Executive Summary

Q2 2024 delivered adjusted EBITDA of $413M and adjusted diluted EPS of $0.10, despite a GAAP net loss of $608M driven by full cost ceiling test impairments; weighted average realized price including derivatives rose to $2.35/Mcfe from $2.33/Mcfe YoY on stronger liquids pricing .
Production was 379 Bcfe (85% gas), down 10% YoY and up slightly QoQ; capital investments were $430M with 22 wells to sales (19 Appalachia, 3 Haynesville), reflecting proactive activity adjustments to commodity prices within annual cash flow .
Guidance remains discontinued due to the pending Chesapeake merger; no earnings call was hosted, limiting qualitative color and Q&A signals for investors .
Balance sheet: total debt $4.19B, net debt/adj. EBITDA 2.1x, and $445M drawn on the revolver at quarter-end; hedging remained extensive across gas, oil, and NGLs .
Near-term stock narrative likely centers on merger trajectory and commodity price sensitivity; absence of guidance and GAAP losses from impairments are headwinds, while operational execution, unit cost discipline, and realized price support provide offsets .

What Went Well and What Went Wrong

What Went Well

Liquids strength supported realized pricing: weighted average realized price including derivatives increased to $2.35/Mcfe vs $2.33/Mcfe YoY, primarily due to higher liquids prices .
Operational execution and cost control: LOE was $1.08/Mcfe and DD&A fell to $0.58/Mcfe, reflecting efficiency and lower amortization vs prior year .
Discipline within cash flow: management “proactively adjusting activity in response to commodity prices while optimizing productive capacity within annual cash flow,” underscoring capital discipline .

What Went Wrong

Large non-cash impairments drove GAAP losses: Q2 net loss of $608M and diluted EPS of ($0.55), with $631M impairments; YTD impairments reached $2.724B, obscuring underlying profitability .
Volume softness YoY: total production declined to 379 Bcfe from 423 Bcfe in Q2 2023, pressuring operating leverage amid low gas prices .
No guidance and no call: withdrawal of guidance due to the Chesapeake merger and absence of an earnings call reduced forward visibility and limited management Q&A .

Financial Results

Metric	Q2 2023 (oldest)	Q1 2024	Q2 2024 (newest)
Operating Revenues ($USD Billions)	$1.269B	$1.417B	$1.083B
Net Income (Loss) ($USD Millions)	$231	$(1,535)	$(608)
Diluted EPS (GAAP) ($)	$0.21	$(1.39)	$(0.55)
Adjusted Net Income ($USD Millions)	$95	$131	$113
Adjusted Diluted EPS ($)	$0.09	$0.12	$0.10
Adjusted EBITDA ($USD Millions)	$484	$472	$413
Net Cash Provided by Operating Activities ($USD Millions)	$425	$496	$291
Capital Investments ($USD Millions)	$595	$538	$430
Free Cash Flow (Deficit) ($USD Millions)	$(142)	$(99)	$(52)
Total Production (Bcfe)	423	376	379
Weighted Avg Realized Price incl. derivatives ($/Mcfe)	$2.33	$2.61	$2.35

Segment breakdown (Q2 2024):

Segment	Gas (Bcf)	Oil (MBbls)	NGL (MBbls)	Total Production (Bcfe)	Total Weighted Avg Realized Price excl. derivatives ($/Mcfe)	Capital Investments ($USD Millions)
Appalachia	192	1,256	7,908	247	$1.71	$216 (D&C $163, Land $22, Cap. interest/exp $31)
Haynesville	132	5	0–1	132	$1.66	$206 (D&C $188, Land $1, Cap. interest/exp $17)

KPIs and unit costs:

KPI	Q2 2023 (oldest)	Q1 2024	Q2 2024 (newest)
LOE ($/Mcfe)	$1.00	$1.12	$1.08
G&A ($/Mcfe)	$0.09	$0.13	$0.11
Taxes other than income ($/Mcfe)	$0.14	$0.13	$0.11
DD&A ($/Mcfe)	$0.77	$0.68	$0.58
Weighted Avg Realized Price excl. derivatives ($/Mcfe)	$1.84	$2.20	$1.70
Weighted Avg Realized Price incl. derivatives ($/Mcfe)	$2.33	$2.61	$2.35

Balance sheet and leverage:

Total debt: $4.19B; net debt: $4.17B; net debt/adjusted EBITDA: 2.1x .
Revolver borrowings: $445M at quarter-end .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Total Production (Bcfe)	FY 2023	1,650–1,705 (updated in Q2’23)	Guidance discontinued (FY 2024)	Withdrawn
Gas Production (Bcf)	FY 2023	1,425–1,465	Guidance discontinued (FY 2024)	Withdrawn
Liquids (% of production)	FY 2023	13.5–14.0%	Guidance discontinued (FY 2024)	Withdrawn
Total Capital Investments ($)	FY 2023	$2.00–$2.30B	Guidance discontinued (FY 2024)	Withdrawn
Nat Gas discount to NYMEX incl. transport ($/Mcf)	FY 2023	$0.55–$0.70	Guidance discontinued (FY 2024)	Withdrawn
Oil discount to WTI incl. transport ($/Bbl)	FY 2023	$12.00–$15.00	Guidance discontinued (FY 2024)	Withdrawn
NGL realization (% of WTI) incl. transport	FY 2023	27–35%	Guidance discontinued (FY 2024)	Withdrawn
LOE ($/Mcfe)	FY 2023	$1.05–$1.11	Guidance discontinued (FY 2024)	Withdrawn
G&A ($/Mcfe)	FY 2023	$0.08–$0.12	Guidance discontinued (FY 2024)	Withdrawn
Taxes other than income ($/Mcfe)	FY 2023	$0.16–$0.20	Guidance discontinued (FY 2024)	Withdrawn
Income tax rate	FY 2023	~23% (deferred)	22.4% used for 2024 non-GAAP adjustments	N/A (methodology only)

Note: Southwestern Energy discontinued guidance in Q4 2023 due to the pending merger with Chesapeake and reaffirmed discontinuation in Q1 and Q2 2024; investors cautioned not to rely on past forward-looking statements .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2023 and Q1 2024)	Current Period (Q2 2024)	Trend
Merger with Chesapeake	Guidance discontinued; transaction process and SEC filings referenced	Guidance discontinued; no call; merger-related expenses $10M in Q2 and $19M YTD	Ongoing integration planning; reduced public guidance cadence
Capital discipline within cash flow	Front-end loaded development in Q1, align activity and capital with expected annual cash flow	“Proactively adjusting activity” and optimizing productive capacity within annual cash flow	Consistent emphasis on discipline
Commodity price environment	Q1 realized price down YoY due to lower Henry Hub; hedging mitigated volatility	Liquids strength lifted realized price incl. derivatives to $2.35/Mcfe vs $2.33/Mcfe YoY	Slight realized price support from liquids
Operational efficiency and unit costs	Q1 LOE $1.12/Mcfe; Haynesville well costs down 13% YoY	LOE improved to $1.08/Mcfe; Appalachia well cost $922/ft, Haynesville $1,788/ft	Incremental cost improvements
Hedging strategy	Extensive collars/swaps across commodities	Significant 2024–2026 hedges across gas/oil/NGLs; 2024 gas swaps 267 Bcf at $3.60/MMBtu	Continued risk management depth

Management Commentary

“Proactively adjusting activity in response to commodity prices while optimizing productive capacity within annual cash flow.” (Q2 2024 press release) .
“For full-year 2024, the Company plans to align activity and capital investment with expected annual cash flow, resulting in an expected consistent production profile throughout the year at current strip prices.” (Q1 2024 press release) .
Historical context: “Southwestern Energy continues to improve the resilience and free cash flow generation capacity of our business… Debt reduction remains our top capital allocation priority.” — Bill Way, President & CEO (Q2 2023 press release) .

Q&A Highlights

No conference call or webcast was hosted due to the pending merger with Chesapeake; therefore, no Q&A highlights for Q2 2024 .

Estimates Context

S&P Global consensus estimates for Q2 2024 EPS, revenue, and EBITDA were unavailable via tool due to mapping limitations. As a result, we cannot provide a beat/miss assessment versus Wall Street consensus at this time. Values retrieved from S&P Global were unavailable.
Given the sizable non-cash impairments driving GAAP losses and the company’s non-GAAP focus (adjusted net income, adjusted EBITDA), investor models will likely emphasize adjusted metrics, realized pricing trends (particularly liquids), unit cost trajectory, and capital pacing within cash flow .

Key Takeaways for Investors

Adjusted performance remains resilient: $413M adjusted EBITDA and $0.10 adjusted EPS, but GAAP loss reflects $631M impairments; the non-GAAP framework better reflects operating performance in this commodity backdrop .
Liquids pricing provided incremental support to realized prices; monitor WTI/NGLs and differentials, as modest liquids tailwinds partially offset gas price weakness .
Activity pacing within cash flow continues; expect measured D&C cadence and cost discipline while maintaining productive capacity through the merger process .
Volume trajectory: slight QoQ increase (379 vs 376 Bcfe), but YoY decline; near-term output likely stable given the stated consistent production profile at strip .
Balance sheet/leverage stable with net debt/adj. EBITDA at 2.1x and revolver utilization at $445M; hedging depth should mitigate price volatility risk into 2025 .
Narrative risk: no guidance and no call reduce visibility; the stock may trade more on merger milestones and macro gas/liquids pricing than company-specific catalysts .
Watch non-GAAP adjustments and tax rate assumptions (22.4%) when comparing reported vs adjusted metrics; impairments and unsettled derivatives materially impact GAAP results .

Appendix: Realized Prices Detail (Q2 2024 vs Q2 2023)

Metric	Q2 2023 (oldest)	Q2 2024 (newest)
Henry Hub NYMEX ($/MMBtu)	$2.10	$1.89
Avg realized gas price excl. derivatives ($/Mcf)	$1.47	$1.22
Avg realized gas price incl. derivatives ($/Mcf)	$2.02	$2.00
Avg realized oil price incl. derivatives ($/Bbl)	$56.82	$66.67
Avg realized NGL price incl. derivatives ($/Bbl)	$20.85	$20.41
Total weighted avg realized price excl. derivatives ($/Mcfe)	$1.84	$1.70
Total weighted avg realized price incl. derivatives ($/Mcfe)	$2.33	$2.35

Disclosures: Non-GAAP metrics and reconciliations provided by the company; tax rate assumption of 22.4% used for 2024 adjustments . Guidance is discontinued due to the pending Chesapeake merger; no Q2 2024 call was held .

SOUTHWESTERN ENERGY CO (SWN)·Q2 2024 Earnings Summary