Baker Hughes Company (BKR): BCG Matrix [Dec-2025 Updated]

You're looking at Baker Hughes Company (BKR) right now, and honestly, the story isn't just about oil and gas anymore; it's a clear pivot toward high-margin energy technology that's reshaping the whole portfolio. Based on the late 2025 picture, we see the company heavily backing its Stars like Liquefied Natural Gas (LNG) Equipment, where orders jumped 44% year-over-year in Q3, alongside reliable Cash Cows like OFSE International that keep the lights on with an 18.7% Adjusted EBITDA margin. But this transformation means tough calls, as some legacy businesses are being shed, and big bets like the New Energy Ventures are still Question Marks needing serious capital to realize their potential. Let's break down exactly where Baker Hughes Company is placing its chips across the four quadrants.

Background of Baker Hughes Company (BKR)

You're looking at Baker Hughes Company (BKR) as of late 2025, and to map out its portfolio using the BCG Matrix, we first need to get a clear picture of where the business stands right now. Baker Hughes Company operates globally across the energy and industrial value chain, structured primarily around two main segments: Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET). As of the end of the third quarter of 2025, the trailing twelve-month (TTM) revenue for the whole company stood at approximately $27.711B. This firm has been actively reshaping its portfolio, focusing on high-value technology and energy transition solutions, which is definitely showing up in the segment results.

Looking at the most recent consolidated results, for the three months ended September 30, 2025, Baker Hughes posted revenue of $7.0 billion, marking a 1% increase year-over-year. The company's total Remaining Performance Obligations (RPO), which is a great indicator of future contracted work, was $35.3 billion at that time. Adjusted EBITDA for the quarter came in at $1,238 million, showing consistent operational discipline and margin improvement across the enterprise, even with some macro headwinds.

The Industrial & Energy Technology (IET) segment is clearly a growth engine right now. In Q3 2025, IET revenue jumped 15% year-over-year to $3.4 billion, with its EBITDA growing 20% year-over-year to $635 million, achieving an EBITDA margin of 18.8%. This strength is being driven by high-demand areas like gas infrastructure, LNG operations, and new energy markets, including significant traction in data center power solutions. Honestly, the record IET RPO of $32.1 billion gives us a very solid line of sight into future revenue streams for this part of the business.

Now, the Oilfield Services & Equipment (OFSE) segment, which historically has been the larger revenue contributor, saw revenue of $3.6 billion in the third quarter, up 1% sequentially. This segment's performance is closely tied to upstream oil and gas activity, and softer international demand or lower spot crude prices can definitely impact its top line. Despite this, management has focused on operational efficiency, with OFSE delivering EBITDA margins of 18.5% in the quarter, which shows they are managing costs well even when volumes fluctuate. The key for OFSE is its leverage to production-related activity, which provided a clear advantage in the U.S. land market during the quarter.

Baker Hughes Company (BKR) - BCG Matrix: Stars

You're looking at the business units within Baker Hughes Company (BKR) that are currently dominating high-growth markets, which, in BCG terms, are the Stars. These areas require heavy investment to maintain their leading market share, but they are the future cash cows if the market growth sustains or slows appropriately.

The Industrial & Energy Technology (IET) segment is the clear engine for this quadrant, posting strong order momentum. For the third quarter of 2025, IET secured orders totaling approximately $4.1 billion, which represented a remarkable 44% year-over-year surge, driving the segment's growth. This segment's success provides significant revenue visibility, as the IET backlog reached a new record of $32.1 billion as of Q3 2025.

Here are the key components fueling the Star status for Baker Hughes Company (BKR):

• Liquefied Natural Gas (LNG) Equipment: Orders in Q3 2025 included more than $800 million for LNG equipment.
• Data Center Power Generation: Baker Hughes Company (BKR) booked over $700 million in orders for power generation equipment just for data centers year-to-date 2025.
• Gas Technology Equipment (GTE): This sub-segment contributed to the record IET backlog, with GTE and Gas Technology Services (GTS) RPO (Remaining Performance Obligations) standing at $11.8 billion and $15.7 billion, respectively, in Q3 2025.
• High-Efficiency Turbomachinery: Secured a massive mobile power award of over a gigawatt of aeroderivative turbines for North American oil & gas operations.

The focus on these areas is strategic, as Baker Hughes Company (BKR) is capitalizing on the structural demand for gas infrastructure. The company is aggressively pursuing the data center market, with management now expecting to hit a prior three-year target of $1.5 billion in data center orders way ahead of schedule. To be fair, the Q2 2025 data center orders alone were over $550 million.

The financial snapshot of the IET segment's strength in Q3 2025 is detailed below:

The high-efficiency turbomachinery, such as the LM9000 gas turbines, is central to securing major LNG contracts, including awards for NextDecade's Rio Grande LNG Train 4 and Sempra Infrastructure's Port Arthur Phase 2. This technology is key to maintaining market leadership in the high-growth LNG sector, which is expected to see global installed capacity reach 800 million tons/year by 2030.

The company is committed to investing in these areas, targeting at least $40 billion of IET orders over the next three years. If this success in high-growth markets is sustained, these units are positioned to transition into Cash Cows as market growth moderates.

Baker Hughes Company (BKR) - BCG Matrix: Cash Cows

You're looking at the core engine of Baker Hughes Company (BKR) portfolio, the units that generate more cash than they need to maintain their strong market position. These are the businesses with high market share in mature segments, providing the necessary fuel for the company's Stars and Question Marks. Honestly, these units are what allow Baker Hughes to service debt and pay shareholders without constantly needing to raise new capital.

The focus here is on maintaining efficiency and milking the gains passively, rather than heavy promotional spending, because the market is established. Investments are targeted at infrastructure improvements to squeeze out even more cash flow. Here's how the key components fit that profile:

• Oilfield Services & Equipment (OFSE) International: Provides stable, high-market-share services outside North America, generating reliable cash flow.
• Subsea and Surface Pressure Systems (SSPS): Secured record orders in Q3 2025, including major contracts with Petrobras and Turkish Petroleum.
• Gas Technology Services (GTS): Recurring, high-margin aftermarket services and maintenance agreements within the IET segment.
• OFSE Adjusted EBITDA Margin: Maintained a strong margin of 18.7% in Q2 2025 despite revenue decline, showing operational efficiency.

The operational discipline in the OFSE segment is defintely a key indicator of its Cash Cow status, showing profitability even when top-line revenue softens. For instance, in Q2 2025, the OFSE EBITDA margin hit 18.7%. This segment's international revenue, which represents the mature, stable part of the business, was $2,656 million in Q3 2025, showing consistent, albeit slow-growing, cash generation.

The Subsea and Surface Pressure Systems (SSPS) business, while securing massive, high-value contracts, operates in a segment where established relationships and installed bases provide a durable advantage. In Q3 2025, SSPS orders hit a record $1.2 billion, showing strong market leadership in securing large, long-term projects. This cash flow underpins the entire structure.

Gas Technology Services (GTS) is the recurring revenue powerhouse within the Industrial & Energy Technology (IET) segment. Its high-margin aftermarket services are less susceptible to the volatility of new project awards. For context on the scale of this recurring base, the Remaining Performance Obligations (RPO) for GTS stood at $15.7 billion as of the end of Q3 2025.

Here is a quick look at the hard numbers supporting the Cash Cow classification for these units based on the latest reported figures:

Finance: draft 13-week cash view by Friday.

Baker Hughes Company (BKR) - BCG Matrix: Dogs

Dogs are units or products with a low market share and low growth rates. They frequently break even, neither earning nor consuming much cash. Dogs are generally considered cash traps because businesses have money tied up in them, even though they bring back almost nothing in return. These business units are prime candidates for divestiture.

Surface Pressure Control (SPC) Product Line

You see this unit being actively removed from the core portfolio, which is the clearest signal of a Dog. Baker Hughes Company announced an agreement to form a joint venture with Cactus Inc. for this product line. Under the terms, Baker Hughes Company will contribute the SPC product line but will retain a 35% stake in the new entity. Cactus will assume operational control with a 65% ownership stake. This transaction is expected to close during the second half of 2025. The action itself suggests this line was not a high-growth, high-share asset, aligning with the lowest revenue contributor status mentioned for 2024.

North American Land Drilling Services

Revenue for this service area is clearly under pressure due to the market environment. The U.S. rotary rig count, as reported by Baker Hughes Company, was down to 544 rigs in the week ending November 26, 2025. This total count was down 38 rigs, or 6.5%, from the same time last year. Specifically, drilling rigs targeting crude oil fell by 12 from the previous week to 407 in that late November report. This decline in activity directly impacts the revenue generation capacity of the land drilling services component within Oilfield Services & Equipment (OFSE).

Legacy Oilfield Equipment and OFSE Performance

The broader OFSE segment, which houses much of the traditional equipment, shows signs of stagnation or decline in certain areas. While OFSE revenue for the third quarter of 2025 was $3.64 billion, this represented a -8.3% change compared to the year-ago quarter. The segment's performance is characterized by softer margins, which were reported at 18.5% in Q3 2025. The segment's Remaining Performance Obligations (RPO) at the end of Q3 2025 stood at $3.2 billion.

Here's a quick look at the segment-level financial context for OFSE:

Certain European/Sub-Saharan Africa OFSE Operations

Specific international operations within OFSE have also shown weakness. For instance, in the first quarter of 2024, the International revenue component of OFSE was $2,793 million, reflecting a 5% sequential decrease, which was attributed to volume decline in regions including Asia and Latin America, suggesting softness in international markets that would include parts of Sub-Saharan Africa. The Q3 2025 commentary noted that OFSE margins softened due to mix and inflation, which often disproportionately affects older, less differentiated product lines.

You should be looking at these areas for capital reallocation away from them, given the trend:

• Divestiture of the SPC product line is expected to complete in the second half of 2025.
• North American land drilling activity is constrained by a total rig count of 544 in late November 2025.
• OFSE revenue declined -8.3% year-over-year in Q3 2025.
• Legacy equipment faces low-to-no market growth.

Finance: draft 13-week cash view by Friday.

Baker Hughes Company (BKR) - BCG Matrix: Question Marks

You're looking at the parts of Baker Hughes Company (BKR) that are burning cash now but hold the key to future market leadership. These are the Question Marks, operating in high-growth areas but currently holding a low market share. They demand heavy investment to capture market share quickly, or they risk falling into the Dog category.

The primary Question Marks for Baker Hughes Company as of 2025 appear centered around its strategic pivot toward lower-carbon and digital growth vectors, which require significant upfront capital deployment.

• New Energy Ventures (CCUS/Geothermal)
• Digital Solutions (Software/Consulting)
• Hydrogen Technology
• Chart Industries Acquisition (Near-term integration risk)

New Energy Ventures (CCUS/Geothermal) shows clear high-growth market signals. Management set a 2025 New Energy orders target between $1.4 billion and $1.6 billion. By the third quarter of 2025, year-to-date orders had already reached $1.6 billion, meeting the high end of the full-year guidance. This segment is clearly in a high-growth market, but its overall contribution to total company orders-which were projected around $12.5 billion to $14.5 billion for the Industrial & Energy Technology (IET) segment in 2025-still positions it as a Question Mark needing rapid scaling.

Digital Solutions, encompassing software and consulting services, is a major cash consumer due to necessary research and development (R&D) to build market presence. Baker Hughes Company reported R&D expense of $643 million for the full year 2024. For the latest twelve months ending September 30, 2025, R&D spend was $616 million. While this investment fuels growth, the revenue share from pure digital offerings remains relatively low compared to the core equipment business, fitting the profile of a high-investment, low-current-return unit.

Hydrogen Technology represents an emerging product line tied to the broader New Energy push. While the overall New Energy orders target is substantial, the specific revenue stream from Hydrogen Technology remains unproven at scale, making it a classic Question Mark dependent on future market adoption and policy support.

The planned acquisition of Chart Industries introduces a significant, near-term Question Mark related to integration and financing risk, even with clear long-term upside. The total enterprise value for this transaction is $13.6 billion. Chart Industries generated $4.2 billion in revenue in 2024. Baker Hughes Company secured bridge financing for the deal, which is expected to close by mid-2026. The company projects $325 million in annualized cost synergies to be realized by the end of year three post-close.

Here's a quick comparison of the investment drain versus the targeted growth area:

To move these units out of the Question Mark quadrant, Baker Hughes Company must commit capital to rapidly increase market share, or divest. The Chart acquisition, for instance, is a massive bet on future market share in LNG and data center adjacent technologies. If onboarding takes longer than the expected completion by mid-2026, integration risk rises, potentially turning the acquired entity into a drag rather than a future Star. The company's total revenue for the twelve months ending September 30, 2025, was $27.711B, putting the New Energy target in perspective relative to the whole enterprise. Defintely, these are high-stakes gambles.