Baker Hughes Rig Count in North America (Rigs)

Baker Hughes Rig Count in International (Rigs)

Baker Hughes Rig Count Worldwide (Rigs)

Remaining Performance Obligations (USD billions)

7cacf9dfdf9fd23f343031b31d0333618c38c830e22b11679da290ce8028330e

6490da3ee4d02712a2fe09dfcf3b1d2e02a3b6d8aa096f192e3c28efba889698

| Metric / Quarter                  | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-----------------------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| CO2 Emissions Reduction (%)       | **23%** **[0001701605-23-000044_bkr-20221231.htm:13]** **[0001701605-23-000044_bkr-20221231.htm:13]**  | **23%** **[0001701605-23-000049_bkr-20230331.htm:26]** **[0001701605-23-000049_bkr-20230331.htm:26]**  | **28%** **[0001701605-23-000063_bkr-20230630.htm:27]** **[0001701605-23-000063_bkr-20230630.htm:27]**  | **28%** **[0001701605-23-000078_bkr-20230930.htm:29]** **[0001701605-23-000078_bkr-20230930.htm:29]**  | **28%** **[0001701605-24-000033_bkr-20231231.htm:13]** **[0001701605-24-000033_bkr-20231231.htm:13]**  | **28%** **[0001701605-24-000067_bkr-20240331.htm:21]** **[0001701605-24-000067_bkr-20240331.htm:21]**  | **28.3%** **[0001701605-24-000111_bkr-20240630.htm:22]** **[0001701605-24-000111_bkr-20240630.htm:22]**  | **28.3%** **[0001701605-24-000131_bkr-20240930.htm:24]** **[0001701605-24-000131_bkr-20240930.htm:24]**  |
| Performance Obligations ($B)      | **$27.8B** **[BKR_3123957_5]**  | **$29.6B** **[BKR_3246802_4]** **[0001701605-23-000049_bkr-20230331.htm:30]**  | **$31B** **[BKR_3254870_5]**  | **$32.4B** **[0001701605-23-000078_bkr-20230930.htm:33]**  | **$33.5B** **[0001701605-24-000007_earningsreleaseex991123120.htm:4]**  | **$32.7B** **[0001701605-24-000067_bkr-20240331.htm:13]**  | **$33.5B** **[0001701605-24-000109_earningsreleaseex991063020.htm:4]**  | **$33.4B** **[0001701605-24-000129_earningsreleaseex991093020.htm:2]**  |

ade82f2972b249315d162704e6a1edf73b51af7ebbc8807bfb470419dceea7bd

Baker Hughes Company is a global leader in providing integrated oilfield products, services, and digital solutions. The company operates through two main business segments: Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET), offering a wide range of products and services for the energy industry **[0001701605-24-000033_bkr-20231231.htm:113]**. OFSE focuses on supporting oilfield operations throughout the lifecycle of a well, while IET provides technology solutions for mechanical-drive, compression, and power-generation applications **[0001701605-24-000033_bkr-20231231.htm:113]** **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-24-000111_bkr-20240630.htm:14]** **[0001701605-24-000131_bkr-20240930.htm:15]**. Baker Hughes is committed to advancing energy technology and delivering innovative solutions to meet the evolving needs of the industry **[0001701605-24-000033_bkr-20231231.htm:113]** **[0001701605-24-000033_bkr-20231231.htm:112]**.

1. **Oilfield Services & Equipment (OFSE)** - Provides comprehensive products and services for onshore and offshore oilfield operations, covering exploration, appraisal, development, production, rejuvenation, and decommissioning **[0001701605-24-000033_bkr-20231231.htm:113]** **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-24-000111_bkr-20240630.htm:14]** **[0001701605-24-000131_bkr-20240930.htm:15]**.
   - **Well Construction** - Offers tools and services for drilling and constructing wells.
   - **Completions, Intervention & Measurements** - Delivers solutions for well completion, intervention, and measurement activities.
   - **Production Solutions** - Focuses on enhancing production efficiency and recovery.
   - **Subsea & Surface Pressure Systems** - Provides equipment and services for managing pressure in subsea and surface environments.

2. **Industrial & Energy Technology (IET)** - Delivers technology solutions and services for mechanical-drive, compression, and power-generation applications across the energy industry, including oil and gas, LNG operations, and lower carbon solutions **[0001701605-24-000033_bkr-20231231.htm:113]** **[0001701605-24-000111_bkr-20240630.htm:14]** **[0001701605-24-000131_bkr-20240930.htm:15]**.
   - **Gas Technology Equipment** - Supplies equipment for gas processing and handling.
   - **Gas Technology Services** - Offers maintenance and support services for gas technology systems.
   - **Industrial Products** - Provides a range of products for industrial applications.
   - **Industrial Solutions** - Delivers integrated solutions for industrial processes.
   - **Climate Technology Solutions** - Focuses on technologies aimed at reducing carbon emissions and enhancing sustainability.

18aa08717b9248692bb2fd09df6b2d3efe5710754faf9b6e8f267d2d72de4da1

Adjustments for Non-Cash Items (USD, millions)

Stock-Based Compensation (USD, millions)

Changes in Working Capital (USD, millions)

Capital Expenditures (CapEx) (USD, millions)

Proceeds from / Repayments of Debt (USD, millions)

Share Repurchases (USD, millions)

Dividend Payments (USD, millions)

Net Change in Cash (USD, millions)

9a3bb97f09857fd2838490b5488d105363ba169f047343754bdfe68eac887a08

| Geographical Segment | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | Q4 2022 | Q3 2024 | Q2 2024 | Q1 2024 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| North America ($M)   | **1,018**  **[0001701605-24-000007_earningsreleaseex991123120.htm:5]**  | **1,064**  **[0001701605-23-000078_bkr-20230930.htm:34]**  | **1,042**  **[0001701605-23-000063_bkr-20230630.htm:32]**  | **992**  **[0001701605-23-000049_bkr-20230331.htm:31]**  | N/A     | **971**  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  | **1,023**  **[0001701605-24-000111_bkr-20240630.htm:26]**  | **990**  **[0001701605-24-000067_bkr-20240331.htm:25]**  |
| Latin America ($M)   | **708**  **[0001701605-24-000007_earningsreleaseex991123120.htm:5]**    | **695**  **[0001701605-23-000078_bkr-20230930.htm:34]**    | **698**  **[0001701605-23-000063_bkr-20230630.htm:32]**    | **661**  **[0001701605-23-000049_bkr-20230331.htm:31]**  | N/A     | **648**  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  | **663**  **[0001701605-24-000111_bkr-20240630.htm:26]**    | **637**  **[0001701605-24-000067_bkr-20240331.htm:25]**  |
| Europe/CIS/Sub-Saharan Africa ($M) | **707**  **[0001701605-24-000007_earningsreleaseex991123120.htm:5]**  | **695**  **[0001701605-23-000078_bkr-20230930.htm:34]**  | **672**  **[0001701605-23-000063_bkr-20230630.htm:32]**  | **581**  **[0001701605-23-000049_bkr-20230331.htm:31]**  | N/A | **933**  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  | **827**  **[0001701605-24-000111_bkr-20240630.htm:26]**  | **750**  **[0001701605-24-000067_bkr-20240331.htm:25]**  |
| Middle East/Asia ($M) | **1,522**  **[0001701605-24-000007_earningsreleaseex991123120.htm:5]**  | **1,497**  **[0001701605-23-000078_bkr-20230930.htm:34]**  | **1,465**  **[0001701605-23-000063_bkr-20230630.htm:32]**  | **1,345**  **[0001701605-23-000049_bkr-20230331.htm:31]**  | N/A | **1,411**  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  | **1,498**  **[0001701605-24-000111_bkr-20240630.htm:26]**  | **1,405**  **[0001701605-24-000067_bkr-20240331.htm:25]**  |

da575c1138347d8ba39451c121428e08a74b7f17415ab9d7995c6687919151ab

| Metric [Unit: $ Million] | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|--------------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| **OFSE Total Revenue**   | 3,600  **[BKR_3123957_6]**  | 3,577  **[0001701605-23-000049_bkr-20230331.htm:14]**  | 3,877  **[0001701605-23-000063_bkr-20230630.htm:32]**  | 3,951  **[0001701605-23-000078_bkr-20230930.htm:34]**  | 3,956  **[0001701605-24-000007_earningsreleaseex991123120.htm:4]**  | 3,783  **[0001701605-24-000067_bkr-20240331.htm:25]**  | 4,011  **[0001701605-24-000109_earningsreleaseex991063020.htm:6]**  | 3,963  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  |
| **IET Total Revenue**    | N/A | 2,138  **[0001701605-23-000049_bkr-20230331.htm:14]**  | 2,438  **[0001701605-23-000063_bkr-20230630.htm:32]**  | 2,691  **[0001701605-23-000078_bkr-20230930.htm:34]**  | 2,879  **[0001701605-24-000007_earningsreleaseex991123120.htm:4]**  | 2,634  **[0001701605-24-000067_bkr-20240331.htm:25]**  | 3,128  **[0001701605-24-000109_earningsreleaseex991063020.htm:6]**  | 2,945  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  |
| **Total Revenue**        | 5,900  **[BKR_3123957_5]**  | 5,716  **[0001701605-23-000049_bkr-20230331.htm:14]**  | 6,315  **[0001701605-23-000063_bkr-20230630.htm:32]**  | 6,641  **[0001701605-23-000078_bkr-20230930.htm:34]**  | 6,835  **[0001701605-24-000007_earningsreleaseex991123120.htm:4]**  | 6,418  **[0001701605-24-000067_bkr-20240331.htm:25]**  | 7,139  **[0001701605-24-000109_earningsreleaseex991063020.htm:6]**  | 6,908  **[0001701605-24-000129_earningsreleaseex991093020.htm:4]**  |

fbdd6533b4dc8f69d8d7293fc75a4866833d5923ce0180b1da7b96d5328b4e27

978773b98f4b3412ad3d45ea07b2ded7bf1f1c0fef1980c33355c19adbbf3783

1. Your margin targets for the Industrial and Energy Technology (IET) segment are ambitious; can you elaborate on the specific drivers that will sustain margin improvement beyond 2026, especially considering potential market headwinds?  **[BKR_3403513_8]** **[BKR_3403513_13]** 

2. The growth in Gas Technology Services (GTS) revenue has historically outpaced the installed base growth; what are the key risks that could prevent this trend from continuing, particularly in terms of pricing and upgrade opportunities?  **[BKR_3403513_14]** 

3. With the expectation of flat global upstream spending next year and activity uncertainties in regions like Saudi Arabia and North America, how will this impact your mature asset solutions, and what strategies are in place to drive growth in this environment?  **[BKR_3403513_3]** **[BKR_3403513_8]** 

4. As you continue to secure large orders in Gas Technology Equipment and New Energy, how are you addressing potential supply chain constraints, such as those affecting aeroderivative technology, that could impact backlog conversion and revenue recognition?  **[BKR_3403513_8]** 

5. Given your significant investments in digital solutions like Leucipa and CarbonEdge, how do you plan to effectively monetize these technologies, and what challenges do you foresee in scaling their adoption across your global customer base?  **[BKR_3403513_2]** 

4e40b32e8211728145f4542e081d4855137e7edbd701efc242973efa5d48025f

| Program Details          | Program 1       |
|--------------------------|-----------------|
| Approval Date            | **July 30, 2021**  **[0001701605-24-000131_bkr-20240930.htm:41]**  |
| End Date/Duration        | No specified expiration date  **[0001701605-24-000131_bkr-20240930.htm:41]**  |
| Total Additional Amount  | **$4 billion**  **[0001701605-24-000131_bkr-20240930.htm:41]**  |
| Remaining Authorization  | **$1.7 billion**  **[0001701605-24-000131_bkr-20240930.htm:9]**  |
| Details                  | The program may be suspended or discontinued at any time. It is funded from cash generated from operations.  **[0001701605-23-000044_bkr-20221231.htm:103]** **[0001701605-23-000049_bkr-20230331.htm:9]** **[0001701605-24-000131_bkr-20240930.htm:9]** **[0001701605-24-000111_bkr-20240630.htm:9]** **[0001701605-24-000067_bkr-20240331.htm:8]** **[0001701605-23-000078_bkr-20230930.htm:10]** **[0001701605-24-000033_bkr-20231231.htm:107]**  |

57864fd9a1fcbff1eafccd1673100f7f16f5fa1b98dac04e74ce2f6d9a76f8d5

### Q3 2024 Earnings Call
- **Issued Period:** Q3 2024
- **Guided Period:** FY 2024
- **Guidance:**
  - **Full Year Guidance:**
    - **Total Company EBITDA:** Midpoint unchanged, orders expected to approach the midpoint of **$11.5 billion to $13.5 billion**  **[BKR_3403513_9]** .
    - **IET EBITDA:** Increased to **$2 billion** at the midpoint  **[BKR_3403513_9]** .
    - **OFSE EBITDA:** Midpoint of **$2.87 billion**  **[BKR_3403513_9]** .
  - **Fourth Quarter Guidance:**
    - **Total EBITDA:** Approximately **$1.26 billion** at the midpoint  **[BKR_3403513_8]** .
    - **IET EBITDA:** **$590 million** at the midpoint  **[BKR_3403513_8]** .
    - **OFSE EBITDA:** **$750 million** at the midpoint  **[BKR_3403513_8]** .
  - **Free Cash Flow:** Targeting a conversion of **45% to 50%**  **[BKR_3403513_6]** .

### Q2 2024 Earnings Call
- **Issued Period:** Q2 2024
- **Guided Period:** Q3 2024 and FY 2024
- **Guidance:**
  - **EBITDA Guidance:**
    - Full year EBITDA of **$4.525 billion** at the midpoint  **[BKR_3394793_8]** .
  - **IET Guidance:**
    - Full year IET EBITDA of **$1.965 billion** at the midpoint  **[BKR_3394793_9]** .
    - Q3 IET EBITDA of **$525 million** at the midpoint  **[BKR_3394793_8]** .
    - Full year IET orders between **$11.5 billion to $13.5 billion**  **[BKR_3394793_8]** .
  - **OFSE Guidance:**
    - Full year OFSE EBITDA midpoint of **$2.9 billion**  **[BKR_3394793_9]** .
    - Q3 OFSE EBITDA of **$760 million** at the midpoint  **[BKR_3394793_8]** .
  - **New Energy Orders:** Towards the high end of **$800 million to $1 billion**  **[BKR_3394793_8]** .
  - **Free Cash Flow Conversion:** Targeting **45% to 50%**  **[BKR_3394793_6]** .

### Q1 2024 Earnings Call
- **Issued Period:** Q1 2024
- **Guided Period:** Q2 2024 and FY 2024
- **Guidance:**
  - **Full Year 2024 Guidance:**
    - **Revenue:** Between **$26.5 billion and $28.5 billion**  **[BKR_3380588_7]** .
    - **EBITDA:** Between **$4.1 billion and $4.5 billion**  **[BKR_3380588_7]** .
    - **New Energy Orders:** Between **$800 million and $1 billion**  **[BKR_3380588_7]** .
  - **Segment Guidance:**
    - **OFSE:**
      - Full Year Revenue: **$15.75 billion to $16.75 billion**  **[BKR_3380588_7]** .
      - Full Year EBITDA: **$2.8 billion to $3.0 billion**  **[BKR_3380588_7]** .
      - Q2 Revenue: **$3.8 billion to $4.0 billion**  **[BKR_3380588_7]** .
      - Q2 EBITDA: **$660 million to $710 million**  **[BKR_3380588_7]** .
    - **IET:**
      - Full Year Orders: **$11.5 billion to $13.5 billion**  **[BKR_3380588_7]** .
      - Q2 Revenue: **$2.8 billion to $3.05 billion**  **[BKR_3380588_7]** .
      - Q2 EBITDA: **$425 million to $475 million**  **[BKR_3380588_7]** .
  - **Second Quarter 2024 Guidance:**
    - Total Revenue: **$6.6 billion to $7.05 billion**  **[BKR_3380588_7]** .
    - Total EBITDA: **$1 billion to $1.1 billion**  **[BKR_3380588_7]** .
  - **Dividend and Shareholder Returns:** Return **60% to 80%** of free cash flow  **[BKR_3380588_9]** .

### Q4 2023 Earnings Call
- **Issued Period:** Q4 2023
- **Guided Period:** Q1 2024 and FY 2024
- **Guidance:**
  - **First Quarter 2024 Guidance:**
    - Total Company Revenue: **$6.1 billion to $6.6 billion**  **[BKR_3370775_9]** .
    - Total Company EBITDA: **$880 million to $960 million**  **[BKR_3370775_9]** .
    - IET Revenue: **$2.4 billion to $2.65 billion**  **[BKR_3370775_9]** .
    - IET EBITDA: **$340 million to $380 million**  **[BKR_3370775_9]** .
    - OFSE Revenue: **$3.7 billion to $3.95 billion**  **[BKR_3370775_9]** .
    - OFSE EBITDA: **$630 million to $670 million**  **[BKR_3370775_9]** .
  - **Full Year 2024 Guidance:**
    - Total Company Revenue: **$26.5 billion to $28.5 billion**  **[BKR_3370775_9]** .
    - Total Company EBITDA: **$4.1 billion to $4.5 billion**  **[BKR_3370775_9]** .
    - New Energy Orders: **$800 million to $1 billion**  **[BKR_3370775_9]** .
    - IET Orders: **$11.5 billion to $13.5 billion**  **[BKR_3370775_9]** .
    - IET Revenue: **$10.75 billion to $11.75 billion**  **[BKR_3370775_9]** .
    - IET EBITDA: **$1.65 billion to $1.85 billion**  **[BKR_3370775_9]** .
    - OFSE Revenue: **$15.75 billion to $16.75 billion**  **[BKR_3370775_9]** .
    - OFSE EBITDA: **$2.8 billion to $3 billion**  **[BKR_3370775_9]** .
    - Free Cash Flow Conversion: **45% to 50%**  **[BKR_3370775_6]** .
  - **EBITDA Margin Target:** 20% for OFSE by 2025 and for IET by 2026  **[BKR_3370775_9]** **[BKR_3370775_14]** .

78efa9ec8346884ef1afd76cb3eda900a15056ca847391cc21cdcb851529d244

- **Siemens Energy** - Competitor for Gas Technology Equipment product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Solar (a Caterpillar company)** - Competitor for Gas Technology Equipment product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **MAN Energy Solutions** - Competitor for Gas Technology Equipment product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Masaood John Brown** - Competitor for Gas Technology Services product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **EthosEnergy** - Competitor for Gas Technology Services product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Sulzer** - Competitor for Gas Technology Services product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Emerson** - Competitor for Industrial Products and Industrial Solutions product lines  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Flowserve** - Competitor for Industrial Products product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Metso Outotec** - Competitor for Industrial Products product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Honeywell Process Solutions** - Competitor for Industrial Solutions product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **ABB** - Competitor for Industrial Solutions product line  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Aker Carbon Capture** - Competitor for CCUS applications in Climate Technology Solutions  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Svante** - Competitor for CCUS applications in Climate Technology Solutions  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **SLB** - Competitor for CCUS applications in Climate Technology Solutions and for Well Construction; Completions, Intervention, & Measurements; Production Solutions; Subsea & Surface Pressure Systems in OFSE  **[0001701605-24-000033_bkr-20231231.htm:7]** **[0001701605-24-000033_bkr-20231231.htm:5]** .
- **Howden (a Chart Industries company)** - Competitor for hydrogen applications in Climate Technology Solutions  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Burckhardt** - Competitor for hydrogen applications in Climate Technology Solutions  **[0001701605-24-000033_bkr-20231231.htm:7]** .
- **Halliburton** - Competitor for Well Construction; Completions, Intervention, & Measurements; Production Solutions; Subsea & Surface Pressure Systems in OFSE  **[0001701605-24-000033_bkr-20231231.htm:5]** .
- **ChampionX** - Competitor for Production Solutions in OFSE  **[0001701605-24-000033_bkr-20231231.htm:5]** .
- **TechnipFMC** - Competitor for Subsea & Surface Pressure Systems in OFSE  **[0001701605-24-000033_bkr-20231231.htm:5]** .
- **Aker Solutions** - Competitor for Subsea & Surface Pressure Systems in OFSE  **[0001701605-24-000033_bkr-20231231.htm:5]** .
- **NOV** - Competitor for Subsea & Surface Pressure Systems in OFSE  **[0001701605-24-000033_bkr-20231231.htm:5]** .

6a296ab8cb822c04e5db838e906d38d2d290a77fecab8ccdcfa1227875f4c8cd

CO2 Emissions Reduction (%)

Performance Obligations ($B)

d0f31c98ec30ef73370919e593e95459f04fc690e761a111e718cc19f62af7ec

Oilfield Services & Equipment (OFSE)

- Well Construction

- Completions, Intervention & Measurements

- Production Solutions

- Subsea & Surface Pressure Systems

Industrial & Energy Technology (IET)

- Gas Technology Equipment

- Gas Technology Services

- Total Gas Technology

- Industrial Products

- Industrial Solutions

- Climate Technology Solutions

Oilfield Services (OFS)

Oilfield Equipment (OFE)

Turbomachinery & Process Solutions (TPS)

Digital Solutions (DS)

Total Revenue

a15a21bb2e0efcdc17bb07a645194c66c62ec42b66d20fcfb0238c8871a68239

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

Oilfield Services & Equipment

- North America

- Latin America

- Europe/CIS/Sub-Saharan Africa

- Middle East/Asia

- International Total

- Total OFSE Revenue

U.S. Revenue

Non-U.S. Revenue

c7ba0fcf7b5974b4f1c9654c5964ddf165ccafdbd153eedfbf49b8de27fdc746

- Total Revenue: $7,364 million (+8% YoY)  **[0001701605-24-000033_bkr-20231231.htm:82]** **[0001701605-24-000033_bkr-20231231.htm:112]** **[0001701605-25-000014_earningsreleaseex991123120.htm:12]** **[0001701605-25-000014_earningsreleaseex991123120.htm:5]**   
- Industrial & Energy Technology: $3,494 million (+21% YoY)  **[0001701605-24-000033_bkr-20231231.htm:113]** **[0001701605-24-000033_bkr-20231231.htm:112]** **[0001701605-25-000014_earningsreleaseex991123120.htm:9]**   
- North America: $887 million (−13% YoY)  **[0001701605-24-000033_bkr-20231231.htm:62]** **[0001701605-25-000014_earningsreleaseex991123120.htm:7]**   
- Latin America: $952 million (+35% YoY)  **[0001701605-24-000033_bkr-20231231.htm:62]** **[0001701605-25-000014_earningsreleaseex991123120.htm:7]**   
- Cost of Goods Sold: $5,833 million (**+62% YoY**)  **[0001701605-24-000033_bkr-20231231.htm:82]** **[0001701605-24-000033_bkr-20231231.htm:112]** **[0001701605-25-000014_earningsreleaseex991123120.htm:12]**   
- Net Income: $1,179 million (**+178% YoY**)  **[0001701605-24-000033_bkr-20231231.htm:82]** **[0001701605-24-000033_bkr-20231231.htm:83]** **[0001701605-25-000014_earningsreleaseex991123120.htm:12]** **[0001701605-25-000014_earningsreleaseex991123120.htm:10]**   

d9e19cac699e63857c9f3754a0b82fead7ab325a66df6c522370a2be6e6f048e

| Name                   | Position                                             | Start Date       | Short Bio                                                                                                                                                                                                 |
|------------------------|------------------------------------------------------|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Lorenzo Simonelli      | Chairman, President and CEO                          | July 2017        | Lorenzo Simonelli has been the **Chairman of the Board of Directors** of Baker Hughes since **October 2017** and has served as the **President and Chief Executive Officer** since **July 2017**. Before joining Baker Hughes, he was the Senior Vice President at GE and President and Chief Executive Officer of GE Oil & Gas from October 2013 to July 2017  **[0001701605-24-000033_bkr-20231231.htm:25]** **[0001193125-24-084804_d687069ddef14a.htm:19]** . |
| Nancy Buese            | Chief Financial Officer                              | November 2022    | Nancy Buese is the **Chief Financial Officer** of Baker Hughes Company. She joined the company in **November 2022**. Before joining Baker Hughes, she served as Executive Vice President and Chief Financial Officer of Newmont Corporation  **[0001701605-24-000033_bkr-20231231.htm:25]** **[0001701605-23-000044_bkr-20221231.htm:22]** . |
| James E. Apostolides   | Senior Vice President, Enterprise Operational Excellence | February 2020    | James E. Apostolides is the **Senior Vice President of Enterprise Operational Excellence** at Baker Hughes. He began his career in 1999 with GE, where he held roles of increasing responsibility, including managerial positions in Shop Operations, Materials, Sourcing, and Fulfillment across multiple continents  **[0001701605-24-000033_bkr-20231231.htm:25]** . |
| Maria Claudia Borras   | Executive Vice President, Oilfield Services and Equipment | September 2022   | Maria Claudia Borras is the **Executive Vice President, Oilfield Services and Equipment** at Baker Hughes. She has been in this role since **September 2022**. Prior to this, she served as Executive Vice President of Oilfield Services from **July 2017 to September 2022**  **[0001701605-24-000033_bkr-20231231.htm:25]** **[0001701605-23-000044_bkr-20221231.htm:22]** . |
| Ganesh Ramaswamy       | Executive Vice President, Industrial & Energy Technology | January 2023     | Ganesh Ramaswamy is the **Executive Vice President of Industrial & Energy Technology** at Baker Hughes. He joined the company in **January 2023**. Before joining Baker Hughes, he served as President of Global Services for Johnson Controls  **[0001701605-23-000044_bkr-20221231.htm:23]** **[0001193125-24-084804_d687069ddef14a.htm:37]** . |
| Georgia Magno          | Chief Legal Officer                                  | 2010             | Georgia Magno is the **Chief Legal Officer** of Baker Hughes Company. She joined the company in **2010**, initially serving as General Counsel for the global supply chain. Over the years, she has held various legal roles across commercial, operational, and product line organizations  **[0001701605-24-000033_bkr-20231231.htm:25]** . |

7fe65dc216bb82fb32e6094734c4be632e73e4ed016ca621efd2881372feab35

49f8b5fb81436a6c7077b2c9178e4d3baaa7fb8b581e74436eaadbccdc9e4871

**Quarterly guidance for Q4 2024:**
- **Total EBITDA**: $1.26 billion  **[BKR_3403513_8]**  (no prior guidance)  
- **IET EBITDA**: $590 million  **[BKR_3403513_8]**  (no prior guidance)  
- **OFSE EBITDA**: $750 million  **[BKR_3403513_8]**  (no prior guidance)  

**Annual guidance for FY 2024:**
- **Total Company EBITDA**: Midpoint unchanged  **[BKR_3403513_9]**  (no change from prior guidance of $4.525 billion  **[BKR_3394793_8]** )  
- **IET EBITDA**: $2.0 billion  **[BKR_3403513_9]**  (raised from $1.965 billion  **[BKR_3394793_9]** )  
- **OFSE EBITDA**: $2.87 billion  **[BKR_3403513_9]**  (lowered from $2.9 billion  **[BKR_3394793_9]** )  
- **IET orders**: $11.5 billion to $13.5 billion  **[BKR_3403513_9]**  (no change from prior guidance  **[BKR_3394793_8]** )  
- **Free Cash Flow conversion**: 45% to 50%  **[BKR_3403513_6]**  (no change from prior guidance  **[BKR_3394793_6]** )  

0140eccec765346aeedf60d35277ae2e5f09bd121d80f633959410274ffecf86

| Name              | Start Date   | End Date   | Reason for Change                                                                                     |
|-------------------|-------------|------------|-------------------------------------------------------------------------------------------------------|
| KPMG LLP          | July 3, 2017  **[0001193125-17-220954_d421375d8k.htm:3]**  | Present | Current auditor.                                                                                 |
| Deloitte & Touche LLP | N/A         | June 30, 2017  **[0001193125-17-220954_d421375d8k.htm:2]**  | Dismissed due to non-audit services, financial interests, and relationships with GE prohibited under SEC rules.  **[0001193125-17-220954_d421375d8k.htm:2]**  |

208e3c208316b6e067a0ccb4605a435c468a8114b2b155c05fb36003f095c9c3

605b5b95e2a8eebd9523ea746bb4ec2ac50c7669895b028e59bdccc1555e6b4b

- **Strong Growth in Industrial & Energy Technology (IET) Segment**: Baker Hughes anticipates its IET segment to become a larger portion of the business due to significant growth opportunities in gas infrastructure, LNG, FPSOs, and industrial technology. The company has booked **$40 billion** of IET orders over the past three years, including **$13 billion in 2024**, the second-highest in its history, despite a **65% decline** in LNG orders due to the U.S. permitting moratorium. This resilience indicates strong demand and positions the company well for future growth.  **[BKR_3413972_21]** **[BKR_3413972_14]**
- **Commitment to Shareholder Returns through Growing Dividends**: The company remains committed to returning **60% to 80%** of free cash flow to shareholders, primarily through dividends. Baker Hughes has increased its dividend for the past **four consecutive years**, reflecting its strong free cash flow performance and commitment to growing profitability. Since 2017, the company has returned over **$10 billion** in dividends and buybacks, demonstrating a strong shareholder return track record.  **[BKR_3413972_19]**
- **Positive Outlook for 2025 IET Orders and LNG Recovery**: Baker Hughes expects strong IET orders in 2025, guiding to **$13.5 billion** at the midpoint, which would mark the third consecutive year exceeding **$13 billion**. The company anticipates LNG orders to rebound, with about **80 MTPA** expected to reach FID over the next couple of years. This, along with continued demand in gas infrastructure and FPSOs, supports a positive growth trajectory for the company.  **[BKR_3413972_14]**

e11a2866c0005193da91f9873843a2b36451fb38c6bc547d7497671b4a920ad7

- **Decrease in OFSE Revenue Expected in 2025**: Baker Hughes anticipates that their Oilfield Services & Equipment (OFSE) segment will experience a **4% decline in top-line revenue** at the midpoint guidance for 2025. This expectation is due to anticipated spending reductions in North America, which are expected to **decrease year-on-year in the mid-single-digit range**, and flat to down spending in international markets. Key regions such as **Mexico, Saudi Arabia, and the North Sea** are expected to remain soft.  **[BKR_3413972_16]**
- **Moderating Growth Rates in Oilfield Services Segment**: The company acknowledges that **growth rates in Oilfield Services are moderating**, and while the Industrial & Energy Technology (IET) segment is projected to grow, there appears to be **no clear strategic destination** regarding the balance between IET and OFSE segments. CEO Lorenzo Simonelli stated, "**we don't have any destination in mind**" concerning the future mix of the business units.  **[BKR_3413972_21]**
- **Potential Overhang Due to OPEC+ Spare Capacity and Changing Regimes**: The international markets face uncertainties such as the **overhang of OPEC+ spare oil capacity** and changing political regimes. These factors could lead to **reduced activity** and negatively impact Baker Hughes' business in these regions.  **[BKR_3413972_16]**

489a1a02ddd441cf4f62795edeef2c4af3810b137e6e517cbce35800acb0a38f

1. **2025 IET Orders Outlook**  
   **Q:** Can you discuss the 2025 IET order outlook?  
   **A:** Lorenzo Simonelli expressed confidence in achieving the **$13.5 billion** midpoint guidance for 2025 IET inbound orders, marking the third consecutive year exceeding **$13 billion**. Despite a **65% decline** in LNG orders in 2024 due to the U.S. permitting moratorium, he anticipates LNG orders to rebound in 2025, supported by **80 MTPA** expected to reach FID over the next couple of years. Strong demand in gas infrastructure, FPSOs (with **7 to 9** units per year), and increased interest in NovaLT turbines—potentially doubling orders in 2025—bolster the positive outlook.  **[BKR_3413972_14]** 

2. **Margin Expansion Goals**  
   **Q:** How will you achieve 20% margins in OFSE and IET?  
   **A:** Nancy Buese stated that self-help initiatives and operational excellence are key to reaching the **20%** margin target for OFSE in 2025 and IET in 2026. In 2024, OFSE margins increased by **1.5 percentage points**, generating incremental margins over 100%. They are focusing on rightsizing the structure, high-end technology offerings, and a production-weighted portfolio to outperform in a softer market. For IET, margin expansion is driven by volume leverage, productivity gains, higher-priced backlog in GTE, digital offerings in GTS, and improvements in Industrial Tech. They view **20% margins** not as a final destination but as a waypoint for further improvement.  **[BKR_3413972_18]** 

3. **Capital Returns and M&A Strategy**  
   **Q:** How will you balance dividends, buybacks, and M&A?  
   **A:** Nancy Buese emphasized their commitment to returning **60% to 80%** of free cash flow to shareholders, anchored by a growing dividend, which has been increased for the past four years. Since 2017, they've returned over **$10 billion** in dividends and buybacks. They will remain opportunistic with share repurchases and retain financial flexibility for potential tuck-in acquisitions, focusing on areas that complement their technology leadership, especially in new energy spaces.  **[BKR_3413972_19]** 

4. **IET vs. OFSE Business Mix**  
   **Q:** Will IET become more than half of your business?  
   **A:** Lorenzo Simonelli acknowledged that while both IET and OFSE are critically important and share capabilities and customers, the IET segment is expected to grow faster due to its considerable addressable market. Over time, IET will comprise a larger portion of Baker Hughes' portfolio, but there is no specific target for the business mix.  **[BKR_3413972_21]** 

5. **Gas Tech Services Growth Drivers**  
   **Q:** Which factors will drive GTS growth in the next years?  
   **A:** Lorenzo Simonelli highlighted that **mix** will be the biggest driver for Gas Tech Services growth, especially the increasing LNG installed base, which is expected to grow by over **50%** through 2030. This outpaces the overall installed base growth of **20%** and generates more service revenue due to high attachment rates. Upgrades are also poised for growth, with a **10%** uptick in the second half of 2024 and the highest order intake since 2020 in the fourth quarter. Pricing and digital offerings will contribute as well.  **[BKR_3413972_17]** 

6. **2025 OFSE Revenue Outlook**  
   **Q:** What are the expectations for OFSE revenue in 2025?  
   **A:** Lorenzo Simonelli indicated that they anticipate 2025 OFSE revenue to be slightly lower than 2024, with a projected **4%** decline at the midpoint. In North America, spending is expected to decrease in the mid-single-digit range due to capital discipline among operators. International markets are expected to be flat to down year-on-year, with softness in Mexico, Saudi Arabia, and the North Sea, partially offset by strength in Brazil and sub-Saharan Africa. Despite lower revenues, they expect to outperform due to a production-weighted portfolio and continued focus on mature asset solutions and brownfield opportunities.  **[BKR_3413972_16]** 

7. **Free Cash Flow Conversion**  
   **Q:** Can you achieve 45–50% free cash flow conversion in 2025?  
   **A:** Nancy Buese expressed confidence in maintaining the **45% to 50%** free cash flow conversion target for 2025, driven by working capital efficiency—such as tighter collections and improved inventory turns—and tax management efforts aimed at lowering the cash tax and book rates. Structurally higher margins will also support free cash flow improvement.  **[BKR_3413972_20]** 

8. **Expanding Gas Turbines Market**  
   **Q:** How are you expanding turbines beyond oil and gas?  
   **A:** Lorenzo Simonelli explained that they are enhancing their industrial gas turbine portfolio to make inroads into markets outside oil and gas, such as data centers, industrial settings, and power generation. Their NovaLT turbines, below **150 megawatts**, provide distributed power solutions behind the meter and off-grid, addressing the growing data center market and the need for compression and power in gas processing and pipelines.  **[BKR_3413972_15]** 

494f99c617e79f866c71dae8475c013219a257260592ad383eec820b0b75c53a

Baker Hughes’ IET segment booked $13B in 2024 orders—the second-highest ever—even after a 65% drop in LNG. Management now guides to $13.5B in 2025 IET orders. Meanwhile, OFSE revenue may fall ~4%. Dividend returns stay robust, underlining strong shareholder support.

25b65a9ffc68042120e8ddcdacea5a2d00217bd0d4d3a97c206cf408c1c367d9

**Quarterly guidance for Q1 2025:**  
- **Revenue**: $6.5B  **[BKR_3413972_12]**  (no prior guidance)  
- **Total EBITDA**: $1.02B  **[BKR_3413972_12]**  (lowered from $1.26B  **[BKR_3403513_8]** )  
- **IET EBITDA**: $460M  **[BKR_3413972_12]**  (lowered from $590M  **[BKR_3403513_8]** )  
- **OFSE EBITDA**: $645M  **[BKR_3413972_12]**  (lowered from $750M  **[BKR_3403513_8]** )  

**Annual guidance for FY 2025:**  
- **Revenue**: $27.75B  **[BKR_3413972_12]**  (no prior guidance)  
- **EBITDA**: $4.95B  **[BKR_3413972_12]**  (lowered from $11.5B–$13.5B  **[BKR_3403513_9]** )  
- **IET Orders**: $12.5B–$14.5B  **[BKR_3413972_12]**  (no prior guidance)  
- **IET Revenue**: $12.75B  **[BKR_3413972_12]**  (no prior guidance)  
- **IET EBITDA**: $2.3B  **[BKR_3413972_12]**  (raised from $2.0B  **[BKR_3403513_9]** )  
- **OFSE Revenue**: $15B  **[BKR_3413972_12]**  (no prior guidance)  
- **OFSE EBITDA**: $3B  **[BKR_3413972_12]**  (raised from $2.87B  **[BKR_3403513_9]** )  
- **Free Cash Flow Conversion**: 45%–50%  **[BKR_3413972_12]**  (no change from 45%–50%  **[BKR_3403513_6]** )  
- **Effective Tax Rate**: 25%–30%  **[BKR_3413972_12]**  (no prior guidance)  

0eab99cb2942ac73c29b6d86eef68aaa08acc49de879280817e126b3443ea053

b6800e4dca3a3dee28187915d98d5db5a35109e23e7f3c1fc4079c8a14f0e858

- Total Revenue: $6.908 billion (+4% YoY)  **[0001701605-24-000131_bkr-20240930.htm:1]** **[0001701605-24-000131_bkr-20240930.htm:31]** **[0001701605-23-000078_bkr-20230930.htm:1]**   
- Industrial & Energy Technology (IET): $2.945 billion (+9% YoY)  **[0001701605-24-000131_bkr-20240930.htm:15]** **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:18]**   
   • Industrial Products: $520 million (**-35% YoY**)  **[0001701605-24-000131_bkr-20240930.htm:15]** **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:34]**   
   • Gas Technology Services: $697 million (+9% YoY)  **[0001701605-24-000131_bkr-20240930.htm:15]** **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:34]**   
- North America: $971 million (-9% YoY)  **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:34]**   
- Latin America: $648 million (-7% YoY)  **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:34]**   
- Europe/CIS/Sub-Saharan Africa: $933 million (**+34% YoY**)  **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:34]**   
- Middle East/Asia: $1,411 million (-6% YoY)  **[0001701605-24-000131_bkr-20240930.htm:14]** **[0001701605-23-000078_bkr-20230930.htm:34]**   
- Operating Income: $93 million (**-87% YoY**)  **[0001701605-24-000131_bkr-20240930.htm:1]** **[0001701605-24-000131_bkr-20240930.htm:4]** **[0001701605-23-000078_bkr-20230930.htm:1]**   
- Net Income: $766 million (**+46% YoY**)  **[0001701605-24-000131_bkr-20240930.htm:1]** **[0001701605-24-000131_bkr-20240930.htm:4]** **[0001701605-23-000078_bkr-20230930.htm:1]**   
- EPS: $0.77 (**+51% YoY**)  **[0001701605-24-000131_bkr-20240930.htm:1]** **[0001701605-24-000131_bkr-20240930.htm:4]** **[0001701605-23-000078_bkr-20230930.htm:1]**   

32bec77a224fa25cef8cefe99916d1918508e553267d20eb8c5f473c8fcbabe6

d7f7e47dd8a2e3f3744d8b6fbeadbb510de1b80fd8622b96c01a36b0ee486a0d

| Year | Amount Due (millions) | Debt Type          | Interest Rate | % of Total Debt |
|------|-----------------------|--------------------|---------------|-----------------|
| 2026 | $598 **[0001701605-24-000131_bkr-20240930.htm:8]**          | 2.061% Senior Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 2.061% **[0001701605-24-000131_bkr-20240930.htm:8]** | 9.9% = (598 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |
| 2027 | $1,309 **[0001701605-24-000131_bkr-20240930.htm:8]**        | 3.337% Senior Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 3.337% **[0001701605-24-000131_bkr-20240930.htm:8]** | 21.7% = (1,309 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |
| 2029 | $263 **[0001701605-24-000131_bkr-20240930.htm:8]**          | 6.875% Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 6.875% **[0001701605-24-000131_bkr-20240930.htm:8]** | 4.4% = (263 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |
| 2029 | $523 **[0001701605-24-000131_bkr-20240930.htm:8]**          | 3.138% Senior Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 3.138% **[0001701605-24-000131_bkr-20240930.htm:8]** | 8.7% = (523 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |
| 2030 | $498 **[0001701605-24-000131_bkr-20240930.htm:8]**          | 4.486% Senior Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 4.486% **[0001701605-24-000131_bkr-20240930.htm:8]** | 8.3% = (498 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |
| 2040 | $1,277 **[0001701605-24-000131_bkr-20240930.htm:8]**        | 5.125% Senior Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 5.125% **[0001701605-24-000131_bkr-20240930.htm:8]** | 21.2% = (1,277 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |
| 2047 | $1,338 **[0001701605-24-000131_bkr-20240930.htm:8]**        | 4.080% Senior Notes **[0001701605-24-000131_bkr-20240930.htm:8]** | 4.080% **[0001701605-24-000131_bkr-20240930.htm:8]** | 22.2% = (1,338 / 6,036) * 100 **[0001701605-24-000131_bkr-20240930.htm:8]** **[0001701605-24-000131_bkr-20240930.htm:8]** |

ae0f5e86f41262f4a00764be6a0f3f7389b892f07af12318d7d6a8412f4e681d

- **Baker Hughes is on track to achieve 20% EBITDA margins in both OFSE and IET segments by 2025 and 2026 respectively**, driven by cost optimization, structural changes, and improved pricing, which is expected to enhance profitability and create more value for shareholders.  **[BKR_3370775_13]** **[BKR_3370775_14]**
- **The company's diversified and versatile IET portfolio, beyond LNG, offers significant growth opportunities**, including leadership in FPSOs with expectations of securing **7 to 9 FPSO projects** over the next few years, and expanding into underserved markets like pipelines, gas processing, petrochemicals, and industrial sectors. This contributes to exceptional growth since 2020, with a **more than 50% increase in other areas**.  **[BKR_3370775_11]** **[BKR_3370775_20]**
- **Record financial performance in 2023**, with EBITDA levels approximately **25% above prior cycle peaks** and consolidated EBITDA margins averaging **200 basis points above 2018 and 2019 levels**, demonstrates strong execution. The company expects continued EBITDA growth in 2024, marking the **fourth consecutive year of double-digit growth**, along with further margin expansion.  **[BKR_3370775_13]**

8fd771f423fe257f0d9d7da570636f2e62735ce04b4673ff7304d91e3738d917

- **Growth is expected to decelerate** in the international market, with the CEO stating that while growth remains positive, it will occur at a **slower pace going forward**.  **[BKR_3394793_14]**
- **U.S. LNG orders have been dampened in 2024**, with a **pause in activity leading to lower orders**, though the company anticipates a future rebound.  **[BKR_3394793_19]**
- **Challenges in Latin America**, particularly in Mexico, are expected to **continue**, impacting the company's performance in that region.  **[BKR_3394793_14]**

8277d9bc893444ec4cc196506c74cfaa7b7b8aa3cf207587a596c8161a239ac5

1. **IET Margin Improvement**  
   **Q:** How confident are you in achieving 20% IET margins by 2026?  
   **A:** We are very confident in reaching the 20% EBITDA target for IET by 2026, given our accelerated margin improvement. EBITDA margins have increased to **17.9%**, up **2.9 percentage points year-over-year**, driven by cost efficiencies, productivity gains, and supply chain improvements. This progress is due to strong execution across segments and over **100** ongoing kaizen projects driving further improvements. Importantly, this margin journey is not solely reliant on external markets but is propelled by internal self-help initiatives.  **[BKR_3403513_13]** 

2. **IET Orders Guidance**  
   **Q:** Do you feel comfortable with the $12.5 billion IET order target for this year, and what about 2025?  
   **A:** Yes, we are confident in achieving the **$12 billion to $12.5 billion** IET orders this year, despite lighter LNG orders and the LNG moratorium. Year-to-date orders are **$9.2 billion**, with only **$700 million** in LNG equipment orders, showing the strength of our diversified portfolio. For 2025, we expect orders to be similar to 2024, with growth across most segments. We anticipate an increase in LNG FIDs next year, assuming a positive resolution of the U.S. LNG moratorium, and continued strength in international LNG projects.  **[BKR_3403513_15]** 

3. **Revenue Growth vs. Installed Base**  
   **Q:** Will revenue growth continue to outpace the installed base growth in Gas Tech Services?  
   **A:** Yes, we expect revenue growth to outpace the **20%** increase in our installed base by 2030. Key drivers include higher pricing due to indexed contractual agreements and market conditions, a higher mix of LNG with a **70%** increase in LNG installed base expected by 2030, advanced service solutions leveraging digital capabilities, and upgrades focused on emissions and efficiencies. These factors give us confidence in exceeding installed base growth rates.  **[BKR_3403513_14]** 

4. **Q3 IET Revenue Timing**  
   **Q:** Why was IET revenue below expectations in Q3, and what drives the rebound in Q4?  
   **A:** The Q3 shortfall was due to timing delays in Gas Tech Equipment deliveries caused by supplier and vessel delays, amounting to just over **$200 million**. This revenue will shift into future quarters, with some occurring in Q4 and some in Q1. Despite this, we remain confident in our guidance, with IET revenues up **30%** this year and margins improving. The underlying business remains strong, and these are normal timing differences in long-cycle projects.  **[BKR_3403513_16]** 

5. **Backlog Conversion**  
   **Q:** How should we think about IET backlog conversion in 2025?  
   **A:** We expect the cycle time of projects to remain consistent, with the RPO (Remaining Performance Obligations) continuing at record levels and converting at the same pace. We see robust activity levels into 2025, similar to 2024, with positive momentum and potential resolution of the LNG moratorium enhancing prospects.  **[BKR_3403513_17]** 

1ccfca0af72f96ac4a47e762080998364ec3a547aebf7a6b76c6c0e3d38e7e1b

1. **20% EBITDA Margin Targets**  
   **Q:** How will you achieve the 20% EBITDA margin targets for OFSE and IET?  
   **A:** Baker Hughes remains committed to the **20% EBITDA targets** for both OFSE and IET.  **[BKR_3370775_14]**  They have a clear plan involving structural changes, cost optimization, and efficiency improvements.  **[BKR_3370775_14]**  In OFSE, recent cost initiatives, including over **$150 million** in cost removals, will help reach **20% margins by 2025**.  **[BKR_3370775_14]**  In IET, they expect to achieve **20% margins by 2026**, driven by higher-margin backlog conversion, improved pricing, and cost productivity.  **[BKR_3370775_14]** 

2. **Impact of U.S. LNG Permitting Delays**  
   **Q:** Are permitting delays in U.S. LNG projects a risk to your 2024 outlook?  
   **A:** There is **no impact expected on 2024** from U.S. LNG permitting delays.  **[BKR_3370775_16]**  While delays are occurring, Baker Hughes anticipates **65 MTPA of LNG FIDs** this year, supporting their outlook.  **[BKR_3370775_16]**  They believe the situation will resolve over time and emphasize that international LNG projects can offset any U.S. slowdown.  **[BKR_3370775_16]** 

3. **IET Order Guidance Details**  
   **Q:** Can you provide details on IET order guidance between LNG and other components?  
   **A:** Baker Hughes expects another strong year of IET orders, with guidance between **$11.5 billion and $13.5 billion**.  **[BKR_3370775_15]**  While LNG remains significant, they also foresee strong growth in **onshore/offshore production**, FPSO awards, and other non-LNG opportunities.  **[BKR_3370775_15]**  The midpoint of **$12.5 billion** would rival their second-largest order year.  **[BKR_3370775_15]** 

4. **Organizational Transformation and Cost Reductions**  
   **Q:** What are your plans for further cost reductions and transformation?  
   **A:** Baker Hughes is focused on operational excellence, having already removed over **$150 million in costs**.  **[BKR_3370775_18]**  They are streamlining processes, synchronizing systems, and eliminating duplication to drive efficiency and margin improvements.  **[BKR_3370775_18]**  They will continue this transformation but are not setting new cost targets, instead focusing on margin improvement.  **[BKR_3370775_18]** 

5. **Aero-Derivative Supply Chain Challenges**  
   **Q:** Can you update on aero-derivative supply chain issues and 2024 outlook?  
   **A:** The aero-derivative supply chain remains tight but stable.  **[BKR_3370775_17]**  Baker Hughes managed the challenges in 2023 and expects to continue doing so in 2024, with this reflected in their guidance.  **[BKR_3370775_17]**  They are working closely with suppliers to ensure execution without impacting results.  **[BKR_3370775_17]** 

6. **International LNG Projects Offsetting U.S. Delays**  
   **Q:** If U.S. LNG approvals slow, can international projects fill the gap?  
   **A:** Yes, international LNG projects can offset any U.S. slowdown.  **[BKR_3370775_19]**  Baker Hughes sees opportunities globally, with projects in the Middle East, Africa, and Southeast Asia progressing.  **[BKR_3370775_19]**  They offer solutions across all LNG project types and are confident in their global reach.  **[BKR_3370775_19]** 

7. **Non-LNG Services and Installed Base Growth**  
   **Q:** What's the growth outlook for non-LNG equipment and associated services?  
   **A:** There is significant opportunity in non-LNG equipment, including **onshore/offshore FPSOs**, gas pipelines, and industrial segments like refineries and petrochemicals.  **[BKR_3370775_20]**  Baker Hughes is expanding service solutions and digital offerings, expecting substantial growth in their installed base and services.  **[BKR_3370775_20]** 

8. **Tax Rate Expectations**  
   **Q:** Where do you expect to get the tax rate to, and over what time frame?  
   **A:** Baker Hughes aims to reduce their tax rate to the **low 20% range** over time.  **[BKR_3370775_22]**  They are working on structuring and efficiencies to bring the rate down in the next few years, acknowledging its importance for earnings improvement.  **[BKR_3370775_22]** 

9. **LNG Award Expectations in IET Guidance**  
   **Q:** What's the LNG award expectation in IET guidance for 2024? Is it contributing to the wide guidance range?  
   **A:** Baker Hughes anticipates **65 MTPA of LNG FIDs** in 2024.  **[BKR_3370775_21]**  The guidance includes expected LNG orders, but they do not include orders from projects not yet FID-ed.  **[BKR_3370775_21]**  The wide guidance range accounts for the timing and certainty of these orders.  **[BKR_3370775_21]** 

10. **New Energy Business Growth Potential**  
    **Q:** In New Energy, which areas have the most potential near-term growth?  
    **A:** Significant growth is expected in **carbon capture technologies**, **hydrogen**, **geothermal**, emissions management, and deflaring.  **[BKR_3370775_12]**  Baker Hughes anticipates **$800 million to $1 billion** in New Energy orders in 2024, with a total addressable market of **$60 billion to $70 billion by 2030**.  **[BKR_3370775_12]** 

11. **IET End Market Growth Opportunities**  
    **Q:** Which IET end markets have the biggest growth opportunities?  
    **A:** The IET portfolio offers significant growth in **onshore/offshore production**, including FPSOs and gas processing.  **[BKR_3370775_11]**  There are also opportunities in **petrochemicals**, refining, and various industrial markets.  **[BKR_3370775_11]**  The versatility of the IET portfolio provides multiple avenues for growth.  **[BKR_3370775_11]** 

12. **Qualitative Aspects of '24 OFSE Margin Increase**  
    **Q:** Can you discuss the qualitative aspects of the '24 OFSE margin increase?  
    **A:** Baker Hughes expects a material step-up in margins for OFSE in 2024.  **[BKR_3370775_13]**  Cost initiatives launched in early 2024, including structural changes and cost optimizations, will drive margin improvements, especially in the second half of the year.  **[BKR_3370775_13]**  They anticipate OFSE to average **20% EBITDA margins** in 2024.  **[BKR_3370775_13]** 

bf0e20d66b9eb044e6c8fee2216f056ddbda59c0727393ef629877aef7155a39

- **Baker Hughes is confident in achieving 20% EBITDA margins**, driven by cost efficiencies, productivity enhancements, and higher-margin activities, **without relying on market tailwinds**.  **[BKR_3380588_19]**
- **Significant growth opportunities in Saudi Arabia**, including a projected **60% increase in natural gas production by 2030**, investments in **new energy and chemicals**, and localization efforts position Baker Hughes as a key player across the **full value chain** in the region.  **[BKR_3380588_15]** **[BKR_3380588_4]**
- Strong performance in the **Industrial & Energy Technology (IET) segment**, with **revenue up nearly 50% year-over-year** in Gas Tech equipment and **EBITDA margins improving**, fueled by robust backlog conversion and productivity improvements.  **[BKR_3380588_12]** **[BKR_3380588_10]**

ce9a660a71c6f36824c5511e057a93326e36685b12032922e2f2c74cddf480ea

- **Persistent supply chain constraints in aeroderivative turbines are expected to remain tight through the end of 2024, potentially impacting execution in Gas Tech Equipment.**  **[BKR_3370775_17]** ,  **[BKR_3370775_18]**
- **Declines in North American land activity are anticipated in 2024, which may negatively affect OFSE revenue and margins.**  **[BKR_3370775_13]** ,  **[BKR_3370775_18]**
- **Baker Hughes has a higher effective tax rate compared to peers and lacks specifics on how they will reduce it to the low 20% range over time, introducing uncertainty.**  **[BKR_3370775_22]** ,  **[BKR_3370775_18]**

464b243864b2ebc0b3fc742a3863bf6a77acc6c4cca9d8643580938a45ade787

1. **Margin Expansion Goals**  
   **Q:** How will you reach 20% margins?  
   **A:** We're proud of our team's accomplishments in expanding margins. In the second quarter, we saw great results from our restructuring efforts, moving from four segments into two and taking out **$150 million in costs in 2023**.  **[BKR_3394793_11]**  In IET, we're improving efficiency through lean processes, automation, and leveraging a strong backlog.  **[BKR_3394793_11]**  In OFSE, we're focusing on cost competitiveness, reducing duplication, enhancing execution, and improving service delivery.  **[BKR_3394793_11]**  We're expecting margin expansion to continue, with **2024 margins up about 150 basis points**, and we're fully committed to achieving **20% margins in OFSE by 2025 and in IET by 2026**.  **[BKR_3394793_11]** 

2. **Increased EBITDA Guidance**  
   **Q:** What is driving higher EBITDA guidance?  
   **A:** We raised our EBITDA guidance midpoint by **12%**, driven by stronger revenue expectations and margin upgrades in IET.  **[BKR_3394793_12]**  We expect IET revenues to increase by **20% this year**, which is **8% above prior guidance**, driven by Gas Tech Equipment and Industrial Solutions.  **[BKR_3394793_12]**  We're projecting **2024 IET margins of 16.2%**, about **120 basis points** ahead of last year and **70 basis points** above our prior outlook.  **[BKR_3394793_12]**  Our technology differentiation and portfolio versatility are driving performance, leading to sustainable improvements for the long term.  **[BKR_3394793_12]** 

3. **Gas Tech Services Growth**  
   **Q:** How does your installed base affect Gas Tech Services growth?  
   **A:** Over the last five years, we've seen a **50% growth in our RPO**, demonstrating our strong portfolio in critical areas.  **[BKR_3394793_13]**  Gas Tech is a full life cycle business, and we're moving toward a **razor-razor blade model**, not just one-time equipment sales.  **[BKR_3394793_13]**  Our installed base provides opportunities for services revenue streams that offer long-term visibility and confidence in sustained growth.  **[BKR_3394793_13]**  This is starting to come through and is underappreciated right now.  **[BKR_3394793_13]** 

4. **International Growth Prospects**  
   **Q:** Which markets offer the best international growth opportunities?  
   **A:** We continue to see **high single-digit growth** in the international market.  **[BKR_3394793_14]**  Key areas include offshore opportunities in **Suriname, Namibia, Guyana, and Brazil**, and the Middle East remains a strong growth area.  **[BKR_3394793_14]**  We're optimistic about continued international growth, though at a slower pace.  **[BKR_3394793_14]**  We also see opportunities in mature assets and brownfield developments, where our production-focused services like chemicals, ESPs, and digital solutions are in demand.  **[BKR_3394793_14]** 

5. **Growth Beyond LNG**  
   **Q:** How are you expanding beyond LNG projects?  
   **A:** We're seeing increased opportunities in areas like microgrids, off-grid solutions, and data centers due to the need for continuous power supply and distributed power systems.  **[BKR_3394793_15]**  Data centers alone are expected to consume **800 terawatt-hours by 2026**, doubling from 2022.  **[BKR_3394793_15]**  We have gas turbine technology beneficial for off-grid solutions, including modular capabilities and small-scale turbines.  **[BKR_3394793_15]**  We're working with partners to develop proposals in sectors like oil and gas, airports, and shipping, representing a tremendous opportunity going forward.  **[BKR_3394793_15]** 

6. **Cash Flow Expectations**  
   **Q:** What drives your cash flow guidance range?  
   **A:** Free cash flow is always lumpy quarter to quarter, but we're confident in achieving **45% to 50% free cash flow conversion** this year, consistent with our past five years.  **[BKR_3394793_16]**  The first half performed as anticipated, and the second half is always stronger.  **[BKR_3394793_16]**  Timing of collections with key customers and down payments can impact cash flow.  **[BKR_3394793_16]**  We remain focused on returning cash to shareholders, having returned nearly **$750 million** in the first half, up **50% year over year**, through dividend growth and share buybacks.  **[BKR_3394793_16]** 

7. **Non-LNG Gas Tech Orders**  
   **Q:** What is driving non-LNG growth in Gas Tech?  
   **A:** Our orders remain strong across IET, particularly in onshore/offshore production and gas infrastructure, which are part of the gas ecosystem.  **[BKR_3394793_17]**  In the first half, we booked **$6.4 billion** and expect the second half to be strong, aiming for **$12 billion to $12.5 billion** in orders for the year.  **[BKR_3394793_17]**  We anticipate LNG projects will return, but in the meantime, our breadth of portfolio and technology differentiation are driving robust orders into 2025.  **[BKR_3394793_17]** 

8. **Gas Infrastructure Projects**  
   **Q:** How will gas infrastructure orders progress?  
   **A:** We believe it's the age of gas, with natural gas being a plentiful resource and lower in emissions than coal.  **[BKR_3394793_18]**  We're seeing developments like the **Master Gas System 3** in Saudi Arabia and projects in Algeria like **Hassi R'Mel**.  **[BKR_3394793_18]**  Other countries also need similar gas infrastructure.  **[BKR_3394793_18]**  Customers globally are focusing on gas infrastructure, and we see opportunities to leverage our portfolio in this area.  **[BKR_3394793_18]** 

9. **2025 Outlook Considerations**  
   **Q:** What are the key factors heading into 2025?  
   **A:** While it's early, we anticipate more of the same positive trends.  **[BKR_3394793_19]**  We'll continue to focus on margin improvement, aiming for **20% EBITDA margins in OFSE**.  **[BKR_3394793_19]**  International growth remains robust, though at a slower pace.  **[BKR_3394793_19]**  We expect a rebound in North America in at least the second half of 2025.  **[BKR_3394793_19]**  In IET, margin improvements and order momentum continue.  **[BKR_3394793_19]**  LNG opportunities are expected to return, and we see positive momentum in New Energy, targeting the upper end of our **$800 million to $1 billion** guidance.  **[BKR_3394793_19]** 

10. **New Energy Opportunities**  
    **Q:** What technologies are driving New Energy orders?  
    **A:** Our portfolio allows us to participate across New Energy projects, from subsurface to CO₂ reduction and storage.  **[BKR_3394793_20]**  For example, in the **Wabash** project, we're providing compression pumps, valves, instrumentation, condition monitoring, and services like sequestration feasibility analysis and well construction.  **[BKR_3394793_20]**  About **50%** of our New Energy orders this year are in the CO₂ space.  **[BKR_3394793_20]**  Carbon capture, utilization, and storage (CCUS) continues to be a key theme, and we're uniquely positioned to capitalize on these opportunities.  **[BKR_3394793_20]** 

14c576bed0a6b34c4a485f31c392335969b40066b474d6e10ec4040292a93f58

- **Strong Margin Expansion and Operational Efficiency Improvements:** Baker Hughes reported strong margins in both segments, attributed to operational efficiencies, cost initiatives, and transformation efforts. The company is committed to achieving **20% margins in OFSE by 2025 and in IET by 2026**.  **[BKR_3394793_11]**
- **Significant Growth in New Energy Orders and CCUS Opportunities:** Baker Hughes is experiencing strong momentum in New Energy orders, particularly in **carbon capture, utilization, and storage (CCUS)**, with record orders and unique capabilities across CO₂ capture, hydrogen compressors, and pumps. The **Wabash project** in Indiana exemplifies their integrated solutions and strategic partnerships.  **[BKR_3394793_20]**
- **Growth Opportunities in Behind-the-Meter and Off-Grid Solutions:** The company sees significant potential in providing **microgrid and off-grid power solutions** using their **gas turbine technology**, including **NovaLT turbines** and small-scale modular reactors (**SMRs**). This is driven by increasing demand for continuous power supply, instability of the grid, and growth in **data centers**, which are expected to double electricity consumption by 2026.  **[BKR_3394793_15]**

959644b498d1e15b614645e2b9751ddc4e96cfeb59a9cebce313490adc663dbd

- **Baker Hughes expects revenue growth to outpace the **20% increase in installed base** by **2030**, driven by higher pricing, a **70% increase in LNG installed base**, advanced service solutions, and upgrades.  **[BKR_3403513_14]**
- **EBITDA margins** have significantly improved, reaching **17.5%**, the highest since the company was formed, with confidence in achieving **20% EBITDA margin** targets by **2026** in IET, driven by self-help measures and efficiencies.  **[BKR_3403513_13]**
- Despite headwinds like the LNG moratorium, **year-to-date orders** are at **$9.2 billion**, with only **$700 million** from LNG equipment orders, demonstrating strong portfolio diversity; similar robust orders are expected in **2025**.  **[BKR_3403513_15]**

d830ae65c1fa7687d1d5ffc6951b3c73af2b26e652300e721b804817c47fa19e

1. **Margin Outlook**

   **Q:** Can you refresh us on drivers to reach 20% margins next year?

   **A:** Nancy Buese reaffirmed confidence in hitting **20% EBITDA margins** in 2024 without needing market tailwinds. Key drivers include their cost-out program reducing duplication and improving efficiency, continued cost efficiencies, and higher-margin activity in the **SSPS** backlog, which will boost margins in **'24 and '25**. They see strength in international markets, maintaining their outlook for **high single-digit E&P CapEx** increases.  **[BKR_3380588_19]** 

2. **Full-Year Guidance Confidence**

   **Q:** Are you more confident in the full-year outlook given the first half?

   **A:** Despite early strength, Baker Hughes retains their full-year guidance, citing it's still early with unknowns ahead. They expressed confidence in the full-year targets, underpinned by strong execution, robust backlog levels, and continued margin expansion, even as they face a slower-than-expected start in **OFSE** due to timing and offshore rig delays.  **[BKR_3380588_13]** 

3. **Non-LNG Orders Growth**

   **Q:** Can you discuss non-LNG orders growth in IET?

   **A:** Non-LNG orders in **IET** tripled in **Q1 versus prior year**, driven by equipment and solutions across multiple end markets like upstream, midstream, refining, petrochemical, and industrial. They see expanding opportunities in onshore/offshore production, gas infrastructure, and industrial gas turbines like **NovaLT** for distributed power generation.  **[BKR_3380588_14]** 

4. **Carbon Capture Strategy**

   **Q:** Has there been a change in your CCUS strategy?

   **A:** Baker Hughes sees **Carbon Capture, Utilization, and Storage (CCUS)** as a key growth area, with projects starting to scale. They've invested in various CCUS technologies, including the **chilled ammonia process** for large-scale applications, the **mixed salt process**, and **compact carbon capture** for smaller industrial footprints, and are piloting **direct air capture** technology. Complementing these are their compression and storage capabilities. They believe CCUS will be a first mover in the energy transition as focus shifts to emissions.  **[BKR_3380588_16]** 

5. **Differentiation in Saudi Arabia**

   **Q:** How are you differentiated in Saudi Arabia versus competitors?

   **A:** Baker Hughes focuses on localization in Saudi Arabia, opening new facilities like their chemicals plant and manufacturing wellheads, compressors, and drill bits **in-country**. This strategy allows them to play across the entire energy value chain, including oilfield services, gas infrastructure, hydrogen projects like **NEOM**, and digital solutions. Their local capabilities support not just the Kingdom but the region and beyond, providing a unique advantage.  **[BKR_3380588_15]** 

6. **Energy Demand from AI**

   **Q:** Are data centers' energy needs impacting your business?

   **A:** There's a growing realization of increased energy demand driven by data centers, especially with **AI** expansion. Baker Hughes' **ready gas turbines** can run on natural gas today and switch to hydrogen in the future, aligning with customers' needs for off-grid and distributed power solutions while reducing emissions. They see this as a growing segment that diversifies their equipment portfolio.  **[BKR_3380588_17]** 

7. **Production Optimization**

   **Q:** How is the production market evolving where you have strength?

   **A:** The shift in market dynamics doesn't change their strategy focused on production solutions. With **70% of global production** from mature assets, there's a tremendous focus on optimization. Baker Hughes has strong capabilities with **ESPs**, chemicals, and digital automation through AI solutions like **Leucipa**, providing significant opportunities for customers and increased focus for the company.  **[BKR_3380588_11]** 

8. **2Q Guidance Details**

   **Q:** What are the puts and takes around the 2Q guide?

   **A:** Strength in the 2Q guidance reflects a differentiated portfolio leading to durable earnings and strong free cash flow growth. The midpoint **EBITDA guidance** represents **16% year-over-year growth**, including **20% EBITDA growth in IET**. Drivers include robust backlog levels, higher margins from backlog conversion, and broadening strength across Industrial Tech. This is partially offset by a slower start in **OFSE** due to timing and offshore rig delays.  **[BKR_3380588_13]** 

9. **IET Margins and Drivers**

   **Q:** Can you discuss the strong IET margins and their drivers?

   **A:** IET had a strong quarter with revenue up nearly **50% year-over-year** and EBITDA up nearly **200 basis points**. Drivers include strong backlog conversion in Gas Tech equipment, better backlog margins, productivity in factories, and improving margins in Industrial Solutions as supply chain constraints ease. They continue to see margin expansion and improvement toward the **20% EBITDA** goal as they move forward.  **[BKR_3380588_10]** 

d0c5bab98357bbe10574307688109826d68d89a48afa29bb65bbe93b2fd1b6a2

- **Dependency on higher pricing and inflation for revenue growth may pose risks if market conditions change**  **[BKR_3403513_14]** .
- **Potential flattening of IET order levels in 2025 compared to 2024, as indicated by questions about book-to-bill ratios**, suggesting possible slowdown in growth  **[BKR_3403513_17]** .
- **Customers have been deemphasizing upgrades and running their equipment without investing in upgrades**, which may negatively impact the company's expected revenue from upgrades  **[BKR_3403513_14]** .

5dedd2b3931dd2c4401a0061fc363ee429dac741de7454c2386e8b461a49e8eb

Baker Hughes Co (BKR)

Financials