Baker Hughes banked $1.45 billion from Hexagon's Waygate buy as its $46.4 billion backlog waits for 2027
Baker Hughes closed the $1.45 billion Waygate sale to Hexagon on November 2, days after raising its AI-era order target past $50 billion. But GAAP net income fell 33% and its own CFO says the record backlog converts to revenue only slowly in 2027.
Vincent Jiang · 2 min read
Baker Hughes−1.63% — Baker Hughes, down 1.63 percent today closed the sale of Waygate Technologies to Hexagon on November 2, collecting roughly $1.45 billion in pre-tax cash, five days after an earnings call that talked almost exclusively about turbines for artificial intelligence data centers 5. The timing tells the story: the company banked a balance-sheet-boosting divestiture while asking investors to price it on a backlog that will not pay out on schedule.
The order book hit a record, and the print hid the decline
The quarter itself was loud. Revenue rose 14% year on year to $8.025 billion, orders surged 31% to $10.8 billion, and remaining performance obligations, the contracted work still to be delivered, reached a record $46.4 billion, of which the Industrial and Energy Technology arm holds $39.4 billion 1. Data-center orders reached $4.9 billion this year, up roughly 500% from a year earlier, and CEO Lorenzo Simonelli raised the segment's 2026-2028 order target to more than $50 billion, a $10 billion increase 2.
Four in ten dollars of adjusted profit were add-backs
But the best revenue quarter in the series came with the weakest GAAP profit of the last three. GAAP net income fell 33% to $411 million from $609 million, while the $695 million adjusted figure carries $284 million of add-backs, largely tied to the Chart Industries acquisition completed July 16 1. Four in every ten dollars of adjusted profit were add-backs this quarter.
Baker Hughes' record revenue quarter came with its thinnest GAAP profit in two years
- Revenue
- Net income
Data
| Revenue | Net income | |
|---|---|---|
| Q4 '24 | 7.36 | 1.18 |
| Q1 '25 | 6.43 | 0.4 |
| Q2 '25 | 6.91 | 0.7 |
| Q3 '25 | 7.01 | 0.61 |
| Q4 '25 | 7.39 | 0.88 |
| Q1 '26 | 6.59 | 0.93 |
| Q2 '26 | 6.74 | 0.68 |
| Q3 '26 | 8.03 | 0.41 |
Chief Financial Officer Ahmed Moghal then gave the part the AI camp does not quote: long-lead power and LNG orders convert slowly, so the segment's organic revenue growth in 2027 is guided to only low-to-mid single digits, with 33% of the gas turbine and compression backlog scheduled to convert that year 2. Simonelli pointed to material non-refundable down payments and cancellation penalties as protection, and noted power systems is under 20% of total obligations 2.
The old business still funds the wait
The oilfield side is doing its job quietly. The US rig count held at 603 for three straight weeks into late October, up about 53 from a year earlier, with the Permian at 272 and tight distillate stocks and a Strategic Petroleum Reserve near multi-decade lows keeping drilling economics supported 3. That steady cash and the $1.45 billion from Waygate are what carry the company through the conversion trough the AI orders create 35.
Operating cash has covered capex in all eight quarters since late 2024
- Operating cash flow
- Free cash flow
Data
| Operating cash flow | Free cash flow | |
|---|---|---|
| Q4 '24 | $1.19B | $0.9B |
| Q1 '25 | $0.71B | $0.45B |
| Q2 '25 | $0.51B | $0.24B |
| Q3 '25 | $0.93B | $0.7B |
| Q4 '25 | $1.66B | $1.34B |
| Q1 '26 | $0.5B | $0.21B |
| Q2 '26 | $1.35B | $1.11B |
| Q3 '26 | $1.01B | $0.77B |
The position is documented; whether the backlog converts on schedule in 2027 is the bet no source resolves.
Readers who want the fuller backstory on the Venture Global power-island awards behind these orders can find our earlier reporting linked below.
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