Baker Hughes sells equipment and services that help companies pull oil and gas out of the ground, move it through pipelines, and turn it into power. It operates in two main groups. The first, called Oilfield Services and Equipment (OFSE), provides drill bits, chemicals, pumps, and other tools used at the wellsite. The second, called Industrial and Energy Technology (IET), makes gas turbines, compressors, and industrial equipment used at power plants, liquefied natural gas (LNG) terminals, and factories. When an oil company drills a new well, Baker Hughes gets paid. When a gas plant needs its turbine serviced, Baker Hughes gets paid again. Revenue comes from individual transactions and from longer service contracts, and it rises and falls with how much energy companies choose to spend. The diagram below traces where the money goes.

Five years of financial data tell a clear story of recovery and then a split. Revenue climbed from $20.5 billion in 2021 to $27.8 billion in 2024, a gain of more than a third. Then in 2025 it slipped back slightly to $27.7 billion, as oil companies cut drilling budgets in response to lower oil prices. That single-year dip, though small, matters because it shows the cyclical nature of the business. When oil prices fall, customers slow down, and the OFSE segment feels it fastest.

The more encouraging trend is on the cash side. Free cash flow (the money left over after paying for the equipment and facilities needed to run the business) rose from $1.5 billion in 2021 to $2.5 billion in 2025. Operating cash flow went from $2.4 billion to $3.8 billion over the same period. That means the business is converting more of its revenue into actual cash, even as revenue growth stalled. Net debt (total borrowings minus cash on hand) dropped from $2.9 billion in 2021 to $2.4 billion in 2025, a sign the balance sheet got somewhat cleaner over this period.

Gross margin also improved steadily, moving from about 19.7% in 2021 to about 23.6% in 2025. That improvement came from cost-cutting programs, better pricing, and a larger share of revenue coming from IET, which tends to carry stronger margins than the more competitive OFSE business. The IET segment grew revenue by 10% in 2025 even as OFSE fell 8%, and IET's earnings contribution jumped 21% in one year.

The IET growth story now has a new chapter. In July 2025, Baker Hughes agreed to acquire Chart Industries, a maker of equipment used to handle gas and liquid molecules across energy and industrial markets. Chart reported about $3.18 billion in revenue for the nine months ending September 30, 2025. The deal is priced at $210 per share in cash, with a total enterprise value of roughly $13.6 billion. Chart shareholders approved it in October 2025, but regulatory reviews were still ongoing at the time of filing, with closing expected in the second quarter of 2026. To fund it, Baker Hughes arranged new debt financing through a bridge facility and a delayed-draw term loan. That new debt will increase the company's leverage noticeably.

The business also booked $1 billion of orders tied to data center applications in 2025 alone. Baker Hughes expects to book roughly $3 billion of data center-related orders between 2025 and 2027. Data centers need reliable, always-on power, and natural gas turbines are increasingly being used to provide it. This is a new source of demand for IET that did not exist at meaningful scale just a few years ago.

Now for the risks. The most immediate documented threat is concentration in the supply chain. Baker Hughes relies heavily on two suppliers, GE Vernova and GE Aerospace, for critical equipment including heavy-duty gas turbines. If either stops supplying or reduces deliveries, Baker Hughes cannot easily replace them, which could delay orders and damage customer relationships. The company itself flagged this as a high-severity risk in its filing.

A second documented risk is the pace of the energy transition. Baker Hughes has invested in hydrogen, carbon capture and storage (CCUS), geothermal, and other clean energy technologies. These bets only pay off if customers actually shift spending toward them. If oil prices stay low and the energy transition moves slower than expected, the money already spent on these new technologies may not generate returns. The filing names this as a high-severity risk. On top of that, the pending Chart Industries acquisition carries its own set of risks including integration challenges, regulatory delays, and the cost of managing a large deal while running the existing business.

Finally, Baker Hughes operates in over 120 countries. Conflicts in Russia, Ukraine, the Middle East, and Venezuela have already affected its operations. The company also faces ongoing pressure from tariffs and supply chain disruptions that made raw material costs harder to predict in 2025, with more volatility expected into 2026.