(Reuters) -Oilfield services provider Baker Hughes surpassed Wall Street expectations for second-quarter profit on Tuesday, as it benefited from robust demand for its natural gas services.
The energy industry is benefiting from an increase in demand for natural gas, driven primarily by LNG exports and rising electricity consumption as a result of hotter temperatures, data centers and AI operations.
Baker Hughes has been trying to leverage its industrial and energy technology (IET) portfolio to drive growth and expand its presence in the natural gas and LNG sectors.
With demand from data centers rapidly accelerating, Baker Hughes said it is well-positioned to “meet or exceed” its three-year orders target of $1.5 billion earlier than anticipated.
Shares of the company, which provides compressors, turbines, valves and other modular systems to customers for gas processing, rose nearly 1% after the bell.
Orders in Baker Hughes’ gas technology services business jumped 28% during the quarter, lifting revenue in the IET segment to $3.29 billion.
However, total revenue fell 3% to $6.91 billion from last year as a slowdown in drilling activity across international markets and in North America weighed on demand for its oilfield equipment and technology.
Baker Hughes joined its U.S. rivals Halliburton and SLB in warning of a slowdown in upstream activity and spending as producers grapple with weakness and volatility in commodity prices.
The firm expects upstream spending in North America to be down in the low-double digits and international spending to be down in the high-single digits.
The Houston-based company posted an adjusted profit of 63 cents per share for the three months ended June 30, compared with analysts’ estimates of 56 cents per share, according to data compiled by LSEG.
(Reporting by Vallari Srivastava in Bengaluru; Editing by Alan Barona)
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