Baker Hughes Co (BKR)

Return on equity (ROE)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net income US$ in thousands 2,979,000 1,943,000 -601,000 -219,000 -9,940,000
Total stockholders’ equity US$ in thousands 16,895,000 15,368,000 14,394,000 14,830,000 12,893,000
ROE 17.63% 12.64% -4.18% -1.48% -77.10%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $2,979,000K ÷ $16,895,000K
= 17.63%

Based on the provided data, Baker Hughes Co's return on equity (ROE) has shown significant improvement over the past few years. The company experienced a negative ROE of -77.10% as of December 31, 2020, indicating substantial loss. However, the ROE has gradually improved since then, declining to -1.48% as of December 31, 2021, and -4.18% as of December 31, 2022.

The positive turnaround occurred in December 31, 2023, when Baker Hughes Co achieved an ROE of 12.64%, signifying a return to profitability and effective utilization of shareholder equity. This positive trend continued into December 31, 2024, with the ROE further increasing to 17.63%, demonstrating strong financial performance and efficient management of the company's assets to generate earnings for shareholders.

Overall, Baker Hughes Co has made significant progress in enhancing its return on equity, transitioning from negative figures to positive values, which reflects improved profitability and shareholder value creation over the years. It is essential for the company to sustain this positive momentum and continue to focus on strategies that drive profitability and enhance shareholder returns.