[First Quarter 2025 Performance Summary](index=1&type=section&id=First%20Quarter%202025%20Performance%20Summary) [Financial Results Overview](index=1&type=section&id=Financial%20Results%20Overview) Chevron reported Q1 2025 earnings of $3.5 billion, a decrease from $5.5 billion last year, with adjusted earnings also declining, while returning $6.9 billion to shareholders | Indicator | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Earnings** | $3.5 billion | $5.5 billion | | **Earnings Per Share (Diluted)** | $2.00 | $2.97 | | **Adjusted Earnings** | $3.8 billion | $5.4 billion | | **Adjusted EPS (Diluted)** | $2.18 | $2.93 | | **Cash Flow From Operations** | $5.2 billion | $6.8 billion | - CEO Mike Wirth highlighted the company's resilient portfolio and capital discipline, positioning it for industry-leading **free cash flow growth by 2026**[5](index=5&type=chunk) - The company returned **$6.9 billion** in cash to shareholders, comprising **$3.9 billion** in share repurchases and **$3.0 billion** in dividends[6](index=6&type=chunk)[11](index=11&type=chunk) - Key operational updates include production ramp-up at Tengizchevroil (TCO), Permian Basin production growth, and first oil from the Ballymore project in the Gulf of America[5](index=5&type=chunk) [Key Metrics and Business Highlights](index=2&type=section&id=Key%20Metrics%20and%20Business%20Highlights) Worldwide net oil-equivalent production remained flat at 3,353 MBOED, with capital expenditures slightly lower, while advancing strategic initiatives like the Hess stake and Ballymore production | Metric | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Return on Capital Employed (ROCE)** | 8.3% | 12.4% | | **Capital Expenditures (Capex)** | $3.9 B | $4.1 B | | **Free Cash Flow** | $1.3 B | $2.7 B | | **Net Debt Ratio (end of period)** | 14.4% | 8.8% | | **Net Oil-Equivalent Production** | 3,353 MBOED | 3,346 MBOED | - Key business milestones include acquiring **4.99% of Hess Corporation** common stock[11](index=11&type=chunk) - Production started from the Ballymore field in the Gulf of America in April 2025[11](index=11&type=chunk) - Completed the sale of a majority interest in East Texas gas assets[11](index=11&type=chunk) - Announced a simplified organizational structure to reduce structural costs by **$2-3 billion by the end of 2026**[11](index=11&type=chunk) [Segment Performance](index=3&type=section&id=Segment%20Performance) [Upstream](index=3&type=section&id=Upstream) Total upstream earnings decreased to $3.8 billion from $5.2 billion, primarily due to lower international earnings from asset sales, affiliate earnings, and unfavorable tax and currency effects [U.S. Upstream](index=3&type=section&id=U.S.%20Upstream) U.S. upstream earnings decreased to $1.86 billion from $2.08 billion due to higher expenses and lower liquids realizations, despite a 63,000 bpd production increase | U.S. Upstream | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Earnings** | $1,858 MM | $2,075 MM | | **Net Oil-Equivalent Production** | 1,636 MBOED | 1,573 MBOED | | **Liquids Realization** | $55.26 /BBL | $57.37 /BBL | | **Natural Gas Realization** | $2.50 /MCF | $1.24 /MCF | - The **63,000 barrels per day increase** in U.S. production was primarily due to higher output in the Permian Basin and Gulf of America, partly offset by lower production in the Rockies[15](index=15&type=chunk) [International Upstream](index=3&type=section&id=International%20Upstream) International upstream earnings fell to $1.9 billion from $3.2 billion due to lower liftings, reduced TCO affiliate earnings, lower realizations, and unfavorable tax/currency impacts, with production down 56,000 bpd | International Upstream | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Earnings** | $1,900 MM | $3,164 MM | | **Net Oil-Equivalent Production** | 1,717 MBOED | 1,773 MBOED | | **Liquids Realization** | $67.69 /BBL | $72.52 /BBL | | **Natural Gas Realization** | $7.12 /MCF | $7.25 /MCF | - The decrease in international production was primarily due to asset sales in Canada and the Republic of Congo, and withdrawal from Myanmar, partly offset by higher production in Kazakhstan[16](index=16&type=chunk) [Downstream](index=4&type=section&id=Downstream) Total downstream earnings decreased to $325 million from $783 million, with both U.S. and international segments experiencing lower earnings due to reduced refined product margins [U.S. Downstream](index=4&type=section&id=U.S.%20Downstream) U.S. downstream earnings dropped to $103 million from $453 million due to lower margins and a legal reserve, despite a 16% increase in refinery crude unit inputs | U.S. Downstream | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Earnings** | $103 MM | $453 MM | | **Refinery Crude Unit Inputs** | 1,018 MBD | 878 MBD | | **Refined Product Sales** | 1,293 MBD | 1,248 MBD | - The **16% increase** in refinery crude unit inputs was primarily due to improved reliability at the El Segundo refinery and increased capacity at the Pasadena refinery[20](index=20&type=chunk) [International Downstream](index=4&type=section&id=International%20Downstream) International downstream earnings fell to $222 million from $330 million due to lower refined product margins and unfavorable foreign currency effects, with refinery crude unit inputs down 5% | International Downstream | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Earnings** | $222 MM | $330 MM | | **Refinery Crude Unit Inputs** | 618 MBD | 651 MBD | | **Refined Product Sales** | 1,398 MBD | 1,430 MBD | - The **5% decrease** in refinery crude unit inputs was primarily due to a planned turnaround at the GS Caltex refinery in South Korea[20](index=20&type=chunk) [All Other](index=4&type=section&id=All%20Other) The 'All Other' segment reported a net charge of $583 million, up from $521 million, driven by increased operating and interest expenses, partially offset by a favorable Hess share valuation | All Other | 1Q 2025 | 1Q 2024 | | :--- | :--- | :--- | | **Net charges** | $(583) MM | $(521) MM | - This segment encompasses worldwide cash management, debt financing, corporate administration, insurance operations, real estate activities, and technology companies[20](index=20&type=chunk) [Detailed Financial Statements and Reconciliations](index=7&type=section&id=Detailed%20Financial%20Statements%20and%20Reconciliations) [Consolidated Statement of Income](index=7&type=section&id=Consolidated%20Statement%20of%20Income) Q1 2025 total revenues were $47.6 billion, slightly down from $48.7 billion, with net income attributable to Chevron significantly decreasing to $3.5 billion from $5.5 billion | (Millions of Dollars) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Sales and other operating revenues** | $46,101 | $46,580 | | **Total Revenues and Other Income** | $47,610 | $48,716 | | **Total Costs and Other Deductions** | $42,027 | $40,794 | | **Income Before Income Tax Expense** | $5,583 | $7,922 | | **Net Income Attributable to Chevron** | $3,500 | $5,501 | [Balance Sheet Data and Key Ratios](index=8&type=section&id=Balance%20Sheet%20Data%20and%20Key%20Ratios) As of March 31, 2025, total debt increased to $29.7 billion, raising the net debt ratio to 14.4%, with ROCE at 8.3% and Capex at $3.9 billion | (Millions of Dollars) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $4,638 | $6,781 | | **Total assets** | $256,397 | $256,938 | | **Total debt** | $29,681 | $24,541 | | **Total Chevron stockholders' equity** | $149,244 | $152,318 | | Ratio | 1Q 2025 | 4Q 2024 (EOP) | | :--- | :--- | :--- | | **Debt ratio** | 16.6% | 13.9% | | **Net debt ratio** | 14.4% | 10.4% | | **ROCE** | 8.3% | N/A | [Summarized Statement of Cash Flows](index=9&type=section&id=Summarized%20Statement%20of%20Cash%20Flows) Q1 2025 net cash from operations was $5.2 billion, investing activities used $5.6 billion, and financing used $1.7 billion, resulting in **$1.3 billion** free cash flow | (Billions of Dollars) | Three Months Ended March 31, 2025 | | :--- | :--- | | **Net Cash Provided by Operating Activities** | $5.2 | | **Net Cash Used for Investing Activities** | $(5.6) | | **Net Cash Used for Financing Activities** | $(1.7) | | **Net Change in Cash** | $(2.1) | | (Billions of Dollars) | Three Months Ended March 31, 2025 | | :--- | :--- | | **Net Cash Provided by Operating Activities** | $5.2 | | **Less: Capital expenditures** | $3.9 | | **Free Cash Flow** | $1.3 | [Reconciliation of Non-GAAP Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) Chevron's reported Q1 2025 net income of $3.5 billion was adjusted to $3.8 billion, excluding $175 million in special items and $138 million in negative foreign currency effects | (Millions of Dollars) | 1Q 2025 | | :--- | :--- | | **Reported Net Income** | $3,500 | | **Add back: Total Special Items** | $175 | | **Add back: Total Foreign Currency Effects** | $138 | | **Total Adjusted Earnings** | $3,813 | - Special items in Q1 2025 included a **$130 million legal reserve** in U.S. Upstream, a **$170 million legal reserve** in U.S. Downstream, and a **$55 million tax item** in International Upstream, partially offset by a **$180 million favorable fair value adjustment** of Hess common stock[36](index=36&type=chunk)

Core Insights - Chevron's adjusted earnings per share for the first quarter were $2.18, exceeding market expectations of $2.11 [1] - The upstream business generated $3.76 billion in earnings for the first quarter, representing a 28% year-over-year decline, while market expectations were $4.13 billion [1]

Key Takeaways Energy companies are expected to face a harsh reporting period. Earnings for the broader Zacks Oil & Energy sector expected to be down -22.7% YoY. XOM and CVX are both two energy titans on the reporting docket this week. Earnings season continues to move rapidly, with a notably rich reporting docket this week. A few big-tech names and representatives from many sectors have delivered their quarterly prints, with next week just as exciting.Among the bunch this week are two energy titans, Exxon ...

Group 1: Earnings Reports Overview - Chevron Corp and Exxon Mobil Corp are set to report first-quarter earnings, with both companies experiencing significant stock declines this year [1][3] - Chevron's stock is down nearly 20% in the past month and 7.46% year to date, with expected earnings per share (EPS) of $2.18 on revenue of $48.09 billion [1][4] - Exxon Mobil's shares have dropped over 11% this month and 1.58% year to date, with analysts projecting an EPS of $1.70 on revenue of $86.09 billion [3][4] Group 2: Technical Analysis - Both Chevron and Exxon Mobil stocks are trading below their eight, 20, 50, and 200-day simple moving averages (SMAs), indicating a strongly bearish trend [1][3] - Chevron's 50-day SMA has crossed below the 200-day SMA, forming a "Death Cross," which further validates the bearish outlook [2] Group 3: Market Conditions and Challenges - Both companies are facing earnings pressure due to crude oil price volatility, uncertainties regarding global demand, and challenges from green energy initiatives [4][5] - A notable difference is that Exxon's revenue base is nearly double that of Chevron's for the quarter, providing it with more capacity to absorb macroeconomic pressures [4]

Core Viewpoint - Dividend investors should consider energy companies for high yields, as they provide essential services and have a history of increasing dividends [1][8] Group 1: Black Hills - Black Hills (BKH) serves approximately 1.35 million customers across several states and offers a 4.5% dividend yield, having increased its dividend for 55 consecutive years [2][3] - The company's customer growth rate is nearly three times that of the U.S. population growth, supported by a $4.7 billion capital investment budget [3] - Management anticipates earnings growth of 4% to 6% year-over-year, which should support continued dividend increases [3] Group 2: Chevron - Chevron (CVX) provides a 4.9% dividend yield and has increased its dividend for 38 consecutive years, outperforming the average energy stock yield of 3.1% [4][5] - The company's diversified business model includes upstream, midstream, and downstream operations, which helps mitigate the volatility of oil prices [5] - Chevron maintains a low debt-to-equity ratio of approximately 0.15%, allowing flexibility to manage debt regardless of oil price fluctuations [5] Group 3: Enterprise Products Partners - Enterprise Products Partners (EPD) operates a significant midstream business in North America, focusing on pipelines and storage, with a distribution yield of 6.8% [6][7] - The company has increased its distribution for 26 consecutive years, supported by a $7.6 billion capital investment plan [7] - Distributable cash flow covered the distribution by 1.7 times in 2024, providing a buffer against potential downturns [7]

Economic Overview - The U.S. GDP declined at an annualized rate of 0.3% in Q1 2025, disappointing economists who had forecasted a growth of 0.4% [1] - Concerns about a slowdown in the economy are negatively impacting oil and gas stocks, with WTI crude oil prices down 1.4% to approximately $59.50 per barrel and Brent crude also down 1.4% to about $63.30 [2] Stock Performance - ConocoPhillips stock decreased by 2% and Chevron by 2.2%, while Cheniere Energy experienced a more significant drop of 3.6% [3] - The U.S. Energy Information Administration reported a decrease in crude inventories by 2.7 million barrels, which contrasts with a previous report indicating an increase [4] Market Dynamics - The conflicting reports on crude supply are leading investors to focus on the GDP report, assuming that a shrinking economy will reduce oil demand and weaken future prices [5] - Wolfe Research downgraded Cheniere Energy to "peer perform," citing concerns over increased competition in the LNG market, which is contributing to its stock's poor performance [6] Investment Insights - The oil and gas industry is cyclical, characterized by cycles of undersupply and oversupply, necessitating a long-term investment perspective [7] - Among the stocks analyzed, Chevron appears to be the most attractive option, with a total return ratio of just over 1.0, a 4.9% dividend yield, and an expected growth rate of nearly 8% annually over the next five years [8][9] - ConocoPhillips has a lower P/E ratio than Chevron but offers a lower dividend yield of 3.4% and a growth rate of 6% [9] - Cheniere Energy is deemed unattractive, with a high P/E ratio of nearly 17, a low dividend yield of 0.8%, and expected earnings to decline over the next three years [9][10]

I last analyzed Chevron Corporation (NYSE: CVX ) more than a month ago on 3-13-2025. That article , under the title of "Why I Prefer Chevron Over Energy Transfer" rated As you can tell, our core style is to provide actionable and unambiguous ideas from our independent research. If your share this investment style, check out Envision Early Retirement. It provides at least 1x in-depth articles per week on such ideas.We have helped our members not only to beat S&P 500 but also avoid heavy drawdowns despite the ...

Core Viewpoint - Analysts forecast a decline in Chevron's quarterly earnings and revenues, indicating a challenging financial environment for the company [1][2]. Earnings and Revenue Estimates - Chevron is expected to report earnings of $2.30 per share, reflecting a year-over-year decline of 21.5% [1]. - Anticipated revenues are projected at $47.85 billion, showing a decrease of 1.8% compared to the same quarter last year [1]. - The consensus EPS estimate has been adjusted downward by 14.4% over the past 30 days, indicating a reassessment by analysts [2]. Specific Revenue Metrics - Analysts predict 'Revenues- Sales and other operating revenues' will reach $46.45 billion, a change of -0.3% from the year-ago quarter [5]. - 'Revenues- Income (loss) from equity affiliates' is expected to be $770.18 million, suggesting a significant decline of 46.6% year over year [5]. - 'Revenues- Other income' is projected at $238.75 million, indicating a decrease of 65.7% from the previous year [5]. Production Estimates - Total net oil-equivalent production is projected at 3,314.65 million barrels per day, compared to 3,346 million barrels per day in the same quarter last year [6]. - U.S. Upstream net oil-equivalent production is expected to reach 1,651.27 million barrels per day, up from 1,573 million barrels per day year-over-year [7]. - International Upstream net oil-equivalent production is forecasted at 1,667.46 million barrels per day, down from 1,773 million barrels per day in the previous year [8]. Natural Gas Production Estimates - Worldwide net natural gas production is estimated at 8,079.33 Mcf/D, a decrease from 8,267 Mcf/D year-over-year [6]. - U.S. Upstream net natural gas production is projected at 2,666.42 Mcf/D, slightly up from 2,657 Mcf/D in the same quarter last year [8]. - International Upstream net natural gas production is expected to be 5,331.01 Mcf/D, down from 5,610 Mcf/D in the previous year [9]. Liquids Production Estimates - International Upstream net crude oil and natural gas liquids production is estimated at 794.10 million barrels per day, down from 838 million barrels per day year-over-year [10]. - U.S. Upstream net crude oil and natural gas liquids production is projected at 1,214.96 million barrels per day, compared to 1,130 million barrels per day in the same quarter last year [11]. Downstream Metrics - U.S. Downstream refined product sales are expected to reach 1,305.54 million barrels per day, an increase from 1,248 million barrels per day year-over-year [12]. Stock Performance - Over the past month, Chevron shares have declined by 17.3%, contrasting with the S&P 500 composite's slight decrease of 0.2% [12].

Image Source: Zacks Energy supermajor Chevron Corporation (CVX) is slated to release its first-quarter 2025 results on May 2, before market open. The Zacks Consensus Estimate for the to-be-reported quarter's earnings per share (EPS) and revenues is pegged at $2.30 per share and $47.9 billion, respectively. The earnings estimates for the to-be-reported quarter have been revised downward by 7.6% over the past 30 days. The bottom-line projection indicates a decline of 21.5% from the year-ago reported number. T ...

Core Viewpoint - The five major oil companies are facing significant financial challenges due to prolonged low international oil prices, geopolitical conflicts, and pressures from energy transition, leading to a cumulative profit decline exceeding $90 billion over three years [1][3]. Financial Performance - The profits of the five major oil companies peaked at approximately $280 billion in 2022 but fell by 23% to $215 billion in 2023, with a further projected decline of 15% to $183 billion in 2024 [3]. - The Brent crude oil price is expected to drop to an average of $81 per barrel in 2024, with predictions of further declines in 2025 as global oil supply increases [3][7]. - In Q1 2025, profits are anticipated to decrease by 18%, with Brent crude prices dipping below $60 per barrel, representing a decline of over 25% compared to the previous year [3]. Dividend and Share Buyback Concerns - Investors are increasingly worried about the sustainability of high dividends and share buybacks, with warnings that companies like Shell and BP may need to cut dividends if oil prices remain below $60 per barrel [4]. - Shell's share buyback program for Q1 2025 has been reduced by 30%, and BP has suspended its buyback plans for the remainder of 2025 [4]. Credit Rating Risks - Moody's has placed Chevron and TotalEnergies on a "negative watch" list due to concerns that low oil prices may lead to increased debt levels [5]. Company Strategies - In response to financial pressures, companies are implementing cost-cutting measures, restructuring, and transitioning to renewable energy [6]. - ExxonMobil plans to reduce operating costs by 12% by 2025, while TotalEnergies is laying off 5% of its workforce [6]. - Shell aims to increase its renewable energy capacity target from 120 GW to 200 GW by 2030, and BP has partnered with Microsoft to supply 100% renewable energy to its data centers over the next decade [6]. Industry Outlook - The oil industry is expected to face ongoing challenges in the short term, with low oil prices likely becoming the norm and demand growth stagnating [7]. - Morgan Stanley predicts that Brent crude prices may stabilize between $65 and $70 per barrel in the second half of 2025, a 15% decrease from 2024 [7]. - Despite short-term pressures, some analysts remain optimistic about the potential for oil companies to transition into renewable energy and carbon capture sectors, which could provide new growth opportunities [7].