Chevron Q1 Profit Drops On Higher Costs, Weak International Margins

Oil giant Chevron Corp CVX shares are trading lower premarket on Friday after the company reported first-quarter results.

Revenues and other income of $47.61 billion missed the consensus of $48.09 billion. 

In the first quarter, net oil-equivalent production remained broadly flat Y/Y at 3,353 MBOED as growth at TCO (20%), in the Permian Basin (12%), and in the Gulf of America (7%) was offset by the impacts of asset sales.

Adjusted net earnings were $3.8 billion, with adjusted EPS at $2.18 (down from $2.93 a year ago) in the quarter in line with the consensus.

U.S. Upstream reported earnings of $1.86 billion versus $2.08 billion a year ago due to higher operating expenses, including a legal reserve, and lower liquids realizations.

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International upstream earnings fell to $1.90 billion from $3.16 billion a year ago, owing to lower liftings and weak affiliate earnings at TCO largely due to higher depreciation, depletion and amortization.

U.S. downstream earnings plunged to $103 million from $453 million a year ago, primarily due to narrower margins and legal reserves.

International downstream earnings declined to $222 million from $330 million in the prior year quarter due to decreased margins on refined product sales and a less favorable impact of foreign currency.

Operating cash flow decreased to $5.2 billion from $6.8 billion a year ago owing to lower earnings and tax payments related to the Canadian asset sale.

Capital expenditure stood at $3.9 billion in the first quarter of 2025, lower than $4.1 billion a year ago quarter, owing to inorganic investment in power solutions for U.S. data centers.

Chevron returned $6.9 billion of cash to shareholders in the quarter, including $3.0 billion in dividends and $3.9 billion in share repurchases.

The company held cash and equivalents of $4.64 billion as of March 31.

Dividend: The company disclosed a quarterly dividend of $1.71 per share, payable on June 10, to shareholders of record as of May 19, 2025.

Mike Wirth, Chevron’s chairman and chief executive officer, said, “Despite changing market conditions, our resilient portfolio, strong balance sheet, and consistent focus on capital and cost discipline position us to deliver industry-leading free cash flow growth by 2026.“

The company disclosed a simpler organizational structure to improve execution, aiming to cut structural costs by $2 billion-$3 billion by the end of 2026.

Investors can gain exposure to CVX via EA Series Trust Strive U.S. Energy ETF DRLL and SPDR Select Sector Fund – Energy Select Sector XLE.

Price Action: CVX shares are down 2.03% at $133.4506 premarket at the last check Friday.

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