Baker Hughes merged with GE Oil & Gas, combining GE's industrial turbomachinery and LNG equipment businesses with the traditional oilfield services portfolio. GE divested its remaining stake in 2021, leaving Baker Hughes a fully independent company. Lorenzo Simonelli is chairman, president, and CEO; Ahmed Moghal became chief financial officer in February 2025.

Baker Hughes is structured differently from its two largest oilfield services peers. Halliburton is concentrated in North American completion services and SLB is weighted toward international oilfield services, while Baker Hughes generates close to half its revenue from industrial and energy technology with limited direct exposure to drilling activity cycles. That business includes a large portfolio of LNG liquefaction turbomachinery, which has grown in value as global LNG capacity expands.

Business segments

LNG franchise

Baker Hughes holds a strong position in LNG liquefaction equipment. Its aeroderivative turbines, derived from aircraft jet-engine technology, power a large share of the world's operating LNG export capacity. Each liquefaction train requires multiple large compressor trains driven by these turbines, creating a capital-intensive initial sale followed by decades of service, parts, and upgrade revenue from the installed base. With a substantial wave of new LNG capacity expected to come online globally through 2030, Baker Hughes expects continued demand for its turbomachinery.

U.S. LNG export expansion has been a major driver for Baker Hughes. It has supplied turbomachinery to projects including Plaquemines LNG, which began production in December 2024, along with Golden Pass LNG and Rio Grande LNG, awards worth billions of dollars across their multi-train configurations. IET set records for orders in 2025, and its remaining performance obligations stood at $32.4 billion at year-end, giving the segment multi-year revenue visibility.

International footprint

About 72% of Baker Hughes's revenue is generated outside the United States, among the highest international shares of the three major oilfield services companies. Key regions include the Middle East, where national oil companies in Saudi Arabia, Kuwait, Iraq, and the UAE are investing to sustain or grow production, along with Latin America, Asia Pacific, and sub-Saharan Africa. The international mix reduces its sensitivity to U.S. rig count swings and gives it exposure to the longer-cycle capital programs of national oil companies.

The IET segment adds a second layer of international diversification, with LNG equipment orders concentrated in Qatar, Australia, the U.S., and East Africa. These orders track LNG investment cycles rather than oilfield services activity.

Financial performance

Baker Hughes reported FY2025 revenue of about $27.7 billion, roughly flat with FY2024, as record IET results offset softer OFSE activity. Adjusted EBITDA was a record $4.8 billion at a margin of about 17%, with IET generating higher margins than OFSE. Net income attributable to Baker Hughes was about $2.6 billion. The company has improved margins steadily since the GE merger, with the integration now complete and the focus on mix shift and cost discipline. It employed about 56,000 people at the end of 2025.

Baker Hughes generated record free cash flow of about $2.7 billion in 2025 and returned capital through dividends and share repurchases while investing in technology. The IET backlog gives multi-year revenue visibility, and the company has guided to continued IET growth as new LNG and power capacity comes online. In the first quarter of 2026 it reported revenue of about $6.6 billion, adjusted EBITDA up 12%, and record total backlog of $36.1 billion.

Strategy & outlook

Baker Hughes's largest strategic move is its agreement, announced in July 2025, to acquire Chart Industries for about $13.6 billion in cash ($210 per share). Chart makes cryogenic and process equipment used in LNG, industrial gas, and data-center cooling, and Baker Hughes has framed the deal as deepening its energy and industrial technology portfolio. Chart shareholders approved the transaction in October 2025; as of mid-2026 it awaited European Union clearance, with completion targeted for July 2026.

Baker Hughes has positioned itself as an "energy technology company" rather than only an oilfield services provider, a label that reflects the IET segment's industrial character and the company's investment in digital and AI tools. In 2025 it renewed and expanded its alliance with C3.ai through 2028 to develop AI applications for industrial operations, and it markets its Leucipa platform for production optimization, though these digital lines remain small relative to the core hardware and services businesses.

Baker Hughes has invested in new-energy adjacencies through its IET Climate Technology Solutions unit, which develops equipment for hydrogen compression, carbon capture, and geothermal. The company says the turbomachinery expertise that powers LNG can be applied to this infrastructure; the unit has not yet contributed materially to earnings.

Key considerations

Baker Hughes's IET segment differentiates it from pure oilfield services peers and provides revenue stability through long-cycle equipment orders and a large installed base. The LNG equipment business benefits from the global buildout of export capacity, and aftermarket services on installed equipment generate recurring revenue. The GE Oil & Gas integration created organizational complexity, and Baker Hughes trailed SLB on oilfield services margins for several years after the merger.

Investors have periodically questioned whether the IET and OFSE businesses are worth more together than apart. Baker Hughes's case for the combination rests on cross-selling, shared international infrastructure, and integrated offerings for operators that need both oilfield services and plant equipment. Its 2025 and 2026 portfolio reshaping, including the Chart acquisition and the sale of several smaller product lines, has concentrated the company on LNG, data-center power, and industrial technology.

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