Market and Outlook - LNG, Power Infrastructure and AI
Baker Hughes sees durable demand across data centers, LNG, gas infrastructure, and industrial markets, with a record $46.4 billion in remaining performance obligations improving revenue visibility. Management raised its IET order outlook for 2026–2028 to more than $50 billion, supported by capacity expansion and a growing installed base. International OFSE activity is also improving, particularly in the Middle East, as customers focus on recovery and extending asset life.
IET booked $5.9 billion of orders in Q3, its second-largest quarter, lifting IET remaining performance obligations to a record $39.4 billion. Awards included 1.1 GW of gas-turbine power for a U.S. technology company, about 500 MW of generation equipment for AI infrastructure, and LNG equipment for Venture Global’s Plaquemines expansion and Cloud Connector Pipeline.
The quarter also brought long-term service and offshore equipment awards, while Chart added orders across cryogenic LNG systems, space infrastructure and industrial cooling. The combination broadens Baker Hughes’ offering from power generation and compression to thermal management and lifecycle services. It is creating opportunities to serve data-center and LNG projects with more integrated solutions.
Segment Performance in Q3
Oilfield Services & Equipment (OFSE) revenue increased 6% sequentially, and EBITDA rose 9% in Q3. International revenues were up 7% as Europe/CIS/Sub-Saharan Africa and Middle East/Asia activity improved.
IET revenue also increased 6% sequentially, while EBITDA was broadly stable and orders eased from Q2’s exceptional level (17% down). Chart contributed $888 million of revenue in its first reported quarter after the acquisition, so total segment comparisons include a change in portfolio.
Cash Flow and Balance Sheet
Operating cash flow and free cash were up by 33% and 55% year-over-year, respectively, in 9M 2026. Debt rose ~200% from year-end 2025 to $18.3 billion, largely reflecting financing associated with the Chart acquisition. Integration and backlog conversion will be important to rebuilding cash generation and managing the larger debt load.
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