Item 1. FINANCIAL STATEMENTS (UNAUDITED)

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Item 1. FINANCIAL STATEMENTS (UNAUDITED)

Baker Hughes Company

Condensed Consolidated Statements of Income (Loss)

(Unaudited)


	Three Months Ended March 31,
(In millions, except per share amounts)	2025		2024
Revenue:
Sales of goods	$	4,144	$	3,999
Sales of services	2,283		2,419
Total revenue	6,427		6,418

Costs and expenses:
Cost of goods sold	3,329		3,276
Cost of services sold	1,623		1,700
Selling, general and administrative	577		618
Research and development costs	146		164

Other (income) expense, net	140		(22)
Interest expense, net	51		41
Income before income taxes	561		641
Provision for income taxes	(152)		(178)
Net income	409		463
Less: Net income attributable to noncontrolling interests	7		8
Net income attributable to Baker Hughes Company	$	402	$	455

Per share amounts:
Basic income per Class A common stock	$	0.41	$	0.46
Diluted income per Class A common stock	$	0.40	$	0.45

Cash dividend per Class A common stock	$	0.23	$	0.21

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Baker Hughes Company 2025 First Quarter Form 10-Q | 1

Baker Hughes Company

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)


	Three Months Ended March 31,
(In millions)	2025		2024
Net income	$	409	$	463
Less: Net income attributable to noncontrolling interests	7		8
Net income attributable to Baker Hughes Company	402		455
Other comprehensive income (loss):

Foreign currency translation adjustments	188		(63)
Cash flow hedges	2		2
Benefit plans	1		2
Other comprehensive income (loss)	191		(59)
Less: Other comprehensive income attributable to noncontrolling interests	—		—
Other comprehensive income (loss) attributable to Baker Hughes Company	191		(59)
Comprehensive income	600		404
Less: Comprehensive income attributable to noncontrolling interests	7		8
Comprehensive income attributable to Baker Hughes Company	$	593	$	396

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Baker Hughes Company 2025 First Quarter Form 10-Q | 2

Baker Hughes Company

Condensed Consolidated Statements of Financial Position

(Unaudited)


(In millions, except par value)	March 31, 2025		December 31, 2024
ASSETS
Current assets:
Cash and cash equivalents	$	3,277	$	3,364
Current receivables, net	6,710		7,122
Inventories, net	5,161		4,954
All other current assets	1,693		1,771
Total current assets	16,841		17,211
Property, plant and equipment (net of accumulated depreciation of $6,241 and $6,056)	5,168		5,127
Goodwill	6,126		6,078
Other intangible assets, net	3,927		3,951
Contract and other deferred assets	1,680		1,730
Deferred income tax assets	1,363		1,284
All other assets	3,005		2,982
Total assets	$	38,110	$	38,363
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	4,465	$	4,542
Short-term debt	55		53
Progress collections and deferred income	5,589		5,672
All other current liabilities	2,485		2,724
Total current liabilities	12,594		12,991
Long-term debt	5,969		5,970
Liabilities for pensions and other postretirement benefits	985		988
Deferred income tax liabilities	93		83
All other liabilities	1,263		1,276
Equity:
Class A Common Stock, $0.0001 par value - 2,000 authorized, 990 issued and outstanding as of March 31, 2025 and December 31, 2024	—		—

Capital in excess of par value	25,450		25,896
Retained loss	(5,438)		(5,840)
Accumulated other comprehensive loss	(2,970)		(3,161)
Baker Hughes Company equity	17,042		16,895
Noncontrolling interests	164		160
Total equity	17,206		17,055
Total liabilities and equity	$	38,110	$	38,363

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Baker Hughes Company 2025 First Quarter Form 10-Q | 3

Baker Hughes Company

Condensed Consolidated Statements of Changes in Equity

(Unaudited)


(In millions, except per share amounts)	Class A Common Stock		Capital in Excess of Par Value		Retained Loss		Accumulated Other Comprehensive Loss		Non- controlling Interests		Total Equity
Balance at December 31, 2024	$	—	$	25,896	$	(5,840)	$	(3,161)	$	160	$	17,055
Comprehensive income:
Net income					402				7		409
Other comprehensive income							191				191
Dividends on Class A common stock ($0.23 per share)			(229)								(229)
Repurchase and cancellation of Class A common stock			(188)								(188)
Stock-based compensation cost			50								50
Other			(79)						(3)		(82)
Balance at March 31, 2025	$	—	$	25,450	$	(5,438)	$	(2,970)	$	164	$	17,206


(In millions, except per share amounts)	Class A Common Stock		Capital in Excess of Par Value		Retained Loss		Accumulated Other Comprehensive Loss		Non- controlling Interests		Total Equity
Balance at December 31, 2023	$	—	$	26,983	$	(8,819)	$	(2,796)	$	151	$	15,519
Comprehensive income (loss):
Net income					455				8		463
Other comprehensive loss							(59)				(59)
Dividends on Class A common stock ($0.21 per share)			(210)								(210)


Repurchase and cancellation of Class A common stock			(158)								(158)
Stock-based compensation cost			51								51
Other			(56)								(56)
Balance at March 31, 2024	$	—	$	26,610	$	(8,364)	$	(2,855)	$	159	$	15,550

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Baker Hughes Company 2025 First Quarter Form 10-Q | 4

Baker Hughes Company

Condensed Consolidated Statements of Cash Flows

(Unaudited)


	Three Months Ended March 31,
(In millions)	2025		2024
Cash flows from operating activities:
Net income	$	409	$	463
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	285		283
Change in fair value of equity securities	140		(52)
Stock-based compensation cost	50		51
Benefit for deferred income taxes	(53)		(24)






Changes in operating assets and liabilities:
Current receivables	487		199
Inventories	(106)		(265)
Accounts payable	(87)		173
Progress collections and deferred income	(193)		170
Contract and other deferred assets	117		(68)
Other operating items, net	(340)		(146)
Net cash flows provided by operating activities	709		784
Cash flows from investing activities:
Expenditures for capital assets	(300)		(333)
Proceeds from disposal of assets	45		51




Other investing items, net	(55)		13
Net cash flows used in investing activities	(310)		(269)
Cash flows from financing activities:



Dividends paid	(229)		(210)

Repurchase of Class A common stock	(188)		(158)

Other financing items, net	(85)		(59)
Net cash flows used in financing activities	(502)		(427)
Effect of currency exchange rate changes on cash and cash equivalents	16		(17)
Increase (decrease) in cash and cash equivalents	(87)		71
Cash and cash equivalents, beginning of period	3,364		2,646
Cash and cash equivalents, end of period	$	3,277	$	2,717
Supplemental cash flows disclosures:
Income taxes paid, net of refunds	$	207	$	108
Interest paid	$	50	$	48

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Baker Hughes Company 2025 First Quarter Form 10-Q | 5

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF THE BUSINESS

Baker Hughes Company ("Baker Hughes," "the Company," "we," "us," or "our") is an energy technology company with a diversified portfolio of technologies and services that span the energy and industrial value chain.

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S.") and pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, certain information and disclosures normally included in the Company's annual financial statements have been condensed or omitted. Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Annual Report").

In the opinion of management, the condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary by management to fairly state the results of operations, financial position and cash flows of the Company and its subsidiaries for the periods presented and are not indicative of the results that may be expected for a full year. The Company's financial statements have been prepared on a consolidated basis. Under this basis of presentation, the Company's financial statements consolidate all of its subsidiaries (entities in which the Company has a controlling financial interest, most often because the Company holds a majority voting interest). All intercompany accounts and transactions have been eliminated.

In the Company's financial statements and notes, certain prior year amounts have been reclassified to conform with the current year presentation. In the notes to the unaudited condensed consolidated financial statements, all dollar and share amounts in tabulations are in millions of dollars and shares, respectively, unless otherwise indicated. Certain columns and rows in the financial statements and notes thereto may not add due to the use of rounded numbers.

In the first quarter of 2025, the Company announced a presentation change to the statements of income (loss). Under the new presentation, research and development costs and other (income) expense, net are reported as separate financial statement line items, with certain expense amounts being reclassified thereto, and the operating income and non-operating income (loss) line items have been removed from the condensed consolidated statements of income (loss). This reporting change accompanied a change in the internal financial information regularly provided to our chief operating decision maker (“CODM”) to evaluate the performance of and allocate resources to our reportable segments 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," 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 March 31, 2025 and December 31, 2024, $388 million and $411 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.

NEW ACCOUNTING STANDARDS TO BE ADOPTED

In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" ("ASU 2023-09"), which is intended to enhance the transparency and decision usefulness of income

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

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

tax disclosures. The amendments in ASU 2023-09 provide for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09, which allows for early adoption, is effective for the Company prospectively for all annual periods beginning after December 15, 2024. This is expected to result in expanded tax disclosures in the full year financial statements for the year ended December 31, 2025.

In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures" ("ASU 2024-03"), which enhances the disclosures required for certain expense captions in the Company's annual and interim consolidated financial statements. ASU 2024-03 is effective prospectively or retrospectively for fiscal years beginning after December 15, 2026 and for interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this standard on its disclosures.

All other new accounting pronouncements that have been issued, but not yet effective are currently being evaluated and at this time are not expected to have a material impact on the Company's financial position or results of operations.

NOTE 2. CURRENT RECEIVABLES

Current receivables consist of the following:


	March 31, 2025		December 31, 2024
Customer receivables	$	5,650	$	5,945
Other	1,310		1,409
Total current receivables	6,960		7,354
Less: Allowance for credit losses	(250)		(232)
Total current receivables, net	$	6,710	$	7,122

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 March 31, 2025, 16% of the Company's gross customer receivables were from customers in the U.S. and 11% were from customers in Saudi Arabia. As of December 31, 2024, 16% of the Company's gross customer receivables were from customers in the U.S. and 10% 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. INVENTORIES

Inventories, net of reserves of $387 million and $390 million as of March 31, 2025 and December 31, 2024, respectively, consist of the following:


	March 31, 2025		December 31, 2024
Finished goods	$	2,499	$	2,494
Work in process and raw materials	2,662		2,460

Total inventories, net	$	5,161	$	4,954

The Company had no inventory impairments during the three months ended March 31, 2025 and 2024.

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

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 4. OTHER INTANGIBLE ASSETS

Intangible assets consist of the following:


	March 31, 2025						December 31, 2024
	Gross Carrying Amount		Accumulated Amortization		Net		Gross Carrying Amount		Accumulated Amortization		Net
Customer relationships	$	1,924	$	(901)	$	1,023	$	1,921	$	(883)	$	1,038
Technology	1,233		(987)		246		1,248		(981)		267
Trade names and trademarks	290		(199)		91		290		(196)		94
Capitalized software	1,562		(1,199)		363		1,522		(1,172)		350

Finite-lived intangible assets	5,009		(3,286)		1,723		4,981		(3,232)		1,749
Indefinite-lived intangible assets	2,204		—		2,204		2,202		—		2,202
Total intangible assets	$	7,213	$	(3,286)	$	3,927	$	7,183	$	(3,232)	$	3,951

Amortization expense for the three months ended March 31, 2025 and 2024 was $66 million and $68 million, respectively.

Estimated amortization expense for the remainder of 2025 and each of the subsequent five fiscal years is expected to be as follows:


Year	Estimated Amortization Expense
Remainder of 2025	$	174
2026	195
2027	175
2028	153
2029	124
2030	99

NOTE 5. CONTRACT AND OTHER DEFERRED ASSETS

Contract assets reflect revenue earned in excess of billings on long-term contracts to construct technically complex equipment, provide long-term product service and maintenance or extended warranty arrangements and other deferred contract related costs. The Company's long-term product service agreements are provided by the Industrial & Energy Technology ("IET") segment. The Company's long-term equipment contracts are provided by both the IET and Oilfield Services & Equipment ("OFSE") segments. Contract assets consist of the following:


	March 31, 2025		December 31, 2024
Long-term product service agreements	$	343	$	346
Long-term equipment contracts and certain other service agreements	1,204		1,247
Contract assets (total revenue in excess of billings)	1,547		1,593
Deferred inventory costs	114		124
Other costs to fulfill or obtain a contract	19		13

Contract and other deferred assets	$	1,680	$	1,730

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

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

Revenue recognized during the three months ended March 31, 2025 and 2024 from performance obligations satisfied (or partially satisfied) in previous periods related to long-term service agreements was $4 million and $(1) million, respectively. This includes revenue recognized from revisions to cost or billing estimates that may affect a contract's total estimated profitability.

NOTE 6. PROGRESS COLLECTIONS AND DEFERRED INCOME

Contract liabilities include progress collections, which reflects billings in excess of revenue, and deferred income on long-term contracts to construct technically complex equipment, long-term product maintenance or extended warranty arrangements. Contract liabilities consist of the following:


	March 31, 2025		December 31, 2024
Progress collections	$	5,456	$	5,550
Deferred income	133		122
Progress collections and deferred income (contract liabilities)	$	5,589	$	5,672

Revenue recognized during the three months ended March 31, 2025 and 2024 that was included in the contract liabilities at the beginning of the period was $1,546 million and $1,476 million, respectively.

NOTE 7. LEASES

The Company's leasing activities primarily consist of operating leases for service centers, manufacturing facilities, sales and administrative offices, and certain equipment.


	Three Months Ended March 31,
Operating Lease Expense	2025		2024
Long-term fixed lease	$	69	$	74
Long-term variable lease	17		24
Short-term lease	119		140
Total operating lease expense	$	205	$	238

Cash flows used in operating activities for operating leases approximate lease expense for the three months ended March 31, 2025 and 2024.

The weighted-average remaining lease term as of March 31, 2025 and December 31, 2024 was approximately seven years for operating leases. The weighted-average discount rate used to determine the operating lease liability as of March 31, 2025 and December 31, 2024 was 4.3%.

Baker Hughes Company 2025 First Quarter Form 10-Q | 9

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 8. DEBT

The carrying value of the Company's short-term and long-term debt consists of the following:


	March 31, 2025		December 31, 2024
Short-term debt
Other debt	$	55	$	53
Total short-term debt	55		53


Long-term debt
2.061% Senior Notes due December 2026	599		599
3.337% Senior Notes due December 2027	1,310		1,302
6.875% Notes due January 2029	260		262
3.138% Senior Notes due November 2029	523		523
4.486% Senior Notes due May 2030	498		498
5.125% Senior Notes due September 2040	1,274		1,275
4.080% Senior Notes due December 2047	1,338		1,338
Other long-term debt	167		173
Total long-term debt	5,969		5,970
Total debt	$	6,024	$	6,023

The estimated fair value of total debt at March 31, 2025 and December 31, 2024 was $5,639 million and $5,409 million, respectively. For a majority of the Company's debt, the fair value was determined using quoted period-end market prices. Where market prices are not available, the Company estimates fair values based on valuation methodologies using current market interest rate data adjusted for non-performance risk.

The Company has a $3.0 billion committed unsecured revolving credit facility (the "Credit Agreement") with commercial banks maturing in November 2028. The Credit Agreement contains certain representations and warranties, certain affirmative covenants and negative covenants, in each case considered customary. No related events of default have occurred. The Credit Agreement is fully and unconditionally guaranteed on a senior unsecured basis by Baker Hughes. At March 31, 2025 and December 31, 2024, there were no borrowings under the Credit Agreement.

Baker Hughes Co-Obligor, Inc. is a co-obligor, jointly and severally with Baker Hughes Holdings LLC ("BHH LLC") on the Company's long-term debt securities. This co-obligor is a 100% owned finance subsidiary of BHH LLC that was incorporated for the sole purpose of serving as a corporate co-obligor of long-term debt securities and has no assets or operations other than those related to its sole purpose. As of March 31, 2025, Baker Hughes Co-Obligor, Inc. is a co-obligor of certain debt securities totaling $5.8 billion.

Certain Senior Notes contain covenants that restrict the Company's ability to take certain actions, including, but not limited to, the creation of certain liens securing debt, the entry into certain sale-leaseback transactions, and engaging in certain merger, consolidation and asset sale transactions in excess of specified limits. At March 31, 2025, the Company was in compliance with all debt covenants.

NOTE 9. INCOME TAXES

For the three months ended March 31, 2025 and 2024, the provision for income taxes was $152 million and $178 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 March 31, 2024, this impact is partially offset by income subject to U.S. tax at an effective rate less than 21% due to valuation allowances.

Baker Hughes Company 2025 First Quarter Form 10-Q | 10

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 10. EQUITY

COMMON STOCK

The Company is authorized to issue 2 billion shares of Class A common stock and 50 million shares of preferred stock, each of which has a par value of $0.0001 per share.

The Company has a share repurchase program which it expects to fund from cash generated from operations, and it expects to make share repurchases from time to time subject to the Company's capital plan, market conditions, and other factors, including regulatory restrictions. The repurchase program may be suspended or discontinued at any time and does not have a specified expiration date. During the three months ended March 31, 2025, the Company repurchased and canceled 4.4 million shares of Class A common stock for $188 million, representing an average price per share of $42.69. During the three months ended March 31, 2024, the Company repurchased and canceled 5.4 million shares of Class A common stock for $158 million, representing an average price per share of $29.32. As of March 31, 2025, the Company had authorization remaining to repurchase up to approximately $1.5 billion of its Class A common stock.

The following table presents the changes in the number of shares outstanding (in thousands):


	Class A Common Stock
	2025	2024
Balance at January 1	989,646	997,709
Issue of shares upon vesting of restricted stock units (1)	4,643	4,745
Issue of shares on exercise of stock options (1)	76	—
Issue of shares for employee stock purchase plan	401	458

Repurchase and cancellation of Class A common stock	(4,406)	(5,399)
Balance at March 31	990,361	997,513

(1)Share amounts reflected above are net of shares withheld to satisfy the employee's tax withholding obligation.

Baker Hughes Company 2025 First Quarter Form 10-Q | 11

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

ACCUMULATED OTHER COMPREHENSIVE LOSS

The following tables present the changes in accumulated other comprehensive loss, net of tax:


	Foreign Currency Translation Adjustments		Cash Flow Hedges		Benefit Plans		Accumulated Other Comprehensive Loss
Balance at December 31, 2024	$	(2,863)	$	(7)	$	(291)	$	(3,161)
Other comprehensive income (loss) before reclassifications	188		—		(4)		184
Amounts reclassified from accumulated other comprehensive loss	—		2		4		6
Deferred taxes	—		—		1		1
Other comprehensive income	188		2		1		191


Less: Other adjustments	—		1		(1)		—
Balance at March 31, 2025	$	(2,675)	$	(6)	$	(289)	$	(2,970)


	Foreign Currency Translation Adjustments		Cash Flow Hedges		Benefit Plans		Accumulated Other Comprehensive Loss
Balance at December 31, 2023	$	(2,513)	$	(6)	$	(277)	$	(2,796)
Other comprehensive income (loss) before reclassifications	(63)		2		(1)		(62)
Amounts reclassified from accumulated other comprehensive loss	—		1		3		4
Deferred taxes	—		(1)		—		(1)
Other comprehensive income (loss)	(63)		2		2		(59)



Balance at March 31, 2024	$	(2,576)	$	(4)	$	(275)	$	(2,855)

The amounts reclassified from accumulated other comprehensive loss during the three months ended March 31, 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.

NOTE 11. EARNINGS PER SHARE

Basic and diluted net income per share of Class A common stock is presented below:


	Three Months Ended March 31,
(In millions, except per share amounts)	2025		2024
Net income	$	409	$	463
Less: Net income attributable to noncontrolling interests	7		8
Net income attributable to Baker Hughes Company	$	402	$	455

Weighted average shares outstanding:
Class A basic	992		998
Class A diluted	999		1,004
Net income per share attributable to common stockholders:
Class A basic	$	0.41	$	0.46
Class A diluted	$	0.40	$	0.45

Baker Hughes Company 2025 First Quarter Form 10-Q | 12

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

For the three months ended March 31, 2025 and 2024, Class A diluted shares include the dilutive impact of equity awards except for approximately nil and 1 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.

NOTE 12. FINANCIAL INSTRUMENTS

RECURRING FAIR VALUE MEASUREMENTS

The Company's assets and liabilities measured at fair value on a recurring basis consist of derivative instruments and investment securities.


	March 31, 2025								December 31, 2024
	Level 1		Level 2		Level 3		Net Balance		Level 1		Level 2		Level 3		Net Balance
Assets
Derivatives	$	—	$	13	$	—	$	13	$	—	$	11	$	—	$	11
Investment securities	1,154		—		15		1,169		1,282		—		2		1,284
Total assets	1,154		13		15		1,182		1,282		11		2		1,295

Liabilities
Derivatives	—		(52)		—		(52)		—		(64)		—		(64)
Total liabilities	$	—	$	(52)	$	—	$	(52)	$	—	$	(64)	$	—	$	(64)


	March 31, 2025								December 31, 2024
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Investment securities (1)
Non-U.S. debt securities (2)	$	15	$	—	$	—	$	15	$	3	$	—	$	—	$	3
Equity securities	555		639		(40)		1,154		544		737		—		1,281
Total	$	570	$	639	$	(40)	$	1,169	$	547	$	737	$	—	$	1,284

(1)Net gains (losses) recorded to earnings related to these securities were $(140) million and $27 million for the three months ended March 31, 2025 and 2024, respectively.

(2)As of March 31, 2025, the Company's non-U.S. debt securities are classified as available for sale securities and mature within one year.

As of March 31, 2025 and December 31, 2024, the balance of the Company's equity securities with readily determinable fair values is $1,154 million and $1,281 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 18. 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 March 31, 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 First Quarter Form 10-Q | 13

Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

DERIVATIVES AND HEDGING

The Company uses derivatives to manage its risks and does not use derivatives for speculation. The table below summarizes the fair value of all derivatives, including hedging instruments and embedded derivatives.


	March 31, 2025				December 31, 2024
	Assets		Liabilities		Assets		Liabilities
Derivatives accounted for as hedges
Currency exchange contracts	$	3	$	—	$	2	$	(2)
Interest rate swap contracts	—		(37)		—		(45)

Derivatives not accounted for as hedges
Currency exchange contracts and other	10		(15)		9		(17)


Total derivatives	$	13	$	(52)	$	11	$	(64)

Derivatives are classified in the condensed consolidated statements of financial position depending on their respective maturity date. As of March 31, 2025 and December 31, 2024, $12 million and $9 million of derivative assets are recorded in "All other current assets" and $1 million and $3 million are recorded in "All other assets" in the condensed consolidated statements of financial position, respectively. As of March 31, 2025 and December 31, 2024, $14 million and $16 million of derivative liabilities are recorded in "All other current liabilities" and $38 million and $50 million are recorded in "All other liabilities" in the condensed consolidated statements of financial position, respectively.

As of March 31, 2025 and December 31, 2024, the Company had issued credit default swaps ("CDS") totaling $775 million and $553 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 $556 million and $412 million as of March 31, 2025 and December 31, 2024, respectively, which will reduce each month through September 2026 as the customer repays the borrowings. As of March 31, 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 March 31, 2025 and December 31, 2024, the maximum term of cash flow hedges that hedge forecasted transactions was approximately one year.

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 March 31, 2025 and December 31, 2024, the Company had interest rate swaps with a notional amount of $500 million that converted a portion of its $1,350 million aggregate principal amount of 3.337% fixed rate Senior Notes due 2027 into a floating rate instrument with an interest rate based on a Secured Overnight Financing Rate

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

index. The Company concluded that the interest rate swap met the criteria necessary to qualify for hedge accounting, and as such, the changes in this fair value hedge are recorded as gains or losses in interest expense and are equally offset by the gains or losses of the underlying debt instrument, which are also recorded in interest expense.

NOTIONAL AMOUNT OF DERIVATIVES

The notional amount of a derivative is used to determine, along with the other terms of the derivative, the amounts to be exchanged between the counterparties. The Company discloses the derivative notional amounts on a gross basis to indicate the total counterparty risk but it does not generally represent amounts exchanged by the Company and the counterparties. A substantial majority of the outstanding notional amount of $3.6 billion and $4.0 billion at March 31, 2025 and December 31, 2024, respectively, 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.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 13. REVENUE RELATED TO CONTRACTS WITH CUSTOMERS

DISAGGREGATED REVENUE

The Company disaggregates its revenue from contracts with customers by product line for both the OFSE and IET segments, as the Company believes this best depicts how the nature, amount, timing, and uncertainty of its revenue and cash flows are affected by economic factors. In addition, management views revenue from contracts with customers for OFSE by geography based on the location to where the product is shipped or the services are performed.

The series of tables below present the Company's revenue disaggregated by these categories.


	Three Months Ended March 31,
Total Revenue	2025		2024
Well Construction	$	892	$	1,061
Completions, Intervention, and Measurements	925		1,006
Production Solutions	899		945
Subsea & Surface Pressure Systems	782		771
Oilfield Services & Equipment	3,499		3,783
Gas Technology Equipment	1,456		1,210
Gas Technology Services	592		614
Total Gas Technology	2,047		1,824
Industrial Products	445		462
Industrial Solutions	258		265

Total Industrial Technology	703		727
Climate Technology Solutions	178		83
Industrial & Energy Technology	2,928		2,634
Total	$	6,427	$	6,418


	Three Months Ended March 31,
Oilfield Services & Equipment Geographic Revenue	2025		2024
North America	$	922	$	990
Latin America	568		637
Europe/CIS/Sub-Saharan Africa	580		750
Middle East/Asia	1,429		1,405
Oilfield Services & Equipment	$	3,499	$	3,783

REMAINING PERFORMANCE OBLIGATIONS

As of March 31, 2025, the aggregate amount of the transaction price allocated to the unsatisfied (or partially unsatisfied) performance obligations was $33.2 billion. As of March 31, 2025, the Company expects to recognize revenue of approximately 61%, 73% and 89% of the total remaining performance obligations within 2, 5, and 15 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.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 14. SEGMENT INFORMATION

The Company's segments are determined as those operations whose results are reviewed regularly by the CODM, who is the Company's Chief Executive Officer, in deciding how to allocate resources and assess performance. The Company reports its operating results through two 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 four 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 five 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 our CODM to formalize the transition to evaluation of the performance of our 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.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

Summarized financial information for the Company's segments is shown in the following tables.


	Three Months Ended March 31, 2025
	OFSE		IET		Total
Revenue	$	3,499	$	2,928	$	6,427
Cost of goods and services sold	(2,819)		(2,112)		(4,931)
Research and development	(61)		(84)		(146)
Selling, general and administrative and other	(221)		(284)		(505)

Add: Depreciation and amortization	226		53		279
Segment EBITDA	$	623	$	501	$	1,124


	Three Months Ended March 31, 2024
	OFSE		IET		Total
Revenue	$	3,783	$	2,634	$	6,418
Cost of goods and services sold	(3,053)		(1,903)		(4,956)
Research and development	(68)		(96)		(164)
Selling, general and administrative and other	(240)		(305)		(546)

Add: Depreciation and amortization	222		56		279
Segment EBITDA	$	644	$	386	$	1,030


	Three Months Ended March 31,
Reconciliation of segment EBITDA to Net Income Attributable to Baker Hughes Company:	2025		2024



OFSE	$	623	$	644
IET	501		386
Total segment	1,124		1,030
Corporate costs (1)	(85)		(88)



Other income (expense), net (2)	(141)		22
Depreciation and amortization	(285)		(283)
Interest expense, net	(51)		(41)
Income before income taxes	561		641
Provision for income taxes	(152)		(178)
Net income	409		463
Less: Net income attributable to noncontrolling interests	7		8
Net income attributable to Baker Hughes Company	$	402	$	455

(1)Corporate costs are primarily reported in "Selling, general and administrative" in the condensed consolidated statements of income (loss) and exclude $6 million and $4 million of depreciation and amortization for the three months ended March 31, 2025 and 2024, respectively.

(2)Other income (expense), net excludes immaterial amounts recorded within Segment EBITDA and corporate costs for the three months ended March 31, 2025. See "Note 18. Other (Income) Expense, Net" for further information.

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

The following table presents total assets:


Assets	March 31, 2025		December 31, 2024
OFSE	$	18,456	$	18,781
IET	13,484		13,838
Total segment	31,940		32,619
Corporate and eliminations (1)	6,170		5,744
Total	$	38,110	$	38,363

(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 March 31,
Depreciation and amortization	2025		2024
OFSE	$	226	$	222
IET	53		56
Total segment	279		279
Corporate	6		4
Total	$	285	$	283

The following table presents capital expenditures:


	Three Months Ended March 31,
Capital expenditures	2025		2024
OFSE	$	201	$	259
IET	85		70
Total segment	286		329
Corporate	14		4
Total	$	300	$	333

NOTE 15. RELATED PARTY TRANSACTIONS

The Company has an aeroderivative joint venture ("Aero JV") it formed with General Electric Company ("GE") in 2019. As of March 31, 2025, the Aero JV was jointly controlled by GE Vernova (NYSE: GEV) and the Company, each with ownership interest of 50%, and therefore, the Company does not consolidate the Aero JV. As a result of GE's spin-off of GE Vernova, GE transferred its interest in the Aero JV to GE Vernova in the second quarter of 2024. The Company had purchases from the Aero JV of $148 million and $103 million during the three months ended March 31, 2025 and 2024, respectively. The Company had $107 million and $117 million of amounts due at March 31, 2025 and December 31, 2024, respectively, for products and services provided by the Aero JV in the ordinary course of business.

NOTE 16. COMMITMENTS AND CONTINGENCIES

LITIGATION

The Company is subject to legal proceedings arising in the ordinary course of business. Because legal proceedings are inherently uncertain, management is unable to predict the ultimate outcome of such matters. The Company records a liability for those contingencies where the incurrence of a loss is probable and the amount can

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

be reasonably estimated. Based on the opinion of management, the Company does not expect the ultimate outcome of currently pending legal proceedings to have a material adverse effect on its results of operations, financial position, or cash flows. However, there can be no assurance as to the ultimate outcome of these matters.

On July 31, 2018, International Engineering & Construction S.A. ("IEC") initiated arbitration proceedings in New York administered by the International Center for Dispute Resolution ("ICDR") against the Company and its subsidiaries arising out of a series of sales and service contracts entered between IEC and the Company's subsidiaries for the sale and installation of LNG plants and related power generation equipment in Nigeria ("Contracts"). Prior to the filing of the IEC Arbitration, the Company's subsidiaries made demands for payment due under the Contracts. On August 15, 2018, the Company's subsidiaries initiated a separate demand for ICDR arbitration against IEC for claims of additional costs and amounts due under the Contracts. On October 10, 2018, IEC filed a Petition to Compel Arbitration in the United States District Court for the Southern District of New York against the Company seeking to compel non-signatory Baker Hughes entities to participate in the arbitration filed by IEC. The complaint is captioned International Engineering & Construction S.A. et al. v. Baker Hughes, a GE company, LLC, et al. No. 18-cv-09241 ("S.D.N.Y 2018"); this action was dismissed by the Court on August 13, 2019. In the arbitration, IEC alleges breach of contract and other claims against the Company and its subsidiaries and seeks recovery of alleged compensatory damages, in addition to reasonable attorneys' fees, expenses and arbitration costs. On March 15, 2019, IEC amended its request for arbitration to alleged damages of $591 million of lost profits plus unspecified additional costs based on alleged non-performance of the contracts in dispute. The arbitration hearing was held from December 9, 2019 to December 20, 2019. On March 3, 2020, IEC amended their damages claim to $700 million of alleged loss cash flow or, in the alternative, $244.9 million of lost profits and various costs based on alleged non-performance of the contracts in dispute, and in addition $4.8 million of liquidated damages, $58.6 million in take-or-pay costs of feed gas, and unspecified additional costs of rectification and take-or-pay future obligations, plus unspecified interest and attorneys' fees. On May 3, 2020, the arbitration panel dismissed IEC's request for take-or-pay damages. On May 29, 2020, IEC quantified their claim for legal fees at $14.2 million and reduced their alternative claim from $244.9 million to approximately $235 million. The Company and its subsidiaries have contested IEC's claims and are pursuing claims for compensation under the contracts. On October 31, 2020, the ICDR notified the arbitration panel's final award, which dismissed the majority of IEC's claims and awarded a portion of the Company's claims. On January 27, 2021, IEC filed a petition to vacate the arbitral award in the Supreme Court of New York, County of New York. On March 5, 2021, the Company filed a petition to confirm the arbitral award, and on March 8, 2021, the Company removed the matter to the United States District Court for the Southern District of New York. On November 16, 2021, the court granted the Company's petition to confirm the award and denied IEC's petition to vacate. During the second quarter of 2022, IEC paid the amounts owed under the arbitration award, which had an immaterial impact on the Company's financial statements. On February 3, 2022, IEC initiated another arbitration proceeding in New York administered by the ICDR against certain of the Company's subsidiaries arising out of the same project which formed the basis of the first arbitration (the "Second Arbitration"). On March 25, 2022, the Company's subsidiaries initiated a separate demand for ICDR arbitration against IEC for claims of additional costs and amounts due; such claims against IEC have now been resolved, with any consideration having an immaterial impact on the Company's financial statements. On February 15, 2025, the parties entered into a confidential Settlement Agreement, settling the claims brought in the Second Arbitration. The consideration contemplated by the Settlement Agreement is immaterial to the Company's financial statements.

On or around February 15, 2023, the lead plaintiff and three additional named plaintiffs in a putative securities class action styled The Reckstin Family Trust, et al., v. C3.ai, Inc., et al., No. 4:22-cv-01413-HSG, filed an amended class action complaint (the "Amended Complaint") in the United States District Court for the Northern District of California. The Amended Complaint names the following as defendants: (i) C3.ai., Inc. ("C3 AI"), (ii) certain of C3 AI's current and/or former officers and directors, (iii) certain underwriters for the C3 AI initial public offering (the "IPO"), and (iv) the Company, and its President and CEO (who formerly served as a director on the board of C3 AI). The Amended Complaint alleges violations of the Securities Act of 1933 (the "Securities Act") and the Securities Exchange Act of 1934 (the "Exchange Act") in connection with the IPO and the subsequent period between December 9, 2020 and December 2, 2021, during which BHH LLC held equity investments in C3 AI. The action seeks unspecified damages and the award of costs and expenses, including reasonable attorneys' fees. On February 22, 2024, the Court dismissed the claims against the Company. However, on April 4, 2024, the plaintiffs filed an amended complaint, reasserting their claims against the Company under the Securities Act and the Exchange Act. On or around February 14, 2025, the plaintiffs filed a further amended complaint, once again

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

reasserting their claims against the Company under the Securities Act and the Exchange Act. At this time, the Company is not able to predict the outcome of these proceedings.

The Company insures against risks arising from its business to the extent deemed prudent by management and to the extent insurance is available, but no assurance can be given that the nature and amount of that insurance will be sufficient to fully indemnify the Company against liabilities arising out of pending or future legal proceedings or other claims. Most of the Company's insurance policies contain deductibles or self-insured retentions in amounts management deems prudent and for which the Company is responsible for payment. In determining the amount of self-insurance, it is the Company's policy to self-insure those losses that are predictable, measurable and recurring in nature, such as claims for automobile liability, general liability and workers compensation.

OTHER

In the normal course of business with customers, vendors and others, the Company has entered into off-balance sheet arrangements, such as surety bonds for performance, letters of credit, and other bank issued guarantees. The Company also provides a guarantee to GE Vernova on behalf of a customer who entered into a financing arrangement with GE Vernova. Total off-balance sheet arrangements were approximately $5.7 billion at March 31, 2025. It is not practicable to estimate the fair value of these financial instruments. As of March 31, 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.

NOTE 17. RESTRUCTURING

The Company recorded restructuring charges of nil during the three months ended March 31, 2025 and 2024.

The following table presents restructuring and associated impairment charges by the impacted segment:


	Three Months Ended March 31,
	2025		2024
Oilfield Services & Equipment	$	—	$	(5)
Industrial & Energy Technology	—		—
Corporate	—		5
Total	$	—	$	—

The following table presents restructuring charges by type:


	Three Months Ended March 31,
	2025		2024
Property, plant and equipment	$	—	$	—
Employee-related termination expenses	—		(2)



Other incremental costs	—		2
Total	$	—	$	—

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Baker Hughes Company

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 18. OTHER (INCOME) EXPENSE, NET

Other (income) expense, net consists of the following:


	Three Months Ended March 31,
	2025		2024
Change in fair value of equity securities	$	140	$	(52)
Other charges and credits (1)	—		30

Total	$	140	$	(22)

(1)Other charges and credits of $1 million for the three months ended March 31, 2025 consist of other income within OFSE, IET, and Corporate.

The Company recorded other (income) expense, net of $140 million and $(22) million for the three months ended March 31, 2025 and 2024, respectively, primarily due to change in fair value of equity securities.

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