Baker Hughes lifts FY26 guidance with Chart, but flags weaker cash conversion

The headline change is an acquisition-inclusive reset, not organic upside. Baker Hughes raised FY26 revenue guidance to a $28.5B-$30.3B range, with a $29.4B midpoint, from the prior $26.65B-$28.05B range and $27.35B midpoint; adjusted EBITDA moved to $4.875B-$5.475B, with a $5.175B midpoint, from $4.6B-$5.1B and a $4.85B midpoint (Updated Baker Hughes FY’26 Guidance). The comparison is not fully apples-to-apples because the new outlook includes Chart from its July 16 closing date. 〔0〕

Versus the published revenue benchmark, the guide screens above expectations, but the beat is partly mechanical. Published FY26 revenue consensus was approximately $27.55B, below the new $29.4B midpoint. But that consensus appears difficult to compare directly with a forecast that now includes Chart, so the cleaner read is that Baker Hughes has quantified the acquired business rather than delivered a large organic forecast upgrade. The company explicitly says OFSE and IET outlooks are unchanged.

The main offset is weaker near-term cash economics. FY26 free-cash-flow conversion was reduced to 40%-45% from the earlier framework of roughly 50%, reflecting acquisition-related interest, transaction, and integration costs. That makes the update less clean than the revenue and EBITDA increases suggest: earnings power is higher because Chart is consolidated, while cash conversion is temporarily worse because of the deal.

The integration evidence is constructive but still early. Baker Hughes reports $35M of synergies executed since closing and says integration is progressing around synergy capture and its Business System. 〔1〕 The filing also expects Chart's second-half revenue to be weighted toward the fourth quarter and projects above-1x book-to-bill in the second half, so the next test is whether the acquired business converts its backlog and margins as planned rather than merely raising the consolidated numbers.