Baker Hughes reported a 13% increase in revenues and a 41% rise in net profits for the second quarter, exceeding analyst forecasts due to strong international business performance.
Like its peers in the oilfield services sector, Baker Hughes performed well overseas but faced challenges in the U.S. The company highlighted major contracts with Algeria’s Sonatrach, Brazil’s Petrobras, and Azerbaijan’s SOCAR as key contributors to its quarterly success.
The company also saw a 12% increase in orders for its oilfield services and equipment compared to the previous quarter. However, year-over-year, the second-quarter orders fell by 3%.
Given this performance, Baker Hughes has raised its full-year financial outlook. CEO Lorenzo Simonelli noted, “Following our strong first half, we are increasing our full-year guidance midpoint by 5% and are confident in our ability to enhance margins in the coming years.”
The U.S. oilfield service industry has faced difficulties recently, with increased competition among service providers due to consolidation among exploration and production companies. Both SLB and Halliburton, Baker Hughes’ main competitors, have reported better performance abroad and weaker domestic results. SLB, in particular, benefits from generating about 82% of its revenue from international markets, as highlighted in a recent Reuters report.
SLB CEO Olivier Le Peuch emphasized, “Investments will increasingly focus on resilient markets, including key international areas such as the Middle East, Asia, and global offshore regions.”
Growth is stronger outside North America due to rising oil demand abroad, while the domestic market remains sluggish. In this consolidating industry, major oilfield service providers are well-positioned to maintain and even grow their business.