I'll research Baker Hughes (BKR) before writing the preview. Let me gather recent earnings history, filings, and current market context.Let me read the most recent Q1 earnings release, the Q1 call for guidance/outlook, and the Chart acquisition announcement.Let me read the Q1 2026 earnings call transcript for management's Q2/full-year guidance and outlook commentary.Let me get recent broader news and analyst context, plus check the Middle East/energy macro backdrop.I have enough to write the preview. Let me quickly pull the exact recent price action figures.Here is the earnings preview.
Report date: Tuesday, July 27, 2026 (after close) · Call: 2026Q2 Earnings Call Recent price: ~$57 · YTD: +~22% · Down ~18% from its late-April peak (~$69.7)
This is the first print in a transformed company. Baker Hughes closed its acquisition of Chart Industries on July 16, adding a brand-new third reporting segment, and it did so against a backdrop where the core OFSE business is still absorbing a Middle East conflict. The quarter's reported numbers matter less than three forward questions: (1) Did the Middle East recovery track the company's assumptions? (2) What does pro-forma guidance and the balance sheet look like now that Chart is in? (3) Does IET's orders/backlog momentum still support the raised Horizon 2 ambition?
Guidance was explicitly built on the assumption that the Middle East conflict persists through end-June with no further escalation, and that the Strait of Hormuz fully reopens entering the second half, followed by a measured activity recovery.
| Metric | Q2 2026 guide (midpoint) | Q1 2026 actual |
|---|---|---|
| Total revenue | ~$6.5B | $6.59B |
| Adjusted EBITDA | ~$1.13B | $1.16B |
| IET EBITDA | ~$670M | $678M |
| OFSE EBITDA | ~$540M | $565M |
Management framed total company EBITDA as roughly flat sequentially. The moving parts: - OFSE: Middle East revenue expected to fall >20% sequentially (double Q1's rate), weighted toward product sales given import/export logistics; offset by normal seasonal recovery elsewhere and flattish North America. Margins guided modestly down sequentially on mix (fewer of Q1's high-margin direct sales), but underlying operational margin was expected to tick up on cost-out. - IET: only a modest conflict impact (shipping logistics on GTE); GTS growth tempered because Q1 already pulled forward overdue aeroderivative backlog. Revenue guided ~flat q/q, margins modestly up.
Full-year framing: company revenue and EBITDA ranges maintained but expected to land slightly below midpoint; IET EBITDA "at least" the $2.7B midpoint; IET orders "at least" the $14.5B midpoint; OFSE EBITDA achievable only at the low end (~$2.325B) and contingent on the conflict ending by end-June. Expect an updated full-year bridge that now folds in Chart — watch whether the OFSE conflict assumption held.
Chart closed July 16 and becomes a standalone reporting segment led by Jim Apostolides. Key facts: Chart did ~$4.3B of revenue in FY2025, management targets $325M in annualized cost synergies by year three (with commercial synergies as upside), and BKR secured $2B in new term loans at close. Investors will want: (a) pro-forma/updated guidance including Chart, (b) purchase-accounting and near-term EPS/margin impacts, and (c) confirmation of the 1.0–1.5x net-leverage target within 24 months. This is now the central story — the market will scrutinize the integration cadence and whether the "industrialized energy solutions" thesis is showing up in numbers.
Q1 OFSE revenue was $3.24B (–9% q/q) with the Middle East hit still relatively contained. The Q2 guide baked in a far larger sequential Middle East decline. The key read-throughs: did activity bottom as assumed, is the Strait of Hormuz reopening on schedule, and — most important for the second half — is management still guiding to a measured H2 recovery including intervention/remediation of shut-in wells? Any change to the FY OFSE low-end (~$2.325B) EBITDA anchor is a swing factor. Note peers SLB and HAL have been volatile on the same macro.
IET is the crown jewel and the reason the stock re-rated. Q1 delivered record orders of $4.9B (1.5x book-to-bill), record RPO of $33.1B, EBITDA +35% y/y and margins above 20%. Management raised the bar, saying it is now "increasingly confident" IET Horizon 2 (2026–28) orders will exceed $40B. Watch: the fourth consecutive $4B+ orders quarter, Power Systems / data-center behind-the-meter momentum (NovaLT sold out through 2028), LNG FID pull-forward, and progress toward the $2.4–2.6B 2026 new-energy order target.
Q1 FCF was a soft $210M (seasonal low, plus customer-payment delays). With Chart debt now on the books, the market wants to see working-capital normalization and a credible deleveraging path. Also watch capital returns: the $0.23 quarterly dividend and whether buybacks (paused in Q1 — $0 vs. $188M a year earlier) resume post-close.
BKR is funding its transformation partly through divestitures: the Waygate sale to Hexagon (~$1.45B), plus PSI (Crane), the SPC JV (Cactus) and the HMH IPO — together ~$3B of gross proceeds in 2026, already exceeding the incremental $1B divestment target ahead of schedule. Any new portfolio actions or an update on gross-proceeds timing feed directly into the deleveraging narrative.
BKR ran from ~$47 in early January to a ~$69.7 peak (late April/early May) on the IET/data-center story and a strong Q1 beat, then gave back roughly 18–21% into July as the Middle East conflict injected oil/LNG volatility and pressured the OFS complex broadly. Net, shares are still up ~22% YTD. That leaves a setup where IET strength is largely priced in, and the incremental question is whether OFSE downside and Chart-related dilution/leverage are worse or better than feared. Expect the reaction to hinge on pro-forma guidance quality more than the headline Q2 EPS.
Bull case - IET orders/backlog and >20% margins prove durable; Horizon 2 >$40B narrative reinforced by more Power/LNG/data-center awards. - Middle East recovery tracks assumptions, de-risking the H2 OFSE ramp. - Clean Chart integration message + concrete deleveraging path (proceeds + FCF) toward 1.0–1.5x.
Bear case - Conflict/Strait-of-Hormuz situation slipped, forcing an OFSE cut below the low-end. - Chart adds leverage and near-term dilution while synergies are back-end loaded to year three; integration risk. - FCF conversion stays weak; buyback remains paused, capping the return story.
Treat Q2 as a transition quarter: the reported print should land near the company's own flat-sequential guide, but the durable signals are (1) whether IET orders extend the record streak and management reiterates/raises Horizon 2, (2) how the Middle East/OFSE second-half recovery is now framed, and (3) the first integrated look at Chart — pro-forma guidance, synergy cadence, and the deleveraging plan. Given IET optimism is already reflected in the shares after a strong-then-choppy year, the risk/reward tilts on OFSE guidance and the credibility of the Chart-inclusive outlook.
Preview based on BKR's Q1 2026 results and earnings call (Apr 23–24), the July 16 Chart acquisition completion announcement, and recent price action; figures are company-reported actuals and management guidance, not third-party consensus.