Machado's first home run of the season got Baltimore within a run at 5-4, and Smith completed the comeback in the seventh with a drive off Tyler Clippard (0-1).
Trailing 4-1 in the fifth inning, the Orioles pulled within 4-3 on a double by Manny Machado and groundout by Mark Trumbo off Masahiro Tanaka. If Sanchez must be placed on the disabled list, the Yankees are likely to call up catcher Kyle Higashioka from Class AAA Scranton/Wilkes-Barre.
It was the 23rd career stolen base for Trumbo in 553 games. The 24-year-old hit 20 homers and finished second in the AL Rookie of the Year voting last season despite playing in only 53 games. It was also the second steal of the day for Baltimore, which had only 19 all a year ago.
Tanaka became the only Yankee ever to allow at least seven earned runs and get fewer than 10 outs on Opening Day.
"I'd say our concern is low", said Yankees general manager Brian Cashman.
Baltimore is assured of a 10th straight series win against NY at Camden Yards, a streak that began after the 2013 season.
It had been 15 years since a Yankee starter threw five-or-more scoreless innings in either the team's first or second game: In 2003, both Roger Clemens (6 innings) and Andy Pettitte (7 innings) held the Blue Jays without a run in the first two games of the season.
Jordan Spieth is already winking at his Masters demons
Butch Harmon looks ahead to the opening men's major of the year and assesses the form of Dustin Johnson ahead of Augusta. Others have certainly taken note of his play, however. "I mean, golf, it's a amusing game", the US Open champion said.
New York's Matt Holliday got his 2,000th career hit, an opposite-field single to right in the first inning. "As the game gets on, you're ready to get warm, but as far as the game played, it's pretty normal", Smith said.
Three games into the season, the New York Yankees find themselves with just one win.
After a two-run single by Ronald Torreyes put NY up 2-0 in the second inning, the Yankees upped their lead to 4-1 in the fifth.
Kevin Gausman gave up four runs and eight hits in 4 2/3 innings for Baltimore. Starlin Castro followed with an RBI single for a 4-1 lead that ended Gausman's day. As we saw in Spring Training, Sanchez controls the run game as good as any catcher in baseball. A 1-2 start to the season isn't ideal, but this is not the time to be freaking out.
The following practice swing showed how much pain Sanchez suffered. Though he's still several weeks away from returning, Gregorious "is progressing well" according to Girardi.
Orioles: RHP Chris Tillman left for Florida to continue his rehabilitation program for his sore right shoulder.
Yankees: LHP CC Sabathia (1-0, 0.00 ERA) pitches in the series finale Sunday, seeking to build upon his effective five-inning stint Tuesday at Tampa Bay. He's been sidelined with an upper respiratory infection.