Diamondback Energy Q2 Earnings Beat Estimates, Revenues Rise Y/Y

Diamondback Energy, Inc. FANG reported second-quarter 2025 adjusted earnings per share of $2.67, which beat the Zacks Consensus Estimate of $2.63. The outperformance was primarily driven by higher-than-expected production and lower cash operating costs. However, the company’s bottom line declined significantly from the year-ago adjusted profit of $4.52, mainly due to a 20% year-over-year decrease in the average realized oil price.

Meanwhile, revenues of $3.7 billion rose 48.1% from the year-ago quarter’s sales and outperformed the Zacks Consensus Estimate by 11.8%.

On July 31, FANG’s board of directors expanded its share repurchase authorization by $2 billion to a total of $8 billion, with roughly $3.5 billion remaining for future repurchases.

During the second quarter of 2025, the company returned a total of $691 million to shareholders, representing approximately 52% of its adjusted free cash flow. This return of capital was comprised of share repurchases and the declared base cash dividend.

Midland, TX-based oil and gas exploration and production company’s board of directors also declared a quarterly cash dividend of $1 per share to its common shareholders of record as of Aug. 1, 2025. The payout will be made on Aug. 21, 2025.

In terms of share repurchases, the company bought back 2,991,653 shares of common stock during the second quarter for $398 million, excluding excise tax, at a weighted average price of $133.15 per share.

Furthermore, the company repurchased $252 million in principal amount of its outstanding senior notes maturing in 2031, 2051, 2052 and 2054. These were acquired at an average price of 76.8% of par, amounting to a total cost of approximately $196 million.

Diamondback Energy, Inc. Price, Consensus and EPS Surprise

Diamondback Energy, Inc. price-consensus-eps-surprise-chart | Diamondback Energy, Inc. Quote

FANG’s Production & Realized Prices

FANG’s production of oil and natural gas averaged 919,879 barrels of oil equivalent per day (BOE/d), comprising 54% oil. The figure was up 94% from the year-ago quarter and beat our estimate of 884,987.3 BOE/d. While crude and natural gas output increased 80% and 115% year over year, respectively, natural gas liquids volumes surged 113%.

The average realized oil price during the most recent quarter was $63.23 per barrel, 20% lower than the year-ago realization of $79.51. However, the figure beat our estimate of $60.50 per barrel. Meanwhile, the average realized natural gas price surged to 88 cents per thousand cubic feet from 10 cents in the prior year. The figure was above our estimate of 55 cents. Overall, the upstream oil and gas company fetched $39.61 per barrel compared with $50.33 a year ago.

FANG’s Costs & Financial Position

Diamondback’s second-quarter cash operating cost was $10.10 per BOE compared with $11.67 in the prior-year quarter and our estimate of $10.87. The drop in costs compared with the year-ago period reflected a decrease in lease operating expenses to $5.26 per BOE from $5.88 in the second quarter of 2024.

Further, FANG’s gathering, processing and transportation expenses fell 9% year over year to $1.73 per BOE, while cash G&A expenses fell in the second quarter of 2025 to 55 cents from 63 cents during the corresponding period of 2024. Moreover, production and ad valorem taxes rose 21% year over year to $2.56 per BOE.

Diamondback logged $864 million in capital expenditure — spending $707 million on drilling and completion, $90 million on infrastructure and environment, and $67 million on capital workovers. The company booked $1.3 billion in adjusted free cash flow in the second quarter.

As of June 30, the Permian-focused operator had approximately $219 million in cash and cash equivalents and $15.1 billion in long-term debt, representing a debt-to-capitalization of 26.1%.

FANG’s Q3 and 2025 Guidance

Based on the company's guidance, Diamondback expects to narrow its full-year 2025 oil production guidance to 485-492 thousand barrels of oil per day (MBO/d). The company anticipates its annual BOE guidance will increase 2% to 890-910 thousand barrels of oil equivalent per day (MBOE/d). In terms of capital expenditures, the company expects to lower its full-year cash capital expenditures to a range of $3.4 billion to $3.6 billion.

For the third quarter of 2025, this Zacks Rank #3 (Hold) company expects oil production to be 485-495 MBO/d and cash capital expenditures to be between $750 million and $850 million. The company also anticipates generating at least $5.8 billion of adjusted free cash flow for the full year 2025 and is committed to returning at least 50% of its quarterly free cash flow to stockholders.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Important Energy Earnings at a Glance

While we have discussed FANG’s second-quarter results in detail, let us take a look at three other key reports in this space.

San Antonio, TX-based oil and gas refining and marketing service provider, Valero Energy Corporation VLO, reported second-quarter 2025 adjusted earnings of $2.28 per share, which beat the Zacks Consensus Estimate of $1.73. However, the bottom line declined from the year-ago quarter’s level of $2.71. The better-than-expected quarterly results can be attributed to an increase in refining margins per barrel of throughput and lower total cost of sales. The positives were partially offset by a decline in refining throughput volumes and renewable diesel sales volumes.

The company had cash and cash equivalents of $4.5 billion at the end of the second quarter. As of June 30, 2025, it had a total debt of $8.4 billion and finance-lease obligations of $2.3 billion.

Houston, TX-based oil and gas equipment and services provider, Halliburton Company HAL, reported second-quarter 2025 adjusted net income of 55 cents per share, which was in line with the Zacks Consensus Estimate but below the year-ago quarter’s profit of 80 cents (adjusted). The numbers reflect softer activity in the North American region, partly offset by international growth.

As of June 30, 2025, the company had approximately $2 billion in cash/cash equivalents and $7.2 billion in long-term debt, representing a debt-to-capitalization ratio of 40.4. Halliburton reported second-quarter capital expenditure of $354 million, up from our projection of $338.2 million.

Norway-based integrated oil and gas operator, Equinor ASA EQNR, reported second-quarter 2025 adjusted earnings per share of 64 cents, which missed the Zacks Consensus Estimate of 66 cents. The bottom line declined 25% from the year-ago quarter’s level of 84 cents. Weak quarterly results can be attributed to lower liquids production across major segments and reduced liquids prices. Natural declines and portfolio divestments in Nigeria and Azerbaijan also contributed to the decrease in overall production.

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