BP Q4 Earnings Beat Estimates on Higher Oil Production, Revenues Miss

BP plc BP reported fourth-quarter 2025 adjusted earnings of 60 cents per American Depositary Share on a replacement-cost basis, excluding non-operating items. The figure beat the Zacks Consensus Estimate of 57 cents. The bottom line also improved from the year-ago reported figure of 44 cents.

Total quarterly revenues of $47.7 billion lagged the Zacks Consensus Estimate of $59.9 billion and declined from $48.1 billion reported a year ago.

The strong quarterly earnings can be primarily attributed to an increase in oil-equivalent production volumes and higher realized refining margins. However, lower liquid price realization partially offset the positives.

Operational Performance

Oil Production & Operations

For the fourth quarter, BP reported a total production of 1,555 thousand barrels of oil equivalent per day (Mboe/d), up from 1,449 MBoe/d recorded in the year-ago quarter.

BP sold liquids at $56.09 per barrel in the quarter, down from $65.56 reported a year ago. The company sold natural gas at $3.19 per thousand cubic feet (mcf), down from $3.29 reported in the year-ago quarter. Overall, hydrocarbon price realization decreased year over year to $44.98 per Boe from $52.28.

After adjusting for non-operating items, underlying replacement cost earnings before interest and tax for the segment amounted to $1.96 billion. The figure was below $2.92 billion recorded in the year-ago quarter. The segment was affected by lower liquid price realizations and an increased depreciation, depletion and amortization charge. A lower share of net income of equity-accounted entities also affected the segment. This was partially offset by production gains and lower exploration write-offs.

Gas & Low Carbon Energy

Segmental profits totaled $1.39 billion, lower than the $1.99 billion registered in the year-ago quarter. The segment’s results were impacted by lower average price realization. Total production of 788 MBoe/d declined from 850 MBoe/d in the year-ago quarter.

Customers & Products

After adjusting for non-operating items, underlying replacement cost earnings before interest and tax for the segment were reported at $1,346 million, significantly higher than a loss of $302 million in the year-ago quarter. The increase can be primarily attributed to a stronger performance in both customers and products. In the customers segment, structural cost reductions supported earnings, while in the products business, higher realized margins and lower turnaround activity further supported the results.

BP-operated refining availability in the December-ended quarter was 96% compared to 94.8% in the year-ago quarter.

Total refinery throughputs were 1,460 thousand barrels per day (MBbl/D), higher than 1,390 MBbl/D in the corresponding period of 2024.

Capex

Organic capital expenditure in the reported quarter totaled $3.5 billion. The company registered a total capital spending of $4.2 billion for the quarter.

Financials

BP's net debt was $22.2 billion at the end of the fourth quarter. Also, the firm announced a gearing of 23.1% for the quarter.

Outlook

BP expects first-quarter 2026 upstream production to remain flat compared to the fourth-quarter level. It also anticipates a seasonal decline in volumes in its customers' business and comparatively lower industry refining margins in the first quarter.

For 2026, BP forecasts flat underlying upstream production compared with 2025, with oil output remaining flat and gas and low-carbon output projected to decline. Growth is anticipated in its customer segment, supported by cost reductions. BP expects divestment proceeds of nearly $9-$10 billion in 2026. The company also expects capital expenditures for the year to be between $13 billion and 13.5 billion.

BP’s Zacks Rank and Key Picks

BP currently carries a Zacks Rank #3 (Hold).

Some top-ranked stocks from the energy sector are Oceaneering International OII, W&T Offshore WTI and Archrock Inc. AROC. While Archrock sports a Zacks Rank #1 (Strong Buy), Oceaneering and W&T Offshore carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Archrock is an energy infrastructure company based in the United States with a focus on midstream natural gas compression. It provides natural gas contract compression services and generates stable fee-based revenues. With natural gas playing an increasingly important role in the energy transition journey, AROC is expected to witness sustained demand for its services.

Oceaneering International delivers integrated technology solutions across all stages of the offshore oilfield lifecycle. The company is a leading provider of offshore equipment and technology solutions to the energy industry. OII’s proven ability to deliver innovative, integrated solutions supports ongoing client retention and new business opportunities, ensuring steady revenue growth.

W&T Offshore benefits from its prolific Gulf of America assets, which offer low decline rates, strong permeability and significant untapped reserves. The company’s recent acquisition of six shallow-water fields in the Gulf of America boosts its production prospects in the future, which is expected to enhance its revenues. 

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