Baker Hughes (NASDAQ:BKR) Q2 2026: Adjusted EPS Beats by 25%, IET Orders Double YoY to $7.1B

Baker Hughes Company (NASDAQ: BKR) reported second-quarter 2026 adjusted EPS of $0.64, beating the $0.51 consensus estimate by 25.5%, while total orders reached $10.5 billion, up 49% year over year. Revenue of $6.742 billion declined 2.4% from $6.910 billion in Q2 2025, yet adjusted EBITDA rose 2% year over year to $1.231 billion, exceeding the high end of guidance. Shares gained 5.83% on Monday, July 27, while the S&P 500 was essentially flat, up 0.02%.

Q2 2026 Results

• Orders: $10.501 billion in Q2 2026, up 49% year over year and 29% sequentially, including $7.1 billion from the Industrial & Energy Technology (IET) segment.
• Revenue: $6.742 billion, down 2.4% from $6.910 billion in Q2 2025.
• Adjusted EPS: $0.64, versus $0.63 in Q2 2025 and $0.51 consensus estimate; GAAP diluted EPS was $0.68.
• Adjusted EBITDA: $1.231 billion, up from $1.212 billion in Q2 2025.
• Cash flow: Operating cash flow of $1.345 billion and free cash flow of $1.109 billion, compared to $510 million and $239 million, respectively, in Q2 2025.
• Backlog: Remaining performance obligations (RPO) of $40.1 billion, including a record IET RPO of $37.1 billion, up 19% year over year.

What Drove the Results

Adjusted EPS of $0.64 beat the $0.51 consensus by 25.5%, with GAAP EPS of $0.68 declining 4.2% year over year from $0.71 in Q2 2025 primarily because of year-ago GAAP items rather than operating deterioration. The divergence between the 2.4% revenue decline and the 2% adjusted EBITDA gain reflects IET order volume: IET bookings doubled year over year to $7.1 billion, lifting the IET RPO to a record $37.1 billion and signaling forward revenue that the current period's top line does not yet capture.

Free cash flow of $1.109 billion was more than four times the $239 million generated in Q2 2025, with capital expenditures declining 12.9% year over year to $236 million. The IET segment secured contracts spanning LNG infrastructure, gas turbines for data center power applications, and compression systems, including a major award from Venture Global for six LNG blocks and an order from Dynamis Power Solutions for 76 NovaLT16 gas turbines representing approximately 1.3 gigawatts of capacity.

In July 2026, Baker Hughes completed the acquisition of Chart Industries (NYSE: GTLS) in an all-cash transaction, adding thermal management, air and gas handling, compression, and lifecycle services capabilities. Separately, the company announced the sale of its Waygate Technologies unit to Hexagon for approximately $1.45 billion in an all-cash transaction, subject to customary closing adjustments.

Baker Hughes raised its full-year IET order guidance and increased its Horizon 2 (2026 to 2028) IET orders outlook to more than $45 billion. Management expressed confidence in achieving the midpoint of full-year guidance despite ongoing uncertainty in the Middle East.

Wall Street View

Wall Street consensus heading into the print was strongly constructive, with 15 Buy ratings and 7 Strong Buy ratings versus 3 Holds and 1 Sell as of July 1, 2026. The combination of a 25.5% adjusted EPS beat, record IET backlog, raised IET order guidance, and the closing of the Chart acquisition gives analysts concrete upward revision catalysts for the second half of 2026.

Investor Takeaway

The core story in Baker Hughes's Q2 2026 results is the structural shift in its order book: IET bookings have now doubled year over year to $7.1 billion, with demand spanning LNG infrastructure, gas turbine-powered data center applications, and compression systems, categories that carry higher margins than the OFSE segment. With RPO at a record $40.1 billion and the Chart acquisition closing in July, the revenue recognition pipeline is deeper than any single quarter's top-line figure suggests, and free cash flow conversion at $1.109 billion in a single quarter provides substantial capacity for further portfolio investment or shareholder returns.