Why we are strengthening and simplifying to take energy forward

Today, Baker Hughes announced an important and deliberate next step in our strategic transformation. Baker Hughes is taking action and moving to a simplified organization - focused on two business segments of Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET). We are also simplifying our corporate structure and focusing intently on our operational execution.

You can read about it here. I shared more details with the financial community at today's Barclays CEO Energy-Power Conference.

Today's announcement is not only the right step for Baker Hughes, but it comes at a time perhaps most relevant to the global backdrop we see today. Before arriving in New York for the Barclays conference, I spent time in Norway for ONS 2022, a key event for our subsea and OFSE customers, as well as Gastech, a critical event for IET and the future of energy, which Baker Hughes co-hosted in Milan.

At these events, I was constantly reminded that our company's strategic next step is coming at the right time, and for the right reasons. Three examples came to my mind of how our customers' needs will be supported by our transformation.

First, the "energy trilemma" may be a popular buzzword in our industry this year, but there is a reason for it. In order to balance the trilemma of energy's sustainability, affordability, and security, we must keep focusing on reducing emissions rather than fuel sources. At Gastech, I had a lively panel discussion with Woodside's Meg O'Neill and ConocoPhillips' Ryan Lance about this. Ryan had a strong opinion - rightly so - that more honest and productive discussions between governments and industry leaders like ConocoPhillips and Baker Hughes are needed. Without that collaboration, we can never hope to "balance" the energy trilemma and will further slip towards a larger energy crisis.

Second, OFSE is a mature industry and an exciting opportunity to raise efficiencies and increase production while reducing emissions. I have said it before - there is no future energy scenario where hydrocarbons disappear, so efficiency matters. At ONS, many of my customer meetings reaffirmed that technology and solutions providers like Baker Hughes remain critical to solving the oil & gas industry's emissions needs, as well as managing a responsible transition in which hydrocarbons play a key role.

Third, a commitment to a net-zero emissions future is still as relevant now as it was before the pandemic, and we can support it profitably. In fact, I believe energy companies now have an even clearer role to play in reducing emissions for the industrial world given the necessity of hydrocarbons. At Gastech, Meg O'Neill summarized it well:, "The world can't exist without fossil fuels today. An opportunity now exists for companies in our industry to have the highest ESG standards, and we must walk-the-walk towards our own net-zero commitments now - and we must show the money is following the narrative we are putting out there."

Baker Hughes' transformed and simplified organization will play a clear role in solving for the energy trilemma. It will support a more efficient, productive, and essential oil & gas industry. It will allow us to keep leading in ESG standards while still supporting a broad energy mix. Our actions today will lead to bigger outcomes tomorrow, and our strategy is how we get there.

I encourage you to follow our team - especially Maria Claudia Borras and Rod Christie who will be leading our two new business segments - to hear their perspectives, too.

We are ready to take energy forward more than ever today, and I am excited to strengthen and simplify for our future.