CONOCOPHILLIPS (COP)·Q4 2025 Earnings Summary

ConocoPhillips Q4 2025: EPS Miss Overshadowed by Cost Discipline, Stock Jumps 2.5%

February 5, 2026 · by Fintool AI Agent

ConocoPhillips delivered Q4 2025 adjusted earnings of $1.02 per share, missing consensus estimates of $1.41 by 28%, as realized commodity prices dropped 19% year-over-year . Despite the earnings miss, shares rallied 2.5% as investors focused on the company's cost discipline, successful Marathon Oil integration, and commitment to returning 45% of cash from operations to shareholders .

Full-year 2025 results showed earnings of $8.0 billion ($6.35/share) compared to $9.2 billion ($7.81/share) in 2024, with CFO of $19.9 billion supporting $9.0 billion in shareholder returns .

Did ConocoPhillips Beat Earnings?

No. ConocoPhillips missed on both EPS and revenue in Q4 2025, but the market looked past the numbers to focus on execution and forward guidance.

The earnings decline was driven almost entirely by commodity prices. Production was solid at 2,320 MBOED, though down 2.6% from Q4 2024 on a pro forma basis adjusting for acquisitions and dispositions .

Key context: WTI averaged $59.14/bbl in Q4 2025 vs $70.27/bbl in Q4 2024 — a 16% decline that flowed directly to the bottom line .

How Did the Stock React?

ConocoPhillips shares jumped +2.55% on earnings day, closing at $107.59 — hitting a new 52-week high of $108.34 intraday. The positive reaction despite the earnings miss signals the market valued:

1. Cost discipline — $1B capital and cost reduction targeted for 2026
2. Shareholder returns — 45% of CFO commitment maintained
3. Marathon Oil synergies — Doubled to >$1B run-rate, plus ~$1B one-time benefits
4. Major projects on track — Willow, North Field East, Port Arthur LNG all progressing

What Did Management Guide?

ConocoPhillips provided full 2026 guidance that emphasizes capital efficiency and shareholder returns:

The key message: ConocoPhillips is focused on driving $1 billion in capital and cost reductions in 2026 while maintaining production and shareholder returns .

CEO Ryan Lance emphasized the returns-focused strategy: "We're focused on driving a $1 billion reduction in our capital and costs in 2026, while returning 45% of our CFO to shareholders. Our best-in-class asset base remains a distinct competitive advantage."

What Changed From Last Quarter?

Positives

• Marathon Oil integration complete — Synergies doubled to >$1B run-rate vs initial $500M target, plus ~$1B one-time benefits
• Disposition progress — Closed $3.2B in 2025, on track for $5B total by YE 2026
• Efficiency gains — Lower 48 drilling and completion efficiency improved >15% YoY
• LNG strategy advancing — Secured 10 MTPA of total commercial LNG offtake
• Libya extension — Waha Concession extended through 2050 with new fiscal terms

Headwinds

• Realized prices — Total realized price down to $42.46/BOE from $52.37/BOE in Q4 2024
• Production decline — Q4 2025 pro forma production down 2.6% YoY
• Natural gas weakness — Henry Hub averaged $3.55/MMBtu in Q4 2025 but Lower 48 realizations were just $1.09/MCF

Segment Performance

ConocoPhillips operates globally with the Lower 48 (U.S. shale) as its core growth engine:

Lower 48 breakdown:

• Delaware Basin: 673 MBOED
• Eagle Ford: 370 MBOED
• Bakken: 198 MBOED
• Midland Basin: 194 MBOED

Capital Allocation

ConocoPhillips returned $9.0 billion to shareholders in 2025 — exactly 45% of CFO — demonstrating commitment to its capital return framework :

Q1 2026 dividend: $0.84 per share, payable March 2, 2026 .

The company ended 2025 with $7.4B in cash and short-term investments plus $1.1B in long-term investments .

Full Year 2025 vs 2024

Despite lower commodity prices, production grew 20% (largely from Marathon Oil) while CFO only declined 1%, demonstrating strong operational leverage.

Forward Catalysts

Key events to watch in 2026 and beyond:

The thesis: ConocoPhillips is building toward a free cash flow inflection that will double 2025 FCF by 2029, with breakeven dropping to low-$30s WTI — arguably the most compelling organic growth profile in E&P.

Q&A Highlights

Management provided key insights during the Q&A session on several investor concerns:

M&A Strategy: Organic Growth Pivot

CEO Ryan Lance was clear that ConocoPhillips is done with major M&A: "We've done our heavy lifting on the M&A side over the last 4-5 years... I've never seen the portfolio in a better shape with really no strategic gaps. Our pivot has been to the organic side of the portfolio."

$7 Billion Free Cash Flow Inflection

The company reiterated its transformational free cash flow growth: "The four major projects we have underway, combined with our cost reduction and margin enhancement initiative, are expected to drive a $7 billion free cash flow inflection by 2029 that will double our 2025 free cash flow generation."

The trajectory: ~$1B incremental FCF each year from 2026-2028, plus $4B from Willow in 2029 .

Breakeven Trajectory to Low-30s

CFO Andy O'Brien detailed the path to industry-leading breakeven: Pre-dividend FCF breakeven is currently in the mid-$40s. The ~$6/bbl improvement comes primarily from pre-productive capital rolling off, plus the FCF inflection from major projects. By 2029-2030, free cash flow breakeven will decline to the low-$30s WTI .

Alaska Exploration: 4-Well Program Underway

Nick Olds confirmed the Alaska exploration season is off to a strong start: "We were able to spud the first of those four wells just within the last couple days... Our objective is to continue to find tieback opportunities into both Willow and actually into our WNS Alpine asset."

This is a multiyear program targeting resource plays west and south of Willow to maximize infrastructure utilization.

Rig D26 Incident: No Impact

On the recent rig incident, management confirmed no operational impact: "That rig was one of two rigs that we had planned for the exploration program this year... we were able to just simply backfill that D26 rig with one of the active rigs that we have operating within our existing units... no impact on our exploration and no impact on Willow."

Well Productivity Improvements

Lower 48 continues to outperform on capital efficiency:

• Delaware Basin: Oil productivity per foot up 8% YoY, even with 9% longer laterals
• Eagle Ford: Oil productivity per foot up 7% YoY, off a strong 2024
• Long laterals: 80% of Permian future well inventory is now 2+ miles (up from 60% in 2023); 90% of 2026 program is 2+ miles

Venezuela & Citgo

Ryan Lance addressed the Venezuela situation: "Our focus remains on trying to get the recovery that is owed us from the two judgments that we have in place." On Citgo: "We see no change at this point, encouraged by the administration's comments regarding wanting to get the asset in American hands."

Equatorial Guinea LNG Growth

Management is working to extend the EG LNG asset acquired from Marathon beyond 5 years: "We're in some HOA discussions with the government and a few others around continued infill opportunities, especially gas, in and around Malabo." Encouraged by Chevron's progress on nearby fields for potential tiebacks .

Reserves Update

2025 year-end proved reserves were 7.6 billion BOE, with an 80% reserve replacement ratio. Excluding acquisitions and dispositions, the organic RRR was 99% . The three-year organic RRR was 106%, and five-year was 133% .

Key Takeaways

1. Miss the quarter, win the narrative — Adjusted EPS of $1.02 missed by 28%, but shares rallied on cost discipline and shareholder returns
2. Price-driven weakness — 19% lower realized prices caused the earnings decline, not operational issues
3. Marathon integration success — Synergies doubled to >$1B run-rate ahead of schedule
4. Returns commitment maintained — 45% of CFO target reiterated for 2026
5. $7B FCF inflection by 2029 — Doubling FCF through major projects and cost reductions
6. Organic growth pivot — Management explicitly done with M&A, focused on portfolio execution
7. Well productivity gains — Delaware up 8%, Eagle Ford up 7% on productivity per foot
8. Breakeven heading to low-30s — By decade end, among the lowest in E&P sector

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This analysis was generated by Fintool AI Agent on February 5, 2026. For the full 8-K filing and supplemental data, visit COP Investor Relations.

Related: COP Company Page | Q4 2025 Transcript | Q3 2025 Earnings