General Electric (GE) reported “some firming” in the oil and gas market during the final three months of 2016, but the energy unit’s results likely will remain challenged through June, management said Friday.

The Boston-based industrial conglomerate, whose offerings range from digital solutions to heavy equipment, said quarterly revenue within the oil and gas unit increased 2% year/year, marking the first uptick in more than two years. Plans remain on track to complete an estimated $32 billion deal by mid-year to become majority shareholder in a partnership combining GE’s oil and gas business with Baker Hughes Inc.

GE has dedicated more than 200 people to the integration effort, Chairman Jeff Immelt said during a conference call.

“I’m particularly excited about the Baker Hughes merger, which creates a strong full-stream competitor in the industry,” he said. “This is a good move for investors and customers…In all we were able to offset a challenging oil and gas market to deliver a year in line with expectations.”

The transaction, which would create the second largest oilfield services operator in the world, would be overseen by Immelt and GE Oil & Gas CEO Lorenzo Simonelli, who would be president and CEO. Baker CEO Martin Craighead, who is scheduled to discuss quarterly results on Tuesday, would be vice chairman.

“The oil and gas business environment continues to be challenging and activity levels remain muted,” said CFO Jeff Bornstein. “2016 was an extremely difficult year for oil and gas, and the business expects the first half of 2017 will continue to remain challenging with sequential improvements in the second half of the year. Offshore drilling and subsea activity will likely remain low in 2017.” He reiterated that GE expects the unit to deliver lower earnings overall this year.

Overall, GE during the fourth quarter was “able to offset a challenging oil and gas market to deliver a year in line with expectations,” Immelt said. “Oil and gas orders grew by 2% organically, our first growth in two years. We see some firming in the market. This includes a 42% orders growth in turbomachinery. Oil and gas equipment grew by 10% with services down slightly. And for the year, oil and gas digital orders grew by 30%. Service orders were strong across the company.”

Beyond the Baker transaction, several collaborative efforts continue to expand the oil and gas business. In November GE and BP plc launched a digital solution system to improve oil and gas production operations worldwide, beginning with a pilot at the Atlantis operating hub in the deepwater Gulf of Mexico. In 2015, GE Oil & Gas launched a partnership with McDermott International Inc. to offer front-end offshore field services, ranging from portfolio evaluation to final investment decisions. It also is collaborating with National Oilwell Varco Inc. to optimize deepwater production. The reimagined Baker is to be a digital, industrial operator, drawing from GE’s technology expertise to provide physical/digital technology solutions for customers using, among other things, GE’s trademark Predix software solutions.

Predix and software orders grew by 36% in 4Q2016. For the year, GE signed 427 partnerships and had 22,000 developers on Predix, Immelt said. The oil and gas unit also “created a few big global partnerships,” including with India’s Reliance Industries Ltd. and with Denmark shipping giant Maersk. It also signed the first enterprise-wide software agreement with Exelon to apply Predix across more than 2,000 power generation assets.

NGI’s Shale Daily will be covering many North American-focused oil and gas operator results in the coming weeks. A calendar listing is available on the website.