Baker Hughes Co - Quarter Report: 2025 June (Form 10-Q)

Changes in operating assets and liabilities:Current receivables ()Inventories()()Accounts payable() Progress collections and deferred income() Contract and other deferred assets ()Other operating items, net()()

Net cash flows provided by operating activities

Cash flows from investing activities:Expenditures for capital assets()()Proceeds from disposal of assets Other investing items, net()()Net cash flows used in investing activities()()Cash flows from financing activities:

Repayment of long-term debt

()Dividends paid()()Repurchase of Class A common stock()()Other financing items, net()()Net cash flows used in financing activities()()Effect of currency exchange rate changes on cash and cash equivalents ()

Decrease in cash and cash equivalents

()()Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period$ $ Supplemental cash flows disclosures:Income taxes paid, net of refunds$ $ Interest paid$ $

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 6

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 1.

as further discussed in "Note 14. Segment Information."

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Please refer to "Note 1. Basis of Presentation and Summary of Significant Accounting Policies" of the Notes to the consolidated financial statements from the Company's 2024 Annual Report for the discussion of significant accounting policies.

Supply Chain Finance Programs

As of June 30, 2025 and December 31, 2024, $ million and $ million of supply chain finance program liabilities are recorded in "Accounts payable" in the condensed consolidated statements of financial position, respectively, and reflected in net cash flows from operating activities in the condensed consolidated statements of cash flows when settled.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 7

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 2.

$ Other Total current receivables Less: Allowance for credit losses()()Total current receivables, net$ $

Customer receivables are recorded at the invoiced amount. The "Other" category consists primarily of advance payments to suppliers and indirect taxes.

The Company's customer receivables are spread over a broad and diverse group of customers across many countries. As of June 30, 2025, % of the Company's gross customer receivables were from customers in the U.S. As of December 31, 2024, % of the Company's gross customer receivables were from customers in the U.S. and % were from customers in Mexico. No other country accounted for more than 10% of the Company's gross customer receivables at these dates.

NOTE 3.

million and $ million as of June 30, 2025 and December 31, 2024, respectively, consist of the following:


	June 30, 2025	December 31, 2024
Finished goods	$	$
Work in process and raw materials
Total inventories, net	$	$

Baker Hughes Company 2025 Second Quarter Form 10-Q | 8

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 4.

$()$ $ $()$ Technology () () Trade names and trademarks () () Capitalized software () () Finite-lived intangible assets () () Indefinite-lived intangible assets — — Total intangible assets$ $()$ $ $()$

Amortization expense for the three months ended June 30, 2025 and 2024 was $ million and $ million, respectively, and $ million and $ million for the six months ended June 30, 2025 and 2024, respectively.

2026 2027 2028 2029 2030

NOTE 5.

$ Long-term equipment contracts and certain other service agreements Contract assets (total revenue in excess of billings) Deferred inventory costs

Other costs to fulfill or obtain a contract

) )() ()()$()$()$()

The amounts reclassified from accumulated other comprehensive loss during the six months ended June 30, 2025 and 2024 represent (i) net gains (losses) reclassified on cash flow hedges when the hedged transaction occurs, and (ii) the amortization of net actuarial gain (loss), prior service credit, settlements, and curtailments which are included in the computation of net periodic pension cost.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 13

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 11.

$ $ $ Less: Net income attributable to noncontrolling interests Net income attributable to Baker Hughes Company$ $ $ $ Weighted average shares outstanding:Class A basic Class A diluted

Net income per share attributable to common stockholders:

Class A basic$ $ $ $ Class A diluted$ $ $ $

For the three and six months ended June 30, 2025 and 2024, Class A diluted shares include the dilutive impact of equity awards except for approximately and million options, respectively, that were excluded because the exercise price exceeded the average market price of the Company's Class A common stock and is therefore antidilutive.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 14

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 12.

$ $ $ $ $ $ $ Investment securities Total assets LiabilitiesDerivatives () () () ()Total liabilities$ $()$ $()$ $()$ $() $ $ $ $ $ $ $ Equity securities () Total$ $ $()$ $ $ $ $

(1)Net gains (losses) recorded to earnings related to these securities were $ million and $ million for the three months ended June 30, 2025 and 2024, respectively, and $() million and $ million for the six months ended June 30, 2025 and 2024, respectively.

(2)As of June 30, 2025, the Company's non-U.S. debt securities are classified as available for sale securities and mature within one year.

As of June 30, 2025 and December 31, 2024, the balance of the Company's equity securities with readily determinable fair values is $ million and $ million, respectively, and is comprised mainly of the Company's investment in Abu Dhabi National Oil Company Drilling, and is recorded primarily in "All other current assets" in the condensed consolidated statements of financial position. The Company measured its investments at fair value based on quoted prices in active markets. Net gains (losses) related to the Company's equity securities with readily determinable fair values are reported in "Other (income) expense, net" in the condensed consolidated statements of income (loss). See "Note 17. Other (Income) Expense, Net" for further information.

FAIR VALUE DISCLOSURE OF FINANCIAL INSTRUMENTS

The Company's financial instruments include cash and cash equivalents, receivables, certain investments, accounts payable, short and long-term debt, and derivative financial instruments. Except for long-term debt, the estimated fair value of these financial instruments as of June 30, 2025 and December 31, 2024 approximates their carrying value as reflected in the condensed consolidated financial statements. For further information on the fair value of the Company's debt, see "Note 8. Debt."

Baker Hughes Company 2025 Second Quarter Form 10-Q | 15

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

$ $ $()Interest rate swap contracts () ()Derivatives not accounted for as hedgesCurrency exchange contracts and other () ()Total derivatives$ $()$ $()

Derivatives are classified in the condensed consolidated statements of financial position depending on their respective maturity date. As of June 30, 2025 and December 31, 2024, $ million and $ million of derivative assets are recorded in "All other current assets" and $ million and $ million are recorded in "All other assets" in the condensed consolidated statements of financial position, respectively. As of June 30, 2025 and December 31, 2024, $ million and $ million of derivative liabilities are recorded in "All other current liabilities" and $ million and $ million are recorded in "All other liabilities" in the condensed consolidated statements of financial position, respectively.

As of June 30, 2025 and December 31, 2024, the Company had issued credit default swaps ("CDS") totaling $ million and $ million, respectively, to third-party financial institutions. The CDS relate to borrowings provided by these financial institutions to a customer in Mexico who utilized these borrowings to pay certain of the Company's outstanding receivables. The total notional amount remaining on the issued CDS was $ million and $ million as of June 30, 2025 and December 31, 2024, respectively, which will reduce each month through September 2026 as the customer repays the borrowings. As of June 30, 2025, the fair value of these derivative liabilities is not material.

FORMS OF HEDGING

Cash Flow Hedges

The Company uses cash flow hedging primarily to mitigate the effects of foreign exchange rate changes on purchase and sale contracts. Accordingly, the vast majority of derivative activity in this category consists of currency exchange contracts. In addition, the Company is exposed to interest rate risk fluctuations in connection with long-term debt that it issues from time to time to fund its operations. Changes in the fair value of cash flow hedges are recorded in a separate component of equity (referred to as "Accumulated Other Comprehensive Income" or "AOCI") and are recorded in earnings in the period in which the hedged transaction occurs. See "Note 10. Equity" for further information on activity in AOCI for cash flow hedges. As of June 30, 2025 and December 31, 2024, the maximum term of cash flow hedges that hedge forecasted transactions was approximately .

Fair Value Hedges

All of the Company's long-term debt is comprised of fixed rate instruments. The Company is subject to interest rate risk on its debt portfolio and may use interest rate swaps to manage the economic effect of fixed rate obligations associated with certain debt. Under these arrangements, the Company agrees to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount.

As of June 30, 2025 and December 31, 2024, the Company had interest rate swaps with a notional amount of $ million that converted a portion of its $ million aggregate principal amount of % fixed rate Senior Notes due 2027 into a floating rate instrument with an interest rate based on a Secured Overnight Financing Rate

Baker Hughes Company 2025 Second Quarter Form 10-Q | 16

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

billion at June 30, 2025 and December 31, 2024 is related to hedges of anticipated sales and purchases in foreign currency, commodity purchases, changes in interest rates, and contractual terms in contracts that are considered embedded derivatives and for intercompany borrowings in foreign currencies.

COUNTERPARTY CREDIT RISK

Fair values of the Company's derivatives can change significantly from period to period based on, among other factors, market movements and changes in the Company's positions. The Company manages counterparty credit risk (the risk that counterparties will default and not make payments according to the terms of the agreements) on an individual counterparty basis.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 17

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 13.

$ $ $

Completions, Intervention, and Measurements

Production Solutions Subsea & Surface Pressure Systems Oilfield Services & Equipment

Gas Technology Equipment

Gas Technology Services

Total Gas Technology

Industrial Products

Industrial Solutions Total Industrial Technology Climate Technology Solutions Industrial & Energy Technology Total$ $ $ $ $ $ $ Latin America Europe/CIS/Sub-Saharan Africa Middle East/Asia Oilfield Services & Equipment$ $ $ $

REMAINING PERFORMANCE OBLIGATIONS

As of June 30, 2025, the aggregate amount of the transaction price allocated to the unsatisfied (or partially unsatisfied) performance obligations was $ billion. As of June 30, 2025, the Company expects to recognize revenue of approximately %, % and % of the total remaining performance obligations within , , and years, respectively, and the remaining thereafter. Contract modifications could affect both the timing to complete as well as the amount to be received as the Company fulfills the related remaining performance obligations.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 18

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 14.

operating segments, OFSE and IET. Each segment is organized and managed based upon the nature of the Company's markets and customers and consists of similar products and services. These products and services operate across upstream oil and gas and broader energy and industrial markets.

OILFIELD SERVICES & EQUIPMENT

OFSE provides products and services for onshore and offshore oilfield operations across the lifecycle of a well, ranging from exploration, appraisal, and development, to production, rejuvenation, and decommissioning. OFSE is organized into product lines: Well Construction, which encompasses drilling services, drill bits, and drilling & completions fluids; Completions, Intervention, and Measurements, which encompasses well completions, pressure pumping, and wireline services; Production Solutions, which spans artificial lift systems and oilfield & industrial chemicals; and Subsea & Surface Pressure Systems, which encompasses subsea projects and services, surface pressure control, and flexible pipe systems. Beyond its traditional oilfield concentration, OFSE is expanding its capabilities and technology portfolio to meet the challenges of a net-zero future. These efforts include expanding into new energy areas such as geothermal and carbon capture, utilization and storage, strengthening its digital architecture and addressing key energy market themes.

INDUSTRIAL & ENERGY TECHNOLOGY

IET provides technology solutions and services for mechanical-drive, compression and power-generation applications across the energy industry, including oil and gas, liquefied natural gas ("LNG") operations, downstream refining, and petrochemical markets, as well as lower carbon solutions to broader energy and industrial sectors. IET also provides equipment, software, and services that serve a wide range of industries including petrochemical and refining, nuclear, aviation, automotive, mining, cement, metals, pulp and paper, and food and beverage. IET is organized into product lines - Gas Technology Equipment, Gas Technology Services, Industrial Products, Industrial Solutions, and Climate Technology Solutions.

In the first quarter of 2025, the Company changed the internal financial information regularly provided to the CODM to formalize the transition to evaluation of the performance of the Company's reportable segments utilizing segment Earnings Before Interest, Taxes, Depreciation, and Amortization ("EBITDA") as the measure of profit. This accompanied a change to the captions and subtotals included on the Company's income statement. The CODM assesses the performance of each segment based on segment EBITDA, which is defined as income (loss) before income taxes and before the following: net interest expense, costs associated with significant restructuring programs, depreciation and amortization, and unallocated corporate costs and other income (expense). The CODM uses segment EBITDA as the measure to make resource (including financial or capital resources) allocation decisions for each segment, predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a quarterly basis when evaluating performance for each segment and making decisions about capital allocation. Accounting policies have been applied consistently by all segments within the Company for all reporting periods. Intercompany revenue and expense amounts have been eliminated within each segment to report on the basis that management uses internally for evaluating segment performance.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 19

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

$ $ $ $ $

Cost of goods and services sold

()()()()()()

Research and development costs

()()()()()()

Selling, general and administrative

()()()()()()

Other income (expense)

Add: Depreciation and amortization

Segment EBITDA$ $ $ $ $ $


	Three Months Ended June 30,			Six Months Ended June 30,
	2024			2024
	OFSE	IET	Total	OFSE	IET	Total
Revenue	$	$	$	$	$	$
Cost of goods and services sold	()	()	()	()	()	()
Research and development costs	()	()	()	()	()	()
Selling, general and administrative	()	()	()	()	()	()
Add: Depreciation and amortization
Segment EBITDA	$	$	$	$	$	$


Reconciliation of segment EBITDA to Net Income Attributable to Baker Hughes Company:	Three Months Ended June 30,		Six Months Ended June 30,
	2025	2024	2025	2024
OFSE	$	$	$	$
IET
Total segment
Corporate costs (1)	()	()	()	()
Restructuring		()		()


Other income (expense), net (2)			()
Depreciation and amortization	()	()	()	()
Interest expense, net	()	()	()	()
Income before income taxes
Provision for income taxes	()	()	()	()
Net income
Less: Net income attributable to noncontrolling interests
Net income attributable to Baker Hughes Company	$	$	$	$

(1)Corporate costs are primarily reported in "Selling, general and administrative" in the condensed consolidated statements of income (loss) and exclude $ million and $ million of depreciation and amortization for the three months ended June 30, 2025 and 2024, respectively, and $ million and $ million for the six months ended June 30, 2025 and 2024, respectively.

(2)Other income (expense), net excludes immaterial amounts recorded within Segment EBITDA and corporate costs for the three and six months ended June 30, 2025. See "Note 17. Other (Income) Expense, Net" for further information.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

IET

Total segment

Corporate and eliminations (1)

Total$ $

(1)The assets reported in Corporate and eliminations consist primarily of the Baker Hughes trade name, cash, and tax assets. It also includes adjustments to eliminate intercompany investments and receivables reflected within the total assets of each of the reportable segments.

The following table presents depreciation and amortization:


	Three Months Ended June 30,		Six Months Ended June 30,
Depreciation and amortization	2025	2024	2025	2024
OFSE	$	$	$	$
IET
Total segment
Corporate
Total	$	$	$	$

The following table presents capital expenditures:


	Three Months Ended June 30,		Six Months Ended June 30,
Capital expenditures	2025	2024	2025	2024
OFSE	$	$	$	$
IET
Total segment
Corporate
Total	$	$	$	$

NOTE 15.

%. The Company had purchases from the Aero JV of $ million and $ million during the three months ended June 30, 2025 and 2024, respectively, and $ million and $ million during the six months ended June 30, 2025 and 2024, respectively. The Company had $ million and $ million of amounts due at June 30, 2025 and December 31, 2024, respectively, for products and services provided by the Aero JV in the ordinary course of business.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 16.

billion at June 30, 2025. It is not practicable to estimate the fair value of these financial instruments. As of June 30, 2025, none of the off-balance sheet arrangements either has, or is likely to have, a material effect on the Company's financial position, results of operations or cash flows.

The Company sometimes enters into joint and several liability consortiums or similar arrangements for certain projects. Under such arrangements, each party is responsible for performing a certain scope of work within the total scope of the contracted work, and the obligations expire when all contractual obligations are completed. The failure or inability, financially or otherwise, of any of the parties to perform their obligations could impose additional costs and obligations on the Company. These factors could result in unanticipated costs to complete the project, liquidated damages or contract disputes.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 17.

)$()$ $()

Other charges and credits (1)

()()() Total$()$()$ $()

(1)Other charges and credits of $() million and $() million for the three and six months ended June 30, 2025, respectively, consist of other income within OFSE and IET.

The Company recorded other (income) expense, net of $() million and $() million for the three months ended June 30, 2025 and 2024, respectively, and $ million and $() million for the six months ended June 30, 2025 and 2024, respectively, primarily due to change in fair value of equity securities.

NOTE 18.

million. CDC is a leading provider of safety-critical pressure management solutions. The acquisition is expected to close in the third quarter of 2025, subject to customary conditions, including regulatory approvals.

BUSINESSES HELD FOR SALE

The Company classifies assets and liabilities as held for sale ("disposal group") when management commits to a plan to sell the disposal group and concludes that it meets the relevant criteria. Assets held for sale are measured at the lower of their carrying value or fair value less costs to sell. Any loss resulting from the measurement is recognized in the period the held for sale criteria are met. Conversely, gains are not recognized until the date of sale.

On June 2, 2025, the Company entered into an agreement to form a joint venture with a subsidiary of Cactus, Inc. The Company will contribute the Surface Pressure Control ("SPC") business, a business within the Subsea & Surface Pressure Systems product line of its OFSE segment, to the newly formed joint venture in exchange for a % non-controlling interest and cash consideration of approximately $ million. The Company expects to complete the sale at the end of 2025 or early 2026 subject to customary conditions, including regulatory approvals.

On June 9, 2025, the Company entered into an agreement with Crane Company, a diversified manufacturer of engineered industrial products, to sell its Precision Sensors & Instrumentation ("PSI") business, a business within the Industrial Solutions product line of its IET segment, for a total cash consideration of approximately $ billion. The Company expects to complete the sale at the end of 2025 or early 2026 subject to customary conditions, including regulatory approvals.

For both transactions, as of June 30, 2025, the businesses met the criteria to be classified as held for sale. The disposition proceeds are expected to exceed the carrying value of the businesses.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

$ $

Inventories

All other current assets

Property, plant and equipment

Operating lease right-of-use assets

Goodwill

Intangible assets

Contract assets

All other assets

Total assets of business held for sale

Liabilities

Accounts payable

Progress collections and deferred income

Operating lease liabilities-current

All other current liabilities

Operating lease liabilities

All other liabilities

Total liabilities of business held for sale

Total net assets of business held for sale

$ $ $

Baker Hughes Company 2025 Second Quarter Form 10-Q | 24

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the condensed consolidated financial statements and the related notes included in Item 1 thereto, as well as our Annual Report on Form 10-K for the year ended December 31, 2024 ("2024 Annual Report").

Baker Hughes Company ("Baker Hughes," "the Company," "we," "us," or "our") is an energy technology company with a broad and diversified portfolio of technologies and services that span the energy and industrial value chain. We conduct business in more than 120 countries and employ approximately 57,000 employees. We operate through our two business segments: Oilfield Services & Equipment ("OFSE") and Industrial & Energy Technology ("IET"). We sell products and services primarily in the global oil and gas markets, within the upstream, midstream and downstream segments, as well as broader industrial and new energy markets.

EXECUTIVE SUMMARY

Market Conditions

In the second quarter of 2025, we saw slowing activity across global oil markets primarily due to the ongoing geopolitical tensions, uncertainty around trade policy and tariffs, and slower global economic growth.

As we look to the rest of 2025, we remain positive on the global liquefied natural gas ("LNG") and natural gas outlook, while we see continued volatility in oil markets as weakening demand and rising production are balanced against persistent geopolitical risks in both the Middle East and Russia. We anticipate oil-related upstream spending will remain subdued until the Organization of the Petroleum Exporting Countries and its allies ("OPEC+") excess barrels are absorbed by the market. Based on the current macroeconomic and geopolitical backdrop, we expect 2025 global upstream spending to be lower than 2024, with pockets of resilience in select international markets. We maintain our expectation for producers to shift spending towards the optimization of mature fields.

We remain optimistic on the global natural gas outlook, as we see a continued shift towards the development of natural gas and LNG. We believe the positive long-term fundamentals for global natural gas are less affected by near-term macro uncertainty and supported by solid growth in demand, positive fundamentals for LNG contracting and the continued desire to reduce emissions across the energy ecosystem.

We will continue to monitor market conditions and assess potential risks, including uncertainty around the macroeconomic environment, trade policy and tariffs, the pace of OPEC+ restarted idled oil production, oil price volatility, changes in regulations and tax or other incentives for new energy solutions.

Financial Results and Key Company Initiatives

In the second quarter of 2025, the Company generated revenues of $6.9 billion, a decrease of $0.2 billion compared to the second quarter of 2024. IET revenue increased $0.2 billion, driven by Gas Technology Equipment ("GTE"), Gas Technology Services ("GTS"), and Climate Technology Solutions ("CTS") revenue. OFSE revenue decreased $0.4 billion with a decrease in international and North America revenue. Net income was $0.7 billion, an increase of $0.1 billion compared to the second quarter of 2024. The increase to net income was a result of higher EBITDA margin in both segments, gains in the fair value of certain equity securities, and to a lesser extent FX, partially offset by lower volume in OFSE.

As part of our journey of transformation, we continued to undertake significant structural changes. We have progressed on our efforts to improve efficiencies and modernize how the business operates, and those benefits have resulted in improved profitability.

Baker Hughes remains committed to a flexible capital allocation policy that balances returning cash to shareholders and investing in growth opportunities. We increased our quarterly dividend in the first quarter of 2025 by two cents to $0.23 per share. In the second quarter of 2025, we returned a total of $423 million to shareholders in the form of dividends and share repurchases.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 25

Outlook

Our business is exposed to a number of macro factors, which influence our outlook and expectations given the current macroeconomic uncertainty and continued volatile conditions in the industry. All of our outlook expectations are purely based on the market as we see it today and are subject to changing conditions in the industry.

•OFSE outlook: In 2025, we expect a second consecutive year of lower Exploration and Production ("E&P") spending in North America due to recent commodity price weakness. We expect International activity to be at lower levels in 2025 compared to 2024.

•IET outlook: We see continued strength in LNG and gas infrastructure, as well as increasing opportunities to leverage our versatile portfolio to enhance IET's position across industrial and distributed power markets, with a growing emphasis on data centers.

We also expect to see continued growth in new energy solutions specifically focused around reducing carbon emissions for the energy and broader industrial sectors. These include hydrogen; geothermal; carbon capture, utilization and storage; energy storage; clean power; and emissions abatement solutions.

Overall, we believe our portfolio is uniquely positioned to compete across the energy value chain and deliver integrated, high-impact solutions for our customers. Over time, we believe global energy demand will continue to rise, supported by durable, secular macroeconomic trends, with hydrocarbons continuing to play a fundamental role in meeting the world's energy needs. As such, we remain focused on delivering innovative, lower-emission, and cost-effective solutions that drive meaningful improvements in operational and financial performance for our customers.

Sustainability

We believe we have an important role to play in society as an industry leader and partner. We view the area of sustainability as a lever to transform the performance of our Company. In 2019, we made a commitment to reduce Scope 1 and 2 carbon dioxide equivalent emissions from our operations by 50% by 2030 and achieve net-zero emissions by 2050. We continue to make progress on emissions reductions, and reported in our 2024 Corporate Sustainability Report a 29.3% reduction in our Scope 1 and 2 carbon dioxide equivalent emissions as compared to our 2019 base year.

BUSINESS ENVIRONMENT

The following discussion and analysis summarizes the significant factors affecting our results of operations, financial condition, and liquidity position as of and for the three and six months ended June 30, 2025 and 2024, and should be read in conjunction with our condensed consolidated financial statements and related notes.

Our revenue is predominately generated from the sale of products and services to major, national, and independent oil and natural gas companies worldwide, and is dependent on spending by our customers for oil and natural gas exploration, field development and production. This spending is driven by a number of factors, including our customers' forecasts of future energy demand and supply, their access to resources to develop and produce oil and natural gas, their ability to fund their capital programs, the impact of new government regulations, and their expectations for oil and natural gas prices as a key driver of their cash flows.

Oil and Natural Gas Prices

Outside North America, customer spending is influenced by Brent oil prices. In North America, customer spending is influenced by WTI oil prices and natural gas prices are measured by the Henry Hub Natural Gas Spot Price.

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Oil and natural gas prices are summarized in the table below as averages of the daily closing prices during each of the periods indicated.


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Brent oil prices ($/Bbl) (1)	$	68.07	$	84.68	$	72.03	$	83.79
WTI oil prices ($/Bbl) (2)	64.57		81.81		68.12		79.69
Natural gas prices ($/mmBtu) (3)	3.19		2.07		3.66		2.11

(1)Energy Information Administration ("EIA") Europe Brent Spot Price per Barrel

(2)EIA Cushing, OK West Texas Intermediate ("WTI") spot price

(3)EIA Henry Hub Natural Gas Spot Price per million British Thermal Unit

Rig Count

Rig counts are an important business barometer for the drilling industry and its suppliers. When drilling rigs are active they consume products and services produced by the oil service industry. Therefore, rig counts may act as a leading indicator of market activity and reflect the relative strength of energy prices; however, these counts should not be solely relied on as other specific and pervasive conditions may exist that affect overall energy prices and market activity.

Rig counts are compiled weekly for the U.S. and Canada and monthly for all international rigs. Published international rig counts do not include rigs drilling in certain locations such as onshore China because this information is not readily available.

The rig counts are summarized in the table below as averages for each of the periods indicated.


	Three Months Ended June 30,				Six Months Ended June 30,
	2025	2024	% Change		2025	2024	% Change
North America	699	738	(5)	%	751	785	(4)	%
International	897	963	(7)	%	900	964	(7)	%
Worldwide	1,596	1,701	(6)	%	1,651	1,749	(6)	%

RESULTS OF OPERATIONS

The discussions below relating to significant line items from our condensed consolidated statements of income (loss) are based on available information and represent our analysis of significant changes or events that impact the comparability of reported amounts. Where appropriate, we have identified specific events and changes that affect comparability or trends and, where reasonably practicable, have quantified the impact of such items. In addition, the discussions below for revenue and cost of revenue are on a total basis as the business drivers for product sales and services are similar. All dollar amounts in tabulations in this section are in millions of dollars, unless otherwise stated. Certain columns and rows may not add due to the use of rounded numbers.

Our condensed consolidated statements of income (loss) display sales and costs of sales in accordance with the Securities and Exchange Commission ("SEC") regulations under which "goods" is required to include all sales of tangible products and "services" must include all other sales, including other service activities. For the amounts shown below, we distinguish between "equipment" and "product services," where product services refer to sales under product services agreements, including sales of both goods (such as spare parts and equipment upgrades) and related services (such as monitoring, maintenance and repairs), which is an important part of our operations. We refer to "product services" simply as "services" within Management's Discussion and Analysis of Financial Condition and Results of Operations.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 27

Our results of operations are evaluated by our chief operating decision maker, who is the Company's Chief Executive Officer, on a consolidated basis as well as at the segment level. The performance of each segment is evaluated based on segment Earnings Before Interest, Taxes, Depreciation, and Amortization ("EBITDA"), which is defined as income (loss) before income taxes and before the following: net interest expense, costs associated with significant restructuring programs, depreciation and amortization, and unallocated corporate costs and other income (expense).

In evaluating the performance, we primarily use the following:

Volume: Volume is defined as the increase or decrease in products and/or services sold period-over-period excluding the impact of foreign exchange. The volume impact on profit is calculated by multiplying the prior period profit rate by the change in revenue volume between the current and prior period. Volume also includes price, which is defined as the change in sales price for a comparable product or service period-over-period and is calculated as the period-over-period change in sales prices of comparable products and services.

Foreign Exchange ("FX"): FX measures the translational foreign exchange impact, or the translation impact of the period-over-period change on sales and costs directly attributable to change in the foreign exchange rate compared to the U.S. dollar. FX impact is calculated by multiplying the functional currency amounts (revenue or profit) with the period-over-period FX rate variance, using the average exchange rate for the respective period.

(Inflation)/Deflation: (Inflation)/deflation is defined as the increase or decrease in direct and indirect costs of the same type for an equal amount of volume. It is calculated as the year-over-year change in cost (i.e. price paid) of direct material, compensation and benefits, and overhead costs.

Productivity: Productivity is measured by the remaining variance in profit, after adjusting for the period-over-period impact of volume and price, foreign exchange, and (inflation)/deflation as defined above. Improved or lower period-over-period cost productivity is the result of cost efficiencies or inefficiencies, such as cost decreasing or increasing more than volume, or cost increasing or decreasing less than volume, or changes in sales mix among segments. This also includes the period-over-period variance of transactional foreign exchange, aside from those foreign currency devaluations that are reported separately for business evaluation purposes.

Orders and Remaining Performance Obligations

Summarized orders information for our segments are shown in the following table.


	Three Months Ended June 30,				$ Change		Six Months Ended June 30,				$ Change
	2025		2024				2025		2024
Orders:
Oilfield Services & Equipment	$	3,503	$	4,068	$	(565)	$	6,784	$	7,692	$	(909)
Gas Technology Equipment	781		1,493		(712)		2,116		2,723		(607)
Gas Technology Services	986		769		218		1,899		1,461		439
Total Gas Technology	1,767		2,261		(494)		4,015		4,183		(168)
Industrial Products	513		524		(12)		1,013		1,070		(57)
Industrial Solutions	327		281		46		608		538		70
Total Industrial Technology	839		805		34		1,621		1,608		13
Climate Technology Solutions (1)	923		392		531		1,071		585		486
Industrial & Energy Technology	3,530		3,458		72		6,708		6,376		332
Total	$	7,032	$	7,526	$	(494)	$	13,492	$	14,068	$	(577)

(1)For the three and six months ended June 30, 2025 and 2024, total new energy orders incorporates CTS in IET.

The Remaining Performance Obligations ("RPO") relate to the aggregate amount of the transaction price allocated to the unsatisfied (or partially unsatisfied) performance obligations. As of June 30, 2025, RPO totaled $34 billion, of which OFSE totaled $2.7 billion, and IET totaled $31.3 billion.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 28

Second Quarter of 2025 Compared to the Second Quarter of 2024

Revenue decreased $0.2 billion to $6.9 billion. OFSE decreased $0.4 billion and IET increased $0.2 billion.

Selling, general and administrative cost decreased $75 million, or 12%, to $567 million driven primarily by a continued focus on cost optimization, partially offset by inflationary pressure.

Research and development cost increased $3 million, or 2%, to $161 million.

We recorded other income of $134 million in the second quarter of 2025, which included a net gain of $119 million from the change in fair value of equity securities. In the second quarter of 2024, we recorded $26 million of other income. Included in this amount was a net gain of $19 million from the change in fair value of equity securities.

Net interest expense incurred in the second quarter of 2025 was $54 million, which includes interest income of $19 million. Net interest expense increased $7 million compared to the second quarter of 2024, with lower interest income primarily driven by lower interest rates.

We recorded income taxes in the second quarter of 2025 and 2024 of $256 million and $243 million, respectively. The difference between the U.S. statutory tax rate of 21% and the effective tax rate in both periods is primarily related to income generated in jurisdictions with tax rates higher than in the U.S. and losses with no tax benefit due to valuation allowances. Further, for the period ending June 30, 2024, this impact is partially offset by income subject to U.S. tax at an effective rate less than 21% due to valuation allowances, which were subsequently released later in 2024.

Net income increased $0.1 billion, or 21%, to $0.7 billion compared to the second quarter of 2024.

Segment Revenues and Segment EBITDA

Oilfield Services & Equipment


	Three Months Ended June 30,				$ Change
	2025		2024
Revenue
Well Construction	$	921	$	1,090	$	(169)
Completions, Intervention, and Measurements	935		1,118		(182)
Production Solutions	968		958		10
Subsea & Surface Pressure Systems	793		845		(52)
Total	$	3,617	$	4,011	$	(394)

Cost of goods and services sold	$	2,891	$	3,200	$	(309)
Research and development costs	65		63		2
Selling, general and administrative	219		255		(36)
Other (income) expense	(1)		—		(1)
Less: Depreciation and amortization	(233)		(223)		(10)

Segment EBITDA	$	677	$	716	$	(39)

OFSE revenue of $3,617 million decreased $394 million in the second quarter of 2025 compared to the second quarter of 2024, driven by lower international and domestic rig count. From a geographical perspective, international revenue was $2,689 million, a decrease of $298 million from the second quarter of 2024, driven by all international regions. North America revenue was $928 million in the second quarter of 2025, a decrease of $96 million from the second quarter of 2024.

OFSE segment EBITDA was $677 million in the second quarter of 2025 compared to $716 million in the second quarter of 2024. The reduction of EBITDA in the second quarter of 2025 was a result of overall lower volume,

Baker Hughes Company 2025 Second Quarter Form 10-Q | 29

changes in business mix, and inflation, partially offset by overall productivity improvements, including cost out initiatives, and favorable price.

Industrial & Energy Technology


	Three Months Ended June 30,				$ Change
	2025		2024
Revenue
Gas Technology Equipment	$	1,624	$	1,539	$	85
Gas Technology Services	752		691		61
Total Gas Technology	2,377		2,230		146
Industrial Products	488		509		(21)
Industrial Solutions	273		262		11

Total Industrial Technology	761		770		(10)
Climate Technology Solutions	156		128		28
Total	$	3,293	$	3,128	$	165

Cost of goods and services sold	$	2,389	$	2,268	$	121
Research and development costs	96		95		1
Selling, general and administrative	283		323		(40)
Other (income) expense	(4)		—		(4)
Less: Depreciation and amortization	(56)		(55)		(1)

Segment EBITDA	$	585	$	497	$	88

IET revenue of $3,293 million increased $165 million, or 5%, in the second quarter of 2025 compared to the second quarter of 2024, with increases in GTE, GTS and CTS, partially offset by Industrial Technology.

IET segment EBITDA was $585 million in the second quarter of 2025 compared to $497 million in the second quarter of 2024. The improved performance in the second quarter of 2025 was driven by positive pricing, favorable FX, and overall productivity, partially offset by inflationary pressure.

The First Six Months of 2025 Compared to the First Six Months of 2024

Revenue decreased $0.2 billion to $13.3 billion. OFSE decreased $0.7 billion and IET increased $0.5 billion.

Selling, general and administrative cost decreased $117 million, or 9%, to $1,144 million driven primarily by a continued focus on cost optimization, partially offset by inflationary pressure.

Research and development cost decreased $15 million, or 5%, to $307 million, mainly related to timing of project spend within the year.

We recorded other expense of $6 million in the first six months of 2025, which included a net loss of $21 million from the change in fair value of equity securities. In the first six months of 2024, we recorded $48 million of other income. Included in this amount was a net gain of $71 million from the change in fair value of equity securities.

Net interest expense in the first six months of 2025 was $105 million, which includes interest income of $39 million. Net interest expense increased $17 million compared to the first six months of 2024, with lower interest income primarily driven by lower interest rates.

In the first six months of 2025 and 2024, the provision for income taxes was $408 million and $421 million, respectively. The difference between the U.S. statutory tax rate of 21% and the effective tax rate in both periods is primarily related to income generated in jurisdictions with tax rates higher than in the U.S. and losses with no tax benefit due to valuation allowances. Further, for the period ending June 30, 2024, this impact is partially offset by

Baker Hughes Company 2025 Second Quarter Form 10-Q | 30

income subject to U.S. tax at an effective rate less than 21% due to valuation allowances, which were subsequently released later in 2024.

Net income increased $0.1 billion, or 7%, to $1.1 billion compared to the first six months of 2024.

Segment Revenues and Segment EBITDA

Oilfield Services & Equipment


	Six Months Ended June 30,				$ Change
	2025		2024
Revenue
Well Construction	$	1,812	$	2,151	$	(339)
Completions, Intervention, and Measurements	1,861		2,123		(263)
Production Solutions	1,867		1,903		(36)
Subsea & Surface Pressure Systems	1,576		1,617		(41)
Total	$	7,116	$	7,794	$	(678)

Cost of goods and services sold	$	5,710	$	6,253	$	(543)
Research and development costs	126		131		(5)
Selling, general and administrative	440		495		(55)
Other (income) expense	(1)		—		(1)
Less: Depreciation and amortization	(459)		(445)		(14)

Segment EBITDA	$	1,300	$	1,360	$	(61)

OFSE revenue of $7,116 million decreased $678 million, in the first six months of 2025 compared to the first six months of 2024, driven by lower international and domestic rig count. From a geographical perspective, international revenue was $5,267 million, a decrease of $514 million from the first six months of 2024, driven by all regions. North America revenue was $1,849 million in the first six months of 2025, a decrease of $164 million from the first six months of 2024.

OFSE segment EBITDA was $1,300 million in the first six months of 2025 compared to $1,360 million in the first six months of 2024. The reduction of EBITDA in the first six months of 2025 was a result of overall lower volume, inflationary pressure, and changes in business mix, partially offset by overall productivity improvement, cost out initiatives, and favorable price.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 31

Industrial & Energy Technology


	Six Months Ended June 30,				$ Change
	2025		2024
Revenue
Gas Technology Equipment	$	3,080	$	2,749	$	330
Gas Technology Services	1,344		1,305		39
Total Gas Technology	4,424		4,054		370
Industrial Products	933		971		(38)
Industrial Solutions	531		526		5

(1)Represents Class A common stock purchased from employees to satisfy the tax withholding obligations primarily in connection with the vesting of restricted stock units.

(2)Average price paid for Class A common stock purchased from employees to satisfy the tax withholding obligations in connection with the vesting of restricted stock units and shares purchased in the open market under our publicly announced purchase program.

(3)On July 30, 2021, our Board of Directors authorized the Company to repurchase up to $2 billion of its Class A common stock. On October 27, 2022, our Board of Directors authorized an increase to our repurchase program of $2 billion of additional Class A common stock, increasing its existing repurchase authorization of $2 billion to $4 billion. The repurchase program may be suspended or discontinued at any time and does not have a specified expiration date.

(4)During the three months ended June 30, 2025, we repurchased 5.3 million shares of Class A common stock at an average price of $36.66 per share for a total of $196 million.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Our barite mining operations, in support of our OFSE segment, are subject to regulation by the Federal Mine Safety and Health Administration under the Federal Mine Safety and Health Act of 1977. Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this Quarterly Report.

Baker Hughes Company 2025 Second Quarter Form 10-Q | 37

ITEM 5. OTHER INFORMATION

Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements

During the three months ended June 30, 2025, none of our officers or directors or a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) and (c), respectively, of Regulation S-K, for the purchase or sale of our securities.

ITEM 6. EXHIBITS

Each exhibit identified below is filed as a part of this report. Exhibits designated with an "*" are filed as an exhibit to this Quarterly Report on Form 10-Q and Exhibits designated with an "**" are furnished as an exhibit to this Quarterly Report on Form 10-Q. Exhibits designated with a "+" are identified as management contracts or compensatory plans or arrangements. Exhibits previously filed are incorporated by reference.


22.1*						List of Subsidiary Guarantors of Guaranteed Securities.
31.1*						Certification of Lorenzo Simonelli, President and Chief Executive Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
31.2*						Certification of Ahmed Moghal, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
32**						Certification of Lorenzo Simonelli, President and Chief Executive Officer, and Ahmed Moghal, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended.
9 5*						M ine Safety Disclosure.
101.INS*						XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*						XBRL Schema Document
101.CAL*						XBRL Calculation Linkbase Document
101.DEF*						XBRL Definition Linkbase Document
101.LAB*						XBRL Label Linkbase Document
101.PRE*						XBRL Presentation Linkbase Document
104*						Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101)

Baker Hughes Company 2025 Second Quarter Form 10-Q | 38

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		Baker Hughes Company (Registrant)

Date:	July 23, 2025	By:	/s/ AHMED MOGHAL
		Ahmed Moghal
		Executive Vice President and Chief Financial Officer

Date:	July 23, 2025	By:	/s/ REBECCA CHARLTON
		Rebecca Charlton
		Senior Vice President, Controller and Chief Accounting Officer

Baker Hughes Company 2025 Second Quarter Form 10-Q | 39

Baker Hughes Co - Quarter Report: 2025 June (Form 10-Q)

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