Executive Summary

Q1 2024 results were resilient in a weak gas price environment: total revenues were $1.08B, GAAP diluted EPS $0.18, and adjusted diluted EPS $0.56; adjusted EBITDAX was $508M and free cash flow was $131M .
Operationally, CHK produced ~3.20 bcfe/d (100% gas), continued deferring completions/TILs to build short-cycle productive capacity, ending Q1 with 50 DUCs and 22 deferred TILs; average realized price including derivatives was $2.85/Mcfe vs NYMEX $2.24/Mcf .
Guidance posture largely maintained: 2024 plan to drill 95–115 wells and place 30–40 wells on production; rig reductions continue (dropping an additional Marcellus rig around mid-year); credit facility commitments raised to $2.5B .
Strategic catalysts: LNG SPAs (0.5 mtpa from Delfin to Gunvor, JKM-linked) and the pending Southwestern merger (timing shifted from “Q2” to “second half” in Q1 commentary), which could influence investor expectations on synergy timing and scale .

What Went Well and What Went Wrong

What Went Well

Built productive capacity while preserving capital discipline: ended Q1 with 50 DUCs and 22 deferred TILs, consistent with a strategy to activate when markets improve .
Liquidity strengthened: borrowing base reaffirmed and aggregate commitments increased to $2.5B; net cash from operations was $552M in Q1 .
LNG strategy advanced: signed long-term SPAs (0.5 mtpa offtake linked to JKM), supporting global pricing access for Lower-48 gas; management remained “Be LNG Ready” focused .

What Went Wrong

Revenue and EPS compressed versus prior year on weaker commodity prices: Q1 total revenues fell to $1.08B from $3.37B in Q1 2023; GAAP diluted EPS fell to $0.18 from $9.60; realized gas price fell YoY (Q1 2024 $2.03/Mcf vs Q1 2023 Marcellus $3.47/Mcf) .
Higher DD&A and G&A vs Q1 2023 contributed to margin compression; DD&A was $399M (vs $390M), G&A $47M (vs $35M) .
Merger timeline push: language shifted from “targeted to close Q2” (Q4 release) to “second half of this year” (Q1 release), which can create near-term uncertainty on synergy realization timing .

Financial Results

Metric	Q3 2023	Q4 2023	Q1 2024
Total Revenues and Other ($USD Millions)	$1,512	$1,948	$1,081
GAAP Diluted EPS ($USD)	$0.49	$4.02	$0.18
Net Income ($USD Millions)	$70	$569	$26
Adjusted Diluted EPS ($USD)	$1.09	$1.31	$0.56
Adjusted EBITDAX ($USD Millions)	$580	$635	$508
Net Cash Provided by Operating Activities ($USD Millions)	$506	$470	$552
Free Cash Flow (Non-GAAP) ($USD Millions)	$83	$91	$131

Segment/Basin Production and Realized Price

Basin	Q3 2023 Production (MMcfe/d)	Q3 2023 Realized ($/Mcfe)	Q4 2023 Production (MMcfe/d)	Q4 2023 Realized ($/Mcfe)	Q1 2024 Production (MMcfe/d)	Q1 2024 Realized ($/Mcfe)
Marcellus	1,734	1.63 gas (2.58 total)	1,801	2.15 gas (3.01 total)	1,720	2.03 gas (2.85 total)
Haynesville	1,568	2.15 gas (2.58 total)	1,497	2.41 gas (3.01 total)	1,478	2.03 gas (2.85 total)
Eagle Ford	193	6.36 total	129	2.42 gas / 6.30 total	—	— (no liquids production in Q1)
Total	3,495	2.79 total	3,427	3.01 total	3,198	2.85 total

Key KPIs

KPI	Q3 2023	Q4 2023	Q1 2024
Average Rig Count (rigs)	9	9	9
Wells Drilled (count)	35	45	28
Wells Turned In Line / On Production (count)	34	52	29
DUCs at Quarter-End (count)	N/A	N/A	50
Deferred TILs at Quarter-End (count)	N/A	N/A	22
Dividends Declared (per share)	$0.575 (Dec 2023 total)	Base dividend (Mar 2024)	$0.715 (Base $0.575 + Variable $0.14; payable June 2024)

Non-GAAP Adjustments (Q1 2024)

Adjusted net income was $80M vs GAAP net income $26M, primarily reflecting unrealized derivative impacts and other adjustments; adjusted diluted EPS was $0.56 vs GAAP $0.18 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Capital Expenditures	FY 2024	$1.25–$1.35B (lowered ~20%)	Not restated in Q1 press release; operating plan “consistent with previous guidance”	Maintained (implicitly)
Production Baseline	FY 2024	2.65–2.75 bcf/d baseline guide	Not restated; continued deferrals and capacity build	Maintained (implicitly)
Wells Drilled	FY 2024	95–115 wells	95–115 wells	Maintained
Wells on Production	FY 2024	30–40 wells	30–40 wells	Maintained
Rig Activity	2024	Drop a rig in Haynesville (Mar) and Marcellus around mid-year	Drop an additional rig in Marcellus around mid-year; currently 8 rigs, 2 completion crews	Update in timing/details
Dividend	Q2 2024 Payable	Base dividend schedule (Mar 26)	Total $0.715 per share (Base $0.575 + Variable $0.14) payable June 5, 2024	Declared update

Earnings Call Themes & Trends

Note: The Q1 2024 earnings call transcript could not be retrieved due to a database inconsistency; themes below reflect press releases and available filings.

Topic	Previous Mentions (Q3 2023)	Previous Mentions (Q4 2023)	Current Period (Q1 2024)	Trend
LNG Strategy	HOA with Vitol to supply gas for up to 1.0 mtpa, JKM indexed starting 2028	SPAs signed: purchase ~0.5 mtpa from Delfin (Henry Hub linked) and sell to Gunvor (JKM linked); merger targeted close Q2	Continued pursuit of LNG agreements; reiterated 0.5 mtpa Delfin-to-Gunvor SPAs; emphasize global market access	Steady execution toward LNG offtake and marketing
Deferrals/DUCs/TILs	Deferral of ~60% planned Marcellus TILs; elective curtailments; maintain flexibility	Defer placing wells on production; drop rigs and frac crews to build capacity	Continued deferrals; 50 DUCs and 22 deferred TILs at quarter-end	Capacity build persists pending price recovery
Southwestern Merger	N/A in Q3	Announced, targeted close in Q2 2024	“Expect close in second half of this year”	Timing pushed later; watch regulatory/process milestones
ESG & Safety	Joined OGMP 2.0; partnerships for geothermal project; safety improvement	100% MiQ/EO100 recertification; net zero 2035 commitment	Achieved 2025 interim intensity targets; ~40% YoY TRIR improvement to 0.14; maintain certifications	Sustained leadership in RSG/ESG practices
Liquidity/Balance Sheet	$713M cash; undrawn $2.0B revolver	Strong cash generation; capital plan reset	Commitments increased to $2.5B; base/variable dividends declared	Liquidity improved; shareholder returns maintained

Management Commentary

“Today’s results show the strength of our portfolio and strategy… As we build productive capacity, we continue to focus on capital discipline and prudently respond to today’s market conditions. We remain excited about our pending combination with Southwestern which we expect will close in the second half of this year.” — Nick Dell’Osso, President & CEO .
“Our 2024 operating plan is designed to prudently respond to today’s market… Our strategic combination with Southwestern will make our future outlook even stronger… We are forming the first U.S. independent that can truly compete on a global scale.” — Nick Dell’Osso (Q4 release) .
“We continue to show the resilience of this organization… Our focus is clear — to ‘Be LNG Ready’ and opportunistically capitalize on our strong financial position and leading operating performance.” — Nick Dell’Osso (Q3 release) .

Q&A Highlights

The Q1 2024 earnings call transcript was unavailable due to a database inconsistency, so Q&A themes, clarifications, and tone checks could not be analyzed from the transcript in this session. We reviewed press releases and 8-K exhibits in full as primary sources .

Estimates Context

We attempted to retrieve S&P Global consensus for Q1 2024 and the prior two quarters (EPS and revenue), but the SPGI/CIQ mapping for CHK was unavailable in this environment, preventing estimate comparisons. As a result, “beat/miss vs consensus” could not be determined here; investors should cross-check with their S&P Global access or broker-provided consensus [SpgiEstimatesError on CHK].
With commodity-price-driven volatility and continued deferrals, we expect street models to emphasize realized pricing, hedge impacts, and timing of wells turned in line; LNG contract progression and merger timing could also drive estimate revisions .

Key Takeaways for Investors

CHK is deliberately building short-cycle gas capacity (50 DUCs, 22 deferred TILs) to flex volumes when prices/demand strengthen, supporting future cash flow optionality .
Liquidity improved with credit facility commitments up to $2.5B; Q1 operating cash flow was $552M and adjusted free cash flow $112M (variable dividend $0.14) underpinning returns through cycles .
LNG strategy is progressing (SPAs with Delfin/Gunvor), aligning CHK with international pricing via JKM and supporting long-term margin uplift potential as U.S. LNG capacity ramps .
The merger with Southwestern remains a major catalyst; language moved from “Q2” to “second half,” suggesting diligence/regulatory sequencing—investors should watch timeline updates and the integration plan .
Near-term, weak gas prices and higher DD&A/G&A pressure GAAP profitability; adjusted metrics reflect hedging and non-GAAP normalization—model sensitivity to realized prices and hedge settlements is key .
Operational efficiency persists with steady rig activity and disciplined well cadence; guidance for 2024 wells (95–115 drilled; 30–40 on production) maintained, implying stable execution while preserving capex flexibility .
ESG/RSG leadership continues with 100% MiQ/EO100 recertification and strong safety performance (TRIR ~0.14), relevant for premium market access and LNG buyers’ credentials .

Supplemental document citations: Q1 2024 Form 8-K and Exhibits . Prior quarters’ 8-Ks and Exhibits: Q4 2023 ; Q3 2023 .

CHESAPEAKE ENERGY CORP (CHK)·Q1 2024 Earnings Summary