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(Reuters) -Oilfield firm Baker Hughes Co beat first-quarter profit estimates on Wednesday, as stronger oil prices supported demand for its equipment and services.
Global oil futures are currently trading around $83.12 a barrel, down about 22% from a year ago but still well above a level where firms can drill profitably.
Markets have been choppy in the past month, with the price of a barrel falling to around $70 amid concerns of a banking crisis and economic jitters before rebounding on a surprise cut by OPEC+.
“While 2023 has already started off with some macro volatility, we remain optimistic on the outlook for energy services,” CEO Lorenzo Simonelli said in a statement.
He sees the current spending-cycle for oil and gas as “less sensitive to commodity price swings,” pointing to factors such as the development of liquefied natural gas projects.
The company is anticipating double-digit spending growth by upstream oil and gas companies this year, eyeing full-year revenue of between $24 billion and $26 billion, up from $21.2 billion in 2022.
Shares of Baker Hughes were up 1.4% in pre-market trading at $29.90 each. They are flat year-to-date.
Revenue from Baker’s Oilfield Services & Equipment business rose 19% year-over-year, while sales in its Industrial & Energy Technology business grew by 18%.
Adjusted net income was $289 million, or 28 cents per share, for the three months ended March 31, topping Wall Street expectations of 26 cents per share, according to Refinitiv data, but down from 38 cents in the prior quarter.
“Positive update as Q1 beats, Q2 sets up well vs. expectations, and order momentum continues,” wrote analysts for investment firm Tudor, Pickering, Holt & Co in a note.
Baker Hughes kicks off first-quarter earnings for the oilfield services industry. SLB, the largest firm in the sector, is expected to report quarterly results on Friday and Halliburton (NYSE:HAL) Co on Tuesday.
