Company: BKR
Filing Date: 2025-02-04
Form Type: 10-K
Source: 0001701605-25-000035
Chunk: 24

Company: Baker Hughes Co
Filing Date: 2025-02-04
Form: 10-K
Item: Item 8
Chunk 24
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 to cost or billing estimates that may affect a contract's total estimated profitability.

NOTE 7. PROGRESS COLLECTIONS AND DEFERRED INCOME

Contract liabilities include progress collections, which reflects billings in excess of revenue, and deferred income on long-term contracts to construct technically complex equipment, long-term product maintenance or extended warranty arrangements. Contract liabilities consist of the following at December 31:20242023Progress collections$5,550 $5,405 Deferred income122 137 Progress collections and deferred income (contract liabilities)$5,672 $5,542 Revenue recognized during the years ended December 31, 2024 and 2023 that was included in the contract liabilities at the beginning of the year was $4,398 million and $2,999 million, respectively.

NOTE 8. LEASES

The Company's leasing activities primarily consist of operating leases for service centers, manufacturing facilities, sales and administrative offices, and certain equipment.The following table presents operating lease expense:Operating Lease Expense202420232022Long-term fixed lease$292 $276 $254 Long-term variable lease76 73 48 Short-term lease511 503 477 Total operating lease expense$879 $852 $779 Cash flows used in operating activities for operating leases approximate lease expense for the years ended December 31, 2024, 2023 and 2022.

Baker Hughes Company 2024 Form 10-K | 69

Baker Hughes CompanyNotes to Consolidated Financial Statements

As of December 31, 2024, maturities of operating lease liabilities are as follows:YearOperating Leases2025$221 2026147 202799 202872 202954 Thereafter210 Total lease payments803 Less: imputed interest130 Total$673 Amounts recognized in the consolidated statements of financial position for operating leases consist of the following:20242023All other current liabilities$198 $220 All other liabilities475 549 Total$673 $769 Right-of-use assets of $678 million and $769 million as of December 31, 2024 and 2023, respectively, are included in "All other assets" in the consolidated statements of financial position. The weighted-average remaining lease term for the Company's operating leases was approximately seven years for the years ended December 31, 2024 and 2023. The weighted-average discount rate used to determine the operating lease liability as of December