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Jun 30, 2020
Baker Hughes Q2 2020 Earnings Report
Baker Hughes's financial performance declined due to the impact of the COVID-19 pandemic and lower oil and gas prices.
Key Takeaways
Baker Hughes reported a challenging second quarter of 2020, with a decline in orders and revenue compared to the previous quarter and the same quarter last year. The company navigated through the ongoing impacts of the COVID-19 pandemic and the sharp decline in activity levels due to lower oil and gas prices.
Orders were down 12% sequentially and 25% year-over-year.
Revenue was down 13% sequentially and 21% year-over-year.
GAAP operating loss was $52 million.
Adjusted loss per share was $(0.05).
Revenue by Segment
Forward Guidance
Baker Hughes is preparing for potential future volatility, while also focusing on structurally reducing their cost base and implementing a number of strategic initiatives across all of their product companies. They are on track to hit their goals of structurally right-sizing their business and achieving the $700 million in annualized cost savings by year end.
Positive Outlook
- Majority of lockdowns have been easing globally and economic activity likely troughed during the second quarter.
- Executing on the framework laid out on first quarter earnings call.
- On track to hit goals of structurally right-sizing business.
- Achieving the $700 million in annualized cost savings by year end.
- Committed to strategy, maintaining focus on higher-margin and differentiated portfolio offerings.
Challenges Ahead
- Risk of a second wave of virus cases.
- Reinstitution of select lockdowns.
- Risk of lingering high unemployment.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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