April 23 (Reuters) - Oilfield services provider Baker Hughes surpassed Wall Street expectations for first-quarter profit on Thursday, helped by strength in its industrial and energy technology unit.
Baker Hughes tops estimates, says oilfield activity hit by Middle East disruptions
First-Quarter Results and Market Impact
Strong Performance in Industrial and Energy Technology Unit
April 23 (Reuters) - Oilfield services provider Baker Hughes beat Wall Street estimates for first-quarter profit, as strong demand in its industrial and energy technology unit offset drilling weakness caused by disruptions in the Middle East.
A surge in electricity demand from data centers, along with investments in liquefied natural gas (LNG), gas infrastructure and grid equipment, lifted orders in the IET unit.
Growth in IET Orders
First-quarter IET orders rose to $4.89 billion from $3.18 billion a year earlier.
Challenges in Oilfield Services and Equipment Division
However, disruptions in the Middle East weighed on oilfield services activity.
Revenue Decline and Regional Disruptions
Its oilfield services and equipment (OFSE) division was under pressure, with revenue falling 7% year-on-year to $3.24 billion, primarily due to the disposition of its surface pressure control business and regional disruptions.
Middle East/Asia Revenue Impact
Revenue from the Middle East/Asia region dropped 19% to $1.15 billion.
Industry-Wide Effects and Peer Performance
Baker Hughes and its peers have yet to benefit meaningfully from higher oil prices following attacks on infrastructure in the Middle East and Iran's effective closure of the Strait of Hormuz, as producers remain cautious about increasing drilling.
Peer Warnings and Earnings Impact
Earlier this week, peer Halliburton warned disruptions linked to the Iran conflict and the Strait of Hormuz closure could cut current-quarter earnings by about 7 cents to 9 cents per share, even after beating first-quarter estimates.
Larger rival SLB, set to report on Friday, has also flagged a potential 6-9 cent hit, citing operational disruptions in the region.
Baker Hughes Financial Highlights
Baker Hughes posted an adjusted profit of 58 cents per share for the three months ended March 31, compared with analysts' estimates of 49 cents per share, according to data compiled by LSEG.
Revenue came in at $6.59 billion, also above expectations of $6.35 billion.
(Reporting by Varun Sahay and Arunima Kumar in Bengaluru; Editing by Maju Samuel)
