Occidental Petroleum reported third‑quarter 2025 results that included an adjusted earnings per share of $0.64, beating the consensus estimate of $0.52 by $0.12 or 23%. Revenue, however, fell short of expectations, coming in at $6.717 billion versus the $6.746 billion consensus.
The earnings beat was driven by disciplined cost management and a favorable production mix. Production rose to 1.46 million barrels of oil equivalent per day, up 4 % from the same quarter last year, largely thanks to the 12 billion‑dollar CrownRock acquisition that added high‑margin assets. Operating margins held steady at 9.9 % despite a 13 % decline in realized oil price to $64.78 per barrel, reflecting the company’s ability to offset lower prices with higher volumes.
Revenue missed forecasts by $29 million, a 0.4 % shortfall. The shortfall was largely attributable to the lower realized oil price and a modest decline in the midstream and marketing segment, which generated $93 million in pre‑tax income compared with $110 million a year earlier. The oil and gas segment, however, delivered $1.3 billion in pre‑tax income, up 5 % from the prior quarter, underscoring the strength of the upstream portfolio.
Net debt stood at $20.85 billion as of September 30, 2025, a reduction of $3.5 billion from the prior year, driven by the $9.7 billion sale of OxyChem to Berkshire Hathaway announced on October 2. The proceeds are earmarked for further debt reduction, with management targeting principal debt below $15 billion in the coming years.
The earnings release did not include forward‑looking guidance, but analysts are projecting Q4 2025 revenue of $6.369 billion and adjusted EPS of $0.47. Management emphasized that the company remains focused on debt reduction and operational efficiency, noting that the OxyChem sale is a milestone in the strategic transformation of the business. Vicki Hollub said, "The sale of OxyChem is an important milestone in the strategic transformation of our company and will enable us to further strengthen our balance sheet, accelerate shareholder returns and unlock high‑return opportunities across our core oil and gas business."
Investors reacted negatively in after‑hours trading, with the market focusing on the revenue miss despite the EPS beat. The negative reaction highlights the sector’s emphasis on top‑line growth, as lower revenue signals potential demand weakness even when profitability remains strong.
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