Trading and cash flow lift quarterly performance
Equinor (NYSE:EQNR) shares rose as much as 3% on Wednesday after the Norwegian energy group delivered second-quarter results that exceeded market expectations for operating income and cash flow, supported by a standout performance in its trading and shipping business.
For the quarter ended June 30, Equinor reported adjusted operating income of $11.48 billion, ahead of the analyst consensus of $11.37 billion based on estimates from 17 analysts.
Cash flow from operations after taxes reached $7.68 billion, comfortably surpassing expectations of $7.32 billion and marking the strongest upside surprise in the company’s quarterly results.
Energy trading offsets weaker international production
The Marketing, Midstream and Processing division generated adjusted operating income of $777 million, beating the consensus forecast of $623 million.
The company benefited from supply disruptions linked to the closure of the Strait of Hormuz, which strengthened physical crude trading margins and boosted shipping optimisation. Higher European natural gas prices, driven by LNG supply disruptions associated with the same event, also supported earnings.
However, the Exploration and Production International segment underperformed, posting adjusted operating income of $843 million, well below analysts’ expectations of $1.09 billion.
Equinor attributed the weaker performance to operational issues at Brazil’s Roncador field and the sale of its onshore Argentina assets to Vista Energy, completed in May 2026.
Norwegian operations remain a bright spot
Equinor’s Norwegian upstream business continued to outperform, with adjusted operating income reaching $9.19 billion, ahead of the $9.05 billion consensus estimate.
Production benefited from the continued ramp-up of the Johan Castberg, Halten East and Verdande fields.
Meanwhile, the company’s U.S. exploration and production business generated adjusted operating income of $720 million, exceeding the consensus estimate of $630 million.
Adjusted earnings per share came in at $1.33, one cent below the consensus estimate of $1.34. The slight miss reflected higher taxes on adjusted operating income, which totalled $8.05 billion compared with expectations of $7.99 billion.
Balance sheet strengthens as shareholder returns continue
Jefferies, which maintains a “hold” rating on the stock with a price target of NOK380, said the results showed continued progress in reducing leverage, although debt reduction was slightly weaker than expected due to changes in working capital and other financial activities.
Net debt, excluding lease liabilities, declined to $5.0 billion from $7.9 billion in the previous quarter, while the net debt-to-capital-employed ratio improved to 10.4% from 15.3%.
The broker also noted that Equinor completed a $2.8 billion state share buyback settlement in July, meaning the cash outflow will be reflected in third-quarter results.
Total equity production averaged 2,165 thousand barrels of oil equivalent per day, slightly below the analyst consensus of 2,172 mboe/d. Production in Norway increased 4% year over year, while international output remained under pressure from operational issues and portfolio changes.
Net operating income rose to $12.99 billion from $5.72 billion a year earlier, including a pretax gain of $467 million related to the Argentina asset sale.
“Strong production in the second quarter enabled us to capture value from higher prices, contributing to strong cash flow and financial results,” chief executive Anders Opedal said.
The board declared a second-quarter cash dividend of $0.39 per share and approved a third share buyback programme of up to $1.125 billion, running from July 23 through no later than October 26. The company continues to expect total shareholder distributions of up to $3 billion through its 2026 buyback programme.
Equinor also reaffirmed its full-year outlook, maintaining guidance for $13 billion in organic capital expenditure and 3% equity production growth.
Equinor stock price
