Chart Industries Inc

Baker Hughes Company is emerging as a key winner from the AI boom, with its Industrial & Energy Technology segment orders doubling year-over-year to a record $7.1 billion in the second quarter. The company raised its full-year 2026 IET orders guidance to $17.5 billion to $19.5 billion, and the segment has surpassed its 20% EBITDA margin target. Baker Hughes is expanding gas turbine and generator capacity, which could support nearly $5 billion in annual Power Systems revenue by 2029. It recently secured an order for 76 NovaLT16 gas turbines from Dynamis Power Solutions, capable of generating 1.3 gigawatts of mobile power. The acquisition of Chart Industries, completed in July, is expected to add $325 million in annualized cost synergies within three years. Morgan Stanley has named Baker Hughes its top pick in the energy services sector with a $70 price target. However, risks include potential declines in oil and gas spending and delays in data-center projects.

Baker Hughes reported second-quarter 2026 adjusted earnings of 64 cents per share, beating the Zacks Consensus Estimate of 51 cents by 25.5%, while revenues of $6.74 billion surpassed the consensus mark of $6.49 billion by 3.9% but declined 2% year over year. Orders across all business segments totaled $10.5 billion, up 49% from $7.03 billion a year ago, driven by record order intake from the Industrial & Energy Technology segment, and remaining performance obligations reached $40.06 billion, up 18% year over year. The company completed its acquisition of Chart Industries and expects Chart to become a third reporting segment beginning in the third quarter of 2026, with run-rate cost synergies projected at $95 million in year one, $230 million in year two, and $325 million in year three. For the third quarter of 2026, Baker Hughes expects revenues of $6.57 billion to $7.17 billion and adjusted EBITDA of $1.12 billion to $1.30 billion, while full-year 2026 guidance calls for revenues of $26.65 billion to $28.05 billion and adjusted EBITDA of $4.6 billion to $5.1 billion. The company raised its IET order guidance to $17.5 billion to $19.5 billion and increased its Horizon 2 IET order target to more than $45 billion for 2026 through 2028.

Baker Hughes completed its all-cash acquisition of Chart Industries in July 2026, creating a third reporting segment and expanding beyond traditional oilfield markets. The deal adds thermal management, air and gas handling, compression, carbon-capture and lifecycle-service capabilities, strengthening Baker Hughes' position in gas infrastructure, industrial markets, data centers, geothermal and carbon capture. Management expects annual run-rate cost synergies of $95 million in year one, $230 million in year two and $325 million in year three, driven by nearly 300 initiatives across procurement, corporate costs, systems, operations and footprint optimization. The transaction increased balance-sheet risk, with long-term debt reaching $15.48 billion at June 30, 2026, compared with $5.40 billion at the end of 2025, and the company is targeting net debt to adjusted EBITDA of 1.0 to 1.5 times within 24 months of closing. Integration is being managed through 18 workstreams, with the first 90 days focused on customer continuity, employee retention, operating performance and early synergy actions, while the next phase emphasizes operating-model alignment, commercial integration and pilot customer solutions.

Baker Hughes has raised its expectation for Horizon 2 Industrial and Energy Technology orders to exceed $45 billion, up from a prior forecast of more than $40 billion, while guiding for full-year 2026 revenue of $27.35 billion and adjusted EBITDA of $4.85 billion. Chairman and CEO Lorenzo Simonelli said the company delivered record IET orders of $7.1 billion in the second quarter, a 2.2x book-to-bill ratio, and an all-time high RPO of $37.1 billion. The company also completed its acquisition of Chart Industries, which will operate as a third reporting segment, and is expanding gas turbine and generator capacity to support an estimated $5 billion in annual Power Systems revenue opportunity by 2029. For the third quarter, Baker Hughes guided to revenue of $6.87 billion and adjusted EBITDA of $1.205 billion, while cautioning that any material change in geopolitical conditions could affect outcomes.

Baker Hughes has completed its acquisition of Chart Industries, marking a major milestone in its transformation into a higher-value industrialized energy solutions company. Chart will operate as a third reporting segment, reflecting the scale and strategic importance of its differentiated capabilities in air and gas handling, thermal management, and lifecycle services. Baker Hughes targets $325 million in annualized cost synergies by year three after close, with additional upside from commercial synergies. Jim Apostolides has been appointed senior vice president to lead the Chart segment. Chart reported $4.3 billion in revenue for fiscal year 2025 and serves customers in more than 50 countries.

The European Union granted antitrust approval for Baker Hughes' acquisition of Chart Industries after Baker Hughes agreed to sell Chart's proprietary process technology and its small-scale process technology business to a suitable third-party purchaser approved by the European Commission. The Commission said the concessions addressed concerns about Baker Hughes' ability and incentive to favor Chart's LNG business. The $13.6 billion purchase ranks among the biggest by an oilfield services company and the most consequential since Baker Hughes merged with General Electric's oil and gas business.

Wolfe Research initiated coverage of three major oilfield services companies, assigning Outperform ratings to SLB and Baker Hughes while rating Halliburton at Peer Perform. Analyst Carlos Escalante said the industry faces a selective capital cycle favoring international exposure. On SLB, Wolfe set a $62 price target, citing margin upside from the ChampionX integration and growth in digital and data center business lines, which doubled from fiscal 2024 to 2025 and is expected to grow 13-15% annually over the next decade. Baker Hughes received a $70 price target, with Wolfe saying its free cash flow trajectory is being mispriced at an oilfield services multiple and its Industrial and Energy Technology business is set to exceed 50% of EBITDA for the first time. The pending $13.6 billion Chart Industries acquisition was flagged as a key catalyst. Halliburton was seen as largely macro dependent, carrying the largest North America exposure of the large-cap oilfield services group.