Magnolia Oil & Gas Corporation

Magnolia reported second-quarter adjusted net income of approximately $184 million, or $0.99 per diluted share, and adjusted EBITDAX of $370 million. Total production grew 8% year over year to 106 thousand barrels of oil equivalent per day, while oil production rose 5% to 41.9 thousand barrels per day. D&C capital was $125 million, equal to a 34% reinvestment rate, free cash flow was $235 million, and pretax adjusted operating income margins averaged 51%; total revenue per BOE increased approximately 39% year over year. For Q3 2026, standalone D&C capex is expected to be about $115 million and total production is expected to be similar to Q2, or about 106 thousand barrels of oil equivalent per day. Full-year 2026 total production growth guidance was raised to approximately 6% from 5%; the effective tax rate is expected to be about 21% and cash taxes for 2026 are expected to be minimal.

Christopher Stavros framed the quarter as another example of Magnolia’s consistent execution and the quality of the Giddings asset, highlighting that production and financial metrics were strong even before the Wildfire transaction closes. He emphasized that Wildfire is a natural strategic fit that extends Magnolia’s runway for profitable development and supports durable free cash flow. His tone was confident and incremental rather than flashy, repeatedly stressing efficiency, disciplined capital allocation, and a business model that should remain unchanged even after the deal.

Brian Corales walked through the quarter’s financial metrics, including $184 million of adjusted net income, $370 million of adjusted EBITDAX, $235 million of free cash flow, and $296 million of cash at quarter-end, up $172 million. He noted cash flow from operations before working capital of $362 million, dividends of $31 million, share repurchases of $49 million, and $125 million spent on D&C and associated facilities/leasehold. He also said total cash operating costs including G&A were $11.55 per BOE and adjusted operating income was $25.15 per BOE, or 51% of revenue. On capital structure, he said the post-close share count is expected to be about 269 million, the credit facility will increase to a $2 billion borrowing base with $1.75 billion of elected commitments, and 2026 cash taxes should be minimal.

Analysts focused on how Magnolia would blend development between legacy Magnolia and Wildfire, with management saying an initially roughly even mix of Eagle Ford and Austin Chalk activity is a reasonable starting point and that the combined team should be able to operate more efficiently over time. Questions also centered on Austin Chalk upside and whether Wildfire’s testing has left broader potential untouched; management said there is a lot of low-hanging fruit across the large acreage position and that it will take time to work through. On buybacks and debt paydown, management said repurchases can resume immediately now that disclosure restrictions are effectively over, while debt reduction will be a priority after close and should progress at a decent pace.