Second quarter 2026
Filed Aug 5, 2026Permian Resources Announces Strong Second Quarter 2026 Results and Updated Full Year Guidance
Oil production increased compared to the prior quarter, adjusted free cash flow was $751 million, oil guidance was raised to a 199.0 MBbls/d mid-point, and the Company reported a Net Debt-to-LQA EBITDAX ratio of 0.5x at June 30, 2026.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total average productionother | 376.4 MBoe/d | – | – |
| Average daily crude oil productionother | 198,071 Bbls/d | a 3% increase compared to the prior quarter | – |
| Natural gas volumesother | 552,885 Mcf/d | – | – |
| NGL volumesother | 86,191 Bbls/d | – | – |
| Realized oil pricesother | $97.81 per barrel | – | – |
| Unhedged natural gas realizationsother | $(1.74) per Mcf | – | – |
| Average all-in natural gas netbackother | $0.38 per Mcf | – | – |
| Realized NGL pricesother | $23.28 per barrel | – | – |
| Total controllable cash costsother | $7.49 per Boe | – | – |
| LOEother | $5.55 per Boe | – | – |
| GP&Tother | $1.07 per Boe | – | – |
| Cash G&Aother | $0.87 per Boe | – | – |
| Total cash capital expendituresother | $521 million | – | – |
| Net cash provided by operating activitiesGAAP | $1,506 million | – | – |
| Adjusted operating cash flownon-GAAP | $1,272 million | – | – |
| Adjusted free cash flownon-GAAP | $751 million | – | – |
| Diluted weighted average shares outstandingGAAP | 855.2 million | – | – |
| Net debt-to-LQA EBITDAXnon-GAAP | 0.5x | – | – |
| Acquisition consideration for year-to-date transactionsother | $1.05 billion | – | – |
| Net leasehold acres added year-to-dateother | 54,000 net leasehold acres | – | – |
| Net royalty acres added year-to-dateother | 20,000 net royalty acres | – | – |
| Production added through year-to-date transactionsother | 5,000 Boe/d | – | – |
Full year 2026 outlook
- NoteOil production: 199.0 MBbls/d, based on the mid-point of guidance
- NoteCash capital expenditures: $1.9 – $2.0 billion
- NoteFull year 2026 average working interest: over 80%
- NoteSecond half of 2026 oil production: over 200 MBbls/d
- NoteSecond half of 2026 cash capital expenditures: less than $1 billion
- NoteYear-end 2026 Net Debt-to-LQA EBITDAX: approximately 0.5x
Capital returns
- Declared quarterly base dividend of $0.16 per share.
- Redeemed $550 million in principal of legacy Earthstone’s 8.000% Senior Notes due 2027 during the quarter.
- On July 15, 2026, redeemed $325 million in principal of legacy Earthstone 9.875% Senior Notes due 2031.
- The Company’s capital-allocation approach includes paying a sustainable base dividend, accretive acquisitions, debt reduction and opportunistically buying back shares.
What drove it
- Oil production was driven higher primarily by ground game efforts that led to a 7% increase in average working interest for second quarter completions compared to original expectations.
- Oil production also benefited from increasing high-return workover projects by over 50% quarter-over-quarter.
- The Company curtailed a portion of high-GOR production exposed to Waha pricing to maximize free cash flow.
- Cost control in the field, including optimization of power and compression, reduced costs and increased runtimes.
- Recent ground game activity, increased workover activity and production from the Ward County bolt-on drove the increase in full-year oil production guidance.
- The Company drilled its first four-mile laterals and is pursuing longer lateral lengths, water-based mud, wellbore design improvements and surfactant trials.
Concerns
- Waha natural gas prices averaged $(3.14) per Mcf and traded as low as $(9.52) per Mcf during the second quarter.
- Curtailment of high-GOR production resulted in lower natural gas and NGL volumes.
- The cash capital expenditure range was increased due to higher working interest associated with ground game activity and approximately $25 million of capital associated with the Ward County bolt-on.
- Management cited higher oil prices and continued volatility as factors that can make for a challenging A&D environment.
What to watch
- Delivery of oil production of over 200 MBbls/d in the second half of 2026 with less than $1 billion of cash capital expenditures.
- Achievement of the 199.0 MBbls/d full-year oil production mid-point and the $1.9 – $2.0 billion cash capital expenditure range.
- The contribution of the Ward County bolt-on, which was producing approximately 5,000 Boe/d (50% oil) at closing on July 31, 2026.
- Whether the Company achieves full-year average working interest of over 80%.
- Natural gas pricing and the ongoing effect of curtailments on natural gas and NGL volumes.
- Progress toward year-end 2026 Net Debt-to-LQA EBITDAX of approximately 0.5x.
Balance sheet and cash flow
- Net cash provided by operating activities was $1,506 million.
- Adjusted operating cash flow was $1,272 million.
- Adjusted free cash flow was $751 million.
- Net debt-to-LQA EBITDAX at June 30, 2026, was 0.5x.
- The redemption of the remaining legacy Earthstone senior notes reduces annual cash interest expense by approximately $75 million.
- Since year-end 2024, the Company reduced total debt by approximately 35% from $4.2 billion to $2.7 billion.
Analysis
Permian Resources reported second-quarter average daily crude oil production of 198,071 Bbls/d, a 3% increase compared to the prior quarter. Total average production was 376.4 MBoe/d. Management attributed oil growth to higher working interest from ground game activity and an increase in high-return workover projects. The Company raised the mid-point of full-year oil guidance to 199.0 MBbls/d and expects oil production of over 200 MBbls/d in the second half of 2026.
The operating backdrop was mixed across hydrocarbons. Realized oil prices were $97.81 per barrel, while Waha natural gas prices averaged $(3.14) per Mcf and traded as low as $(9.52) per Mcf. The Company curtailed a portion of high-GOR production exposed to Waha pricing, which reduced natural gas and NGL volumes but supported cash generation. Unhedged natural gas realizations were $(1.74) per Mcf, and natural gas hedges lifted the average all-in netback to $0.38 per Mcf.
Cash performance was a central feature of the release. Net cash provided by operating activities was $1,506 million, adjusted operating cash flow was $1,272 million and adjusted free cash flow was $751 million. Total cash capital expenditures were $521 million. Controllable cash costs of $7.49 per Boe were below the mid-point of full-year guidance, according to the Company, supported by field cost control and power and compression optimization.
The Company expanded its Delaware Basin position through approximately 190 year-to-date transactions for total consideration of $1.05 billion. These transactions added 54,000 net leasehold acres, 20,000 net royalty acres and 5,000 Boe/d. Management increased the cash capital expenditure range to $1.9 – $2.0 billion, citing higher working interest associated with ground game activity and approximately $25 million of capital related to the Ward County bolt-on.
Balance-sheet actions continued alongside acquisitions and the dividend. The Company redeemed $550 million of legacy Earthstone notes during the quarter and redeemed a further $325 million on July 15, 2026. Net debt-to-LQA EBITDAX was 0.5x at June 30, 2026, and management expects year-end 2026 leverage of approximately 0.5x. The quarterly base dividend was declared at $0.16 per share. The main reported execution items are sustaining second-half oil production of over 200 MBbls/d within less than $1 billion of cash capital expenditures and managing exposure to weak Waha natural gas pricing.
Management, verbatim
This was an exceptional quarter for Permian Resources. Our team executed a targeted response to higher oil prices, increasing capital expenditures to focus on high-return, rapid payback projects such as workovers.
Will Hickey, Co-CEO of Permian Resources
Additionally, the success of our ground game increased working interest in both second quarter and full year TILs, which allows us to increase production in the near-term while utilizing the same drilling rigs and completion crews. Overall, these efforts produced higher free cash flow than originally anticipated during the quarter.
Will Hickey, Co-CEO of Permian Resources
Our revised guidance highlights the continuously improving capital efficiency of the Permian Resources business. This year, we expect to produce approximately 199 MBbls/d of oil, nearly 10% more than we produced last year, with less capital than we spent in 2025.
James Walter, Co-CEO of Permian Resources
Not in the filing
stated, not guessed- Full financial statements and accompanying appendix were not included in the supplied filing text because the text ends mid-sentence.
- GAAP total revenue and revenue comparisons.
- Segment revenue and segment profitability.
- GAAP gross profit, gross margin, operating income, net income and EPS.
- Non-GAAP earnings, adjusted net income and adjusted EPS.
- Cash balance, total debt at June 30, 2026, and liquidity.
- Detailed full-year 2026 guidance table, including guidance for production categories other than oil, operating costs, taxes and free cash flow.
- Prior-quarter and prior-year values for most reported operating, pricing, cost and cash-flow metrics.
- Previous-release outlook for comparison against reported results.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.