Occidental Petroleum's Q2 Results Show Stronger Free Cash Flow Ahead

Occidental Petroleum's Q2 results indicate stronger free cash flow ahead, despite its underperformance compared to Berkshire Hathaway's purchase price. The upstream oil producer has a market value of $43 billion.

Occidental Petroleum Corp. (OXY) reported its second-quarter 2025 earnings, showing a decline in earnings per share (EPS) compared to the same period last year but still managing to beat Wall Street estimates. The company reported an EPS of $0.26, adjusted for non-recurring items, which was $0.39 per share. This compares to $1.03 per share a year ago [1].

The company's net income attributable to common stockholders was $288 million, down from $992 million in the same period last year. Despite the decrease, the company's adjusted earnings per share (EPS) of $0.39 exceeded the average analyst estimate of $0.31 per share [1].

Revenue for the quarter was $6.456 billion, a 6.1% decrease from $6.879 billion in the same period last year. The company's quarterly average global production was 1.4 million barrels of oil equivalent per day (MMboepd), up from 1.26 MMboepd a year earlier [2, 3].

Occidental Petroleum Corp. announced $950 million of additional divestitures since the start of the second quarter, with approximately $370 million already closed. The company also disclosed that its operating cash flow was $3.0 billion and free cash flow was $0.7 billion for the quarter [2, 3].

The company's earnings report also highlighted its ability to offset lower crude oil prices with higher production, a trend that was also seen among other major oil companies such as Exxon Mobil and Chevron [2, 3].

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. The current consensus EPS estimate for the coming quarter is $0.62 on $6.66 billion in revenues, and for the current fiscal year, it is $2.29 on $26.68 billion in revenues [4].

Occidental Petroleum is one of Berkshire Hathaway's largest holdings. The oil company recently reported solid second-quarter results. It's making excellent progress on its plans to repay debt and grow shareholder value. Despite lower oil and gas prices during the period, Occidental Petroleum delivered strong performance across the board [2].

The Swiss National Bank increased its stake in Occidental Petroleum by 10.8% in Q1, now owning 1,985,014 shares valued at approximately $97.98 million. Analysts have varying ratings for Occidental Petroleum, with the consensus being a "Hold" and a target price of $53.71, alongside recent adjustments in price objectives from several major firms [3].

The company's market value stands at approximately $43 billion, indicating a significant position in the energy sector. Despite the underperformance compared to Berkshire Hathaway's purchase price, Occidental Petroleum's Q2 results indicate stronger free cash flow ahead, which is a positive sign for the company's financial health and future prospects.

References:
[1] https://www.nasdaq.com/articles/occidental-petroleum-corp-q2-profit-decreases-beats-estimates
[2] https://www.reuters.com/business/energy/occidental-petroleum-beats-quarterly-profit-discloses-additional-divestments-2025-08-06/
[3] https://www.marketbeat.com/instant-alerts/filing-swiss-national-bank-purchases-194100-shares-of-occidental-petroleum-corporation-nyseoxy-2025-08-10/
[4] https://www.nasdaq.com/articles/occidental-petroleum-oxy-q2-earnings-beat-estimates