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Letter to Stockholders
Baker Hughes delivered 2013 record revenue of $22.4 billion
along with the highest free cash fl ow levels in the history of
the company—a strong performance that was due to collab-
oration with our customers and a commitment to improving
our business. We were awarded signifi cant contracts in our inter-
national markets, particularly in the North Sea, and undertook fi eld
development projects in both hemispheres. We witnessed a growing
appetite for our new technology from customers in the Middle East
and Asia Pacifi c, and continued to transition to a service-based business model in Russia Caspian. And the
initiatives we undertook to transform our U.S. Pressure Pumping business and to stabilize a volatile Latin
America region showed steady progress.
At the heart of our 2013 performance was Baker Hughes technology. Throughout the year, we launched
129 products, combined products and services to create greater value for customers, and expanded our port-
folio through a key alliance—continuing the innovation that is fundamental to the company’s legacy
and is the mainstay of our culture.
Twenty thirteen was a year of building momentum for Baker Hughes. The most prominent shift in our results
came from a 24 percent growth in the Middle East/Asia Pacifi c region, which became our fastest-growing
area and largest international segment. The Russia Caspian area refl ected a strong demand for our reliable
well construction solutions, and we continued to build critical mass in this market. In Latin America, the steps
we took in the second half of the year to improve profi ts and reduce risk with a more stable business mix led
to new contract wins in Colombia and Mexico. Our North America business continued to evolve, with our
strategy to realign our Pressure Pumping business gaining traction. Although this business is improving, I was
disappointed with the pace of its recovery, and I remain personally committed to correcting this performance
during 2014.
Our Drill Bits, Drilling Services, Upstream Chemicals, Artifi cial Lift, and Completions Services product lines all
performed exceptionally well in 2013, leveraging innovative new products to enhance shale production and
unlock new and stranded reserves offshore.
While we exceeded several of our health, safety, and environment metrics during the year, our success was
overshadowed by the loss of six employees in workplace incidents. These fatalities strengthened our resolve
to be the undisputed leader in safety, sustainability, and compliance, and we continued to invest in the
infrastructure to support safe and environmentally responsible operations. We broke ground for our Western
Hemisphere Training Center near Houston, with an expected opening date of early 2014, and opened key
new fl uids and chemicals laboratories for the Gulf of Mexico.
Our $556-million investment in research and technology funded incremental developments, as well as
game-changing ideas based on nontraditional oilfi eld science such as advanced materials and nanotechnology.
And at the end of the year, our Oklahoma-based Artifi cial Lift Research and Technology Center—built to
deliver state-of-the-art testing capabilities for production technology—was near completion.
Martin Craighead
Chairman and Chief Executive Offi cer
32013 Annual Report