Coterra Energy Inc.

Coterra reported Q3 pre-hedge oil and gas revenues of $1.7 billion, with 57% from oil versus 52% in the prior quarter. Oil volumes increased by 11,300 barrels per day, more than 7% above Q2 levels, and oil, natural gas and BOE production each came in about 2.5% above guidance midpoint. Cash operating costs were $9.81 per BOE, up 5% sequentially; incurred capital was $658 million; discretionary cash flow was $1.15 billion; and free cash flow was $533 million. For Q4 2025, oil production is expected at 175 MBoe/d midpoint, total production at 770-810 MBoe/d, gas at 2.78-2.93 Bcf/d, and capital around $530 million. For full-year 2025, total production guidance was raised to 777 MBoe/d midpoint and gas to 2.95 Bcf/d midpoint, while capital is expected to be about $2.3 billion. Management also said 2026 capital should be down modestly year over year, while still staying within the 2025-2027 3-year outlook ranges. The company ended Q3 with $98 million of cash, an undrawn $2 billion credit facility, $2.1 billion of total liquidity, and $3.9 billion of total debt.

Tom Jorden framed the quarter as evidence that Coterra’s multi-basin, multi-commodity model is working, saying the company is delivering consistency, profitable growth and value creation. He emphasized discipline in 2026, saying Coterra is not chasing growth in a volatile oil market and will keep prioritizing free cash flow and shareholder value. He also highlighted the gas marketing strategy, pointing to committed volumes into LNG, power and industrial deals and saying the company wants value, not press releases.

Shane Young focused on the quarter’s financial strength and balance sheet progress, citing $1.7 billion of pre-hedge revenue, $1.15 billion of discretionary cash flow and $533 million of free cash flow. He noted costs were temporarily higher at $9.81/BOE because of mix and workovers, but said those should moderate in Q4 and that LOE should settle within range for the year. On capital allocation, he said Coterra repaid $250 million of term loans in Q3, bringing year-to-date paydown to $600 million, reinitiated buybacks in October, and is targeting leverage back to around 0.5x net debt to EBITDA.

Analysts pressed on the Kimmeridge letter, with Doug Leggate suggesting Coterra might be better as a pure-play Delaware E&P; Jorden pushed back, saying Coterra trades well versus oil peers and gas peers at different times and that the company benefits from being multi-basin. Questions also focused on capital allocation, with management saying debt reduction remains the priority but buybacks have resumed and a robust return-of-capital program is expected in 2026. Several analysts asked about 2026 capex and production shape; management repeatedly described the 2026 plan as a soft guide, said capital should be modestly down, and said they will stay flexible depending on commodity markets and timing of TILs.