Natural Gas Lifts Chevron Q1 Earnings Amid Oil Weakness

Core Viewpoint - Chevron Corporation reported adjusted first-quarter earnings per share of $2.18, exceeding the Zacks Consensus Estimate of $2.15, primarily due to higher-than-expected U.S. natural gas production in its upstream segment [1] Financial Performance - The company generated revenues of $47.6 billion, missing the Zacks Consensus Estimate of $48.7 billion and reflecting a 2.3% year-over-year decrease [2] - Adjusted profit of $2.18 per share was significantly lower than the year-ago adjusted profit of $2.93, attributed to weaker oil price realizations and a decline in refined product sales margins [2] Segment Performance - Upstream segment production of crude oil and natural gas was 3,353 thousand oil-equivalent barrels per day (MBOE/d), a slight increase of 0.2% year over year, driven by higher output from the Permian basin, Kazakhstan, and the Gulf of America [3] - U.S. output rose 4% year over year to 1,636 MBOE/d, while international operations, accounting for 51% of total production, fell 3.2% to 1,717 MBOE/d [4] - The upstream segment profit decreased by 28.3% to $3.8 billion due to flat volumes and lower oil realizations, partially offset by higher natural gas sales prices [4] Pricing and Margins - Average realized liquids prices in the U.S. were $55.26 per barrel, down 3.7% from the previous year, while international prices decreased 6.7% to $67.69 per barrel [5] - Natural gas prices more than doubled in the U.S., but declined 1.8% internationally [5] - The downstream segment reported a profit of $325 million, a 58.5% decrease from last year's income of $783 million, primarily due to lower product sales margins [5] Cash Flows and Capital Expenditure - The company recorded $5.2 billion in cash flow from operations, down from $6.8 billion in the year-ago period, with free cash flow for the quarter at $1.3 billion [6] - Chevron spent approximately $3.9 billion on capital and exploratory expenditures during the quarter, compared to $4.1 billion in the previous year [7] Balance Sheet - As of March 31, Chevron had $4.6 billion in cash and cash equivalents and total debt of $29.7 billion, resulting in a debt-to-total capitalization ratio of about 16.6% [8]