Magnolia Oil & Gas Q2 2025 Earnings Call Highlights: Strong Production Growth, Financial Performance, and Shareholder Returns

Magnolia Oil & Gas Corp reported strong Q2 2025 earnings, with adjusted net income of $81 million, adjusted EBITDAX of $223 million, and free cash flow of $107 million. Production rate reached 98.2 thousand barrels of oil equivalent per day, a 9% YoY growth. The company increased its full-year 2025 production growth guidance to approximately 10%. Total revenue per BOE declined 13% YoY due to lower oil prices.

Magnolia Oil & Gas Corp (NYSE: MGY) delivered robust financial performance for the second quarter of 2025, with adjusted net income of $81 million, adjusted EBITDAX of $223 million, and free cash flow of $107 million [1]. The company's production rate reached 98.2 thousand barrels of oil equivalent per day, marking a 9% year-over-year (YoY) growth [1]. Magnolia also increased its full-year 2025 production growth guidance to approximately 10% [1].

Despite a 13% YoY decline in total revenue per BOE due to lower oil prices, Magnolia's strong operational performance and capital efficiency contributed to the positive results. The company's adjusted EBITDAX of $223 million reflected a 9% decrease compared to the same period last year [3]. Additionally, the company generated $107 million in free cash flow, returning 72% of it to shareholders through dividends and share repurchases [1].

Magnolia's capital expenditures for drilling, completions, and associated facilities amounted to $95 million, which was 43% of its adjusted EBITDAX for the quarter [1]. The company also completed bolt-on acquisitions totaling $40 million, adding approximately 18,000 net acres in Giddings [1]. These acquisitions did not impact the company's Q2 2025 production, which increased by approximately 2% compared to Q1 2025 [2].

The company's lease operating expenses dropped by 10% per BOE from Q1 2025 to Q2 2025, driven by lowered workover expenses [2]. Magnolia expects its lease operating expense to end up around $5.25 per BOE during the second half of 2025 [2].

Magnolia's cash balance as of the end of the second quarter was $251.8 million, and it expects minimal cash income taxes for 2025 and 2026, potentially saving around $30 million to $35 million per year [2]. The company's estimated value has increased from $25 per share to $26 per share, trading around 8% below that level [2].

References:
[1] https://uk.finance.yahoo.com/news/magnolia-oil-gas-corp-mgy-073041556.html
[2] https://seekingalpha.com/article/4807238-magnolia-oil-and-gas-q2-another-improvement-to-its-guidance-as-it-approaches-100000-boepd
[3] https://www.magnoliaoilgas.com/investors/press-releases/year/2025/07-30-2025-210117321