It has been about a month since the last earnings report for California Resources Corporation (CRC). Shares have added about 3.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is California Resources due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.
Key Highlights
• Total operating revenues: $855 million, down 37% year over year vs $1,353 million in Q3 2024 and missing the Zacks Consensus Estimate of $879 million .
• Adjusted EPS: $1.46, down 3% year over year vs $1.50 in Q3 2024 but topping the Zacks Consensus Estimate of $1.31.
• Net income: $64 million, down 81% year over year vs $345 million in Q3 2024.
• Net total production: 137 Mboe/d, down 6% year over year vs 145 Mboe/d but matching the Zacks Consensus Estimate.
• Net oil production: 107 MBbl/d, down 5% year over year vs 113 MBbl/d and missing the Zacks Consensus Estimate of 108 MBbl/d.
Headline Drivers and Mix
Third-quarter results reflected strong operational execution against a softer year-over-year revenue and EPS comparison. The principal driver of the year-over-year revenue decline was a shift in commodity derivative outcomes: a net loss in Q3 2025 compared to a substantial gain in Q3 2024, which largely explains the ~$498 million YoY revenue delta. Realizations remained solid, with management noting oil at 97% of Brent and gas at a premium to NYMEX, and the oil mix was approximately 78%. Operating costs were approximately $275 million in Q3 2025. Adjusted EBITDAX was $338 million. Free cash flow totaled approximately $188 million, or $231 million before working capital changes.
Segment Performance
Oil and natural gas operations produced 137 Mboe/d, flat quarter over quarter and lower year over year on natural decline and lower oil volumes. Within oil, San Joaquin and Los Angeles basins were stable sequentially. Carbon management remained pre-revenue and recorded a segment loss in the quarter, as CRC continued spending on permitting, easements and early-stage project work. Electricity margin improved quarter over quarter, aided by pricing and operating conditions. Marketing margins from purchased commodities were stable versus the second quarter.
Balance Sheet and Liquidity
CRC ended the quarter with $180 million of cash and cash equivalents (excluding $16 million of restricted cash), while total liquidity exceeded $1.1 billion. Operating cash flow was $279 million, and capital investments totaled $91 million. The quarterly dividend was raised 5% to $0.405 per share, and buyback authorization had over $200 million remaining through mid-2026.
Management Commentary and Outlook
Management emphasized an improving California regulatory backdrop and steady execution. Net production during the fourth quarter is projected between 131–135 Mboe/d, with oil comprising about 78%. Operating costs are expected near $310 million, while adjusted EBITDAX is guided at $240 million at the midpoint. Capital spending is forecast around $115 million, underscoring disciplined investment. The company also reaffirmed its 2025 capital expenditure guidance in the range of $280–$330 million and adjusted EBITDAX midpoint guidance at $1.235 billion. Looking ahead, CRC expects 2026 capital spending between $280–$300 million, Management also lowered its corporate base decline assumption to 8–13% for 2026, citing improved reservoir performance and integration benefits. The pending Berry merger, expected to close in the first quarter of 2026, is set to generate $80–$90 million in annual synergies within 12 months.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -10.73% due to these changes.
VGM Scores
At this time, California Resources has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top quintile for value investors.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, California Resources has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
California Resources is part of the Zacks Oil and Gas - Exploration and Production - United States industry. Over the past month, Magnolia Oil & Gas Corp (MGY), a stock from the same industry, has gained 9.6%. The company reported its results for the quarter ended September 2025 more than a month ago.
Magnolia Oil & Gas Corp reported revenues of $324.93 million in the last reported quarter, representing a year-over-year change of -2.5%. EPS of $0.41 for the same period compares with $0.52 a year ago.
Magnolia Oil & Gas Corp is expected to post earnings of $0.39 per share for the current quarter, representing a year-over-year change of -20.4%. Over the last 30 days, the Zacks Consensus Estimate has changed -1.1%.
Magnolia Oil & Gas Corp has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.
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California Resources Corporation (CRC): Free Stock Analysis Report Magnolia Oil & Gas Corp (MGY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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