Strong demand for natural gas-related services helped Baker Hughes beat expectations for its financial performance in the second quarter of the year, as the company boasted a record order backlog for the period in its Industrial and Energy Technology segment.
Baker Hughes booked a net income of $710 million for the three-month period, which represented a 74% increase on the first quarter and a 21% increase on a year earlier. The net income came on earnings before interest, tax, depreciation, and amortization of 41.2 billion, up 7% on the year.
The order backlog in the Industrial and Energy Technology segment reached 43.5 billion in the second quarter, Baker Hughes said, with chief executive Lorenzo Simonelli noting that “Importantly, order momentum remained strong, supported by more than $550 million of data center related orders, despite the absence of large LNG awards.”
The oilfield services and energy technology major struck a more upbeat note in its second-quarter report than it did in the report for the first quarter of the year. At the time, Baker Hughes, like many others, was concerned about the impact of President Trump’s trade policies on the business. Now, it appears the worst of the dangers related to tariffs has been averted or at least delayed.
At the same time, Baker Hughes felt the pain of declining activity in the oil patch due to the lower oil prices. Lower drilling activity pushed its total revenues down by 3% in the second quarter, to $6.91 billion. The revenue figure, however, represented an 8% increase on the first quarter.
Orders in the oilfield services segment were also strong, up by 7% from the first quarter to $3.5 billion, although the number represented a 14% decline on the second quarter of 2024.
On the back of these developments, CEO Simonelli said that “we are raising our full-year revenue and EBITDA guidance for IET and reestablishing full-year guidance for OFSE.”
By Irina Slav for Oilprice.com
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