Plummeting commodity prices over the last two years have caused a big hole in the pockets of oilfield service companies across the globe. The disturbance in the commodity markets resulted in sluggish exploration and drilling demand worldwide, particularly in the North American markets, resulting in a steep drop in the demand for drilling rigs and other oilfield equipment. Consequently, large oilfield service companies, such as Baker Hughes (NYSE:BHI), have witnessed a significant decline in their revenue as well as profitability.
North American oil and gas markets have been the worst hit by the commodity slump. Thus, Baker Hughes, which has a sizeable presence in these markets, has suffered a notable contraction in its earnings, particularly over the last couple of quarters. This has resulted in a declining share of North American operations in the Houston-based company’s global revenues, and operating losses to the tune of almost $1 billion in the June quarter of 2016.
- Fed Rate Hike Causes Oil Prices To Hit Their Lowest Level For The Year
- Baker Hughes Exceeds 1Q’17 Earnings Expectations; Continues To Focus On Product Innovation
- Baker Hughes To Report A Subdued Recovery In 1Q’17 Compared To Its Peers
- Baker Hughes Is On The Path To Recovery, Despite Weak 4Q’16 Earnings
- Baker Hughes’ Fourth Quarter Earnings To Witness A Rise Driven By An Improvement In Oil Prices
- Baker Hughes’ 2016 In Review: Halliburton’s Loss Is GE’s Gain
Having said that, we do believe that Baker Hughes still has an upside potential because of its strong presence in the North American markets. Though the oilfield service provider anticipates the commodity markets to remain weak even in the second half of 2016, it is expected to benefit from the gradual recovery of the North American markets.
Have more questions about Baker Hughes (NYSE:BHI)? See the links below:
- How Does Baker Hughes Plan To Deal With The Ongoing Commodity Slump?
- Baker Hughes’ Earnings Continue To Plunge; Company Foresees A Weak Second Half
- What To Expect From Baker Hughes’ 2Q’16 Earnings Results?
- How Will Baker Hughes’ Revenue Move If Crude Oil Prices Rebound To $100 Per Barrel By 2018?
- How Will Baker Hughes’ Revenue Move If Crude Oil Prices Average At $50 Per Barrel In 2018?
- What Is Baker Hughes’ Fundamental Value Based On Estimated 2016 Value?
- How Will Baker Hughes’ Revenue And EBITDA Grow Over The Next Five Years?
- How Has Baker Hughes’ Revenue And EBITDA Changed Over The Last Five Years?
- How Has Baker Hughes’ Revenue And EBITDA Composition Changed Over The Last Five Years?
- What Is Baker Hughes’ Revenue And EBITDA Breakdown?
- Baker Hughes 1Q’16 Earnings Continue To Slide As Commodity Prices Remain Depressed
- 2015 Earnings Review: A Tough Year For Baker Hughes Due To Weak Drilling Demand
- HAL-BHI Merger: Is No Action Better Than A Rejection?
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email email@example.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Baker Hughes
View Interactive Institutional Research (Powered by Trefis):