Shares of Baker Hughes Co. (BKR) slipped 0.7% in premarket trading Wednesday, pulling back from a 13-month closing high in the previous session. However, this decline comes despite the oil services company exceeding second-quarter earnings expectations. Notably, Baker Hughes saw significant strength in its subsea and surface pressure systems business.
Despite lower oil prices in the first half of 2023, Baker Hughes remains optimistic about the outlook for upstream spending. The company emphasized that market softness in North America is expected to be outweighed by strength in international and offshore markets, making them “constructive” about the future.
Baker Hughes reported a net income of $410 million, or 40 cents a share, for the quarter ending June 30. This is a significant turnaround from the loss of $839 million, or 84 cents a share, recorded in the same period last year. Adjusted earnings per share rose to 39 cents from 11 cents, surpassing the FactSet consensus of $33 cents.
Furthermore, revenue experienced robust growth of 25.1%, reaching $6.32 billion, surpassing the FactSet consensus of $6.27 billion. Orders also rose by 27.5% to $7.47 billion.
Over the past three months, Baker Hughes stock has shown strong performance with a 14.7% climb. In contrast, the Energy Select Sector SPDR exchange-traded fund (XLE) has dipped by 4.8%, while the S&P 500 (SPX) has gained 9.6%.