Baker Hughes' Results Take a Step Back in Q1

After several quarters of impressive gains, Baker Hughes' results took a step back in the first quarter 2022. Revenue dropped 12% sequentially, driven mainly by the Turbomachinery segment, which experienced a seasonal drop in revenue even larger than last year's first quarter. As a result, Turbomachinery segment revenue was down 9% year over year, though this was offset by a 13% increase in the Oilfield Service segment, leaving companywide revenue flat year over year. Adjusted operating margins of 7.2% were also down sequentially, though up about 160 basis points from the prior year quarter. Our fair value and no-moat rating are unchanged following the results.