Baker Hughes Closes $13.6 Billion Chart Deal as Segments Diverge
Baker Hughes completed its acquisition of Chart Industries on July 16, adding a third operating segment that reported $4.3 billion in revenue for fiscal 2025.
Baker Hughes (BKR) completed its acquisition of Chart Industries on July 16, 2026, creating a new third operating segment and closing a deal first announced in the third quarter of 2025 at roughly $13.6 billion. Chart generated $4.3 billion in revenue for fiscal 2025, and Baker Hughes targets $325 million in annualized cost synergies within three years of the close.
The deal followed months of balance-sheet preparation. Baker Hughes issued $6.5 billion in USD notes and €3 billion in euro-denominated senior notes in early March 2026 to fund the purchase ahead of closing. That financing left cash and equivalents at $14,764 million as of March 31, 2026, up from $3,715 million at year-end 2025, while long-term debt rose to $15,411 million from $5,398 million as $9,885 million of new debt hit the books. Management now targets net leverage of 1.0 to 1.5 times within 24 months of the Chart close, a capital-allocation goal introduced in the anchor release to address the elevated debt load.
The acquisition landed against a first quarter that showed diverging trends beneath the headline numbers. Revenue of $6,587 million rose 2% year over year but fell 11% sequentially from $7,386 million in the fourth quarter, reversing the prior quarter's 5% sequential gain. Net income attributable to Baker Hughes climbed 131% year over year to $930 million and rose 6% sequentially, even as adjusted net income and adjusted EBITDA both declined on a sequential basis, down 26% and 13% respectively. Adjusted EBITDA fell to $1,158 million from $1,337 million in the fourth quarter, a decline attributed to lower volume, the effects of two dispositions, and unfavorable mix, partly offset by productivity gains.
The segment story underscored a mix shift already visible in full-year 2025 results, when Industrial & Energy Technology (IET) segment EBITDA rose 21% to $2,482 million while Oilfield Services & Equipment (OFSE) segment EBITDA fell 9% to $2,618 million. That divergence continued into the first quarter: IET's EBITDA margin expanded for a third straight quarter to 20.2%, approaching management's stated 20% target, while OFSE margin compressed to 17.4%, a cumulative 110 basis points of decline over three quarters tied to the dispositions and disruptions in the Middle East.
IET orders reached a record $4,887 million in the quarter, up 54% year over year and 21% sequentially, marking a third consecutive quarter above $4 billion. Climate Technology Solutions orders within IET jumped from $310 million in the fourth quarter to $1,257 million in the first, a step-change flagged for exceeding 100% variance. IET's backlog reached a record $33.1 billion, up from $32.4 billion in the fourth quarter and the third straight quarterly record. OFSE orders moved the opposite direction, falling 15% sequentially to $3,272 million after a 16% sequential rise in the third quarter of 2025.
Baker Hughes also pruned its portfolio during the quarter, divesting three businesses for combined proceeds of roughly $2.8 billion: a surface pressure control joint venture with Cactus for $344.5 million, its Precision Sensors & Instrumentation unit to Crane for $1.15 billion, and the announced sale of Waygate Technologies to Hexagon for approximately $1.45 billion, expected to close later in 2026.
Free cash flow fell to $210 million in the first quarter, down 84% sequentially and 54% year over year, after a record $1,341 million in the fourth quarter that itself had risen 92% sequentially. The swing reflected typical seasonal working-capital timing layered on top of the portfolio changes and the run-up to the Chart financing.
With the Chart deal now closed, Baker Hughes carries a materially larger debt load and a new segment to integrate, while its existing two segments continue to move in opposite directions on margin and orders.