Why Are Baker Hughes Shares Trading Lower Today

Baker Hughes Co BKR reported first-quarter revenue growth of 1% year-over-year and a 12% decline sequentially to $4.84 billion, missing the consensus of $5.03 billion.
Orders grew by 51% Y/Y to $6.84 billion and were up 3% sequentially.
Baker recorded strong orders from TPS as the LNG order cycle continued to unfold.
Revenues by segments: Oilfield Services $2.49 billion (+13% Y/Y), Oilfield Equipment $528 million (-16% Y/Y); Turbomachinery & Process Solutions $1.35 billion (-9% Y/Y), and Digital Solutions $474 million (+1% Y/Y).
Adjusted EPS improved to $0.15 compared to $0.12 in 1Q21, missing the consensus of $0.20.
Adjusted operating income was $348 million for the quarter, down 39% sequentially and up 29% Y/Y. Margin expanded by 155 bps to 7.2%.
Adjusted EBITDA was $625 million, down 26% sequentially and up 11% Y/Y, and the margin expanded by 117 bps to 12.9%.
BKR’s Cash flow from operating activities for the quarter totaled $72 million, compared to $678 million a year ago. Adjusted Free cash flow was negative $105 million.
The company held cash and equivalents of $3.19 billion as of March 31, 2022.
Baker acquired Mosaic Materials, a growth stage technology company.
Mosaic is focused on developing a proprietary direct air capture technology using Metal-Organic Framework materials that can be used to separate carbon dioxide from gas mixtures across a variety of applications. This will enhance the company’s carbon capture, utilization, and storage portfolio, enabling direct air capture with higher efficiency and lower total cost of ownership.
“As we look ahead to the rest of 2022, we see a favorable oil and gas price backdrop and a dynamic operating environment...We believe that we are well-positioned to benefit from an extended cyclical recovery in upstream oil & gas and longer-term structural growth trends in LNG, new energy and industrial asset management,” commented Lorenzo Simonelli, chairman, and CEO.
Price Action: BKR shares are trading lower by 7.49% at $33.99 on the last check Wednesday.
Photo Via Wikimedia Commons

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