Occidental Petroleum (OXY) delivered first-quarter adjusted earnings of $1.06 per share, surpassing the 58 cents consensus estimate, according to LSEG data. The better-than-expected results were driven by higher domestic output, even as revenue came in below forecasts and the company trimmed its production guidance for the year.
The Houston-based oil and gas producer reported net income attributable to common stockholders of $3.2 billion, or $3.13 per diluted share. On an adjusted basis, income from continuing operations totaled $1.1 billion. Total production averaged 1.426 million barrels of oil equivalent per day (boed), exceeding the high end of the company's guidance range. Occidental attributed the production beat to strong performance from its Permian Basin, Rockies, and Gulf of America operations.
Revenue for the quarter reached $5.11 billion, falling short of the $5.49 billion consensus estimate. Analysts pointed to timing issues related to derivatives and physical cargo sales as factors behind the revenue miss. Melius Research analyst James West noted that lower realizations were likely a timing issue.
Occidental's oil and gas pre-tax income rose to $1.0 billion, up from $700 million in the fourth quarter. Global crude prices averaged $69.91 per barrel during the quarter, an 18% increase sequentially. However, domestic natural gas prices declined 10% to $1.01 per thousand cubic feet.
Debt reduction remains a key focus for investors. As of May 5, Occidental had repaid $7.1 billion in principal debt, lowering total principal debt to $13.3 billion. The company's stated goal is to bring that figure down to $10 billion. CEO Vicki Hollub highlighted disciplined execution, cost reductions, and efficiency improvements as drivers of the quarter's performance and deleveraging progress.
Looking ahead, Occidental revised its full-year production outlook to a range of 1.41 million to 1.46 million boed, down from the prior guidance of 1.42 million to 1.48 million boed. For the current quarter, management expects output between 1.39 million and 1.43 million boed. The lowered guidance introduces a new metric for investors to monitor as the company balances production with debt reduction goals.
In a notable leadership change, Occidental announced that Hollub will step down as president and CEO on June 1. She will be succeeded by Chief Operating Officer Richard Jackson, who will also join the board. Hollub will retain her board seat. The transition comes as the company navigates a challenging environment of volatile oil prices and geopolitical uncertainty in the Middle East.
Occidental shares closed at $59.34 on Tuesday, down about 1.5% ahead of the earnings release. The stock edged higher in after-hours trading following the report. In comparison, Exxon Mobil and Chevron both posted lower first-quarter earnings due to derivative accounting impacts, while Occidental benefited from its focus on US shale production.
