Devon Energy reported second quarter earnings of $899 million, or $1.41 per share, and $536 million of core earnings, or 84 cents per share – compared to earnings of $494 million, or 77 cents per share, in Q1.
With 21 operating rigs and six completion well units, the Oklahoma City energy company’s total oil, gas and NGL sales totaled $2.7 billion. The second quarter performance was so strong, Devon decided to increase its full-year 2025 oil production forecast to a range of 384,000 to 390,000 barrels per day.
Devon achieved production of 841,000 oil equivalent production (Boe) per day, exceeding the topend of guidance and averaged 387,000 barrels per day of oil production, exceeding midpoint guidance.
Plus, Devon is boosting its investments in natural gas production with the announcement of two new agreements to further diversify its natural gas marketing portfolio.
The first agreement, effective in 2028, will supply 50 MMcf per day for LNG exports over a 10-year term, with pricing indexed to international markets.
Additionally, the company has entered into a gas sale agreement with CPV Basin Ranch Energy Center, to support its proposed 1,350 MW combined-cycle natural gas power plant. Expected to begin in 2028, Devon will provide 65 MMcf per day over a seven-year term with pricing indexed to ERCOT West.
“We generated $1.5 billion in operating cash flow and $589 million in free cash flow, with capital investments 7% below guidance,” said Clay Gaspar, president and CEO. “Our disciplined capital allocation approach supported robust returns to shareholders through dividends and share repurchases, while strengthening our balance sheet and ending the quarter with $1.8 billion in cash.”
He said the business plan at Devon is positioning it to ac hieve $1 billion in annual pre-tax free cash flow by the end of 2026.
“For the second consecutive quarter, we reduced 2025 capital by $100 million while raising production forecasts, further strengthening our free cash flow trajectory. Our team’s innovation and commitment ensure we are well-equipped to navigate price volatility, adapt to market trends, and maximize returns for shareholders,” Gaspar said.
Devon’s capital activity in the second quarter averaged 21 operated drilling rigs and six completion crews across its asset por tfolio. This level of activity resulted in 110 gross operated wells being placed online, with an average lateral length of 10,300 feet. Total capital investment was $932 million, or 7% below guidance. This positive variance was primarily attributable to lower completion cost primarily in the Delaware, as well as lower infrastructure and facilities spend, efficiency gains, and effective supply chain management across the asset portfolio.
Production averaged 841,000 Boe per day in the second qua rter, exceeding the top-end of guidance. This result represents a 3% increase quarter-over-quarter driven by strong growth from the Delaware Basin. Oil totaled 387,000 barrels per day in the quarter, which was 46% of total volume.