Executive Summary

Q2 2025 adjusted EPS of $1.42 beat Wall Street consensus of $1.36, while revenue and EBITDA were slightly below expectations; production again exceeded guidance high end at 2,391 MBOED . Values retrieved from S&P Global.
Management completed Marathon Oil integration, raised disposition target to $5B by year-end 2026, and identified an additional >$1B run‑rate cost reductions/margin enhancements by year-end 2026 on top of >$1B run‑rate synergies by year-end 2025 .
Guidance narrowed: FY25 production now 2.35–2.37 MMBOED (midpoint unchanged); Q3 production guided to 2.33–2.37 MMBOED; full-year tax rate now mid‑to‑high 30% with ~$0.5B deferred tax benefit; ordinary dividend maintained at $0.78 per share .
Narrative catalysts: synergy outperformance, Lower 48 efficiency (30% fewer rigs/frac crews vs pre-deal levels), LNG commercialization progress (Dunkerque regas, Asia SPA, Port Arthur offtake placed), and asset sale momentum (Anadarko $1.3B) .

What Went Well and What Went Wrong

What Went Well

Production outperformed: total 2,391 MBOED, Lower 48 1,508 MBOED; Permian 845, Eagle Ford 408, Bakken 205; exceeded the high end of guidance and achieved optimized steady‑state development post Marathon integration .
Synergy and efficiency execution: management expects >$1B run‑rate synergies by YE25 and identified >$1B additional run‑rate cost/margin programs by YE26; delivering more production with ~30% fewer rigs/frac crews vs pre‑transaction pro forma levels .
LNG commercialization progress: added 1.5 MTPA regas capacity at Dunkerque, executed an Asia SPA, and effectively placed the entire 5 MTPA Port Arthur offtake, supporting multi‑year FCF inflection .

What Went Wrong

Price-driven compression: average realized price fell 19% YoY to $45.77/BOE, more than offsetting volume gains; YoY earnings/adjusted earnings declined .
Working capital headwind and lower CFO QoQ: net cash provided by operating activities was $3.5B vs $6.1B in Q1 due to ~$1.2B operating working capital change (tax timing) .
Revenue and EBITDA below consensus: revenue ~$14.0–$14.3B vs $14.89B consensus; EBITDA ~$5.68B vs $5.88B consensus. Values retrieved from S&P Global.

Financial Results

Metric	Q2 2024	Q1 2025	Q2 2025
Revenue – Sales & other operating revenues ($USD Billions)	$13.62	$16.52	$14.00
Total Revenues & Other Income ($USD Billions)	$14.14	$17.10	$14.74
GAAP Diluted EPS ($USD)	$1.98	$2.23	$1.56
Adjusted EPS ($USD)	$1.98	$2.09	$1.42
EBITDA ($USD Billions)	$6.13*	$7.28*	$5.68*
EBITDA Margin (%)	43.68%*	43.02%*	39.67%*
Net Income ($USD Billions)	$2.33	$2.85	$1.97
Net Income Margin (%)	16.61%*	16.85%*	13.76%*
Net Cash Provided by Operating Activities ($USD Billions)	$4.92	$6.12	$3.49
Capital Expenditures & Investments ($USD Billions)	$2.97	$3.38	$3.29

Values retrieved from S&P Global for items marked with *.

Vs Estimates (Q2 2025):

Adjusted EPS: $1.42 vs $1.36 consensus → bold beat. Values retrieved from S&P Global.
Revenue: $14.32B actual (SPGI revenue mapping) vs $14.89B consensus → bold miss. Values retrieved from S&P Global.
EBITDA: $5.68B vs $5.88B consensus → miss. Values retrieved from S&P Global.

Segment Production Breakdown

Segment / Basin (MBOED)	Q2 2024	Q1 2025	Q2 2025
Total Company	1,945	2,389	2,391
Lower 48 Total	1,105	1,462	1,508
Alaska	201	208	205
Permian (Lower 48)	N/A	816	845
Eagle Ford (Lower 48)	N/A	379	408
Bakken (Lower 48)	N/A	212	205

KPIs

KPI	Q2 2024	Q1 2025	Q2 2025
Average Realized Price ($/BOE)	$56.56	$53.34	$45.77
CFO (non‑GAAP) ($USD Billions)	N/A	$5.47	$4.72
Shareholder Distributions ($USD Billions)	$0.90 (ordinary dividend)	$2.50 (buybacks $1.50 + dividend $1.00)	$2.20 (buybacks $1.20 + dividend $1.00)
Cash & Short‑Term Investments ($USD Billions)	$6.11	$7.24	$5.70

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Production (MMBOED)	Q3 2025	N/A	2.33–2.37	New range
Production (MMBOED)	FY 2025	2.34–2.38	2.35–2.37	Narrowed; midpoint unchanged
Effective Corporate Tax Rate	FY 2025	N/A	Mid‑to‑high 30%	Update
Deferred Tax Benefit	FY 2025	N/A	~$0.5B	Set
Capital Expenditures	FY 2025	$12.3–$12.6B (lowered in Q1)	Unchanged	Maintained
Adjusted Operating Costs	FY 2025	$10.7–$10.9B (lowered in Q1)	Unchanged	Maintained
Ordinary Dividend	Q3 2025	N/A	$0.78/share	Maintained
Return of Capital Target	FY 2025	$10B ROC target (initial)	~45% of FY CFO distribution track	Clarified mix
Disposition Target	Through YE 2026	$2B (initial)	$5B	Raised
Synergies (Run‑Rate)	By YE 2025	$0.5B (at announcement)	>$1B	Raised
Additional Cost/Margin Enhancements	By YE 2026	N/A	>$1B	New program

Earnings Call Themes & Trends

Topic	Q4 2024 (Prior Two)	Q1 2025 (Prior Two)	Q2 2025 (Current)	Trend
Synergies & Cost Program	Focus on >$1B integration run‑rate synergies by YE25	Lowered FY capex and adjusted op costs	>$1B run‑rate synergies by YE25; +>$1B cost/margin enhancements by YE26; 30% fewer rigs/frac crews	Strengthening
Lower 48 Efficiency	Scaling program; production up 6% YoY in 4Q	Record Eagle Ford drilling performance	Optimized steady‑state; more output with less activity	Improving
LNG Strategy	Zeebrugge regas & Asia SPA	Willow winter construction milestones	Dunkerque regas + Asia SPA; Port Arthur offtake placed	Advancing
Dispositions/M&A	Signed ~$0.6B Lower 48 sales for 1H25	Closed/signed $1.3B noncore L48 including Ursa	Anadarko sale $1.3B; raise target to $5B	Accelerating
Macro/OPEC/Demand	N/A	N/A	“Choppy” near‑term; OPEC+ unwinds, demand +0.8–1.0 MBD; LNG bullish 400→700 MTPA in 5–10 yrs	Mixed near‑term; constructive long‑term
Supply Chain/Tariffs	N/A	N/A	Tariffs and inflation create equipment uncertainty for Willow; ~90–95% contracts secured by YE	Managing constraints
Technology/ERP	N/A	CFO transition to Andy O’Brien	ERP implementation enabling efficiency & commercial margin capture	Enabler

Management Commentary

“We completed the integration of Marathon Oil and remain on track to deliver greater than $1 billion in synergies and more than $1 billion of one-time benefits… [and] drive a further $1 billion-plus… cost reductions and margin enhancements by the end of 2026.” — Ryan Lance, CEO .
“We produced 2,391 MBOED… generated $1.42 per share in adjusted earnings and $4.7B of CFO… returned $2.2B to shareholders.” — Andy O’Brien, CFO .
“We’re delivering more combined production with 30% fewer rigs and frac crews… and have signed over $2.5B of dispositions within nine months… we’re more than doubling our asset sales target to $5B by the end of next year.” — Andy O’Brien .
“We’ve now effectively placed the entire 5 MTPA from Port Arthur… opportunities with customers in Europe and Asia certainly aren’t slowing down.” — Andy O’Brien (LNG) .

Q&A Highlights

Free cash flow trajectory: Management guided to ~$7B incremental FCF by 2029 at $60–$70 WTI, with staggered project startups (Qatar, Port Arthur, Willow) de‑risking the path; “you don’t have to wait until 2029” as tailwinds start in 2H25 .
Cost/margin optimization plan: ~80% expense reductions (G&A/LOE/T&P), ~20% commercial margin enhancements; enabled by scale, ERP, and centralization .
Tax outlook: FY25 effective rate cut to mid‑30s due to geographic mix; ~$0.5B “One Big Beautiful Bill” deferred tax benefit from 100% bonus depreciation; tailwind expected to continue into 2026 .
LNG commercialization: 1.5 MTPA Dunkerque regas; Asia SPA; Port Arthur offtake fully placed; ongoing conversations on additional placements .
Willow execution: Year‑round construction underway; 900 workers on slope; tariffs/inflation impacting international equipment sourcing; 90–95% contracts targeted by YE .

Estimates Context

Metric	Q2 2024	Q1 2025	Q2 2025
EPS – Consensus ($)	1.95	2.05	1.36
EPS – Actual ($)	1.98	2.09	1.42
Revenue – Consensus ($USD Billions)	14.73	15.91	14.89
Revenue – Actual ($USD Billions)	14.02	16.91	14.32
EBITDA – Consensus ($USD Billions)	6.31	7.13	5.88
EBITDA – Actual ($USD Billions)	6.13	7.28	5.68

Values retrieved from S&P Global. Q2 2025: EPS beat; revenue and EBITDA modest misses. Implication: models likely adjust for lower realized prices and cost inflation vs mix-driven tax tailwinds; production trajectory and synergy realization underpin forward EPS resilience.

Key Takeaways for Investors

Operational execution remains strong: production above guidance high end; Lower 48 continues to deliver efficiency gains without increasing rig count .
Capital returns intact: ordinary dividend steady at $0.78 and management tracking ~45% of FY CFO to shareholders, supported by synergy and tax tailwinds .
Structural improvements: >$2B total run‑rate improvements targeted (synergies + new cost/margin program) by YE26, plus raised disposition target to $5B, high‑grading the portfolio .
LNG commercialization is advancing and de‑risking multi‑year FCF: Dunkerque regas and Asia SPA, Port Arthur offtake placed; expect incremental updates on placements .
Near‑term earnings variability tied to commodity realizations and working capital timing; underlying CFO tailwinds expected in 2H25 from higher APLNG distributions, tax benefits, and lower capex .
Guidance quality: FY25 production range narrowed with unchanged midpoint despite dispositions, signaling confidence in base plan execution .
Trading lens: EPS beat vs revenue/EBITDA miss suggests mixed print; watch sell‑side revisions on realized price assumptions, tax rate, and synergy timing; catalysts include Anadarko close, further asset sales, LNG contracting, and Willow milestones .

Disclosures:
- All document-based figures and quotes are cited directly from ConocoPhillips’ 8‑K press releases, supplemental exhibits, and the Q2 2025 earnings call transcript.
- Values retrieved from S&P Global for consensus estimates and certain derived metrics (EBITDA and margins marked with *).

CONOCOPHILLIPS (COP)·Q2 2025 Earnings Summary