Matador Resources Company Reports Second Quarter 2026 Results and Increases Full-Year 2026 Production Guidance

DALLAS--(BUSINESS WIRE)--Matador Resources Company (NYSE: MTDR) (“Matador” or the “Company”) today reported financial and operating results for the second quarter of 2026, updated full-year 2026 production guidance and provided an update on the four strategic catalysts, which were executed during and shortly after the quarter. A slide presentation summarizing the highlights of this release is included on the Company’s website at www.matadorresources.com on the Events and Presentations page under the Investor Relations tab.

Management Summary Comments

Joseph Wm. Foran, Matador’s Founder, Chairman and CEO, commented, “The second quarter of 2026 was, in our view, one of the most consequential quarters in Matador’s history—not only for what we produced, but also for what we acquired and put in place for the years ahead.

“During the quarter, despite external headwinds and associated oil volume shut-ins, Matador exceeded its expected range for oil production (123,000 to 125,000 barrels of oil per day) and delivered record average oil production of 126,106 barrels of oil per day. On the strength of this performance, we have increased our full-year 2026 outlook for oil from 4% growth up to 7% year-over-year oil production growth. In addition, Matador grew its total proved oil and natural gas reserves 5%, from 667 million barrels of oil equivalent (‘BOE’) at December 31, 2025 to a record 703 million BOE at June 30, 2026. The Company also generated net cash provided by operating activities of $937.1 million, leading to near-record adjusted free cash flow of $303.2 million during the second quarter of 2026, nearly tripling first quarter 2026 adjusted free cash flow of $113.3 million. This cash flow generation allowed Matador to repay over $200 million of borrowings associated with the Federal lease sale in May 2026.

Strategic Transformational Acquisitions

“We successfully executed on four of our strategic catalysts during the first half of 2026 including:

1. May 2026, Federal Lease Sale. Acquired 5,154 net undeveloped acres located in what we believe to be the most prolific areas of the Delaware Basin with nine or more prospective formations and added over 141 net operated locations.
   
2. June/July 2026, Cardinal Midstream Acquisition. San Mateo acquired Cardinal Midstream, which adds complementary midstream assets including (i) a cryogenic natural gas processing plant complex in Loving County, Texas with a designed inlet capacity of approximately 320 million cubic feet of natural gas per day and (ii) approximately 145 miles of low-pressure and high-pressure natural gas gathering pipelines located in West Texas and southern Eddy County, New Mexico. This transaction, which closed on July 31, adds third-party customer relationships, volumes, and expanded scale and enhances flow assurance for Matador and San Mateo’s third-party customers.
   
3. July 2026, Paloma Acquisition. Entered into an agreement to acquire Paloma Permian, LLC, including 16,235 net primarily undeveloped acres located in the core of the Delaware Basin in Southeast New Mexico. The majority of this acreage is held by production and adds over 156 net operated locations. The acquisition also includes third quarter 2026 estimated production of approximately 11,100 BOE per day (57% oil) and immediate reserve additions of 55 million BOE.
   
4. July 2026, Ridge Runner Acquisition. Entered into an agreement to acquire 13,600 net acres in the emerging Woodford play of the Delaware Basin from Ridge Runner Resources. Once closed, Matador’s total Woodford acreage position will be approximately 50,000 net contiguous, undeveloped acres acquired at approximately $4,000 per acre. This emerging play is substantiated by Matador’s successful Woodford exploration well, the ‘Rae’s Creek,’ which achieved test rates exceeding 2,200 BOE per day (72% oil). Overall, this acquisition combined with Matador’s previous ‘brick-by-brick’ acquisitions in the Woodford formation add approximately 150 net operated locations

“In total, once the Paloma and Ridge Runner transactions are completed, which is expected to occur in the fourth quarter of 2026, Matador will have successfully added approximately four additional years of high-quality drilling inventory based on current activity levels. We expect this newly acquired inventory to immediately compete for capital within our portfolio and provide depth to Matador’s future operating plans in 2027 and beyond.

Acquisition Value Creation

“There are many reasons we are excited about the recent catalysts and the announced acquisitions, but we want to highlight for our shareholders and bondholders the primary drivers for these additions:

1. Capital efficiency on costs. Matador expects future well costs associated with the Federal lease sale and Paloma acquisition will be 15% to 20% below Matador’s current drilling and completion cost per completed lateral foot average. For example, due to reduced drilling times, extended laterals, and multi-well completions, we expect Matador’s third quarter well costs on adjacent assets will be as low as $640 per completed lateral foot, as compared to Matador’s full year 2026 cost per completed lateral foot estimates of $795 per foot.
   
2. Productivity. We expect these lease additions to improve Matador’s well productivity profile and contribute to Matador’s growing reserve base. In fact, on assets associated with the Federal lease sale and Paloma acquisition, we expect average 12-month cumulative oil production will be 20% to 30% higher than Matador’s average 12-month cumulative oil production for wells turned to sales in previous years. We also expect 15% to 20% improvement in estimated ultimate recoveries (‘EUR’) in barrel of oil per foot metrics compared to Matador inventory averages.
   
3. Revenue. Over 30% of expected inventory additions from the recently-announced transactions benefit from favorable lease terms—in particular, the larger 87.5% net royalty interest (‘NRI’) associated with the Federal leases compared to the smaller NRI interest of 75% normally set on many State and private fee leases. This larger 87.5% NRI increases free cash flow generation and increases net present value over 35% for each well versus similar wells at a lower 75% NRI. In addition, the vast majority of the approximate 450 net locations that will be added from the Federal lease sale and Paloma and Ridge Runner acquisitions have advantaged NRIs (greater than 75% NRI) for an average of 82% NRI.
   
4. Economics. Prior to the announcements of the Federal lease sale and Paloma and Ridge Runner acquisitions, Matador highlighted 10 to 15 years of inventory generating, on average, a 50% rate of return at $70 per barrel of oil and $3.00 per thousand cubic feet of natural gas. We expect our rates of return on the properties being acquired will exceed 80% on average, using similar price decks and capital assumptions.
   
5. Woodford. Early production results on Matador’s Rae’s Creek well have been encouraging. While we have yet to officially add proved, undeveloped reserves from our Rae’s Creek well, early results indicate oil EUR potential could be over 800,000 barrels. Additionally, we expect 30% to 40% well cost reductions over the next 12 to 18 months, targeting $800 to $900 per completed lateral foot on Woodford wells by 2028.

Financing and Debt Repayment

“Matador’s acquisitions—the Federal lease sale, the Paloma acquisition and the Ridge Runner acquisition—will be funded through cash on hand and borrowings under Matador’s existing reserve-based lending (‘RBL’) credit facility. The RBL balance was fully repaid in May 2026. Our supportive bank group subsequently increased the elected commitment level by $500 million, bringing the elected commitment level under the RBL to $2.75 billion.

“Matador generated net cash provided by operating activities of $1.41 billion in the first half of 2026 as compared to $2.43 billion during full year 2025. During the first half of 2026, Matador generated $417 million of adjusted free cash flow, which is almost equal to the $437 million of adjusted free cash flow the Company generated during full year 2025. We currently estimate adjusted free cash flow for the full year 2026 will be approximately $900 million (assuming strip oil and natural gas pricing as of late July 2026), and we will continue to prioritize the use of free cash flow for debt repayment. We expect to be at or close to our 1.0x target leverage ratio by the end of 2027, funded primarily by free cash flow generation depending on commodity prices. Based on current market conditions, we do not anticipate needing to access the equity capital markets at this time.

Integrated Midstream and Marketing

“In addition to Matador’s upstream acquisitions, San Mateo closed on its acquisition of Cardinal Midstream on July 31, which we believe adds growth potential, scale and a diversified customer base for San Mateo. San Mateo’s new, fully integrated system now has over one billion cubic feet per day of designed natural gas processing capacity, placing it as the largest non-public natural gas processing company in the northern Delaware Basin by capacity. This acquisition highlights San Mateo’s ability to grow, using midstream capital to fund midstream expansion, and to provide ‘producer-first’ service to Matador and other customers with greater scale and reach in the Delaware Basin.

“Looking forward, we also continue to expect meaningful improvement in our realized natural gas prices for the remainder of the year. As previously disclosed, Matador secured, at no capital expense, 500,000 million British thermal units (‘MMBtu’) per day of firm natural gas transportation on Energy Transfer’s new Hugh Brinson pipeline. Matador anticipates flow on the Hugh Brinson earlier than previously expected by the end of the third quarter of 2026 and estimates that it will be able to add approximately $90 million annually in increased natural gas revenue for each $0.50 per MMBtu increase it is able to achieve in its average realized natural gas price.

Improved Full-Year 2026 Outlook

“Special appreciation to Matador’s exceptional operational team and field staff is warranted for navigating a difficult quarter, which included shut-in volumes due to negative Waha prices and third-party gathering and processing maintenance. Matador successfully managed these challenges and produced oil volumes exceeding the upper end of May 2026 guidance estimates for the quarter. These better-than-expected results are a testament of the strength and size of Matador’s production base, its operational execution in the field and the responsiveness and flow assurance of its midstream business. Matador is now expecting to increase the number of wells turned to sales in 2026, pushing net lateral footage turned to sales higher for the year and increasing full year production guidance.

“The increased positive outlook for 2026 also will result in accelerated activities and, combined with capital associated with the recent acquisitions discussed earlier, Matador now expects its full-year 2026 drilling, completing and equipping (‘D/C/E’) capital expenditures to be in the $1.48 to $1.56 billion range and midstream capital expenditures in the $145 to $165 million range. It is important to note that the majority of this incremental capital is associated with:

1. Working interest additions and accelerated wells turned to sales; Matador now estimates to turn-in-line 112.6 net operated wells, a 5% increase versus previous February 2026 guidance estimates of 107.6 net operated wells turned-in-line.
   
2. Increased non-operated activity; Matador now estimates to turn-in-line 15.9 net non-operated wells, a 33% increase versus previous February 2026 guidance estimates of 12.0 net non-operated wells.
   
3. Midstream infrastructure and integration; capital associated with infrastructure integration related to assets acquired in the Federal lease sale and the Cardinal Midstream acquisition.

“Most importantly, I am pleased to report well-level capital discipline and efficiencies remain intact, with Matador’s overall costs per completed lateral foot expected to remain firm at $785 to $805 for 2026. The team also expects these ranges should improve in future years, as the recently announced acquisitions close and become integrated into Matador’s current activity plans going forward.

Closing Thoughts

“We remain focused on finishing 2026 on a strong note and look forward to the opportunities that lie ahead for Matador in 2026 and beyond. We believe our best days are still to come and that our recent acquisitions, operational accomplishments, midstream flow assurance and financial discipline have all helped place Matador in an excellent position for continued strong performance in the months and years ahead.”

All references to Matador’s net income, adjusted net income, Adjusted EBITDA and adjusted free cash flow reported throughout this earnings release are those values attributable to Matador Resources Company shareholders after giving effect to any net income, adjusted net income, Adjusted EBITDA or adjusted free cash flow, respectively, attributable to third-party non-controlling interests, including in San Mateo. Matador owns 51% of San Mateo. For a definition of adjusted net income, adjusted earnings per diluted common share, Adjusted EBITDA and adjusted free cash flow and reconciliations of such non-GAAP financial metrics to their comparable GAAP metrics, please see “Supplemental Non-GAAP Financial Measures” below.

Full-Year 2026 Guidance Update

Effective August 5, 2026, Matador increased its full-year 2026 guidance range for oil, natural gas and total BOE production as set forth in the table below.

The 4% increase in the midpoint of Matador’s expected 2026 production from 213,250 BOE per day to 221,000 BOE per day is attributable to:

1. 1,700 BOE per day (32% oil) from better-than-expected production in the second quarter of 2026 as detailed below,
   
2. 3,550 BOE per day (64% oil) from organic improvements to expected production in the second half of 2026, and
   
3. 2,500 BOE per day (57% oil) attributable to the Paloma and Ridge Runner acquisitions. Excluding the impact of these accretive acquisitions, Matador expects to achieve organic oil production growth of 6% year-over-year as compared to its original expectations of 3% growth.

As noted previously, Matador is adjusting the midpoint of its 2026 D/C/E capital expenditure guidance from $1.395 billion in May 2026 to $1.52 billion and the midpoint of its 2026 midstream capital expenditure guidance from $105 million in May 2026 to $155 million. The midpoint of total capital expenditure expectations of $1.675 billion represents a 1% improvement as compared to total capital expenditures of $1.694 billion in 2025. Notably, Matador has not made any revisions to its 2026 drilling and completion costs per foot estimates, which remain at $785 to $805 per completed lateral foot.

Operational and Financial Update

Second Quarter 2026 Oil, Natural Gas and Total BOE Production

As summarized in the table below, Matador’s total BOE production averaged 215,631 BOE per day in the second quarter of 2026, which was a 3% year-over-year increase from an average of 209,013 BOE per day in the second quarter of 2025 and 3% better than the midpoint of Matador’s expected second quarter production guidance of 209,000 BOE per day. The better-than-expected oil and natural gas production was primarily due to outperformance of Matador’s new wells that were turned to sales in the first half of the year, including Matador’s first 3.4-mile lateral wells as part of a 13-well batch drilled on the Guss pad on our Eastern Antelope Ridge acreage. This better-than-expected performance was achieved despite approximately 9,900 BOE per day (24% oil) shut in during the quarter due to the elective shut-in of volumes due to weak Waha pricing and scheduled maintenance on third-party treatment plants. Matador had estimated these elective Waha shut-ins and scheduled maintenance would reduce second quarter 2026 volumes by approximately 10,000 BOE per day (30% oil). The Company turned to sales 23.7 net operated wells in the second quarter of 2026, including the 13 Guss wells noted above.

Second Quarter 2026 Realized Commodity Prices

The following table summarizes Matador’s realized commodity prices during the second quarter of 2026, as compared to the first quarter of 2026 and the second quarter of 2025.

Second Quarter 2026 Operating Expenses

For the second quarter of 2026, operating expenses of $32.90 per BOE were at the high end of Matador’s expected 2026 guidance range of $31.00 to $33.00 per BOE, primarily due to higher non-cash depletion, depreciation and amortization expenses (“DD&A”) of $16.06 per BOE, as compared to expectations of $15.65 per BOE, primarily due to the booking of proved undeveloped reserves from the May 2026 Federal lease sale. Notably, however, lease operating expenses (“LOE”) of $5.45 per BOE were better than expectations of $5.60 per BOE primarily due to lower-than-expected repair and maintenance costs.

The increase in expectations for 2026 operating expenses from approximately $32.00 per BOE in May to $33.00 per BOE is primarily driven by the increase in non-cash DD&A noted above and an increase in midstream services operating expenses associated with the Cardinal Midstream acquisition.

Second Quarter 2026 Capital Expenditures

For the second quarter of 2026, Matador’s total capital expenditures were $436.1 million, which was near the low end of the expected range of $430 to $460 million.

Shareholder Returns Update

During the second quarter of 2026, Matador repurchased 225,000 shares of its common stock at a weighted average price of approximately $49.59 per share for a total of $11 million. Matador’s Board of Directors, management, and staff also continue to be regular purchasers of Matador’s shares in the open market, further aligning ourselves with our shareholders. Matador’s directors and executive officers purchased approximately 13,000 shares of Matador stock during the second quarter of 2026. In addition, over 95% of Matador employees continued to participate in Matador’s Employee Share Purchase Plan, or ESPP.

Midstream Update

Matador’s midstream assets include (1) San Mateo, which is owned 51% by Matador and 49% by Five Point Infrastructure LLC (“Five Point”), and (2) wholly-owned assets, which were largely acquired as part of the Advance acquisition in 2023 and the Ameredev acquisition in 2024. San Mateo distributed $30.1 million to Matador during the second quarter of 2026. On a combined basis, San Mateo and Matador’s wholly-owned midstream assets had quarterly net income of $57.9 million and quarterly Adjusted EBITDA of $89.9 million in the second quarter of 2026. The table below sets forth San Mateo’s throughput volumes for the second quarter of 2026, as compared to the first quarter of 2026 and second quarter of 2025.

Third Quarter 2026 Estimates

Third Quarter 2026 Estimated Oil, Natural Gas and Total BOE Production Growth

As noted in the table below, Matador anticipates sequential oil production growth of approximately 3% to a quarterly record of approximately 129,500 barrels per day in the third quarter of 2026, primarily as a result of the 13 Guss wells and the 30 to 33 net operated horizontal wells Matador expects to turn to sales in the Delaware Basin during the third quarter of 2026. These third quarter estimates do not include oil or natural gas volumes associated with the Paloma or the Ridge Runner acquisitions, which are expected to close in the fourth quarter of 2026. The Company expects sequential production growth of approximately 5% to 6% in the fourth quarter of 2026, primarily as a result of the Paloma and Ridge Runner acquisitions, which are expected to contribute approximately 10,000 BOE per day (57% oil) in the fourth quarter.

Third Quarter 2026 Estimated Wells Turned to Sales

At August 5, 2026, Matador expects to turn to sales 30 to 33 net operated horizontal wells in the Delaware Basin during the third quarter of 2026, including 11.3 net wells near acreage acquired in the May 2026 Federal lease sale.

Third Quarter 2026 Estimated Capital Expenditures

Matador expects D/C/E and midstream capital expenditures for the third quarter of 2026 will be approximately $410 to $440 million. The midpoint of guidance for the third quarter of $425 million is a 3% decrease, as compared to $436 million in the second quarter of 2026.

Second Quarter 2026 Earnings Conference Call

The Company will host a live conference call on Thursday, August 6, 2026, at 10:00 a.m. Central Time to review its second quarter 2026 financial results and operational highlights. To access the live conference call by phone, you can use the following link https://register-conf.media-server.com/registe

Mac Schmitz
Senior Vice President - Investor Relations
(972) 371-5225
investors@matadorresources.com

Christopher P. Calvert
Executive Vice President and Chief Financial Officer
(972) 371-5443