Chevron (NYSE:CVX) released first-quarter financial results and hosted an earnings call on Friday. Read the complete transcript below.
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The full earnings call is available at https://event.webcasts.com/starthere.jsp?ei=1740948&tp_key=b288c096d9
Summary
Chevron Corp reported first-quarter 2026 earnings of $2.2 billion or $1.11 per share, with adjusted earnings of $2.8 billion or $1.41 per share, despite a $360 million charge related to legal reserves.
The company emphasized its disciplined execution despite geopolitical tensions, maintaining strong production and refining operations, with US production over 2 million barrels per day and significant integration benefits across its value chain.
Chevron maintains its 2026 guidance unchanged, expecting 7-10% production growth and consistent capital spending, while continuing to execute strategic projects in Venezuela and optimizing global supply chains.
Share repurchases were consistent with guidance at $2.5 billion, and the company anticipates improvements in working capital in the second half of the year, driven by commodity prices.
Management reiterated the importance of maintaining capital discipline, strong cash flow, and consistent shareholder returns, with a focus on long-term resilience and strategic growth opportunities, particularly in the Permian and Venezuela.
Full Transcript
OPERATOR
Good morning, my name is Katie and I will be your conference facilitator today. Welcome to Chevron’s first quarter 2026 earnings conference call. At this time, all participants are in a listen only mode. After the speaker’s remarks, there will be a question and answer session and instructions will be given at that time. If anyone requires assistance during the conference call, please press star then zero on your touchtone telephone. As a reminder, this conference call is being recorded. I will now turn the conference call over to the head of Investor Relations of Chevron Corporation, Jeanine Wei. Please go.
Janine Wei
Thank you, Kayte. Welcome to Chevron’s first quarter 2026 earnings conference call and webcast. I’m Janine Wei, Head of Investor Relations. Our Chairman and CEO Mike Wirth and CFO Eimear Bonner are on the call with me today. We’ll refer to the slides and prepared remarks that are available on Chevron’s website. Before we begin, please be reminded that this presentation contains estimates, projections and other forward looking statements. A reconciliation of non GAAP measures can be found in the appendix to this presentation. Please review the cautionary statement and additional information presented on slide 2. With that now I’ll turn it over to Mike.
Mike Wirth (Chairman and CEO)
All right, thanks Janine, and welcome to your new role. This quarter, Chevron delivered solid performance driven by disciplined execution and a resilient portfolio. Despite market volatility and heightened geopolitical tensions, our people remain focused on safely delivering the reliable energy the world needs. Our approach remains consistent. Maintain capital and cost discipline, generate strong cash flow and deliver superior shareholder returns. Chevron’s fundamentals are strong. We have a world class portfolio and upstream assets with peer leading cash margins. And we’re carrying strong momentum into the second quarter with US production over 2 million barrels of oil equivalent per day, Gorgon and Wheatstone LNG running at full rates, TCO producing above 1 million barrels of oil equivalent per day and US refineries operating at record crude throughput. The unique combination of Chevron’s industry leading refining complexity and our diverse waterborne equity crudes from TCO, Guyana, Permian, Venezuela and Argentina creates opportunities for value capture through integration. Our high quality upstream and downstream portfolios delivered significant integration benefits during the quarter. We maintained strong supply into tight markets and maximized margins across products including fuel oil, sulfur and other secondary products which saw significant price dislocations. We continue to optimize flows across our value chains to maintain high utilization and reliable supply into the market. In the second quarter, we expect global equity crude throughput to more than double to year over year to 40% in Asia. We anticipate over 80% refinery utilization moving to Venezuela. We continue to leverage our deep expertise and long standing position to create an option for the future. Two weeks ago we announced an asset swap with PDVSA. The agreement increases our position in the Orinoco Ayacucho 8 expands our continuous acreage position with PetroPiar offering operating and development synergies along with long term growth potential and optionality. Petroindependencia is a joint venture we’ve been in for more than 15 years where we’ve increased our equity stake to 49%. Current operations are running smoothly. We’re still in debt recovery mode and expect Venezuela to continue to represent 1 to 2% of cash flow from operations. This transaction is expected to improve resource depth and integration upside supporting potential growth into the future. Now over to EMER to discuss the financials.
Eimear Bonner
Thanks Mike for the first quarter, Chevron reported earnings of $2.2 billion or $1.11 per share. Adjusted earnings were $2.8 billion, or $1.41 per share. Included in the quarter was $360 million. Charge related to legal reserve foreign currency effects decreased earnings by $223 million. Organic capex was $3.9 billion this quarter, consistent with historical capex trends of lighter spending in the first half of the year. Inorganic capex was approximately $200 million. We expect to finish within full year. Capital guidance adjusted first quarter earnings were $440 million lower than last quarter. Adjusted upstream earnings increased due to higher realizations, lower depreciation, depletion, and amortization and favourable operating expenses and tax impacts. Adjusted downstream earnings decreased primarily due to unfavourable timing effects which were partly offset by higher refining margins. Unfavourable timing effects totalled around $3 billion for the quarter, reflecting a steep rise in commodity prices in March. The effect was evenly split between inventory valuation and mark to market accounting. On paper derivative positions linked to physical cargoes. We anticipate approximately $1 billion of the paper positions to unwind in the second quarter, with the majority of related cargoes delivered in April. Looking forward, we would expect additional timing effects when prices are rising and further unwinds when prices are falling. Chevron generated cash flow from operations, excluding working capital of $7.1 billion in the quarter. This includes unfavorable impacts from special items and timing effects totaling approximately $3 billion. Adjusted free cash flow was $4.1 billion for the quarter and included a $1 billion loan. Repayment from TCO. Share repurchases were $2.5 billion in line with guidance, working capital was impacted by sharp commodity price increases as well as a build in inventory. Consistent with historical trends, we expect an increase in working capital in the first half of the year and a release in the second half, the extent of which will be primarily driven by prices. Over the period. More than $5 billion in commercial paper was issued to manage liquidity and general business needs. About half has already been paid down in April and we expect these short term balances to climb further throughout the second quarter. First quarter 2026 oil equivalent production increased by approximately 500,000 barrels per day compared to the first quarter of 2025. This reflects the integration of legacy Hess assets in addition to continued organic growth across the portfolio. The conflict in the Middle east had a limited impact on production in the quarter. With less than 5% of our portfolio located in the region in the partition zone, we’re operating at near minimum rates to manage storage in the Eastern Mediterranean. Both Tamar and Leviathan are operating at full capacity. During the quarter, we continued to execute key expansion projects, completing the offshore scope for both the Tamar optimization project and the Leviathan Third Gathering Line. Let me close by reinforcing that. Despite changes in the external environment, we’re executing our plan with discipline, consistent with our long standing financial priorities. This disciplined approach gives us resilience during periods of volatility and the ability to invest and return cash to shareholders through the cycle, all while ensuring we maintain a balance sheet built for the long term. Chevron business is Strong and our 2026 guidance is unchanged. Capital spending and production outlooks are consistent with previous guidance and we’re on track to deliver our 3 to 4 billion dollars structural cost reduction target by year end. This consistency underpins our 2030 targets announced in November, including over 10% growth in adjusted free cash flow and earnings per share and 3% improvement in ROC, all at $70. Brent, these aren’t aspirational goals. They’re grounded in assets that are operating today, a more efficient organizational model and continued capital discipline. I’ll now hand it off to Janine.
Janine Wei
Okay, that concludes our prepared remarks. Thank you, Mike Emer As a reminder, additional guidance can be found in the appendix of the presentation as well as in the slides and other information that’s posted on chevron.com we’re now ready to take your questions. We ask that you please limit yourself to one question and we’ll do our best to get all of your questions answered. Katie, please open the lines.
OPERATOR
Thank you. If you have …
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