EOG Resources 2025 Q1 Earnings Misses Targets as Net Income Declines 18%

EOG Resources reported its fiscal 2025 Q1 earnings on May 01st, 2025. EOG Resources fell short of expectations with net income declining 18.2% to $1.46 billion. The company adjusted its capital expenditure guidance, reducing the range to $5.8 billion to $6.2 billion for 2025, reflecting a cautious approach amid potential near-term impacts on global demand. Despite the decrease in net income and adjustments in guidance, EOG remains committed to maintaining production levels consistent with first-quarter performance, targeting a 2% growth in oil production and a 5% increase in total production for the year, showcasing a balanced strategy amid market uncertainties.

Revenue

EOG Resources experienced a 7.3% decrease in total revenue, falling to $5.65 billion in Q1 2025 from $6.10 billion in the previous year's Q1. The crude oil and condensate segment was the largest contributor, generating $3.29 billion. The natural gas liquids segment brought in $572 million, while natural gas accounted for $637 million. The company's financial commodity and derivative contracts showed a net loss of $191 million. Gathering, processing, and marketing activities contributed $1.34 billion, with asset dispositions resulting in a marginal loss of $1 million. Other revenues, net, added $19 million, culminating in a total of $5.67 billion.

Earnings/Net Income

EOG Resources saw a decline in its EPS by 14.5%, dropping to $2.66 in Q1 2025 from $3.11 in Q1 2024. Net income also decreased significantly, falling to $1.46 billion, an 18.2% reduction from the previous year's $1.79 billion. The earnings per share performance reflects a challenging quarter.

Price Action

The stock price of EOG Resources edged up 1.96% during the latest trading day, but declined 1.57% over the full trading week, and fell 12.91% month-to-date.

Post-Earnings Price Action Review

Following the earnings report, EOG Resources’ stock price demonstrated positive trends. Revenue, net income, and EPS all influenced the stock price positively over various time frames. The backtest indicated a 3-day win rate of 52.55% for both revenue and net income, suggesting a moderate likelihood of short-term price increases post-earnings. Over a 10-day window, the win rate slightly improved to 53.51%, further increasing to 56.54% over 30 days. EPS showed a stronger immediate reaction with a 3-day win rate of 56.54%, indicating frequent short-term price increases. Across all metrics, the maximum return observed within 30 days post-earnings was 8.94%, with the peak return day occurring on day 79. While short-term volatility is present, EOG Resources tends to achieve sustained price appreciation in the medium to long term following earnings disclosures.

CEO Commentary

Ezra Yacob, Chairman and CEO, highlighted EOG's solid execution across foundational and emerging plays, driving better-than-expected results. Yacob emphasized EOG's generation of $1.3 billion in free cash flow, all returned to shareholders through dividends and share repurchases. He reaffirmed the company's focus on capital discipline and strategic exploration success in Trinidad, reinforcing EOG's low-cost position and long-duration resource base, ensuring profitability during price volatility and significant shareholder value.

Guidance

EOG Resources has adjusted its capital expenditures for 2025 to a range of $5.8 billion to $6.2 billion, a reduction from previous plans. The company anticipates a 2% growth in oil production and a 5% increase in total production for the year, maintaining production levels consistent with Q1 performance. This guidance reflects a cautious approach in light of potential near-term impacts on global demand.

Additional News

EOG Resources recently announced a strategic participation agreement with Bapco Energies in Bahrain, focusing on evaluating a natural gas exploration prospect with planned drilling in 2025. This collaboration marks a significant step in EOG's international expansion efforts. Additionally, EOG declared a regular quarterly dividend of $0.975 per share, payable on July 31, 2025, to stockholders of record as of July 17, 2025, showcasing its commitment to shareholder returns. Furthermore, EOG has $5.1 billion remaining on its current share buyback authorization, demonstrating substantial flexibility in capital allocation strategies amid market uncertainties.